Thursday, November 17, 2011

Compulsory licensing: Is presumptive evidence sufficient?

Sometime back, we posted on compulsory license triggered by Natco Pharma with respect to IN215758 claiming anti-cancer drug Nexavar, generically sorafenib tosylate marketed by Bayer. The Application for compulsory license (FORM 17) was filed on July 28, 2011 along with the details of documentary evidence as mandated under S. 84 (3) of the Act. Natco argument for issuance of compulsory license mainly relied upon on the issues that:
  • patented product (sorafenib tosylate) not been manufactured in India. In other words, patented invention not worked within the territory of India.
  • circulation of patented product limited to certain hospitals and metro cities. In other words, patented invention not worked to the fullest extent.
  • unaffordable to 99% of patients. In other words, patented product not available at affordable price.
  • requirement of patented product is far higher than what is available in Indian market. In other words, reasonable requirements of the public with respect to the patented product not been satisfied.
  • patented product is found expensive in UK and US. In other words, Natco possibly trying to say anything that is expensive in UK and US will automatically be expensive in India.

Natco further provided details including regulatory approval, proposed manufacturing capacity (6,00,00,000 tablets per day) and proposed market price to a patient (INR 8,800 per month). Natco also proposed to provide free to patients who cannot afford even the proposed price. Interestingly, Natco’s application completely lacked factual evidence/data to support most of its argument rather Natco relied primarily on secondary sources collected from Mayo Clinic and Harward Center for Cancer Prevention. 

As per Indian patent practice, the Controller may either publish the application in the Official Journal (see S. 87 (1) of the Act) when a prima facie case is made by the Applicant or reject the application. In this case, the Controller found prima facie case and published the application is Issue No. 32/2011 dated August 12, 2011. 

Later Bayer petitioned for an extension to file notice of opposition and subsequently in November filed a writ petition with the Mumbai High Court challenging the Controller decision to publish the application. However, the Court refused to look into the merits of the case and disposed of the petition citing that the proper jurisdiction to file the petition would be the Delhi High Court. The Court also extended time to file opposition till November 18, 2011. 

Tuesday, November 08, 2011

Glivec patent dispute: the case so far
Part III

Round Three: Appointment of IPAB Technical Member
After losing its first two rounds before the Madras Patent Office and the Madras High Court, Novartis third round came against appointment of technical member of newly-constituted IPAB. In April 2007, soon after the Central Government appointed former Controller General of Patents S. Chandrasekhar as a technical member on the Appellate Board, a three member quasi-judicial panel, the Madras High Court transferred Novartis’s appeal challenging the rejection order to the Appellate Board to adjudicate patentability of beta-crystalline variant of imatinib mesylate. But even before the Appellate could start hearing, Novartis debated the appointment of Chandrasekhar as technical member to hear the appeal.

Novartis protest was based on facts, that, firstly, Chandrasekhar was the Controller General at the time the application got rejected, and secondly he deposed an affidavit before the Madras High Court defending the rejection order. In short, Novartis doubted that Chandrasekhar cannot act as an impartial member of the Appellate Board and in July 2007 filed a petition before the IPAB praying for the appointment of another technical member in place of Chandrasekhar. The petition was penned around the fundamental principle of natural justice that no one can be a judge in his own cause but the appeal was dismissed by the Appellate Board relying on ‘doctrine of necessity.’ In August 2007, Novartis again approached to the Madras High Court filing a writ petition against the IPAB order allowing Chandrasekhar to hear the appeal.

In October 2007, the whole drama over the appointment of technical member saw an interesting twist when the Central Government stepped in with the proposal that the Appellate Board instead of three-member panel will now be two-member panel comprising a chairman and a vice-chairman excluding technical member. Wonder what made the Central Government to come with such a proposal. Smell like lobbying? Anyhow let’s stick to facts rather making wild guesses. 

In November 2007, the Madras High Court agreeing with the Central Government proposal allowed the Appellate Board to function without a technical member, removing Chandrasekhar from hearing the appeal. But even before the two-member Appellate Board could start hearing, Natco brought another twist by filing a special leave petition before the Supreme Court of India against the Madras High Court decision to allow the Appellate Board to hear Novartis appeal without a technical member. In January 2008, the Supreme Court agreeing with Natco issued a stay order halting the hearing before the IPAB.

While hearing the case, Justice SH Kapadia and Justice B Sundershan Reddy suggested the Central Government to consider appointing a new technical member to hear Novartis’s appeal and in October 2008, PC Chakraborty was opted and appointed as new technical member to hear the appeal and directed reconstituted IPAB to start hearing the matter on day-to-day. And finally hearing began in November 2008. 

So, precious one and a half years lost in mere constituting a three-member Appellate Board, showcasing the efficiency and sensitivity of Indian judiciary and patent system. As a patent practitioner, I always wonder.
  • What made whole process dragged so long?
  • Why the Appellate Board voluntarily never looked for new technical member?
  • Why the Appellate Board strongly backed Chandrasekhar despite him being from non-chemistry and non-pharmaceutical background?
  • Why neither High Court nor Supreme Court agreed with the IPAB’s “doctrine of necessity” argument?
  • Is Indian patent system running in crisis to find a capable technical member and that also in a country with strong hold in global pharmaceutical industry?
  • Whether the government need to re-look provisions and prerequisites for appointment of technical member?
These questions possibly will remain unanswered but a precious time got wasted for nothing.

Friday, November 04, 2011

Glivec patent dispute: the case so far
Part II

Round Two: Madras High Court
Continuing from our earlier post where we discussed rejection of beta-crystalline imatinib mesylate application by the Madras Patent Office under S. 3 (d), we will now focus on round two where Novartis approached the Madras High Court challenging constitutional validity of S. 3 (d). Before we discuss the judgment, a quick reading of S. 3 (d) –

mere discovery of a new form of a known substance which does not result in increased efficacy of that substance or the mere discovery of any new property or new use for a known substance or the mere use of a known process, machine or apparatus unless such 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.”

The Patent Office rejection particularly involved the underlined portion of S. 3 (d) which Novartis in its appeal argued is vague, arbitrary and unconstitutional. Novartis also argued that S. 3 (d) is non-complaint with the TRIPS Agreement. The appeal was filed with the Madras High Court and was dismissed in August 2007.

TRIPS Compatibility
On TRIPS issue, the Madras High Court refused to address the question and categorically cited lack of jurisdiction to decide the validity of S. 3 (d) being in violation of Article 27 of TRIPS Agreement and further noted that the proper forum to bring this issue would be the WTO’s Dispute Settlement Body (DSB).

Constitutional Validity
On Constitutional validity issue, Novartis argued violation of Article 14 of the Constitution of India on the ground of vagueness, arbitrariness and conferring un-canalised powers on the Patent Office. During hearing, Novartis counsel particularly stressed upon that:

(1)   in the absence of proper guidelines as how to establish the enhancement of known efficacy of a known substance, the Patent Office is vested with arbitrary discretionary power to decide the enhancement efficacy.
(2)   in the absence of proper explanation and guidelines to the expression   “enhancement of the known efficacy” and “differ significantly in properties with regard to efficacy”, these expressions stand ambiguous.

Opposing counsels, however, defended use of general expressions and argued that the Legislature left these expressions for the Patent Office to apply mind and decide whether the invented drug is within or outside S. 3 (d) and further added that any fixed formula would be unwise and humanely impossible. 

The Madras High Court found none of Novartis arguments persuasive and hold S. 3 (d) not in violation of Article 14 of the Constitution of India. The High Court categorically relied upon (1) Medicinal Dictionary, and (2) Parliamentary debate to come to a decision over Novartis arguments.

While addressing Novartis argument that S. 3 (d) stands vague and ambiguous, the Court look into Dorland’s Medical Dictionary for the meaning of the expression “efficacy” in the field of Pharmacology which defines it as the ability of a drug to product the desired therapeutic effect” where efficacy is independent of the potency of the drug. The court further noted the dictionary meaning of “therapeutic” which defines it “healing of disease – having a good effect on the body.” Taking both “efficacy” and “therapeutic” definitions into account, the Court came with the observation that the patent applicant is expected to show “how effective the new discovery would be in healing a disease/having a good effect on the body?

The Court further limited applicability of the Explanation provided under S. 3 (d) to discoveries made in the pharmacology field. The Court particularly found that the Explanation creates a deeming fiction of derivatives of a known substance are deemed to be the same substance unless they differ significantly in properties with regard to efficacy. 

The Court finally came with the observation that S. 3 (d) along with the Explanation prescribes a test “to decide whether the discovery is an invention or not is that the Patent applicant should show the discovery has resulted in the enhancement of the known efficacy of that substance and if the discovery is nothing other than the derivative of a known substance, then, it must be shown that the properties in the derivatives differ significantly with regard to efficacy.

In the course of addressing issue of vagueness and ambiguity, the Court surprisingly pointed that Novartis, being a pharmaceutical giant, “cannot plead that they do not know what is meant by enhancement of a known efficacy and they cannot show that the derivatives differ significantly in properties with regard to efficacy.

The Court while addressing Novartis second argument that the Patent Office is vested with arbitrary discretionary power to decide the enhancement efficacy looked into Parliamentary debate for the Legislative object and purpose of enacting S. 3 (d). The Court observed that S. 3 (d) was included “to achieve namely, to prevent evergreening; to provide easy access to the citizens of this country to life saving drugs and to discharge their Constitutional obligation of providing good health care to it's citizens.” 

The High Court also relied upon the Supreme Court precedents recognizing that Legislature is permissible to lay down broad policy and delegate powers of rule making to the statutory authority to implement the policy, particularly in areas of specialized knowledge, where the Legislature lacks and knowledge and expertise to frame detailed rules.

In short, the Madras High Court dismissed Novartis plea challenging constitutional validity and TRIPS compatibility of S. 3 (d). The decision, however, lacked meticulousness that could have resolved uncertainty and debate concerning S. 3 (d) as the Madras High Court missed important opportunity by taking an approach which was more to defend the provision rather acknowledging and resolving the issue. If mere theoretical use of medicinal dictionary could have resolved such complex issue then neither Novartis (pharmaceutical major) nor the Patent Office (specialized body) would have ever approached the High Court just to hear dictionary meaning of “efficacy”. The Patent Office could have easily discussed and conveyed mere dictionary meaning to Novartis in their Office library. The expression “efficacy” needed more scientific and technical explanation which is obviously beyond the expertise of the Patent Office, in fact, Office of Drug Controller General of India would be the appropriate body to decide the efficacy enhancement.

In its decision, the Madras High Court restricted efficacy in terms of therapeutic efficacy for new discoveries made in the pharmacology field but the decision lacked diligent insight to take into account inventions such as polymers, liposomes, peptides, lipids, releasing agents etc. which are therapeutically inactive but broadly falls in the area of pharmacology and are used to deliver and facilitate absorption of therapeutic active agents. Is the Court expecting such inventions per se to show enhancement in therapeutic efficacy or else they altogether do not qualify for patent protection in India? In fact, we have been prosecuting more than dozen patent applications that claim classes of polymers and compounds used to deliver and facilitate adsorption of therapeutic agents and surprisingly all these applications got rejection under S. 3 (d) as the Patent Office contended that claimed subject-matter lack increased efficacy.

Ironically contrary to the High Court theoretical observations that S. 3 (d) is not vague and arbitrary and having hindsight to help Patent Office adjudicate patents applications in the field of pharmacology, the Patent Office continue to use fairly irrational discretions in applying S. 3 (d) even where it is not required. The so-called specialized body not only lacked insight to basics of pharmaceutical science but even failed to differentiate therapeutic active inventions from therapeutic inactive inventions. As of now, the Patent Office has been treating both therapeutic active compounds and therapeutically inactive agents (such as biodegradable polymers used as carriers for therapeutic active agents) exactly the same and constantly been applying S. 3 (d) rejections.

Using “efficacy” yardstick for inventions that are not therapeutically active but still falls in the area of pharmacology is correct or erroneous, not only leave considerable ambiguity but also arbitrariness on the Patent Office in deciding the same. As a patent practitioner, it is often hard to process the fact that the Patent Office asked for “therapeutic efficacy” for therapeutically inactive inventions.

Let us now summarize what the High Court observed in its judgment.

(1)   S. 3 (d) not in violation of Article 14 of the Constitution of India.
(2)   Lack jurisdiction to decide issue of TRIPS compatibility.
(3)   Inclusion of S. 3 (d) to prevent ever-greening.
(4)   Expression “efficacy” not vague and ambiguous.
(5)   Explanation under S. 3 (d) limited to discoveries in the field of pharmacology.
(6)   Patent Applicant either needs to show how effective new discovery would be in healing a disease or how effective new discovery would be in having a good effect on the body.
In light of facts covered so far, the expression “efficacy” contemporarily needs to be in terms of “therapeutic efficacy” which as the High Court observed can be gauged by showing effectiveness in healing a disease or showing effectiveness in having a good effect on the body. Let us end this post by putting the Court observation into analytical perspective.

(1)   Whether a toxic drug provides healing or good effect on the body? Or in other words, does the threshold to make drug non-toxic qualify for therapeutic efficacy?
(2)   Whether an unstable drug provides good effect on the body? Or in other words, does the threshold to make drug formulation stable/increase self-life qualify for therapeutic efficacy?
(3)   Whether lack of bioavailability provides healing or good effect on the body? Or in other words, does the threshold to make drug bioavailable qualify for therapeutic efficacy?

However, one point that we found hard to digest was the High Court observation that inclusion of S. 3 (d) was to prevent ever-greening. Anyone with experience working in pharmaceutical industry can easily understand that “ever-greening” is more of a business strategy for product lifecycle management to extend protection beyond original compound/patent by protecting incremental and even possibly trivial innovations. It would be completely wrong to acknowledge that ever-greening is only and all about trivial innovations. Now if we consider the Legislature has intention to prevent ever-greening then that would mean to rule out any protection beyond original patent. In that case, S. 3 (d) not only disqualifies trivial innovations but also genuine incremental innovations. And if incremental innovations are not what the Legislature wanted to exclude from patent protection then the word “ever-greening” is inappropriately used.