Standards of Patentability and Opposition Procedures: India Patent Act & Novartis v. India

1. Standards of Patentability and Opposition Procedures: India Patent Act & Novartis v. India Professor Brook K. Baker Health GAP Northeastern University School of Law, Program on Human Rights and the Global Economy UKZN IP and Access to Medicines 2010

2. Brief History of India’s Patent Regime • Britain enacted India’s first patent act in 1856, designed “to enable English Patent holders to acquire control over Indian markets.” • After independence (1947), it took India until 1970 to enact a new Patent Act that excluded patents on medicinal products and foods. • Before 1970, most of the modern medicines used in India were imported from abroad and sold at some of the highest prices in the world. • It was impossible to get a compulsory licenses –years of delay.

3. Emergence of India’s Generic Industry • Between 1972-2005, the Indian generic industry had over 30 years to develop technical capacity to reverse-engineer medicines and to engage in efficient manufacturing processes. • India became a major producer of generic medicines for both domestic use and exportation.

5. U.S. Threatened India with Trade Sanctions during TRIPS Negotiations • India was part of a developing country coalition trying to keep IPRs out of the GATT negotiations. • The U.S. used its Special 301 List to threaten India and other key developing countries including Brazil and Thailand during the negotiations. • Despite losing the battle to exclude IPRs, India held out for some key flexibilities and transition periods.

6. TRIPS • In 1994, India signed the WTO TRIPS Agreement. • Although it was no longer permissible to discriminate against product patents or against a field of technology, like pharmaceuticals, India was granted a 10-year transition period. • However, between 1995-2005, India was required to collect pharmaceutical patent applications in a “mailbox” and thereafter to grant patents under new post- Jan. 1, 2005 standards.

7. TRIPS Standards of Patentability are Flexible • Art. 27.1: “[P]atents shall be available for any inventions … provided that they are new, involve an inventive step and are capable of industrial application.[5] • Fn 5. For purposes of this article, the terms “inventive step” and “capable of industrial application” may be deemed by a Member to be synonymous with the terms “non-obvious” and “useful” respectively.

8. Members Have Interpretive Flexibility • Art. 1.1: Members shall be free to determine the appropriate method of implementing the provisions of this Agreement within their own legal systems. • Art. 8.1: Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health … provided that such measures are consistent with the provisions of this Agreement.

9. Doha Declaration • Para. 4: We agree that the TRIPS Agreement does not and should not prevent Members from taking measures to promote public health. … [W]e affirm that the Agreement can and should be interpreted and implemented in a manner supportive of WTO Members’ right to protect public health and, in particular, to promote access to medicines for all.

10. India Adopted Multiple TRIPS Flexibilities • In its amended Patent Act of 2005, India adopted virtually all of the flexibilities granted by the TRIPS Agreement and confirmed by the Doha Declaration to ensure access to more affordable generic medicines: • Compulsory license mechanisms, including for export • Licenses of right for generic producers already producing “mailbox” generics, even if 1995-2005 patent applications were granted • Strict definitions of patentability

11. India’s Strict Standard of Patentability for Drugs • Section 2(1)(j): An “invention” is “a new product or process involving an inventive step and capable of industrial applicability.” • Straight from TRIPS • Excludes “discoveries,” which are patentable under U.S. law • In addition, India enacted some key exclusions from patentability

12. Section 3(d) • The following are not inventions within the meaning of the Act – The mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a know substance ... 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 [a] known substance shall be considered to be the same substance, unless they differ significantly in properties with regard to efficacy; ...

13. The Efficacy Standard • Relatively new concept in the patent context but quite familiar in the drug registration context. • Note, full clinical trial evidence of efficacy will ordinarily be lacking at the time a first patent application is filed, but is much more likely for product-improvement patents.

14. The New Use Exclusion • Although “new uses” patents are routinely granted under U.S. law. • Although the U.S. is increasingly seeking to impose “new use” standards in its FTAs, India’s refusal to grant patents for new uses is clearly TRIPS-compliant. • Art. 27.2 of TRIPS permits Members to exclude “diagnostic, therapeutic and surgical methods for the treatment of humans” from patentability.” • Note: Section 3(i) of the Patent Act also excludes methods of treatment.

15. Exclusion of Combinations • The exclusion of combinations is also significant given the role that therapeutically appropriate fixed-dose combination medicines have played in treating resistance-prone diseases like AIDS, TB, and malaria, and given their benefit for patient adherence. • The mere fact of combination should not itself be considered evidence of increased efficacy.

16. Impact of Section 3(d) • This explicit exclusion of minor, incremental “innovations” is unique, though the Philippines and Zanzibar have now adopted the same provision. • The exclusion expresses a strong antipathy towards “me-too” drugs and towards the evergreening of pharmaceutical patents (successive 20-terms)

17. Most India Mailbox Applications are for “me-too” drugs • 9000+ pharmaceutical product patent applications were filed between 1995-2005; there were only 300+ new chemical entity patents during this same time frame. • The vast majority of these do not comprise new chemical entities or evidence significantly enhanced efficacy and thus should be subject to exclusion under section 3(d).

18. Opposition Mechanisms In Indian Patent Law • Pre-grant opposition (any time before grant), any person can file, no fees • Post-grant opposition (one year from date of publication of grant), aggrieved parties can file • Standard patentability criteria and 3d exclusions are applied – novelty, inventive step and industrial application • Failure to inform Patent Controller of corresponding or similar foreign applications; failure to disclose genetic resources or traditional knowledge • Other opposition mechanisms: Revocation and Counter-claim of patent invalidity in infringement proceedings.

19. Pre- and Post-Grant Oppositions • Between 2005-09, a total of 250 pre- and post-grant oppositions were filed at the Indian Patent Office. • Successful oppositions to Forteo, an osteoporosis drug, gifitinib and Givec, cancer drugs; Combivir (withdrawn), nevirapine (pediatric formulation), tenofovir and darunavir, all antiretrovirals, and valganciclovir (AIDS-related eye disease and river blindness). • Important opposition pending to, heat stable lopinavir/ritonavir (pre-grant: ARV)

20. Technical Lessons • Focus on priority medicines (HIV, cancer, psychiatric) • Identify the relevant applications (what could potentially block generic versions) • Seek status updates from patent office • Procedural problems, e.g., refusal by patent office to furnish copy of reply statement and evidence of patent application • Search prior art & seek expert evidence

21. Novartis’ Patent Application for Glivec • In 1998, Novartis filed a “mailbox” application for a new beta-crystalline form of imatinib mesylate, the active ingredient in anti-cancer drug, Glivec. • Six generic companies began manufacturing a generic version of Glivec and selling it at one/tenth the cost. • Novartis, which had gained exclusive marketing rights for Glivec, obtained a stay in Jan. 2004, against the six companies. • Companies resumed production in 2005 pursuant to the new Patent Act (based on significant investments), but were required to pay royalties to Novartis if a patent were to be granted.

22. The Patent Office Denied the Patent • When Novartis asked that its Glivec patent application be processed, India cancer patient groups and several generic drug manufacturers filed a pre-grant opposition claiming that Glivec was a new form of an old (1993, pre-TRIPS) drug. • Novartis submitted evidence that Glivec had 30% greater bioavailability. • The India Patent Office disagreed that Novartis had shown significantly increased efficacy and on Jan. 25, 2006 refused to grant a patent on Glivec.

23. Novartis Appealed to the High Court • Novartis appealed the denial of its patent application to the High Court in India making three claims: • First, that the denial of the Glivec application was erroneous; • Second, that Section 3(d) of the Patent Act was not compliant with TRIPS; and • Third, because of non-TRIPS-compliance, Section 3(d) was unconstitutional.

24. Novartis’ Claims • In its Constitutional claim, Novartis argued: (1) courts are obligated to interpret Indian law so as to harmonize it with binding international law if at all possible and (2) section 3d was unconstitutionally arbitrary and irrational because (a) it upsets "established expectations," (b) it is inconsistent with the stated intent of three Patent Act Amendments to comply with TRIPS, and (c) it is internally inconsistent with the basic definition of an invention in the Patent Act.

25. The Merits of the Case were Extraordinarily Weak • India’s treaties not self-executing, according to Article 57 of its Constitution (like the U.S.) • Permissible to differentiate between field of technology under TRIPS Art. 27. • Implementing flexibility, under TRIPS Article 1.1 and under the broadly interpretable meanings of newness and inventive step, to limit pharmaceutical product patents as it has.

26. The Implications of the Case were Quite Important • 67% percent of India’s generic production was being exported to developing countries. • No patients have benefited more than people living with HIV, 70% of whom receive treatment with low-cost generic drugs of assured quality from India. • Due to Indian competition, first-line AIDS treatment regimes cost approximately $87-130/patient/year, a quarter the price of the R&D industry’s “discount” prices.

27. Novartis’s Defense of its Lawsuit • “We are entitled to sell to middle class consumers” (Note: 95% of Indians are not middle-class) • “We support India’s rights to issue compulsory licenses to solve its access problems” (Note: opposite position in Thailand) • “We have solved the access problem through our Glivec donation program” (Note: the access program is inaccessible for many) • High mark-up sales in India are crucial to finance future research and development (Note: India is 1.3% of the global pharmaceutical market)

28. Internationally, activists fought Novartis’s lawsuit – Chennai India

29. Cambridge – Valentine’s Day Broken-Heart Award Demo

30. Campaign Strategy – Key Lessons • Engage patent experts, i.e., I-MAK • Involve patient groups • Seek involvement of generic companies • Recruit public interest lawyers – The Lawyers’ Collective • Use the media • Activate international solidarity/network

31. Novartis Lost Court Case • On August 6, 2007, the Madras High Court ruled against Novartis’s challenge to the constitutionality and TRIPS-compliance of Sec. 3d of the Patent Act on three main grounds: • Because TRIPS had not been domesticated into India’s positive law, Novartis could not challenge TRIPS compatibility • The meaning of “enhancement of efficacy” was not so vague, uncertain, or discriminatory so as to render Sec. 3d unconstitutional or unreasonable • There was no unconstitutional delegation of a legislative function to the Patent Office. • Novartis’s separate appeal from the decision of the patent office is still pending.

32. Other challenges to access-to-medicines in India • Bayer v. Union of India – challenge to generic registration, attempts to establish patent/registration linkage by litigation • EU-India EPA proposal seeks higher IPRs: data exclusivity, patent term extension, increased enforcement • Divisional patents defeat opposition procedures (Kaletra, atazanavir)