THE IIS UNIVERSITY

(ICG)

PROJECT WORK ON CERTIFICATE

COURSE OF PATENT LAW PRACTIE
TOPIC : JURISDICATION AT PATENT
ISSUE
SUBBMITED BY : VAISHALI KIRORIYA

Introduction
The term patent usually refers to the
right granted to anyone who invents
any new, useful, and non-obvious
process, machine, article of
manufacture, or composition of
matter. Some other types of
intellectual property rights are also
called patents in some jurisdictions

Patients win Patent War

Life-saving medicines to become

affordable as two landmark rulings
favour cheaper versions of patented
drugs

NOVARITS PLEA
It's double trouble for global pharma
companies in India. On April 1, a Supreme
Court bench comprising Judges Aftab Alam
and Ranjana Desai dismissed Swiss drug
major Novartis AG's seven-year-old plea
seeking patent protection for its blood cancer
drug sold as Glivec.
The court held that Glivec was not the
outcome of an invention but a known
substance as laid down in the Indian Patents
Act, 1970.

WHY SC DISMISSED NOVRATIS PLEA.

Abuse of the patent system must be
checked to ensure affordable pricing.
Availability of the medicines to the
poor patients must get priority.
Slightly modification of the old and
existing drugs do not warrant
patents.

NATCO v/s BAYER

CASE INTRODUCTION
Natco v/s Bayer was the first case of
compulsory licensing being obtained
in India in pharmaceutical field of
discipline
International drug manufacturing
firm Bayer Corporation and Indian
pharmaceutical company Natco
Pharma Limited
Bayer obtained a patent on Nexavar.

FACTS
The players of this case are:
Bayer Corp The Patentee
NATCO - The Applicant
NEXAVAR

BAYER CORP
Ms Bayer Corp is an innovative drug
multinational giant based at
Germany.
Invented a drug named SORAFENIB.
Life extending drug to be used in
liver and kidney cancer treatment
Brand name 'NEXAVAR'

NATCO
Indian generic pharmaceutical company
Natco filed an application with the Bayer
Corporation for the Voluntary license of the
drug Nexavar (Sorafenib) with reasonable
commercial terms and conditions.
Received a license from the Drug
Controller General of India for
manufacturing the drug in bulk and
marketing in form of tablets in April 2011.

NEXAVAR
The drug Nexavar (Sorafenib) is the
patented product of Bayer
Corporation.
Life extending drug to be used in
liver and kidney cancer treatment

CASE
Natco, a generic drug manufacturing company
requested Bayer for giving it a voluntary
license.
The request was denied and so Natco filed an
application in the Controller of Patents Court for
grant of a compulsory license.
In accordance with the provision of Indian
Laws Section 84 of the Patent Act, the Indian
Controller of Patents started with competing
claims of both the patentee (Bayer) and the
compulsory license applicant (Natco).

NATCO VS BAYERS
ISSUE
The Intellectual Property Appellate Board (IPAB) endorsed the
Government's decision to allow India's Natco Pharma to make
inexpensive copies of German multinational Bayer's anti-cancer
drug Nexavar under a Compulsory Licence (CL)-the first to be
issued in India.
But the issue is far from conclusively settled yet. Bayer is to
challenge the IPAB order in the Bombay High Court to defend its
Intellectual Property (IP) rights. Its contention is that the order
weakens the international patent system and endangers research.
Consequently, more legal battles on patents were on the cards
apart from the ongoing ones such as that of US drug firm Pfizer
against Cipla over the alleged infringement of its patent on anticancer drug Sutent in India; that of Bayer against Natco over its
patent on anticancer drug Nexavar; and of Bristol-Myers Squibb
against Natco over its patent on another anti-cancer drug.

THE LAWS
The legal battle in which Novartis was pitted against several
Indian generic drug makers such as Cipla, Hetero, Ranbaxy
and Natco began in 2005 when the Mumbai-based Cancer
Patients Aid Association (CPAA) challenged the Swiss firm's
application for patenting Glivec, made in July 1998. CPAA
contended that Novartis was trying to patent a variation of
an existing drug, not allowed under Indian patent laws.
Section 3(d) of the Indian Patents Act, 1970, prohibits the
grant of patents to new forms of known substances. "The
purpose of the section is to ensure that patent monopolies
are not extended and generic versions delayed, unless the
new form results in enhanced efficacy,"

 Under World Trade Organization's Trade Related

Aspects of Intellectual Property Rights (TRIPS), to
which India is a signatory, patents allow companies
20-year exclusivity on manufacture and distribution.
Without competition, an exclusive marketer could
price a medicine beyond the reach of patients.
So, companies are allowed to make affordable
copies without compensating the innovator after the
20-year period. The point of contention for global
majors is the amendment India made to safeguard
against frivolous patents and 'evergreening'.

VERDICT OF THE CASE

Bayer had disputed the Government's decision to grant
a CL by ordering Natco to sell the cancer drug at
Rs.8,800 for a month's therapy (Bayer's drug cost
Rs.2.80 lakh for the same dosage) and pay 6 per cent
royalty to Bayer on total sales. "In three years, Bayer
has not taken any steps to revise the marketing
strategy and cut the price of the product," IPAB directed
Natco to increase the royalty to 7 per cent.
The applicant Natco has very limited rights to
manufacture and commercially sell the drug .
Natco cannot sublicense to another party. It is a nonassignable and non-exclusive license with no right to
import the drug.

 The compulsory licensed drug can be sold

only for the treatment of liver and renal
cancer. Natco cannot use this license for
alternate or subsequent use of the drug.
Natco, as committed before, has to
provide the drug free of cost to at least
600 needy and deserving patients per
year.
Natco cannot or it has no right to
represent privately or publicly that the
product manufactured by it is the same
as Bayers Nexavar.

EFFECTS/CONSEQUENCES
In light of the IPAB ruling, the Government will grant more CLs.
The Department of Industrial Policy and Promotion is already
considering the grant of CLs for three more anti-cancer drugs.
Price will fall as more generic version become available.
They say that the rulings are likely to strain the relationship
between Indian firms and their global counterparts operating in
the Rs.72,000 crore Indian drug market.
India's image as an investment hub could, however, suffer in
the aftermath of the rulings. Innovator companies will not feel
secure investing in a country where their extensively
researched products could be subject to CLs. Bayer says the
cost of inventing and developing a new medical entity like
Nexavar is about Rs.11,775 crore .
More legal battle will come up.

SOLUTIONS FOR THE

FUTURE
The way out for the Government is to evolve a
price mechanism wherein the drugs made by
MNCs are sold alongside those made by Indian
companies at different prices. In a move that can
possibly put an end to the price war.
The solution is either a cross-subsidy model where
the rich pay the full price and the poor pay a
subsidised price or the Government buys for the
poor and supplies through government hospitals,
But such a policy will distract from the grant of CLs
and, in turn, delay the entry of low-cost generic
versions.

thank you
By-prashant joshi pradhan