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KEYCODE BAYER 447

9 February 2010
Lawyers Collective (www.lawyerscollective.org)

Delhi High Court Rejects Bayer's Appeal for Patent Linkage

Health Groups: Defend affordable drug treatment in India!

Full text of the judgment: (Download: Bayer_v._Union_of_India.pdf)

In a judgment that bodes well for patients, a Division Bench of the Delhi High Court comprising Chief Justice AP Shah and Justice Muralidhar today dismissed an appeal by Bayer Corporation, a multinational pharmaceutical company, seeking the introduction of patent linkage system in India. The appeal was filed against a judgment delivered by Justice Ravindra Bhat on 18 August 2009, rejecting Bayer's attempt to introduce the patent linkage system in India-a policy change-through a court direction.

The Delhi High Court held that it found no ground "to reverse the well reasoned judgment of learned single Judge Justice Ravindra Bhat in which we fully concur". In the decision under challenge, while rejecting Bayer's writ petition, Justice Ravindra Bhat of the Delhi High Court had earlier held that the case was "what may be characterised as a speculative foray; an attempt to tweak 'public policies' through court mandated regimes".

Patent linkage is a system in which the Drug Controller refuses to grant or delays a marketing approval to a generic drug manufacturer to manufacture and sell a drug, if the drug is already patented. Patent linkage is known to be against public health interests as it will delay the entry of cheap, generic medicines into the market and keep medicines out of reach of those who need them.

Y K Sapru, Chairperson of Cancer Patients Aid Association (CPAA), who had intervened in the case filed by Bayer Corporation against the Drug Controller of General of India, said "We are very glad that the Court has rejected Bayer's attempt to introduce a policy change, which would have adverse consequences for access to medicines, through the court. This decision will prevent delays in cancer patients getting access to less expensive, generic versions of patented drugs"

In 2008, Bayer Corporation filed a Writ Petition before the Delhi High Court against Union of India, the Drug Controller General of India (DCGI) and Cipla Ltd. seeking an order that the DCGI should consider the patent status of its drug, Sorefenib tosylate, before granting a marketing approval to any generic versions of the drug and refuse marketing approval to any generic version. Sorefenib tosylate is used to treat renal cancer and is sold by Bayer at Rs. 2, 85,000 (Rupees two lakh eighty five thousand) for 120 tablets for a month dosage.

CPAA, represented by Lawyers Collective HIV/AIDS Unit through Mr. Anand Grover as counsel, had filed an intervention application to be added as a party, which was allowed by the Delhi High Court. In a decision delivered on 18 August 2009, Justice Ravindra Bhat of the Delhi High Court rejected Bayer's writ petition holding that unpatented (generic) drugs are not spurious drugs.

Immediately thereafter, Bayer filed an appeal before a Division Bench of the Delhi High Court challenging this decision.

Appearing for Bayer, Mr. Shanthi Bhushan, Senior Advocate, had argued that patent linkage was in-built in the Indian law, and that granting marketing approval to generic versions of patented drugs would infringe the patent holder's rights. Pointing out the Patents Act, 1970 conferred limited negative rights against third parties, Mr. Anand Grover, counsel for CPAA, urged that the grant of marketing approval to a generic version of a patented drug by the DCGI would not violate any right of the patent holder.

Bayer had also urged that generic versions of patented drugs are "spurious drugs" under the Drugs and Cosmetics Act, 1940 and therefore could not be granted marketing approval while the patent was in force. Mr. Anand Grover, counsel for CPAA, pointed out from the Hathi Committee Report, the Parliamentary debates and other legislative history that the Drugs and Cosmetics Act, 1940 does cover generic versions of drugs within the ambit of "spurious drugs". At this, Mr. Shanthi Bhushan, counsel for Bayer, conceded this issue and said that he would not urge this issue further.

On the issue of introducing patent linkage in India, the Delhi High Court today held, "This court cannot possibly read into the statute a provision that plainly does not exist. ... The scheme of both the Patents Act and the Drugs and Cosmetics Act are distinct and separate and ... the attempt by ... Bayer to establish a linkage cannot be countenanced. Whether patent linkage should be introduced is an issue that requires a policy decision to be taken by the government. It is not for the court to determine if the government should bring in a system of patent linkage."

The Court also held that generic versions of patented drugs could not be considered as "spurious drugs" under the Drugs and Cosmetics Act.

Anand Grover, counsel for CPAA and Director of Lawyers Collective HIV/AIDS Unit, said "We welcome the High Court's judgment. In India, we do not have a patent linkage system. The patent system and the drug regulatory system are two separate and independent mechanisms and this is Parliament's intent. We hope that Bayer and other pharmaceutical companies respect this fact. If introduced, the patent linkage system would have seriously impacted the early entry of generic drugs into the market. This is especially important as we are now seeing an increase in the number of patents being granted to drugs, which we believe are being wrongly granted. Moreover, a patent holder cannot use the DCGI, a government agency, to enforce its private rights. This was an attempt to introduce a TRIPS-plus requirement in India, which has been rejected."

If introduced, the patent linkage system would have seriously impacted the early entry of generic drugs into the market. Such early entry of generic drugs is possible either through mechanisms such as compulsory licensing within the Patents Act itself, or where there is a bona fide belief that a patent has been wrongly granted. This is especially important as India is now witnessing an increase in the number of patents being granted to drugs by the Indian patent office.

THE HINDU BUSINESS LINE, Feb. 9
Court ruling allows Cipla to market generic cancer drug

Bayer loses appeal on patent linkage case

Mumbai - In a major test of the five-yearold product patent regime, the Delhi High Court dismissed an appeal by multinational drug-maker Bayer Corporation regarding its advanced renal cancer drug Nexavar.
Bayer had urged the regulatory the Drug Controller General of India (DCGI) to not give marketing approval to Cipla's generic version of the same drug.
In what is referred to as "patent linkage" in pharmaceutical circles, Bayer had initially approached the Delhi High Court seeking to link the patent status of an innovative drug to the marketing approval given by the DCGI to generic versions of the same medicine.
In its judgment, the court said that the scheme of both the Patents Act and the Drugs and Cosmetics Act (DCA) are "distinct and separate" and that the attempt by Bayer to establish a linkage cannot be "countenanced".
"Whether patent linkage should be introduced is an issue that requires a policy decision to be taken by the government. It is not for the court to determine if the Government should bring in a system of patent linkage," the court said.
Bayer's initial writ petition, filed in November 2008, was dismissed in August 2009 by the Delhi High Court. Subsequently, in late August, Bayer filed an appeal to rehear the case before aDivision Bench of the court. And on Tuesday, the two-judge Bench ruled against Bayer concurring with the earlier, single-judge, decision.
"Bayer is disappointed about and disagrees with the court's decision and will consider its legal options in this regard," a spokesperson told Business Line. The directive outlines the role of the DCGI and also clears the way for Cipla to launch its drug in the market, an industry-watcher said. Cipla, though, did not comment if it was ready to launch the drug.
In its judgement, the Court said that Bayer's argument would mean that instead of testing the validity of a patent, the DCGI will begin with the presumption that the patent granted in respect of the drug for which marketing approval is sought has been validly granted.
This would block generic manufacturers who could have made the drug at affordable prices, subject to infringement suits by the patent holder, the Court observed.
According to industry information, Bayer's Nexavar (Sorefenib tosylate) is sold at Rs 2,85,000 for 120 tablets for a month's dosage.
Also, if the patent holder did not apply for a marketing approval, then the drug will be virtually unavailable in India till such time the patent holder decides it should be available, it noted.
P. T. Jyothi Datta