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Evergreening Withers in India
When India's Supreme Court ruled in April that Novartis AG's cancer drug Gleevec was not sufficiently innovative to merit a patent, public health advocates lauded the decision. They said that it would give more people access to needed drugs. Predictably, Big Pharma condemned it, saying that it would stifle innovation.
The court's decision, however, was not about innovation or access. It revolved around a practice the pharmaceutical industry refers to as "life-cycle management," which public health advocates call "evergreening." Pharmaceutical companies periodically make small changes to a patented drug and then apply for a new patent on the modified version. This strategy, which is common in the United States, essentially extends the term of a drug's patent, prolonging the time in which patent protection can ensure exclusive rights and precluding competition from generic drug manufacturers.
The tactic has long come under criticism by generic drug makers and public health advocateseven in the U.S., where it has been cited as one reason that health care costs are so high. But by and large the courts have backed up the companies. As long as the modified drug is shown to have utility and to be novel and nonobvious, it can receive a patent. "There have been cases in which the courts have ruled against a company's secondary patent," says Srividhya Ragava, a professor at the University of Oklahoma's College of Law who has followed the Novartis case, "but the Federal Circuit has made it clear that if a company writes its claims carefully, the new patent can stand."
The standard for patentability in India, however, is much higher. "It's a more rigorous standard than in the U.S., but it's not contrary to the rules of the World Trade Organization," says Janice Mueller, a former patent law professor who offers legal seminars and consulting services to law firms and has followed the controversy.
A statute in India's law known as section 3(d)now well-known in the pharmaceutical worldsays in part that "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" is not patentable. That means that changing the form of a drug to a salt, an ester, or anything else will not, by itself, result in a new patent.
"In other words, if it's the same compound but in a new form, it will be deemed the same as the original drug unless the applicant can prove clear therapeutic efficacy," Ragava says, adding that the rule is "a tough bar" for drug companies to clear.
And Novartis did not, according to the Indian court. The patent for the original compound on which Gleevec is basedimatinib mesylatewas filed in the U.S. in 1993. India only began implementing patents in 1995, and compounds that predated its system are not eligible for patent protection. That meant that Novartis could only apply for a patent on the newer cancer drug, says Bhaven Sampat, a professor at Columbia University's Mailman School of Public Health who is also affiliated with Columbia Law School.
The courts in India found that the basis for the newer form was anticipated by Novartis's earlier U.S. patentthat it was a new form of a known substance. And it denied the patent on that basis, saying that there was no proof of "enhanced efficacy."
"No one questions the value of the drug," says Sampat, "and if Novartis could have filed a patent application in India for the original drug, it would have been granted. Gleevec was a victim of timing."
Even in the U.S., a generic challenge has been asserted against the secondary drug, according to Sampat. Generic drug makers often try to be the first challenger of a patent, because the move can give them 180 days of exclusivity when the patent expires. But in many instances, a brand owner, when notified of such a challenge, will sue the generic drug maker in federal court to show that its patent is valid. In fact, Sampat and Columbia Law School professor Scott Hemphill conducted a study in which they found that manufacturers of generics almost always win in U.S. courts when such challenges are litigated to completion.
Novartis, however, has not sued. "Novartis doesn't seem to be pursuing it," Sampat says. "Perhaps it knows even in the U.S. its patent wouldn't hold up."
Back in India, where big pharma is also facing compulsory licensing rulings that allow generic drug makers to pay a royalty to produce drugs still under patent protection, the repercussions of the Supreme Court ruling are unclear. Some say Big Pharma will stop investing in research and development facilities there. Others say the decision paves the way for a booming generic drug industry in India, a country that is already dubbed "the world's pharmacy."
"We don't know what will happen, but the rest of the world is watching," says Mueller. "Other countries already have some antievergreening provisions in place, and more are likely to follow India's lead."