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By Daniel Pruzin
GENEVA--On April 8, a senior Indian government official defended the Indian Supreme Court’s recent ruling denying domestic patent protection for the cancer drug Glivec and dismissed suggestions the ruling could be challenged as illegal under global trade rules.
Speaking to reporters following an event at the World Intellectual Property Organization marking India’s accession to the Madrid system for the international protection of trademarks, India’s Minster for Commerce and Industry Anand Sharma said the court’s decision was fully complaint with India’s obligations under the WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights.
In its April 1 ruling, the Supreme Court of India ruled that a new form of the drug for which the Swiss pharmaceuticals company Novartis A.G. sought a patent did not represent a significant improvement over an earlier version (63 PTD, 4/2/13).
The Supreme Court rejected a Novartis challenge to Section 3(d) of the Indian Patents Act, which was enacted when India’s patent laws were amended in 2005 to conform with the WTO’s Trips Agreement.
The provision seeks to prevent drug makers from unfairly and indefinitely extending the duration of their patents by making small and trivial changes to existing formulations, a practice known as “evergreening.”
In commenting on the ruling, Novartis said the court’s decision “discourages innovative drug discovery essential to advancing medical science for patients.”
John Castellani, president of the Pharmaceutical Research and Manufacturers of America, known as PhRMA, added that the decision “marks yet another example of the deteriorating innovation environment in India.”
Sharma rejected the criticisms as unfair and unfounded, adding that he was “surprised” by some of the reactions.
“Novartis is the third largest beneficiary of patent registrations in India,” Sharma said, noting that the company currently holds 147 patents under Indian law. “They should look at the 147 patents which have been granted, not the one which has rightfully been denied.”
“It’s a minor increment,” the Indian official said in reference to the novelty of the Novartis drug. “It is not enhanced efficacy of the medicine. We have to respect the judicial verdict, which is based on law, which is based on facts, which is based on science.”
The court’s ruling followed a March 4 decision by Intellectual Property Appellate Board upholding India’s first-ever compulsory license (55 PTD, 3/21/13). The license was issued to Indian generics-maker Natco to manufacture and sell a generic version of German drugmaker Bayer A.G.’s cancer drug Nexavar.
As a result of the March 2012 decision by India’s Controller of Patents to issue the license (48 PTD, 3/13/12), the price for the cancer treatment has dropped from approximately $5,300 per month per patient to $160, with multinationals later dropping their prices at or below the licensing price fixed for Natco, Sharma noted.
Asked whether the recent actions could be challenged before a WTO dispute panel, Sharma insisted that India has acted within the confines of the Trips Agreement.
“Compulsory licensing is entirely legitimate and in conformity with the Trips Agreement,” he said, noting that 160 such licenses have already been issued by other countries. “This is a flexibility made available to countries under law. Even after the compulsory license, royalties have been made available to Bayer, so it’s not that they’ve been denied the royalty in any manner.”
“We are not going to do anything ever, as a sovereign nation, which would find us, even remotely, in breach” of multilateral rules, he said. “What is being done is being done correctly.”
“There is neither any ground nor any justification to question something which is integral to the multilateral agreement,” Sharma said. “It would be most unfortunate if such a step is envisaged.”
Sharma also said he did not believe that recent actions would impact foreign investment in the country’s pharmaceutical industry or other innovation sectors of the economy.
“I don’t see that it is going to dissuade the multinationals from investing in R&D,” he said. “First, India itself is investing more in R&D. We’ve set up an innovation fund, we’re doubling the state’s contribution to R&D and innovation. … There’s much innovation going on which is potentially very particular to the protection of intellectual property, and there’s a lot of intellectual property which is coming out of India.”
The Trips Agreement originally allowed governments to issue compulsory licenses only if the license was used “predominantly” for the supply of the domestic market, effectively preventing poor countries with no pharmaceutical industry from utilizing the provisions.
In August 2003, WTO members issued the so-called “Paragraph 6” decision--referring to Paragraph 6 of the Doha Declaration on the Trips Agreement and Public Health--allowing developing countries to issue compulsory licenses for the import of generic copies of patented medicines and for developed countries to allow production of the medicine for export to poor nations.
The Trips Agreement also allows for various forms of parallel imports (under so-called “international exhaustion” rules) and the use of a patented drug without authorization in order to obtain marketing approval for a generic drug before the patent expires (“Bolar” provisions).
By Daniel Pruzin
Text of the April 1 opinion is available at http://op.bna.com/hl.nsf/r?Open=bbrk-96clsc.
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