The Hindu Business Line : ‘Novartis verdict has no bearing on the price of any drug’

Chennai, Aug. 25 The recent judgment of the Madras High Court in the Novartis case has created the “mistaken impression” that it will now make it possible for certain drugs to be made available at low cost, according to Mr Arvind P. Datar, a senior advocate of the Madras High Court who appeared in this case, representing a few Indian pharmaceutical companies.

Speaking to Business Line on the need to understand the issues that arose for consideration before the court and the “real effect” of the judgment, he said: “Two categories of writs were filed before the Madras Hig h Court. One challenged the constitutional validity of Section 3(d) of the Patents Act, 1970. In the other batch of writ petitions, Novartis had challenged the order passed by the Controller of Patents rejecting their claim for patent of the beta-crystalline form of imatinib mysilate.”

The court took up only the first writ petition for hearing to debate whether the amended Section 3(d) was valid.

“The judgment has nothing to do with the patentability of a cancer drug or with the availability of medicines at affordable prices,” Mr Datar stated categorically.

He also said the court has only upheld the validity of Section 3(d).

“By itself, the judgment has no bearing on the price of any drug. The patentability of Glivac is now pending before the Intellectual Property Appellate Board (IPAB) and that case has its own legal complications. For now, the benchmark for the grant of a patent, particularly in the pharma sector, would be the amended Section 3(d).”

Stating that Section 3 enumerates what are not inventions, he said: “For example, mere discovery of a scientific principle, a substance obtained by a mere mixture, mere rearrangement of known devices and so on are not patentable.”

Section 3(d), before 2005, prohibited grant of patent for mere discovery of a new property or a new use of a known substance.

It was amended with effect from January 1, 2005 and prohibited the grant of a patent for mere discovery of a new form of a known substance which did not result in the enhancement of the known efficacy of that substance.

An explanation was added, stipulating that salts, esters, isomers and so on shall be considered to be the same substance unless they significantly differ with regard to efficacy. Novartis contended that this amendment was not in accordance with India’s treaty obligations under the Trade Related Aspects of Intellectual Property Rights (TRIPS).

“Secondly, it contended that the amendment was arbitrary, illogical and vague and violative of Article 14 of the Indian Constitution,” said Mr Datar.

“Novartis contended that every member country of the WTO had to ensure that its laws were fully TRIPS-compliant. Section 3(d) as amended had failed to fulfill India’s obligation under TRIPS. It was argued that the section was vague as it did not lay down guidelines as to what would constitute efficacy.”

Mr Datar informed that on behalf of the Indian companies, it was argued that even if the amendment to Indian Patents Act was not in line with TRIPS, Indian courts had no jurisdiction to decide this issue.

“TRIPS itself provides that such disputes were to be referred to the Dispute Settlement Board (DSB) at Geneva. Further, these disputes would be treated as ‘country-level disputes.’ For instance, if a dispute between Fuji of Japan and Kodak of US were referred to DSB, the case would be decided under the title US vs Japan.”

He added that it was for the DSB to give a verdict on whether the amended provisions of our Patents Act are in tune with TRIPS.

Stating that it was difficult to understand why Novartis did not take up this issue before DSB, instead choosing to file a writ petition, he said that it was “ equally surprising” that the challenge to Section 3(d) was made after the company had lost its case before the Controller of Patents.

“The next issue was whether Section 3(d) was violative of Article 14 as being arbitrary and vague on the ground that there was no test or guideline as to what constitutes efficacy. The Madras High Court held that the amended section was not unconstitutional.”

The Indian companies argued that the amendment created the right balance as it permitted a new form of a known substance from being patented if it could be demonstrated that the new form had enhanced its known efficacy.

“It is left to the patent authorities to decide what would constitute enhancement of efficacy, as it would be impossible to give a standard formula applicable for all cases. For one drug, a five per cent increase in known efficacy may justify the grant of a patent, whereas a 20 per cent increase for another drug may not be adequate enough.”

Related Stories:
HC stays IPAB proceedings on Novartis plea
Glivec case: Madras HC judgment likely today
Novartis moves HC for new IP Board member
Govt hearing on Glivec next week

More Stories on : Pharmaceuticals | Courts/Legal Issues | IPR

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