India vs. Novartis (to be continued)

♠ Posted by Emmanuel in ,, at 8/08/2007 03:26:00 PM
One of the accusations leveled against Big Pharma is that it abuses patent laws by continually claiming patent protection for drugs that have been infinitesimally changed from previous formulations or are otherwise largely similar to previously patented ones. That is, drug firms seek to extend patent protection--and profits--by making highly contestable claims about the innovativeness of newer drugs.

India is having none of it. Novartis's best-selling cancer drug Gleevec has again been judged as being "incrementally innovative" or not meriting patent protection there. As I am no expert on pharmacological formulations [!], I will not venture as to whether this decision was technically correct. Of course, generics dominate Indian drug production, so there is a local political economy interest favoring laxer patent laws. On the other hand, relief groups like Medicins Sans Frontieres (MSF) are lauding this decision in India ruling against Big Pharma since a lot of the generics that it and other relief groups obtain are from India. Here is Forbes's report:

An Indian court has upheld the country’s unique patent laws, which were challenged by Novartis in the case of its best-selling cancer drug, Glivec. The ruling ensures that domestic firms--which derive a bulk of their revenues from generics--can continue to pump out generic versions of Glivec.

Section 3(d) of India’s 2005 patent laws holds that modifications of new medicines cannot be patented unless they make the drug significantly more effective.

Novartis challenged the constitutional validity of the law and said it was not in compliance with the World Trade Organization’s trade-related aspects of intellectual property rights, or TRIPs. The Madras High Court in the southern Indian city of Chennai has deferred to the WTO on the question of TRIPs.

Beyond the issue of constitutionality, Novartis--fighting back on a second front--has an appeal pending with the newly operational Intellectual Property Appellate Board against the rejection of a patent for Glivec. The patent was denied in 2006 on grounds that the drug is a new form of an old substance. Glivec is patented in 40 countries, including Russia and China.

Speaking of the Madras High Court's ruling, Ranjit Shahani, vice chairman and managing director of Novartis India, said in a statement Monday, “We disagree with this ruling; however we likely will not appeal to the Supreme Court. We await the full decision to better understand the court’s position.” Novartis pointed to a WTO review of India’s trade policy in May that had urged authorities to strengthen intellectual property rights.

Basel, Switzerland-based Novartis warned the ruling would have “long-term negative consequences for research and development into better medicines for patients in India and abroad.”

Generic versions of Glivec in India cost about one-tenth what Novartis charges for the drug every month, which is approximately 105,000 rupees ($2,600). That price is fixed globally, give or take variations from currency conversion. More than 6,700 people--about 99% of those who use Glivec in India--get treatment for free under a program Novartis runs with the Max Foundation. But critics point out that global drug companies would rather give drugs away than reduce prices in one country, in order to protect rates in developed markets. [This is a key contention.]

Relief groups that get the bulk of their supply of drugs for developing nations from India welcomed the decision. “This is a huge relief for millions of patients and doctors in developing countries who depend on affordable medicines from India,” Tido von Schoen-Angerer, director of the essential medicines campaign at Doctors Without Borders, said in a statement. Indian firms provide 84% of its HIV/AIDS drugs and 25% of other essential drugs the organization supplies to patients.

India’s government also spelled out which side of the debate it was on in April, when Health Minister Anbumani Ramadoss urged Novartis to step back, saying India hadn’t used compulsory licensing yet and “shouldn’t be pushed towards that.” Compulsory licensing allows generic makers to produce drugs, after paying a royalty to inventors, to meet public health needs in the event of a crisis.

In a country where the domestic industry is dominated by generic makers and less than 1% of GDP is invested in health care each year, Novartis’s battle to protect its star drug Glivec--which could have resulted in laws favoring a stronger patent regime--has not found much local support.

But the U.S.-India Business Council, which represents 250 American companies with investments here, pushed for stronger patents. “The issue here is encouraging investment in innovation to ensure access to the best treatments and cures for the people of India and the world. In other countries we have seen that inadequate protection for innovation discourages both domestic and foreign investment in innovation and access,” President Ron Somers said in a statement on the ruling.

Other multinational players were waiting for the outcome of the patent appeal to decide how to proceed in India, which is ranked 12th in the world in patent filings. The number of applications has rapidly risen since the government signed the TRIPs agreement in 2005. The Indian Patent Office is reported to have gotten about 30,000 patent applications in 2006-07, an increase of nearly 23% over the previous year. Applications from pharmaceutical firms accounted for about 50% of that number.

As noted, this isn't the end of the story. Another judicial body, the Intellectual Property Appellate Board, hasn't issued its verdict. And, the WTO is also mulling the legality of India's patent regime. From Bloomberg:

Novartis AG said its challenge to Indian patent law over the country's rejection of a patent on the best-selling cancer treatment Gleevec was turned down by a court.

The Basel, Switzerland-based company challenged India's legal basis for the rejection of a patent on Gleevec. The Indian government last year denied the application, saying the drug was insufficiently innovative. Novartis said it probably won't appeal today's decision to the country's supreme court.

Novartis said that strong patent laws would strengthen Indian research. The High Court in Chennai deferred to the World Trade Organization to settle whether India was meeting international trade rules. Doctors Without Borders and other groups contend a court victory by the drugmaker would have dried up a major source of affordable medicines for people across the globe.

``This is a huge relief for millions of patients and doctors in developing countries who depend on affordable medicines from India,'' Tido von Schoen-Angerer, director of the Doctors Without Borders Campaign for Access to Essential Medicines, said in an e- mailed statement.

Indian law allows patent officials to exclude products that are based on ``incremental innovation.'' Gleevec is patented in 40 countries, including Russia and China.

``It is clear there are inadequacies in Indian patent law that will have negative consequences for patients and public health in India,'' Paul Herrling, head of research at Novartis, said today in a statement.

The World Trade Organization forum will resolve the challenge to Indian patent law. The Indian Intellectual Property Appellate Board hasn't decided whether Novartis will be granted a patent on Gleevec.