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Business News/ Companies / Compulsory license application may prove to be test for Modi govt

Compulsory license application may prove to be test for Modi govt

The reason for the industry's keen anticipation of the decision is because the govt had assured protection of IP rights to multinational pharmaceutical firms operating in India

A CL application can be filed by domestic drug manufacturers if patented drugs are not available to the public at a reasonable price. Photo: Pradeep Gaur/MintPremium
A CL application can be filed by domestic drug manufacturers if patented drugs are not available to the public at a reasonable price. Photo: Pradeep Gaur/Mint

Mumbai: After a gap of about two years, the filing of a compulsory license (CL) application against a patented drug owned by a multinational company has got the Indian pharmaceutical industry holding its breath in anticipation.

In June, Hyderabad-based Lee Pharma Ltd filed the application with the Controller of Patents, Mumbai, seeking license to manufacture AstraZeneca AB’s patented diabetes medicine Saxagliptin.

The reason cited was that the patented drug is sold at an exorbitant price in India.

A CL application can be filed by domestic drug manufacturers if patented drugs are not available to the public at a reasonable price.

The reason for the industry’s keen anticipation of the decision is because the Narendra Modi-led government had assured protection of intellectual property (IP) rights to multinational pharmaceutical companies operating in India. According to a Reuters report, Prime Minister Modi said India is ready to accept suggestions made by a joint working group with the US on intellectual property rights, at a conclave of Indian and US corporate chiefs held on 26 January 2015.

This resolve could now be tested by the decision taken by the Controller of Patents, who is the principal officer responsible for administering the patent system in India.

The drug, Saxagliptin, is protected and covered by an Indian patent titled “A cyclopropyl-fused pyrrolidine-based compound", granted on 30 April 2007 to Bristol-Myers Squibb (BMS).

BMS assigned the ownership rights on the patent to AstraZeneca AB on 3 April 2014, based on commercial terms.

In its application, Lee Pharma has alleged that the quantity of Saxagliptin available in the market fulfilled less than 1% of the market’s needs.

The CL applicant has also stated that the cost incurred for the import of Saxagliptin is only 0.80 per tablet, whereas it is being sold in the market for 41-45 per tablet. Even after about 8 years of the grant of the patent, no effort has been made to manufacture Saxagliptin in India, Lee Pharma alleged.

Lee Pharma declined to comment further on the application.

“AstraZeneca enables affordable access to our medicines in India and elsewhere. AstraZeneca has complete confidence in its intellectual property that protects our inventions and does not believe that such intellectual property is a barrier to access to medicines in developing countries," a spokesperson from AstraZeneca said.

According to the International Diabetes Federation, there were 66.84 million diabetic people in India in 2014 and India has the second highest incidence of diabetes in the world after China, the application said.

There are several off-patent drugs such as metformin and sulfonylureas used in non-insulin based treatment for type-2 diabetes. In many cases, drug resistance is a major challenge as these drugs are consumed on a daily basis. As an alternative, dipeptidyl peptidase-4 (DPP-4) inhibitors or gliptins were launched in 2007 as a new class of oral diabetes drugs for people who are resistant to metformin and sulphonylureas. In addition to decreasing blood glucose levels (hypoglycemia), gliptins are found to be helpful in weight loss.

“We certainly hope that the court will not grant the compulsory license," said Mark Grayson, deputy vice-president, The Pharmaceutical Research and Manufacturers of America (PhRMA).

PhRMA is one of the most influential lobbies in the world and works for public policies that encourage the discovery of new medicines.

“We are optimistic that the reforms in the intellectual property regime discussed by Modi will bring India up to international standards that will give companies the certainty they need to enter the Indian market and give patients access to some of the most innovative medicines," Grayson added.

The only CL issued in India was in 2012, to Natco Pharma Ltd to make a generic version of cancer drug Nexavar, owned by Bayer Pharma AG.

The second CL application by BDR Pharmaceuticals International Pvt. Ltd for Bristol-Myers Squibb’s cancer drug Dasatinib was rejected in 2013.

Indian IP experts believe that Lee Pharma’s arguments may not be sufficient for the grant of a CL.

“There are many diabetic drugs available in India which are off-patent and widely prescribed by doctors. As of date, there are few doctors who prescribe gliptins to patients. Lee Pharma’s argument that Saxagliptin is required to treat millions of diabetic patients in India is an over-reach with the intention to mislead the Indian patent office," said Varun Chhonkar, CEO, IP Feathers, a Mumbai-based intellectual property consultancy.

“The Modi government seems to be pro-patent. If more CLs are issued then this may upset big pharma multinationals, which may cost the government dearly. This government is already working hard to send a global message about Make in India, and issuance of CLs will seriously jeopardize that," Chhonkar added.

Multinational drug makers have long complained about the lack of IP protection in India, especially following the setback they faced in the patent litigation over Glivec, a cancer drug manufactured by Swiss firm Novartis.

In 2013, the Supreme Court of India upheld the rejection of the patent application filed by Novartis for Glivec in 1998 before the Indian Patent Office. The patent application had initially been rejected by the Controller of Patents in 2006 after taking into account pre-grant opposition from Indian pharmaceutical companies such as Cipla Ltd, Hetero Drugs Ltd, Ranbaxy Laboratories Ltd and the Cancer Patient Aid Association (CPAA).

Novartis sells Glivec at 1.2 lakh ($2,400) per monthly dose, while Indian generic equivalents cost 8,000-12,000 ($160-$240) for a monthly dose.

“Each CL application must be examined in the context of its ability to lower prices of the medicine to levels that are near its cost of production," said Leena Menghaney, lawyer and India manager of international medical charity Médecins Sans Frontières (MSF) Access Campaign.

“It is time the patent office worked independently of political pressure to take up CL applications from domestic manufacturers," she added.

Apart from mid-sized companies such as Natco Pharma, BDR Pharma and Lee Pharma, none of the leading Indian generic makers has applied for a compulsory license so far.

“In a changing economic climate, not many serious Indian pharma companies will try the CL route because of two key reasons—first, because most of these patented drugs haven’t achieved considerable market success (economically); and second, the CL business is subject to lot of scrutiny which does not allow companies applying for such a license to make much profit," Chhonkar explained.

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Published: 14 Jul 2015, 08:36 PM IST
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