[Ip-health] India: Setting aside Bayer's 'spurious' claims

[Leena Menghaney]

Setting aside Bayer's 'spurious' claims

Latha Jishnu / New Delhi September 02, 2009

Two weeks ago Justice S Ravindra Bhat of the Delhi High Court dismissed wit=
h
costs the writ petition filed by the German pharmaceuticals giant Bayer
Corporation against the Union of India, the Drug Controller General of Indi=
a
(DCGI) and Cipla. The importance of Justice Bhat=92s judgment cannot be
overestimated. It is a clear =97 and sharp =97 judgment that puts paid to
attempts by foreign companies to modify India=92s regulations to suit their
commercial interest.

The judge characterised the litigation as =93a speculative foray; an attemp=
t
to =91tweak=92 public policies through court mandated regimes=94 and, in a =
first
of its kind, awarded costs of Rs 6.75 lakh. The amount, far from being
punitive, is to be shared by the government and the third respondent Cipla,
one of India=92s top drug companies. However, the point that the judgment
makes is strong: Companies with deep pockets may =93achieve short term goal=
s
of keeping out competitors through interim orders=94 but the court will imp=
ose
=91realistic costs=92.

Two principles of India=92s pharmaceuticals policy were at stake when Shant=
i
Bhushan began arguing Bayer=92s writ petition in November 2008. It challeng=
ed
the DCGI=92s authority to process Cipla=92s application for marketing appro=
val
for the generic version of an anti-cancer drug sorefenib tosylate that had
been patented by the German multinational as Nexavar. In India, it was
patented in March 2008 giving it patent protection up to 2028.

By seeking an order to DCGI that it should take into account the patent
status of the drug before granting marketing approval to a company
manufacturing generic versions, Bayer was trying to bring about a linkage
between drug approvals and patents, a linkage that does not exist in most
countries (see The curious case of drug regulation, January 21, 2009). In
short, Bayer wanted the courts to order a patent linkage system for the
country, a smart move for drug multinationals who want to keep cheaper
generics out of the market for as long as possible.

The patent linkage system is pernicious not merely because it attempts to
club two different functions of regulation and law; it also goes against
public health objectives by unnecessarily delaying the entry of cheap
generic medicines into the market and thereby adversely affecting access to
generic medicines. In fact, the European Union is just now looking into a
potentially explosive issue of drug firms delaying the entry of generics in
the market.

The Bayer petition has kept all stakeholders on edge from the start. The
initial stay granted by the court in November last year had led to the hope
(by innovator companies) and fears (by health activists and generic
manufacturers) that all marketing approval applications for generic version=
s
of branded drugs would come to a stop. The stay, fortunately, applied only
to Cipla=92s soranib.

The other and, perhaps, more significant outcome of the case is that Bayer=
=92s
attempt to classify all generic versions of patented drugs as spurious has
been quashed firmly by Justice Bhat. Bayer had claimed Soranib being an
imitation of Nexavar or a substitute was, therefore, a =91spurious drug=92 =
under
the Drugs and Cosmetics Act. Justice Bhat=92s conclusion is categorical tha=
t
generic drugs are not spurious by any yardstick. While the former =93is the
one that resembles another drug in a manner likely to deceive, we have
already held that the disputed drugs manufactured by the parties (generic
companies) are different=94.

The implications of the Bayer petition were, in fact, extremely grave for
generic manufacturers. The Indian Pharmaceutical Alliance (IPA), the
grouping of the big companies, had pointed out early this year that apart
from a serious conflict of jurisdiction between the DCGI and the Patent
Office, the drug multinational=92s claim, if upheld, would have led to an
erosion of the =91Bolar exception=92 under the Patents Act =97 this allows
companies to experiment with any patented drug with a view to generating
data that could then be submitted to a drug control authority =97 and the
introduction of =91data exclusivity=92 through the back door.

So the outcome has come as a huge relief all around. IPA=92s secretary gene=
ral
Dilip Shah, who had been badgering different government departments to take
a more aggressive stance in the case, calls it a landmark decision. But it
may not be the end of the story yet since a disappointed Bayer is likely to
appeal the decision before a division bench of the high court.

For Bayer, too, there is much at stake. Nexavar is used to fight cancer of
the kidney and the liver and is listed as one of its promising drugs with a=
n
earning potential of =A42 billion ($2.82 billion) annually. That makes it a
true blockbuster for Bayer. In India, the drug is reported to be selling at
Rs 2.85 lakh for a month=92s treatment. Naturally, the Cancer Patients Aid
Association which had impleaded itself in the case is cheering, too.

Link to story:
http://www.business-standard.com/india/printpage.php?autono=3D368796&tp=3D

****************************************************
Leena Menghaney

Campaign Co-ordinator (India)
Medecins Sans Frontieres
Campaign for Access to Essential Medicines
New Delhi
Tel: +91 11 46573731, +91 11 46573730
leenamenghaney@gmail.com