Novartis Loses Indian Patent Case

On August 6, the High Court in the Indian city of Chennai rejected Novartis’ constitutional challenge to Section 3 (d) of the country’s patent law. To understand the implications, a little background on the law is helpful.

Facing a Trade-Related Aspects of Intellectual Property Rights (TRIPS) deadline in January 2005, India implemented a law offering patent protection on pharmaceutical products for the first time. Despite the attention (both pro and con) this legislation received, the reality is that its provisions are extremely favorable to the country’s strategically important generic drug industry.

The law contains a number of hurdles to patentability.  For this case, the most relevant is that while new chemical entities are patentable, new uses of known chemical entities are not unless the new use results in “enhancement of known efficacy.” Section 3 (d) of the patent law is at the heart of the dispute. It reads:

“The mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant.

“Explanation:  For the purposes of this clause, salts, esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of known substance shall be considered to be the same substance, unless they differ significantly in properties with regard to efficacy.”

In January 2006, the Indian Patent Office denied a patent application for Novartis’ cancer drug Gleevec on the grounds that it represented a new form of a known substance and lacked significant improvements in efficacy.

As a result of the Patent Office’s decision, Novartis filed two separate suits in January 2007. The first claimed that Gleevec was, in fact, more efficacious than previously known substances and, as a result, should have been issued a patent under Section 3 (d). The second claimed that the Section 3 (d) restrictions are unconstitutional as they fail to meet India’s TRIPS agreements. Arguments in both cases wrapped up in April 2007.

The case concerning the constitutionality of Section 3 (d) was addressed by the Chennai High Court on August 6. The Court dismissed Novartis’ action and referred the matter to the WTO forum. While Novartis has a right of appeal to the Indian Supreme Court, it appears that the company does not intend to exercise this right.

The other case, in which Novartis argues that Gleevec deserves a patent under Section 3 (d), was referred by the court of first instance to the newly composed Intellectual Property Appellate Board (IPAB). The Board has not yet issued a decision. Therefore, while Section 3 (d) will likely be in place for the foreseeable future, it is still possible that Gleevec will be granted a patent.