[Ip-health] Economic Times: Natco victory could encourage other generic companies also to apply for compulsory licence

Jamie Love james.love at keionline.org
Sat Mar 17 14:52:31 PDT 2012



Natco victory could encourage other generic companies also to apply
for compulsory licence

Avinash Celestin, March 18 2012

Patent wars are hard to wrap your head around, not least because it's
unclear what's at stake for consumers. Apple, Samsung, Google and
other tech giants have spent millions slugging it out in the courts
over mobile phone patents, but that hasn't really hurt our ability to
buy the latest flashy smartphone. Consumers have had little reason to

Not so for another type of patent war playing out in India, whose
first ripple effects were felt last Monday. The Controller of Patents
issued Hyderabad-based Natco, a 'compulsory licence' to manufacture
Sorafenib, a drug prescribed to patients in the advanced stages of
kidney or liver cancer. Bayer, which developed and patented the drug,
sells it in India at Rs 2.8 lakh for a monthly dose (that's Rs 33 lakh
for a year's worth, if you want to know). Natco argued that the high
price and limited availability meant that Bayer was effectively not
complying with the law which required that those who get patents must
make their products available to the public and at a reasonable price.
Natco promised to make the drug for Rs 8,800 for a monthly dose. The
Controller agreed with Natco and granted it a licence to do so, over
Bayer's objections (hence the 'compulsory' aspect of the licence). The
result: a 97% cut in the price of Sorafenib. You don't have to be a
patent lawyer to understand the implications.

"It is a very important and critical decision," says advocate Prathiba
M Singh, who represents Cipla in another pharma patent case in the
courts. "The grant of such a licence is one way to balance the patent
owner's rights to enjoy the fruits of their innovation, and the
public's right to access medicines."

But Natco-Bayer is just one of the many big battles in India's pharma
landscape. All of them are about the balance that Singh talks about -
the right to enjoy the profits from that drug you could have spent
millions developing, versus the right of the public to, if not cheap,
at least affordable medicines.

Perhaps the biggest and most-watched of them will be drug major
Novartis' bid to patent Gleevec, another anti-cancer drug used to
treat leukaemia. The patent office refused a patent, saying Gleevec
wasn't a new drug, but just a newer form of an existing drug which
wasn't significantly more effective on patients. Novartis says that
test of 'efficacy' is too strong. That case is up for hearing in the
Supreme Court later this month.

If Novartis wins, say health campaigners, it could open the floodgates
to the practice of 'evergreening' - where companies make minor changes
to old drugs, repatent them and keep them out of the bounds of
competitors. Cheap generic versions will not be made and prices will
stay high.

There's also the battle over patent linkage. The marketing approval
for a drug does not depend on whether its patented or not. The
approval is given by a different body than the patent office. Thus
Cipla has a right to market Sorafenib despite the patent being owned
by Bayer. Cipla is being sued by Bayer for violating the latter's
patent. Interestingly, Cipla's generic version of Sorafenib is being
sold for about Rs 30,000 per monthly dose, higher than what Natco
proposes to sell it for.

"The Natco victory could encourage many more generic companies to
apply for a compulsory licence on other drugs," says Meenakshi
Khurana, partner in IP firm Khurana & Khurana. The market for
high-priced drugs is dominated by treatments for cancer and HIV. Could
Natco open the floodgates?

James Love.  Knowledge Ecology International
http://www.keionline.org, +1.202.332.2670, US Mobile: +1.202.361.3040,
Geneva Mobile: +41.76.413.6584, efax: +1.888.245.3140.  Sometimes I am
using my MaxRoam number: +447937390810

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