Fading history of Novartis v Union of India

Exactly 10 years ago, the Supreme Court of India delivered a landmark judgement on a crucial case involving patent protection for pharmaceuticals under the country’s new intellectual property rights regime. It was a case that had riveted the world since the outcome had major implications for the pharma industry and for patients.

It was the first test of the country’s patent law, which had been amended to comply with World Trade Organization (WTO) rules, and specifically of a particular part of the law, Section 3d, which delineated what was not patentable in India. This section deals with patents for derivatives of known substances and new uses of a known substance, a hugely contested domain.

The legal challenge had come from Swiss drug giant Novartis which had filed a special leave petition (SLP) in the apex court; its final attempt to get a patent for a new form of its anti-cancer medicine Glivec after several courts had rejected the claim. The claim was for a beta crystalline version of its base compound imatinib mesylate, which had been patented much earlier.

A division bench of the Supreme Court rejected the SLP and Justice Aftab Alam, who wrote the carefully nuanced judgement, laid down the fundamental reasoning for the law and its application. While the court considered the counter arguments — generic companies, patient groups and lobbyists had also filed SLPs — it was not unduly swayed by the argument for access to the medicine.

This is what makes Justice Alam’s 112-page judgement important on several counts. A major point that he underlines and explains at length is why India included Section 3d, which has earned undeserved notoriety as a law that blocks patents for incremental inventions, and how it should be interpreted.

In order to understand what a law really is, he said, it is essential to know the “why” and “how” of the law, particularly with reference to the law of patents in India — perhaps more than any other law. “What were the concerns of Parliament when it made such basic changes in the Patents Act? What were the issues the legislature was trying to address? What was the mischief Parliament wanted to check and what were the objects it intended to achieve through these amendments?” This is an injunction that needs to be kept in mind.

The mischief referred to is the practice of pharma companies to extend patent protection on a drug by filing new patents over the process, dosage form or method of administration, rather than the active ingredient itself. Section 3d is aimed at regulating such patents by limiting the scope of protection available for derivatives of known substances and new uses of known substance.

The 2013 judgement was notable for its understanding of the science on which Novartis based its claim. After poring over the history of the imatinib patent, Justice Alam points out that no material has been offered to prove that the beta crystalline form of imatinib mesylate would provide enhanced therapeutic efficacy than what imatinib free base does.

Terming the case of Novartis weak, the court said the beta crystalline form of imatinib mesylate fails both the tests of invention and patentability under several clauses of the Patent Act, including Section 3d. Yet, Justice Alam was categorical that the court’s ruling does not mean “Section 3(d) bars patent protection for all incremental inventions of chemical and pharmaceutical substances. It will be a grave mistake to read this judgment to mean that section 3(d) was amended with the intent to undo the fundamental change brought into the amended patent regime”.

Much has changed since that milestone judgement. The nature of the industry has changed greatly and patenting of drugs has taken on manic proportions. Most of the drugmakers in developed countries surround a single drug with hundreds of patents that throw formidable thickets around the new molecules (see 'One drug, 166 patents and $208-billion sales', Down To Earth 1-15 March, 2023), making it impossible for generic companies to launch their less expensive versions of the drug even after the expiry of the mandated 20-year patent term. Monopolies continue for years longer than the law intended while profits of Big Pharma grow exponentially.

When the National Law University of Delhi held a symposium on "10 Years of Novartis vs Union of India", one was hoping for an update on how the industry is dealing with new developments.

For instance, generic companies worldwide, including many from India, are locked in lawsuits with Novartis over its blockbuster heart drug Entresto, although the extended patent protection period for the medication ended in January this year. The drug enjoys a market of over US $4 billion.

While Novartis is suing a long list of generics producers, the company itself is facing a patent infringement lawsuit from the University of Michigan and the University of South Florida. Instead, the symposium, which brought together top corporate lawyers, academics and law students to discuss the aftermath of the Supreme Court’s 2013 decision, showed an amazing lack of understanding of India’s patent regime. It banged on about the lack of clarity on efficacy, a charge that is as old as the judgement.

There were other embarrassments. Newbie lawyers wondered why India was allowed another layer of protection in Section 3d when it violated WTO rules. Perhaps, they were unaware apparently that in the 18 years since the new Patent Act came into being, no member of WTO has challenged it at the trade regulating body.

True, the US and other developed countries have put pressure on New Delhi in various forums to rescind the section, such as when negotiating free trade agreements, but it would appear that Section 3d is no longer viewed as a significant threat, going by the muted reaction of major trade partners and Big Pharma. Nor did participants at the symposium make a convincing case that Section 3d has significantly stopped the grant of patents on incremental inventions. As with patent rulings elsewhere, decisions here have resulted in six of one and half a dozen of the other.

What is more important is the need to understand what India’s legislators were intending when the law was enacted. It would be instructive for all stakeholders, and specially examiners in the Patent Office, to peruse India’s amended pact from this perspective. History is always important—even on patent law and its evolution.

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