Court rejects Novartis challenge of patent law

Court rejects Novartis challenge of patent law
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First Published: Tue, Aug 28 2007. 04 18 PM IST
Updated: Tue, Aug 28 2007. 04 18 PM IST
Mumbai / New Delhi: In a clear signal that India will continue with its position of not granting patent protection for incremental innovations by pharma firms, the Madras high court has rejected Swiss firm Novartis AG’s challenge of a key provision in a 2005 patent law. Multinational pharma firms use incremental innovations to extend the life of a patent on a drug.
While Novartis and other foreign-owned drug makers expressed dismay over Monday’s ruling, the court’s decision was cheered by health activists and patients groups as a landmark decision that would ensure the availability of cheap generic or off-patent drugs that typically cost a fraction of patented medicines.
Novartis said it may not appeal against the ruling in a higher court. The Basel, Switzerland-based drug maker’s patent on its cancer drug Glivec—the drug, sold as Gleevac internationally, had sales of $2.5 billion (Rs10,125 crore) last year—was turned down by India in January 2006, under Section 3(d) of the Patents Act, 1970, that refuses patents to drug derivatives that have been modified only slightly. (Glivec is a modified version of an earlier drug molecule, Imatinib Myselate, patented by Novartis in the early 1990s.) Novartis challenged the rejection of patent to Glivec as well as the legal provision that allowed for this.
A two-judge bench comprising justice R. Balasubramanian and justice Prabha Sridevan on Monday upheld the amended act and rejected Novartis’ contention that the said section was not compliant with the World Trade Organization’s Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement and violated the Indian Constitution as it was “vague” and gave arbitrary powers to the patent authority.
Dismissing the Novartis petition, the bench observed that the drug maker was “no novice” in the pharmacological field “to plead that it does not know what is meant by enhancement of known efficacy of a substance or that derivatives differ significantly in properties from the original substance”. It said the relevant section was neither “vague or ambiguous”, nor did it give the patent authority arbitrary powers. The section had “in-built materials” to guide patent authorities to take a decision on an application. Even if a patent authority misused his powers, there were forums available to the applicant, including courts, to seek a remedy.
The judges said when the TRIPS agreement itself provides for a dispute settlement mechanism, the courts have no jurisdiction to decide whether the amended section violates Section 27 of the agreement. They noted that the objective of the amended act was to “provide easy access to citizens to life-saving drugs”. The full text of the court’s decision is awaited.
Novartis expressed disappointment, saying it would “have long-term negative consequences” and create disincentives for research. “The provision [Section 3(d)] is vague as there is no parameter to efficacy. If incremental innovation is not patentable here with this clause, the outputs of majority of the drug researches currently undertaken by Indian companies will not qualify for patents,” said Ranjit Shahani, managing director Novartis India Ltd.
Other foreign-owned drug firm executives, too, said the decision will discourage drug innovators from bringing their brands to India. “It is not good news for research-based pharma companies as the decision to reject a plea for establishing innovation affects the confidence of such companies to bring newer products to India,” said Ranga Iyer, managing director, Wyeth Ltd, the Indian subsidiary of the US drug multinational Wyeth Inc. Novartis has repeatedly questioned India’s rejection of a patent for Glivec when it has been granted such protection in nearly 40 countries including China, Russia and Taiwan.
This is the second setback for Novartis in recent weeks. Novartis’ request that the technical member of the government’s Intellectual Property Appellate Board, which is to hear its Glivec patent appeal, be replaced was rejected by the board. It has petitioned the Madras high court as it believes the current technical member, former controller general of the Indian Patent Office S. Chandrasekharan, under whose tenure the Glivec patent was rejected, may not be unbiased.
“This is a huge relief for millions of patients and doctors in developing countries who depend on affordable medicines from India,” said Tido von Schoen-Angerer, director of Medecins Sans Frontieres’ Campaign for Access to Essential Medicines. NGOs such as Oxfam and Care International, too, welcomed the decision.
The court’s decision will have a far-reaching impact on those fighting for easier access to life-saving drugs. Loon Gangte of the Delhi Network of Positive People, which has filed 15 patent oppositions and is fighting patents on HIV drugs, said “Section 3(d) forms the backbone of all of our oppositions.”
Even though a month’s treatment of Glivec costs Rs1.2 lakh and copycat versions cost just Rs8,000-10,000, Novartis says it provides the drug to 99% of all the patients who need it in India and for as long as required under the Glivec International Patient Assistance Programme. Patients’ groups contest this claim, saying the programme services less than 25% of the needy and supplies aren’t dependable.
Drug activists and legal experts have long argued for legal restraints on what is known in intellectual property law as “ever-greening”—getting patent protection indefinitely by passing off variants and derivates as new inventions. Anand Grover, project director of Lawyers Collective’s Affordable Medicines and Treatment Campaign, said the judgement will set a precedent. Grover represented the Cancer Patients’?Aid?Association in?court.
R.A. Mashelkar, former director general of the Council of Scientific and Industrial Research, who in a 2006 report on patents had supported patents for incrementally innovative drugs, which was the subject of a controversy then, said he considered the court ruling positive. “Section 3(d) was always TRIPS-compliant and it was just a question of its implementation. Even in our report, we had said that guidelines should be laid down to determine the standards and levels of innovation, for the patent examiners,” he said.
(ch.unni@livemint.com)
(G.C. Shekhar of Hindustan Times also contributed to this story.)
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First Published: Tue, Aug 28 2007. 04 18 PM IST