India patent Law and Drug prices of patented drugs in India

Charanjit Sehgal
The history of medicine is both a study of medicine throughout history as well as a multidisciplinary field of study that explores and understand medical practices, both past and present, throughout human societies. Prior to the 19th century, humorism (also known as humoralism/Humors) was thought to explain the cause of disease. The concept of “humours” (chemical systems regulating human behaviour) became more prominent from the writing of medical theorist Alcmaeon of Croton (c. 540-500 BC). However, gradually owing to better understanding it was replaced by the germ theory of disease, leading to effective treatments and even cures for many infectious diseases. Based on better understanding of causes of diseases and understanding the fact that the natural sources like plants used as herbal drugs have been effective owing to presence of natural chemical entities present in the said herbal drugs. It has been these natural chemicals which have been treating the diseases. Better understanding of social, science economics and medical science encouraged the scientists, corporates to invest in research and development activities to identify new more effective chemical molecules as drugs. Research and development investment required to bring a new therapeutic agent to market varies from $314 million to $2.8 billion.
It takes several years for a new chemical entity to attain marketable drug status as once at laboratory scale identified to treat a disease then as per regulatory federal drug authorities it has to undergo 5 phases of clinical trials to establish its safety with acceptable side effects. However, Phases 1, 11 and are essential and many a time depending upon urgency regulatory authorities based on phase III clinical trial results may grant an approval for marketing the drug. Pivotal (phase 3) studies for new drugs approved by the Food and Drug Administration (FDA) of the United States cost a median of $41,117 per patient. For Phase 1 a minimum of 25-30 patients are needed, for Phase II 100-300 patients and for Phase III about 300 to 3000 patients.
A corporate house responsible for inventing a new drug after investing a huge sum of money and time gets a patent for the said new drug molecule which provides a proprietary right of the product for 200 years under Intellectual Property Rights (IPR) law. This enables the corporate business house investing huge sum in R&D to recover the investments and also to accumulate resources for future innovation requirements. In developing countries many academic institutions and public research and development institutions develop new drugs and the resultant IPR in the form of patent is licensed to the business corporates at an appropriate cost depending upon the business potential of the invention. For example Northwestern University had invented a Lyrica Aniepiliptic drug and the patent rights for commercial use were sold to a corporate for $ 3.1 B, New York University’s patent for Remicade drug for Arthritis for $ 1B, Emory University’s patent for Emritive a HIV Drug for $ 525 M, Minisoto University’s patent for a Ziagen a HIV Drug for $ 450 M, Rochester University’s Penver Vaccine’s patent for $ 350 M and Flourida University’s patent for Glaucoma Drug for $ 260 M.
Foregoing in a vivid manner describes the fact that how much money is spent in preparing and launching a new drug molecule which is protected by a patent barring all others to make and market during 20 years of patent protection period. In view if above to enable the patent holder of a new drug to recover money the price of drug protected by patent is considerably high and many a time out of reach of many patients who are in dire need of such drugs.
Till Jan 2005 there was no imposition on India though a member of WTO’s(World Trade Organisation) to enact Indian patent legislation complying foreign jurisdictions nor there were such WTO guidelines for this.
In view of above Indian patent law under section 5 did not permit a patent for a drug molecule as a product and instead only a process patent for making a drugs were only permitted. Accordingly, any new drug developed in any other global jurisdiction and protected by patent was not protected by patent in India, therefore, there was a liberty to copy the new drug and sell only in Indian market and in those global jurisdictions where the said new drug is not protected by a patent.
India had been a member of GATT (General Agreement on Tariffs and Trade)
Effective from July 8, 1948. WTO was established in 1995 as an international organisation to cater to global trade by providing basic agreements between member countries for efficient global market.
On Ist January 1995, India became a member of the World Trade Organisation (WTO), in order to continue with the reforms in economy post 1991.
On April 15, 1994 in Marrakesh, Morocco, Marrakesh agreement was signed by GATT member states establishing WTO. TRIPS (Trade Related Aspects of Intellectual Property Rights) agreement is Annexure-C of the Marrakesh agreement. TRIPS agreement provides guidelines to member states to enact IPR related legislation in their respective jurisdiction. WTO came into being on record on January 1, 1995 and it was decided that developing member states have to comply with TRIPS agreement requirements within 10 years and under developed countries within 15 years from January 1, 1995. India had become member from the day of its inception, therefore, it was necessary that India must enact IP laws complying TRIPS agreement by January 1, 2005.
Article 27 of the TRIPS agreement emphasises that each WTO member state must respect and honour the IP of member states in their respective jurisdiction under its IP laws enacted complying TRIPS agreement.
During pre TRIPS agreement implementation era in India drugs as a product was not patentable under section 5. Only process patents were considered for grant. However, India enacted legislations and amended the IP laws complying with TRIPS agreement. As a result, section 5 was deleted and applications for drugs as a product were considered for grant. However, prior to this some generic pharmaceutical companies were making patented molecules as generic products for Indian market as the said drug molecules were not protected by patent in India under section 5. In such cases amended Indian patent law made it mandatory for patent holders to grant a voluntary license for their patent to those who had been making the patented molecule prior to January 1, 2005. As a such patented drugs continued to be available to Indian users at a reasonable price.
It has been a standard practice by big pharma companies to evergreen a new drug molecule by filing new patents for new chemical derivatives of same product like salts and new crystalline physical form also referred as polymorphic form. This approach provides a provision for protection to innovator company for a basic drug molecule for over 50 years depending upon the possibility of new chemical and physical form substitutes/derivatives as filing a new patent for a new chemical or physical form of a known patented drug molecule during later tenure part of the patent term provides additional protection of a same base molecule. Likewise, multiple applications for a known product for a new chemical and physical forms can be submitted for the same symptoms depriving availability of a cheaper generic version of drug molecule to masses at large.
However, Indian Govt. realised of such an ever greening and while enacting and amending IP law addressed this issue by introducing section 3d which bars patenting of any new physical or chemical form of a known drug molecule unless it has enhanced efficacy which has to be supported by clinical trial data.
Article 8 of TRIPS agreement gives freedom to WTO member states to formulate or amend their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development.
In addition, TRIPS agreement Article 31(f) provides a provision for member states to enact the IP legislation wherein there is a provision for compulsory licensing of a patented drug molecule to local pharma manufacturers to meet domestic requirements at an affordable price.
In a recent judgement of the Delhi High Court in Chugai Seiyaku Kabushiki Kaisha versus Controller of Patents and Design C.A.(COMM.IPD-PAT) 4/2021 dated April 6, 2022, the Delhi High Court held that the method of producing a solid form (tablet) of pre-existing drug via direct compression method is not patentable under section 3d of Indian patent act.
Novartis had invented Imatinib drug molecule for certain types of leukaemia and other blood cancers. Novartis had filed a patent for beta crystalline form of imatinib mesylate in India primarily to evergreen the base Imatinib molecule which at that time was already known and as in public domain. Indian patent office had rejected the patent under section 3d. Novartis had escalated the matter up to Supreme court of India and it validated High court decision that drug was a modification of an existing substance, imatinib, and therefore represented a case of ‘ever greening’ which is not patentable under section 3d. This way the said cancer drug continued to be available in Indian market at an affordable price.
Sitagliptin is a diabetic drug for which Merck has a product patent in India. This drug molecule is used in the dosage form as its phosphate salt. To evergreen the base molecule Merck had filed a patent for Sitagliptin phosphate as a product in India. However, the said patent for ever greening was rejected avoiding ever greening and extended protection of the drug molecule ensuring early availability of cheaper generic version of the said diabetic drug in India.
Many a time a known generic drug molecule finds a 2nd use to treat another disease for which there is no information in public domain. In developed jurisdictions like US and Europe innovator company gets a new patent for 2nd use of a known product making the known drug molecule expensive and unaffordable for its new use. However, in India it is not permitted under section 3i as it is considered method of retreatment of a disease by using a known substance. For example Nimodipine is used for Blood pressure, however, it has been found that it can be used for cerebral disorder too. This way a known generic substance continues to be available at affordable price even for its new 2nd use.
Another notable factor under Indian patent law which ensures availability of patents drugs in India in sufficient quantity at reasonable price is compulsory licensing under section 85 of Indian patent law. Article.
UN commission on Human Rights and other states have declared that access to medication is a fundamental element for achieving human right. Yet an estimated 1/3rd of world’s population lacks regular access even to products included in WHO’s model list of essential medicines.
Article 31 paragraph(f) provides a provision for WTO member states to consider enacting IP legislation for compulsory licensing in a health related national requirement. Trips agreement of WTO also gives liberty to member states to decide national health requirement parameters for compulsory licensing. Section 84 of India patent law demonstrates that a patented product has to be manufactured in India else if the said drug is not being manufactured and not available in sufficient quantity at affordable price then any generic company having an expertise in making the said patented drug can submit an application under section 85 for compulsory licensing. Alternately under section 92 Govt. of India based on understanding that the patented drug is a dire need for Indian public, can offer such patent to generic manufacturer directly without involvement of patent owner.
This factor of the Indian patent law ensures good control of cost of patented drug and its availability in sufficient quantity.
Foregoing in a vivid manner demonstrate the fact that Indian patent law though ensures protecting the inventions of all WTO member states but still ensures that such rights are not misused and abused which may cause inconvenience to Indian public. Indian patent law provide provision for sufficient quantity availability of drugs at affordable price.