Introduction
One of the most controversial legal cases pertaining to patent law, especially regarding the pharmaceuticals industry in India, is *Novartis AG vs. Union of India* (2013). This case, for example, began with Novartis’s application for a patent on the drug Glivec, a medication used in the treatment of cancer that was marketed as Gleevec in the US, and sparked debates about patenting life saving drugs, patent laws and public health concerns in general. The verdict given by the Supreme Court of India in this case was a turning point in the history of health-related patenting, demonstrating that some patents must yield to the right of the public to receive affordable healthcare.
Background of the Case
Glivec, which is marketed by Novartis, is indicated for patients who have been diagnosed with chronic myeloid leukemia (CML) as well as certain select gastrointestinal tumors. The active component of Glivec, imatinib mesylate, was found to work efficiently in combating these cancer types. Nonetheless, Glivec has also been effective; its cost proved to be prohibitively expensive for a large number of Indians. For example, in India, the price of Glivec was nearly $2600 per patient per month, which is beyond the reach of the majority of Indian victims of cancer.
In 1997, Novartis pitched for a patent in India for a beta crystalline form of imatinib mesylate. The Company considered the new form to be a pronounced advancement over the older forms. Thereafter, Indian patent laws provided for patenting of pharmaceutical products once the country amended its laws on patents in 2005 in order to implement the TRIPS Agreement of the World Trade Organization. Still, India introduced to the Patents Act Section 3(d) that places limitations on the patenting of new forms of known substances. This clause sought to inhibit ‘evergreening,’ which is a practice employed by pharmaceutical firms whereby various patents are filed due to slight modifications on the existing product, this has the effect of prolonging patent protection and therefore high prices.
The Legal Battle
In 2006 the Indian Patent Office rejected Novartis’s application for a patent claiming the beta crystalline form of imatinib mesylate under Section 3(d) of the Patents Act. The Patent Office held that the novel crystalline form of imatinib did not exhibit increased therapeutic effects over the known imatinib and accordingly failed the test postulated under Section 3(d). Novartis sought to overturn this decision by filing an appeal, asserting, that Section 3(d) was vague, inapplicable under the constitution and in contravention of the TRIPS Agreement.
In turn, the Indian generic drug industry and health activists welcomed the action taken by the Patent Office and argued that the grant of patent to Novartis would have adverse effects in modulating the supply of cheap generic medicines for other crucial medical conditions. Oftentimes, Indian pharmaceutical firms had already been making cheaper generic versions of Glivec for the public.
Outcomes of Case in the Supreme Court
The matter finally went to the Supreme Court of India, and on April 1st, 2013, the court pronounced its decision. The Court sustained the ruling of the Patent Office rejecting the patent claim of Novartis regarding the beta crystalline structure of imatinib mesylate. The Supreme Court found that Novartis’s application did not fulfill the requirements of Section 3(d), because there was no increase in therapeutic efficacy of the new form of imatinib as compared to the known substance.
The Supreme Court considered Section 3(d) to be an important and indispensable provision of Indian patent law developed primarily to curb the tendency towards patent evergreening. In their ruling, the judges reminded that the law on patents exists for the protection and rewarding of new inventions, but such should not be detrimental to the health of the society. The Court accepted that given the state of the economy in India, it would be prudent to have such a clause that would protect the interests of the patent owner and the need for affordable medicine for the general populace.
Impact on Public Health and Access to Medicines
The ruling passed by the Supreme Court in *Novartis AG vs. Union of India* contributed a great deal to the preservation of health in the sense of a legal environment, especially in a country like India with its considerable population below poverty line not affording highly priced drugs. The court did not allow Novartis to claim a patent right over imatinib and ensured that Indian competitors would keep on manufacturing and marketing cheaper imatinib. This policy not only reduced the costs of cancer treatment for several thousands of patients in India but also provided a lesson to other developing nations, which suffer from the rat race in the prices of basic medicines.
The case also highlighted the importance of ensuring their patent laws serve public health objectives in the case of Third World countries. This ruling was a boon for the Indian generics industry that is essential to bridge the global healthcare gap. Due to its prowess in manufacturing shoddy generics, India is often called the ‘drugstore of the developing countries’ and this decision reinforced that reputation by permitting Indian firms to continue providing low-cost drugs to even the other emerging economies.
The Consequences on Pharmaceutical Advancements and Patent Legislation
Even if the judgement was embraced as a success for patients and public health advocacy groups, there was also contention on the issue regarding more innovation in the pharmaceutical industry and the provision of necessary drugs. Pharmaceutical firms including Novartis claimed that the judgement was likely to have a chilling effect on innovation by preventing the patenting of new uses or indications for old drugs. From their standpoint, Section 3(d) in more ways than one, limits the tendencies for firms to pursue more R&D investments for purposes of new product development, especially considering the vast market that is India.
Nonetheless, those who supported the ruling, claimed that the Section 3(d) does not completely prohibit the patenting of incremental innovations; it simply does so for innovations that do not show any enhanced efficacy or therapeutic benefit to the existing product. This is meant to discourage drug manufacturers from making trivial changes to their products in order to extend patent protections for the purposes of artificially high pricing.
The case of Novartis also focused world’s interest on the patent system of India and the way it interprets which the so-called TRIPS agreement. While the TRIPS agreement administered by WTO obligates every member State to observe high standards of protection of intellectual property rights, it contains certain provisions that favour the fulfilling of public health requirements, such as those expressed in the Doha Declaration on TRIPS and Public Health 2001. As far as India’s approach was concerned, it was similar to the one expounded in the Doha Declaration in respect of public health surpassing the concerns of patent rights.
Overall
The case of *Novartis AG vs. Union of India* is a significant case in the development of the Indian patent law and has wider consequences on the protection of such rights around the world. The notice also reaffirmed that it is the policy of the country to protect health care of the people rather than to encourage the imposition of any artificial monopolies over the production of drugs. Indeed, the ruling may have curtailed patent rights in some respects, yet it sytematically illustrated more the country’s esteem of the right to provide its citizens and other third world countries with cheaper medicines.
The case illustrates the typical dilemma that public health and development policies face in developing countries: the treatment of intellectual property as a primary end versus the pursuit of equitable health outcomes. In affirming Section 3(d) and its rejection of Novartis’ patent application, the Indian Supreme Court called for laws on patents that respect peoples’ health and that do not allow the ‘ever greening’ of drugs.
Even as genuine debate rages on the issue of affordable medicine versus research and development of pharmaceuticals, the *Novartis AG vs. Union of India* case offers a situated yet dynamic framework for many across the globe including civil society actors, health advocates as well attorneys. This ruling supported the view that society should benefit from the use of patents and that such patents should not prevent people from accessing life saving drugs, particularly in countries with low or middle incomes where healthcare coverage is a challenge. By this judgment the Supreme Court of India maintained reasonable balance between the promotion of creative activity through protection of patents and protection of access to essential medicines.
