India has earned its reputation as “the world’s pharmacy” because it supplies—primarily in the form of generics—much of the affordable medicine needed by countries in the developing world. The country’s $26 billion generic pharmaceutical industry gained the lion’s share of its growth in the period before 2005, when India started offering patent protection to pharmaceuticals. Since then, courts in India have struggled to balance the international trade commitments that prompted the 2005 creation of India’s patent laws with a desire to continue providing wide-spread access to lower cost generic medicines.
Swiss drug manufacturer Novartis recently found itself on the losing end of that struggle. In April, it failed in an attempt to obtain patent protection for its anti-cancer drug Gleevec (marketed in India and Europe as Glivec). Though the vagaries of timing play a part in the outcome of Novartis’ claims, the decision still has significant implications for originator and generic pharmaceutical manufacturers, particularly in India and the U.S.
Gleevec in India
Gleevec is the brand name of imatinib mesylate, a medicine that has apparently proved extraordinarily effective at treating certain kinds of leukemia. In India, a month’s supply of Gleevec costs patients $2,600 compared to around $175 for the generic version. Novartis has supplied 90 percent of the Gleevec used by patients in India for free under a charitable program.
Novartis applied for U.S. patent rights on imatinib and its derivatives in 1993. Imatinib mesylate is the salt or beta crystalline form of the drug. Novartis applied for U.S. patent rights on that formulation in 2000. The patent laws India enacted in 2005 extended protection to medicines discovered after 1995. Because discovery of imatinib preceded that date, Novartis sought patent protection in India for the beta crystalline formulation of the drug. But the Indian patent office rejected Novartis’ application shortly after it was filed on grounds of obviousness given the earlier formulation. Novartis then began its seven-year court battle to establish its patent rights to Gleevec in India.
First, Novartis appealed the patent office’s decision to India’s newly established Intellectual Property Appellate Board (IPAB). The IPAB ruled that Novartis could not patent the beta crystalline version of Gleevec because it was an amended version of a known compound without any of the significant increases in efficacy as required for a follow-on drug formulation under section 3(d) of the Indian Patents Act. Novartis also brought a separate, independent action before the Madras High Court to have section 3(d) declared unconstitutional. That effort failed as well. Because of the relatively short time left on the Gleevec patent, the India Supreme Court granted Novartis special leave to bypass the usual appellate processes and directly appeal the IPAB decision to the court. Novartis did not appeal the ruling on the constitutionality of the section 3(d).
Undertaking de novo legal and factual review, the India Supreme Court agreed with the IPAB that Novartis’ application for Gleevec should be rejected under section 3(d). Section 3(d) disallows the patenting of a known substance unless it results in an “enhancement of the efficacy of that substance.” Novartis argued that the beta crystalline form of Gleevec satisfied section 3(d) because, in addition to other advancements, that formulation provided more bioavailability.
But the Supreme Court chose a different, more stringent interpretation of the “efficacy” language of section 3(d). Because the subject matter of the patent under consideration involved a compound of medicinal value, the court said that, before allowing the patenting of a previously known substance, section 3(d) required that the applicant show actual enhanced “therapeutic efficacy.” Here, the court found no evidence that the beta crystalline form of imatinib produced any enhanced or superior therapeutic effect when compared to the prior—and patent-ineligible—version of the drug. That determination means that Novartis has no patent rights for Gleevec in India and that it cannot stop generic manufacture of the drug there.
Section 3(d), evergreening and the future of generics in India
The Indian Patents Act included its section 3(d) in a specific effort to prevent the practice known as “evergreening.” Evergreening occurs when drug manufacturers seek additional protection for small changes to the formulation of patented drug compounds in order to extend the lifecycle of their patents and increase the amount of time they can exclude generics from the market.
To prevent that practice, section 3(d) provides:
[S]alts, 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.
By interpreting this section to require that drug reformulations provide increased therapeutic effectiveness, the India Supreme Court has potentially set a higher patentability bar than that used in most other countries, possibly including the U.S. For drug manufacturers, this higher standard may arguably discourage further innovation and research within India because of manufacturers’ worry that advancements won’t receive adequate patent protection. And, in fact, in response to its Gleevec loss, Novartis announced that it is pulling its research and development efforts in India.
But organizations like Doctors without Borders hail the decision and the access to life-saving, lower cost medicines it will provide. These organizations argue that the majority of patenting that’s happening now does not truly cover new innovations but, instead, is the kind of evergreening section 3(d) was enacted to prevent. They believe the decision will encourage other countries in the developing world to use or create similar evergreening in order to ensure access to crucial medicines at an affordable price.
The role India plays with respect to pharmaceuticals continues to grow. The pharmaceutical industry views India warily. With a higher bar for patenting of extensions of known compounds and the recent grant of a compulsory license for generic manufacture of a cancer drug, the industry has taken to speculating loudly on whether the risk is worth the investment when it comes to developing new drugs. At the same time, governments in developing world nations like India face pressure to facilitate access to affordable, life-saving medicines. As a result, the world will continue to watch how India balances its pharmaceutical gatekeeper role and the tensions that arise when trying to protect and promote both intellectual property and human rights.