Indian Generic Drug Maker Seeks to Invalidate Cancer Drug Patent

    By Kevin E. Noonan --

The latest skirmish in the struggle between innovator pharmaceutical companies (mostly in the Western world) and developing world populations is being played out in India.  The outcome will depend on how the Delhi High Court interprets provisions of Indian patent law enacted to implement India's compliance with provisions of the international Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement on intellectual property.

Roche is the Western innovator pharmaceutical company, Cipla is the Indian generic drug company (the largest) and the drug is erlotinib (trade name, Tarceva), a drug used to treat lung cancer.  Roche has an Indian patent on the drug, obtained under patent laws revised in 1995 upon India's accession to the TRIPS agreement.  Cipla has ignored the patent and is producing and selling erlotinib (under the name Erlocip) in India, the first time this kind of blatant infringement has happened.  Roche has asked the High Court for an injunction to prevent Cipla from continuing to sell its infringing form of the drug.

Countervailing Indian patent law are the economic realities:  Roche's drug costs $125/tablet (about $45,000 US per year), while Cipla's drug costs much less ($42/tablet).  Cipla's position is that Roche's patent is invalid; the application was originally filed in 1995, and while patents filed in 1995 or later were deemed to be valid by operation of Indian law in 2005, Cipla contends that only Indian patents filed in 1996 or later are valid because there was a one-year grace period to implement TRIPS, according to Yusuf K. Hamied (at right), Cipla's chairman.

Tarceva is also under attack by another Indian generic drug manufacturer, Natco Pharma, which is seeking a compulsory license under Indian patent law to produce its generic version of the drug.  Natco's application is for permission to export 30,000 tablets of the drug to Nepal; for the privilege Natco is willing to pay Roche a 5% royalty.  However, such a compulsory license, while permissible under Indian law, cannot be granted until three years after the innovator is granted an Indian patent (and thus should not be available until July 2010).

This is not the first time Natco has challenged a Western drug company with an Indian patent on a pharmaceutical product:  Natco was the company that challenged Novartis over its Gleevec patent, and won.

The issue, of course, is cost, and the political pressure on governments in developing countries like India make it unlikely that such governments will be able to resist pressure from their own citizens in favor of multinational drug companies like Roche.  In view of modifications to the TRIPS agreement, most notably the Doha declaration, such governments can effectively eat their cake and have it too, since Doha and other TRIPS provisions have created "loopholes" in intellectual property protection for medical emergencies and life-saving drugs (see "The Law of Unintended Consequences Arises in Applying TRIPS to Patented Drug Protection in Developing Countries").  While initially confined to anti-AIDS drugs, the scope of how these provisions are being applied has been expanded to include other drugs by countries like Thailand, who last year included Plavix® as one of the drugs granted a compulsory license by its government to (foreign) generic manufacturers.

Drug prices being the key motivator for governments in the developing world to grant such compulsory licenses, it would seem prudent for companies to lower their own prices and thus blunt if not forestall the generic companies' justifications for government action.  While this has happened sporadically in the past, there has been no coordinated effort by Western drug companies to develop a strategy around drug pricing in the developing world to address the compulsory licensing issue.  Actions such as the ones contemplated in India and elsewhere make it apparent that such a coordinated strategy is necessary if innovator drug companies are not to be left with none of the advantages that the TRIPS agreement was intended to have for their industry.

For information regarding this and other related topics, please see:

• "Novartis to Supply Cancer Drug to Thai Patients," February 5, 2008
• "Neocolonialism in the Current Global Drug Pricing Regime?" August 19, 2007
• "More on the Global Drug Patenting Crisis," August 14, 2007
• "EU Trade Commissioner Sends Warning Letter to Thailand," August 13, 2007
• "Trying to Find a Solution to the Global Drug Pricing Crisis," July 16, 2007
• "Pharma Sanity Lacks Global Reach," July 13, 2007
• "Brasil Prevails in Dispute with Abbott over AIDS Drug Pricing," July 9, 2007
• "Africa (Still) Depending on the Kindness of Strangers in Anti-AIDS Drug Pricing," May 29, 2007
• "U.S. Trade Policy Becoming Less Pharma-Friendly," May 18, 2007
• "The "Unfairness" of World Intellectual Property Protection According to The New Yorker," May 17, 2007
• "Worldwide Drug Pricing Regime in Chaos," May 9, 2007
• "Not Getting It about Patented Drug Prices at The Wall Street Journal," May 6, 2007
• "A Modest Proposal Regarding Drug Pricing in Developing Countries," May 2, 2007
• "The Law of Unintended Consequences Arises in Applying TRIPS to Patented Drug Protection in Developing Countries," May 1, 2007
• "Abbott Agrees to Offer AIDS Drug at Reduced Price," April 12, 2007
• "No New Abbott Medicines for Thailand," March 14, 2007
• "More Compulsory Licensing in Thailand," February 1, 2007

Comments

[Sandeep K. Rathod]

Dear Patentdocs Team,

There is an error in your post.
The 2 years minimum time limit for application of a Compulsory license is for licenses which seek to sell products in India.
Natco seeks to sell the product in Nepal.
Hence, u/s 92 A of the Patent Act, the 2 years blocking window is NOT applicable.

Regards,
SKR

[Rajesh]

I hope this will not
start a new episode of challenging
Patent by way of compulsory licensing
provision.

[Rajesh]

I think time for compulsory
license is 3 years

[Kevin E. Noonan]

Dear SKR:

Thanks for the comment. From the Times of India:

Indian firm Natco Pharmaceuticals made the plea for the country's first so-called "compulsory licence" to the patent office as it bids to make generic copies of Pfizer's Sutent and Roche's Tarceva cancer drugs. "This is the first case in India.

A compulsory licence will allow companies like ours to manufacture and export drugs to least developing countries," said M Adinarayana, secretary of Natco Pharma.

Maybe they are just being proactive.

Thanks for the post.

[Sandeep K. Rathod]

Dear Mr. Noonan,

Let us not get Indian news media in the fray... I can only say that their understanding of IP law/ basics.

The fact still remains:
a) The CL application was NOT for India, but for export to a LDC- Nepal;
b) I still think that the time limit for application of CL is 3 years [S. 84 (1)]and not 2 years.
The 2 years comes in picture if the Controller has already granted a CL to a generic and the generic itself does not use the license [works the invention] within 2 years from the date of grant of the CL [S. 85(1)].
SKR.

[Kevin E. Noonan]

Dear Sandeep:

Thanks for the clarification. We agree that Natco wants to sell its generic drug in Nepal, and think that the post says that clearly. We have changed the compulsory license time from 2 years to three; between the Times of India, Patent Docs and yourself, I think it clear who is more informed about Indian patent law, and thank you for your correction.

What do you think about the trend (political, financial, etc.) of generic drugs and foreign company patent rights in India? We'd appreciate your insights.

Best regards.

[Sandeep Rathod]

Dear Kevin,

a) I apologize for not seeing the changes already made [2 years to 3 years etc.]
b) I do not claim to know the fine nuances of Indian law, though I am an Indian patent attorney, simply because the law itself is nascent/ developing.

WHAT FOLLOWS ARE MY PERSONAL VIEWS. PLEASE NOTE THAT I AM EMPLOYED WITH A MAJOR GENERIC COMPANY, BASED OUT OF INDIA; HENCE MY VIEWS ARE NECESSARILY BIASED AS I LOOK AT PATENTS IN INDIA FROM THE GENERIC INDUSTRY'S VIEWS [by training/ professional focus].

A) I personally agree that the patent litigation trend in India is not very healthy. Especially, the trend of opposing patent applications by generic companies on very filmsy grounds is bad.
B) The Innovator side has its issues. They try to mix too many issues such as whether Indian law is even TRIPs compliant in their case/ litagations at the Indian courts. To them I say that no country's law is completely TRIPs compliant. Every country protects its interests BEFORE it honours international commitments.

That being said, all players in the Indian context have to play within the system as it stands today.

If our Law has very narror definition of patentability [salts/ polymorphs/ esters etc not being patentable], so be it. Play and live within this frame work.

Personally, patent rights in India [with out restricting my views to ownership of the same] are healthy and well protected. You can read my blogs where I have posted cases on patent owners winning cases. See here:

http://genericpharmaceuticals.blogspot.com/2008/02/india-patentee-gets-injunction-against.html

Innovator companies are getting patents granted. See here:
http://genericpharmaceuticals.blogspot.com/2008/01/india-pfizer-gets-product-patent-for.html

The present trend of litigation will taper in few years, simply because the system [all players included] is testing every thing.
See here:
http://genericpharmaceuticals.blogspot.com/2008/02/india-compulsory-license-hearings-start.html

AND here:
http://genericpharmaceuticals.blogspot.com/2008/02/india-learnings-from-tvs-bajaj-patent.html

Kevin,
Indian patent law is an open topic.
Should you feel like talking on it, do touch base with me, via my email.
I would love to talk and debate our law.

Sincerely,
Sandeep.