Novartis A.G. v. Union of India

After reading this case analysis, you will learn about the patents regime in India with respect to pharmaceutical companies. The court has further interpreted Section 3(d) of the Indian Patents (Amendment) Act, 2005.
CITATION(2013) 6 SCC 1
COURTSupreme Court of India
JUDGES/CORAMJustice Aftab Alam and Justice R.P. Desai
DATE OF JUDGEMENT01.04.2013

Introduction

The judgment rendered by the Supreme Court in the case of Novartis AG (“Novartis”) v. Union of India is one of the landmark judgments of the Supreme Court with respect to grant of patents in India. The decision came as a relief for millions of people around the world to have access to medicines at a low cost, thus preventing the pharmaceutical industries from “evergreening” their patents. The judgment is seen as a means to ensure the availability of life-saving drugs at an affordable price to people in India and elsewhere, at the same time the decision defined the scope of Section 3(d) of the Indian Patents (Amendment) Act, 2005. In the said matter, the Supreme Court refused to grant a patent to a drug of Novartis AG on the basis that the said drug did not involve an invention which is capable of being patentable under Indian law.

Facts

The facts of the case are as follows: In 1997, Novartis, a Swiss based pharmaceutical giant filed an application to grant patent to an anticancer drug Glivec which is used to treat Chronic Myeloid Leukemia (CML) and Gastrointestinal Stromal Tumours (GIST) on the basis that it invented the beta crystalline salt form (imatinibmesylate) of the free base, imatinib. It is a critical drug which is patented in about 35 countries of the world.

However during those days, India did not grant patent to pharmaceutical products and agrochemical products. It was in the year 2005 in India; the drug products became the subject of patent in compliance with the TRIPS agreement. India thereon revised its patent law and started granting patents on pharmaceutical drugs. Subsequently in 2006, the Madras Patent Office refused the patent application of Novartis for its drug Glivec stating that the said drug did not exhibit any major changes in therapeutic effectiveness over its pre-existing form, which was already patented outside India. The said decision was based on Section 3(d) of the Indian Patents (Amendment) Act, 2005 which provides a known substance can only be patented if its new forms exhibit “enhanced efficacy”. The Patent Office did not find any enhanced efficacy in the drug Glivec and, therefore, considered it incapable of patentable under Section 3(d) of 2005 Act. In May 2006, Novartis filed two writ petitions under Article 226 of the Indian Constitution before the High Court of Madras – one appealing against the order of Madras Patent Office rejecting its patent request and the other contesting that Section 3(d) of the Indian Patents Act is not in compliance with TRIPS and is vague, arbitrary and violative of Article 14 of the Constitution.

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The Madras High Court refused the Writ Petitions of Novartis holding that it did not have jurisdiction to determine whether a domestic law is in contrary to international treaty, so it cannot decide whether Section 3(d) is in compliance with TRIPS. As far as Section 3(d) is considered, the objective of the Amending Act was to prevent evergreening and to make easy the access to life-saving drugs to the citizens. Therefore, it cannot be considered to be vague and arbitrary.

The new phase of litigation started in Intellectual Property Appellate Board, which is an appellate body of patent controller. IPAB considered the beta-crystalline form of imatinibmesylate as new and an inventive step but refused to grant a patent to the drug of Novartis since it was hit by Section 3(d) of the Act. Novartis challenged the said order by filing Special Leave Petition before the Supreme Court.

Issues

The main issues in the case were:

  1. Whether the invention is in consistent with Section 3(d) of the patent act?
  2. Interpretation of Section 3(d) of the patent act, 2005.
  3. Whether the invention qualifies for the test of novelty and inventive for the alleged product?

Summary of court decision and judgment

Court observed that the product was one of the new forms of the substance and not the whole substance. It has always existed in the original amorphous form. The product thus has to qualify the test laid down in Section 3(d) of the Patent Act.The Section clearly specifies that a new form of the substance in not patentable under Indian law unless it enhances its “known efficacy”.

Novartis contended that the physico-chemical properties of the polymorph form of the imatinib molecule, i.e. better flow properties, better thermodynamic stability and lower hygroscopicity, resulted in improved efficacy and hence is patentable under Indian law.

The Apex Court rejected this contention stating that in the case of medicines, efficacy means “therapeutic efficacy” and these properties while they may be beneficial to some patients do not meet this standard. The Supreme Court also held that patent applicants must prove the increase in therapeutic efficacy based on research data in vivo in animals.

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The Supreme Court held that the true intention to enact section 3(d) was to prevent the concept of evergreening and thus if the invention does not fulfil the test of Section 3(d), it cannot be granted a patent. The court further specified that this case should not be interpreted to mean that Section 3(d) bars all incremental inventions. It is with regard to the field of medicine especially in cases of life-saving drugs, a great care and caution needs to be taken so as to protect the right to life of the masses.

Analysis

The case decided by the lower courts delivered the same judgment as the Supreme Court. The Supreme Court looked into the findings of the lower courts and delivered the judgment appropriately. This judgment is considered as a landmark judgment because of the reason that the court’s decision stopped the concept of patent “evergreening”. It also explained the scope of Section 3(d) of the Patent Act, 2005. It also looked into the poor sections of the society who because of these big pharmaceutical companies are not able to have access to medicines.

Conclusion

The decision given by the Supreme Court was appropriate because it came as a huge relief for those people who can’t afford the lifesaving drugs manufactured by these big pharma giants. These companies who have already made billions of dollars prevent people from purchasing the drugs at low price thus endangering the very life of the poor people by acquiring patents over their drugs. The importance of patent cannot be denied to prevent a new invention provided such invention is available to all the individuals at a reasonable rate. On the contrary, companies like Novartis are putting the life of these poor people at stake by obtaining a monopoly over its drugs. However, the Supreme Court in its judgment made clear that India is a developing country and the availability of medicines at a cheap price is necessary for the lives of 1 billion people. The Supreme Court is thus justified in its decision thereby prohibiting the liberal approach in granting patents and granting patents only to genuine inventions as against frivolous inventions.

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