Patients or patents?

On 1 April, India’s Supreme Court dismissed the Swiss drug maker’s claim on patent protection for Glivec, Novartis’s anti-cancer medicine, in what was widely described as a setback for Big Pharma.

In an email interview, Novartis India’s managing director and vice-chairman Ranjit Shahani sought to highlight the link between strong patent laws and innovative activity, and said the court’s verdict does not “invalidate the principles of a patent system that has provided millions of patients with medicines to improve their suffering and keep them from dying prematurely".

Yet, the verdict, on closer reading, is in keeping with traditional concepts of IPR and may have no real impact either on new drug discovery or on foreign investment in the country.

Nor will it prevent similar litigation by setting a precedent, said an expert.

According to Shamnad Basheer, a professor of intellectual property, although the Supreme Court judgement is well reasoned and legally sound, the court lost a “terrific" opportunity to lay down broader legal propositions that could guide the patent office in future pharmaceutical cases.

That could mean similar patent disputes in the future—hinging on what constitutes “efficacy" and “therapeutic efficacy"—will continue to surface.

The verdict comes at a time when overseas drug makers are keen on gaining a bigger share of India’s pharmaceutical market, which is seen growing to ₹ 5 trillion from ₹ 1 trillion by 2020, according to India’s department of pharmaceuticals (DoP).

India’s patent office rejected Novartis’s application for a patent in 2006. The Madras high court rejected Novartis’s appeal in 2007 and the patent appeals body in 2009. The same year, the company approached the Supreme Court. At the core of the case was the debate over whether Novartis’s patent for Glivec was based on a significant innovation that made the drug more efficient, or simply an incremental innovation.

The court ruled it was the latter; yet the specificity of the judgement makes it limiting, said a former government official in charge of the patent office.

Indeed, since 2005, when the Indian Patents Act was amended, at least 78 “incremental innovative" drugs have been granted patents, said T.C. James, who once headed the intellectual property division at the commerce ministry. “This judgement was a very specific interpretation on the meaning of efficacy," added James.

And it definitely wouldn’t set a precedent, James said.

“It doesn’t mean that efficacy will be interpreted in exactly the same way in future disputes. The decision was unlikely to affect the entry of future drugs or stifle drug innovation in India."

The keenly followed legal battle, which lasted seven years, is significant because Novartis had challenged the interpretation of Section 3(d) of the patents Act, a public health safeguard introduced by Parliament in 2005 to prevent so-called evergreening, where a company makes a minor modification to a known molecule merely to extend the patent.

Novartis had argued that the modification it had made to Glivec was significant. More pertinently, Shahani said in the email interview, charges of evergreening were irrelevant simply because Novartis had never been given a patent for Glivec in India (which meant there was no question of extending the patent).

Many of the petitioners in the Novartis case were hoping the Supreme Court would set a precedent on evergreening.

Anand Grover, a lawyer for Cancer Patients Aid Association (CPAA), claimed that 76% of the patents granted in the US were on products with minor modifications of known molecules. “All over the world, new drug discoveries are reducing and companies demand patents for known products. There are flaws in the patent system if most patents are granted on incremental innovations where there is no increase in therapeutic efficacy," he said. Mint couldn’t independently verify his claim.

Grover also said that patents do not necessarily hurt patient interests or public health.

In this case, while dismissing Novartis’s plea, a bench of justices Aftab Alam and Ranjana Prakash Desai limited the implication by stating, “We have held that the subject product, the beta crystalline form of imatinib mesylate, does not qualify the test of Section 3(d) of the Act but that is not to say that Section 3(d) bars patent protection for all incremental inventions of chemical and pharmaceutical substances."

Essentially, the judges ruled that the changes made to the drug by Novartis did not add any significant therapeutic value. In its verdict, the court stated that “the beta crystalline form of imatinib mesylate, fails in both the tests of invention and patentability as provided under of Section 2(1) and Section 3(d) respectively". Section 2(1) refers to enhanced efficacy and Section 3(d) addresses the issue of patentability.

Basheer said the court could have done more. “Unfortunately, this was a very specific facts-based interpretation, and the court could have gone much further, given that it spent more than 130 hours hearing the various parties to the dispute," said Basheer, who testified as an academic expert in the proceedings. “We still don’t now know, for instance, whether a future incremental innovation in a drug that significantly improves the safety or reduces the toxicity in a drug would qualify as increasing therapeutic efficacy."

Indeed, another expert said, the case may set a precedent, but not the one most petitioners wanted. “The verdict says indirectly that, in appropriate cases, incremental inventions will not be barred by Section 3(d). It means firms will be able to seek protection under the patents Act. This limits the verdict only to this particular case without settling the larger debate about evergreening or efficacy," said Rahul Singh, a professor of law at the National Law School of India, Bangalore.

“Under TRIPS (Trade-Related Aspects of Intellectual Property Rights, an agreement framed by the World Trade Organization), the nuanced idea of incremental innovation is not addressed. It has been left to the national judgement of the each country. In the sense, this judgement gives an idea the Indian government envisaged this situation and amended laws to introduce Section 3(d). But the judgement neither clarifies nor amplifies IPR in India. The judges have actually played it safe by saying this is not a precedent," he said.

Glivec, used in treating chronic myeloid leukaemia, is priced at ₹ 1.2 lakh (about SGD 2,700) per person per month by Novartis while the generic version of the drug is available in India for approximately ₹ 8,000 (about SGD 180). The Swiss drug maker has a patent for this modified version of Glivec in 40 countries, including the US, Russia and China.

James termed Big Pharma’s chagrin over the verdict as an “over-reaction" and said drug patents in India were neither pro- nor anti-patents and that India’s stricter interpretation of what constituted a patentable drug could “work both ways as far as patents were concerned".

Under TRIPS, innovator firms are granted patent monopoly for 20 years after which generic companies are allowed to make cheaper copies of the original drug without paying the innovator. India has a thriving generics industry. An expert said current provisions, such as Section 3(d), would work to the advantage of India’s generic manufacturers and patients as long as India continued to refrain from investing substantially in developing new drugs.

“However, when they shift to discovering and developing new drugs, such provisions may actually impede them," said Sujit Bhattacharya, an analyst of India’s patenting trends at the National Institute of Science, Technology and Development Studies.

A day after the verdict on Glivec, US drug maker Merck and Co. moved court against Glenmark Pharmaceuticals Ltd to defend its soon-to-expire patent on Januvia and Janumet—two diabetic drugs. The last hasn’t been heard on the issue of incremental innovations in India.