Pharmaceutical companies must balance profits and affordability

the sc said IPA 2005 is not meant to commercially reward “ever-greening” or use of minor changes in product to allow extension of patent protection

Published: 14th April 2013 07:35 AM  |   Last Updated: 14th April 2013 07:35 AM   |  A+A-

Two major judicial pronouncements this month have stipulated a debate over the rationale of patent rights of the international pharmaceutical companies in India. On April 1, the Supreme Court denied patent protection for Glivec, a cancer drug made by Novartis that’s patented in nearly 40 other countries. On April 5, the Delhi High Court dismissed a claim by Merck’s Indian subsidiary, Merck Sharp and Dohme, that Mumbai-based Glenmark Pharmaceuticals should be barred from marketing generic versions of the hit diabetes drugs, Januvia and Janumet.

The message is unmistakable. While the protection of intellectual property rights is essential to promote invention, international pharmaceutical manufacturers will not be allowed unlimited pricing power over the Indian market of 1.2 billion people. The industry’s obligation to provide access to life-saving drugs should outweigh its drive for profits.

The Supreme Court’s ruling is one of the most significant verdicts on patent law in independent India. That it has come at a time when the pharmaceutical industry is once again tending towards tight “oligopolisation” and high prices, which was the case before 1972 when the country had pharmaceutical product patent protection, is all the more welcome.

India did not start granting patents on drugs until 2005, and even then, its laws only applied to drugs discovered after 1995. Novartis patented an early version of Glivec in 1993 and then abandoned it in favour of the molecule that’s on the market today. The Supreme Court ruled that the two drugs were not different enough to warrant a patent in India on the marketed version. With the coming into force of pharmaceutical product patent protection in January 2005 following the third amendment of the Indian Patents Act (IPA), transnational pharmaceutical companies have been marketing patented medicines at exorbitant prices, particularly in the case of life-threatening diseases such as cancer.

Novartis’ Glivec—used for the treatment of chronic myeloid leukaemia (a form of blood cancer)—has been a prime example. The company had applied for a patent for the beta crystalline form of IM on July 17, 1998, which went into the “post-box for filing” under the TRIPS agreement, but it was granted an exclusive marketing right in 2003. It was charging an unaffordable `1.2 lakh per month for the required dose. Fortunately, Indian drug manufacturers such as Natco, Cipla and Ranbaxy entered the market with generic variants at one-tenth of that price.

Meanwhile Novartis’ patent application was stoutly opposed by the Cancer Patients Aid Association and others. Given the disclosure in the original patent for Imatinib free base, its beta crystalline form of IM was found to be “obvious” and also unable to pass the test of Section 3(d) of IPA, 2005 and the patent was denied.

Hearing the final appeal in the case, the Supreme Court went into the history of patent legislation in India up to the TRIPS agreement and the 2005 amendment of the IPA. It held that Section 3(d) of IPA is meant to “leave the door open for true and genuine inventions, but, at the same time, to check any attempt at repetitive patenting or extension of the patent term on spurious grounds”.

In effect, the SC has laid down that the IPA, 2005 is not meant to commercially reward “ever-greening” or the use of minor, almost cosmetic, changes in the product to allow continual extension of patent protection and the concomitant super-profits. The purpose of the intellectual property rights is to incentivise only genuine research.

The pharmaceutical industry has for years consolidated profits by advocating a stronger and ever inequitable global intellectual-property regime. The Supreme Court’s refusal to uphold the patent on a blockbuster cancer drug, though only a small reversal for the big pharmas, sets a good precedent for other developing countries and frees up money and resources that can contribute to growth and poverty reduction efforts.

Misra is a senior fellow with Observer Research Foundation

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