Novartis India case: Campaigners hail patent rejection

Novartis MD, Ranjit Shahani: "We are disappointed a patent was not granted"

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Healthcare campaigners have welcomed India's rejection of a legal bid by Swiss company Novartis to patent a new version of its cancer drug, Glivec.

"The ruling will save a lot of lives across the developing world," said aid agency Medecins Sans Frontieres (MSF).

The decision means generic drugmakers can continue to sell cheaper copies of Glivec in India, one of the fastest growing pharmaceutical markets.

Novartis said the Supreme Court's ruling "discourages future innovation".

Indian authorities denied the firm's plea on the grounds that the updated version was only slightly different from the previous one.

"This ruling is a setback for patients that will hinder medical progress for diseases without effective treatment options," said Ranjit Shahani, vice-chairman and managing director of Novartis India.

Glivec, which is used to treat chronic myeloid leukaemia and other cancers, costs about $2,600 (£1,710) a month.

The generic equivalent is currently available in India for just $175.

'Big relief'

There were concerns that, if granted, a patent could threaten access to cheap generic versions of life-saving drugs in poorer countries.

"The ruling has come as a big relief," said MSF lawyer Leena Menghaney.

"The ruling doesn't mean no patents will be granted in India, but the abusive practice of seeking many patents for one drug will be curbed."

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The decision is a major boost to cheap life-saving drugs in a country where the healthcare system cannot cope with the demands on it”

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Anand Grover, a lawyer representing Cancer Patients Aid Association, said he was "ecstatic with the ruling".

"This will go a long way in providing affordable medicine for the poor," he said.

Novartis applied for a patent in 2006 for its new version of the drug, arguing that it was easier to absorb and therefore qualified as an innovation.

However, the Indian patent authority rejected the application based on a law aimed at preventing companies from getting fresh patents by making only minor changes to existing drugs, a practice known as "evergreening".

Officials also turned down a subsequent appeal by the company three years later.

The AFP news agency quoted the court as saying that the updated drug "did not satisfy the test of novelty or inventiveness" as required by the law.

The previous version of Glivec did not have a patent, as it preceded India's 2005 patent law.

Setting a precedent?

Patents usually protect the companies for 20 years of exclusive sales. After that, it is open to other firms who can make cheaper copies of the original drug.

Analysis

There were celebrations outside the Supreme Court as the landmark decision was read out. One charity, Medecins Sans Frontieres, called it a victory for poor patients not just in India but across the world.

The bone of contention was Section 3D of India's patent laws and the court argued that Novartis had to demonstrate that Glivec represented more than just a small improvement to an existing substance. In its ruling, the court said it wanted to discourage "repetitive patenting".

The decision is seen as a major boost for generic drugmakers in India who supply cheap medicines to poor people across the developing world.

India exports generic drugs worth $11bn (£7.23bn), including crucial anti-retrovirals supplied to Africa.

Experts say Monday's court order will set a precedent for the so-called "patent cliff" - a phrase used to describe the expiry of pharmaceutical patents across a range of blockbuster drugs.

It is estimated that drugs with combined annual sales of $150bn will go off-patent by 2015 and that could help companies here earn millions of dollars in profits.

Once the protection expires, the first company to challenge the patent gets an exclusive right to sell the copy for 180 days.

After 180 days, more companies can sell the generic versions, potentially resulting in a further price drop.

India's generic drug makers are among the biggest in the world and many expect them to benefit from patents expiring in the coming years.

However, there have been concerns that if firms are granted patents for updated versions of their drugs, it may not only deny access to cheaper medicines to poor people, but also hurt the makers of generic drugs.

Pratibha Singh, a lawyer for the Indian generic drug manufacturer Cipla, said the ruling had set a precedent that would prevent international pharmaceutical companies from obtaining fresh patents in India on updated versions of existing drugs.

"Patents will be given only for genuine inventions, and repetitive patents will not be given for minor tweaks to an existing drug,'' she said.

Shares of Novartis India fell almost 5% on the Bombay Stock Exchange, while stocks of generic drugmakers such as Cipla and Natco rose after the judgement.

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