Debunking Pharma’s Cant Against the Novartis Judgment: Myth and Fact



Professor Brook K. Baker, Senior Policy Analyst Health GAP
April 2, 2013, IP

Novartis, its fellow Big Pharma multinationals, Chambers of Commerce, and PhRMA have all roundly denounced India’s Supreme Court’s decision invalidating Novartis’ patent application for Glivec (Gleevec in the United States) and its affirmation of strict anti-evergreening standards of patentability and inventive step in India.  As usual, Big Pharma cannot tell the truth about what India has done, what international intellectual property rules require, and what the impact of this decision will be on product introductions in India and innovation of new medicines.  Because journalists continue to carry Pharma canards and since observers are anxious to understand whether India’s decision is legal or purely instrumental to advance industrial policy in favor of Indian generics, I debunk the major myths with what I hope are convincing facts.

Myth 1:  India was obligated to issue a patent on Glivec because it is a superior medicine and because 40 other countries have done so.

Fact:  Prior to the effective date of the WTO TRIPS Agreement (January 1, 1995), there was no provision in international law whatsoever requiring any country in the world to grant patents on pharmaceutical products.  None.  Accordingly, India lawfully adopted a patent law in 1970 that refused to grant patents on pharmaceutical or food products.

When India signed the TRIPS Agreement and became a member of the WTO, it was not required to retroactively grant patents on pharmaceutical products that had been invented before the effective date of the TRIPS Agreement (subject only and arguably to a 1-year grace period for filing after a first application elsewhere).

The initial patent on the active pharmaceutical ingredient in Glivec, imatinib, had first been filed in the U.S. in in April of 1993.  That application was later withdrawn and a second application was filed on April 28, 1994, but it had a so-called priority date back in 1992.  Accordingly, India was under no obligation whatsoever to recognize this first application, not only because a patent application on it was never filed in India but because India had lawfully declined to grant pharmaceutical product patents at the time of invention.

Thus, it is completely irrelevant that other countries granted patents on the first Glivec patent application.  Likewise, it is irrelevant that that Novartis continued to research and modify that compound and that Glivec is an excellent cancer medicine.  Everyone agrees it’s an excellent cancer medicine, but that doesn’t mean it is automatically or retroactively entitled to a patent monopoly.

Myth 2:  India was obligated to issue a patent on Glivec’s “improved beta crystalline form of imatinib mesylate” discovered/invented in 1997 because it was a new medicine and 40 other countries granted a patent.

Fact:  This is the crux of the Indian Supreme Court‘s decision upholding the strict standards on inventive step and standards of patentability that India adopted in section 2(1)(j) and (ja) and section 3(d).  India had flexibility under Art. 1.1 of the TRIPS define strict standards for novelty, inventive step, and industrial applicability.  It chose to limit evergreening of pharmaceutical patents by preventing patents on new form, uses, dosages, formulations, and combinations of known medicines or know substances.  The “beta crystalline” patent application that Novartis filed in India in 1998, with a 1997 priority date, fell squarely in the middle of the prohibited category.  It was purportedly a “new form” of the previously invented substance imatinib and its salt imatinib mesylate.

Even if the beta-crystalline form was the optimized active pharmaceutical ingredient in Glivec (a fact that Novartis did not claim either to the Food and Drug Administration in the United States nor drug regulatory authorities in India), that does not make the modification of the previously known substance patentable.

Novartis claims in its press statements that because Glivec was never marketed using imatinib in its original form and that its beta crystalline form was not a modification of an existding medicine is specious.  The Indian Patent Act section 3(d) refers to modification of “known substances,” not just known existing medicines.

Myth 3:  Novartis’ new and improved beta crystalline form of imatinib mesylate showed increased efficacy – it was a “better” drug.

Fact:  As the Indian Supreme Court confirmed, section 3(d)’s standard of enhanced efficacy requires that the revised medicines show significantly enhanced therapeutic efficacy when involving a medicine that treats human disease.  Novartis only offered evidence of better flow properties, improved temperature stability, and reduced hygroscopy.  None of these physical features affect treatment as such.  Similarly, Novartis offered some after-the-fact evidence on increased bio-availability but it did so in comparison to imatinib only not imatinib myselate, the appropriate comparison.  Even then, increased bioavailability does not directly equate, on its own, with enhanced therapeutic efficacy.

Accordingly, contrary to its claims, Novartis offered no relevant evidence whatsoever that its secondary patent application on Glivec showed enhanced efficacy as required by section 3(d).

Myth 4:  India is just favoring its generic industry by this ruling.

Fact:  Of course, this ruling will benefit Indian generic companies because they are fulling capable of manufacturing generic imatinib mesylate to global standards.  However, this ruling also means that companies in countries where Glivec is not patented could also manufacture and export to India.  Novartis claims that its patent in Glivec is protected in 40 countries, but that means it does not have a patent in many others.  With no patent bar in a country of production and no patent bar in India, a generic company in any of those countries could also benefit from the denial of the India patent on Glivec.

Myth 5:  This decision means that India does not respect intellectual property rights and that it is impossible to get a patent on a medicine in India.

Fact:  Contrary to this claim, India’s Patent Act clearly allows patents on medicines that are either brand new (don’t involve a known substance) or are modified sufficiently to offer enhanced efficacy in the treatment or prevention of human illness.  Studies show that there have been hundreds of patents on medicines in India since it revised its Patent Act in 2005.  In fact, those studies show that India has probably been too lenient in grating weak patents and that it has not properly been applying section 3(d) to weed out evergreening patents.  In sum, it is not impossible to get a patent on medicines in India, you simply have to meet lawful strict standards on what is inventive and patentable.

Myth 6:  Neither Novartis or other drug companies will patent their medicines in India or bring new medicines to the market.

Fact:  Novartis officials made this sad-face prediction on April 1 but by April 2 they had withdrawn this claim and clarified that they would still seek patents in India.  And every other Big Pharma company will do so both to gain access to the world’s third largest market by volume (one that is growing at an annual rate of 15-20% and that will have $49-$74 billion a year in sales by 2020) and to block Indian generic companies from producing either for the domestic market or the export market (where India is now the largest volume exporter of generics in the world).  Big Pharma companies will continue to seek patent monopolies on truly novel medicines and those with major therapeutic improvements – full stop.  They will seek to sell to India’s growing middle-class and to middle–classes in other countries that Indian generics might otherwise supply.

What Big Pharma won’t be able to do is to file new patent applications over and over again on minor modifications and thereby gain many added years of monopoly protections and supra-competitive profits.  They’ll still make money, but not as much as they had hoped for.

Myth 7:  Pharma won’t do any future research and development in India or invest in India.

Fact:  Big Pharma doesn’t site its research and development facilities based on whether there is a maximalist patent regime there or not.  Big Pharma does R&D for a global market, not for a particular country.  For example, drug companies don’t do diabetes research for Indian diabetics in India and for British diabetics in the UK.  They site their research facilities where there are good scientists, good infrastructure, favorable taxes, etc.  Moreover, Big Pharma companies are buying up Indian generics, contracting manufacturing, and doing clinical trials in India hand over fist.  Maybe they’re not currently siting their latest greenfield R&D facilities in India, but you can’t bet such decisions have nothing to do with India’s patent regime.

Myth 8:  The Novartis decision undermines the global search for new medicines.

Fact:  Of all the canards, this is probably the most ludicrous.  Big Pharma makes the vast majority of its profits on sales to rich patients in rich countries.  Nearly 75% of global drugs sales by dollar volume in 2011 was in Europe, North America, and Japan.  Indian sales comprised less that 2% of global sales.  Drug giants do not make R&D decisions or shut down promising drug candidates because they didn’t squeeze a little extra profit out of small market.

To the contrary, drug companies waste a lot of research dollars now trying to evergreen existing medicines instead of focusing on truly innovative medicines.  They spend nearly 2 1/2 times on marketing and administration as they spend on R&D.  Despite the “risks” of R&D they still retain more in profits than they actually spend each year on R&D.

In sum, the Novartis decision will have little or nothing to do with Big Pharma’s R&D efforts.  But this doesn’t mean that continuing innovation isn’t important.  Nonetheless, it makes little sense to hold poor patients and poor countries hostage for 20 years selling monopoly protected medicines at prices they can’t afford.  We need a better system for investing in therapeutically targeted innovation, with a variety of push and pull mechanisms, and a better system for sharing global R&D costs that is delinked from the market for selling “generic” medicines at low-cost with minimal mark-ups.

Myth 9:  India is engaged in other unlawful IP practices such as issuing compulsory licenses.

Fact:  India has issued one compulsory license on an extraordinarily expensive cancer medicine sold by Bayer.  Some other high-price cancer medicines are under review to see if India wants to issue government use license (licenses that will leave the lucrative private sector to Big Pharma).  However, TRIPS Article 31 specifically allows for compulsory licenses as does the 130 year old Paris Convention as does the 2001 Doha Declaration on the TRIPS Agreement and Public Health.  Virtually all countries, including the United States, have compulsory licensing rules on the book.  Such licenses are not limited to emergencies or infectious diseases, despite what Pharma officials say (and the press uncritically reports).  Such licenses can even favor local producers.

Myth 10:  Novartis was litigating on principle – all that Big Pharma wants is a fair chance to earn enough money to make the next generation of life-saving medicines.

Fact:  Big Pharma and its enablers in Europe and the US are ruthlessly trying to expand its patent and data monopolies through court suits, free trade agreements, diplomatic pressures, and biased technical assistance.  The US in its Trans Pacific Partnership Agreement negotiations is trying to mandate patent standards that would require patents on new forms, uses, and formulations of existing medicines – in essence outlawing section 3(d).  It is also trying to obtain separate monopolies on clinical trial data and win mandatory extensions of patent terms.  The EU sought many of the same terms in direct free trade negotiations with India but has not been successful in most of its efforts.  But it is still seeking investor right and IP enforcement rules that will strengthen Pharma’s hand.  For example, investor clause rules in NAFTA are currently being used by Eli Lilly to extort $100 million from Canada from having revoked a patent on an ADHD medicines pursuant to well-established national law.  Eli Lilly, through private non-reviewable arbitration, is claiming that its reasonable expectations of monopoly profits are being frustrated and that Canada has to have US style levels of protection.  It’s important to note in this regard that investor–state dispute resolution, if adopted in India, would have permitted Novartis to bring the same kind of claim against India regardless of what the Supreme Court had ruled.

Pharma does not want an even playing field.  It wants longer, broader, and stronger monopolies.  It persists in promoting medicines off label, hiding adverse results, bribing foreign regulators, and funding Congress and the executive to fight its battles and to expand its empire.

These ten myths, in one form or another, are creating a fog-bank of disinformation in the wake of the historic Novartis decision.  In sum, the Indian Novartis decision is both legal and wise – it reduces the risk of unwarranted patent monopolies and speeds access to low cost generic medicines of assured quality, both in India and elsewhere.  The panicked reaction of Novartis, Big Pharma and their apologists is the tantrum of a bully who is frustrated because it wanted freedom to steal more candy on the playground.  The press should do a much better job directly confronting Pharma’s myths or at least soliciting opposing views.

Professor Brook K. Baker

Health GAP (Global Access Project)
Northeastern U. School of Law
Program on Human Rights and the Global Economy
400 Huntington Ave.
Boston, MA 02115 USA
Honorary Research Fellow, University of KwaZulu Natal, Durban, S. Africa
(w) 617-373-3217
(cell) 617-259-0760
(fax) 617-373-5056
b.baker@neu.edu

 

__._,_.___

 

#India- SC rejects Novartis’s patent plea for cancer drug Glivec #goodnews


Vidya Krishnan , livemint

Court says Glivec does not meet any standard of ‘novelty or inventiveness’ to qualify for a patent

First Published: Mon, Apr 01 2013.
Shares of Novartis India fell as much as 7% after the Supreme Court judgement. The stock later recovered a bit to trade at `577, down 3.64%, at 11:18am.
Shares of Novartis India fell as much as 7% after the Supreme Court judgement. The stock later recovered a bit to trade at `577, down 3.64%, at 11:18am.

Updated: Mon, Apr 01 2013. 11 54 AM IST
New Delhi: Swiss drug maker Novartis AG’s seven-year battle to win an Indian patent for its blockbuster anti-cancer drug Glivecended on Monday with the Supreme court dismissing the company’s appeal.
In its ruling, the apex court said that Novartis’s “application for patent on the beta-crystalline salt does not meet any standard of novelty or inventiveness”, and therefore the company cannot be given any patent for this drug.
Shares of Novartis India Ltd fell as much as 7% after the Supreme Court judgement. The stock later recovered a bit to trade at Rs.577, down 3.64%, at 11:18am.
The judgement has provided clarity on the so-called evergreening and incremental innovation by pharmaceutical companies in order to retain patents.
Reacting to the ruling, Anand Grover, senior counsel appearing for Cancer Aid Patients Society, said: “It is a very good day for cancer patients. We are very happy. It is a myth spread by the company that judgement will affect research and development expenditures by companies—these companies want to make money without innovation.”
“The court noted that the product—beta crystalline—was known prior to 1995 through an earlier patent Novartis held. The implication of the judgement is that the Indian provision has been completely upheld and patents would be granted only for genuine inventions and litigative patenting will not be allowed,” said Pratibha Singh, an intellectual property lawyer who appeared for Cipla.
The ruling has been keenly followed across the world by pharmaceutical companies, humanitarian aid organizations and generic drug manufacturers as it will have far reaching implications on access to life-saving essential drugs under patents.
After a series of decisions that have gone against the big drug makers with respect to intellectual property rights in the past year, Paul Herrling, Novartis’s head of tropical disease research had said on Wednesday that the company is prepared for a negative response.
The case over patents for Glivec—a blockbuster anti-cancer drug made by Novartis—reached the courts when India denied patent for it in 2006 as the drug wasn’t considered a new molecule, but an altered version of one that had already been in the market for around 15 years. Basel-based Novartis had challenged the rejection of its patent application for Glivec by the Indian patent office and subsequently by the Intellectual Property Appellate Board.
Further, the company had challenged India’s interpretation of section 3 (d), which relates to what constitutes a new molecule, essentially to ensure that companies to not extend patents by simply modifying an already existing drug without any consequent changes in therapeutic effects.

 

Pharma vs India: a case of life or death for the world’s poor #Health #drugs


WEB EXCLUSIVE, New International  Oct , 2012

Irekia under a CC License<br /><br />

Cases being heard in Indian courts could ‘open the floodgates’ for pharmaceutical companies to challenge generic drug production and keep prices ridiculously high, explains Nick Harvey.

It’s a worrying time for the poor and the sick. Two cases brought to India’s courts by transnational pharmaceutical companies could massively effect whether people in the Global South can access life-saving medicines. The most significant of these involves Swiss drugmaker Novartis which was refused a patent in India for its anti-cancer drug Glivec (imatinib) and is now challenging the country’s patent law.

There could be significant impact on access to medicines in countries such as India. Irekia under a CC License

‘People are already dying because they can’t get treatment and if Novartis wins things will become worse,’ says Eldred Tellis, who runs a centre for drug users and people living with HIV in Mumbai. ‘They are targeting India because many quality generic drugs are produced here for many people.’

Thanks to India’s 1970 Patents Act, around one-fifth of the world’s generic drugs – containing the same active ingredients as a patented drug but made by a different company at a fraction of the price – are made in the country. As well supplying India’s huge population, these drugs are shipped to poor countries around the world.

‘We source 80 per cent of our global HIVmedicines, as well as other medicines, from India – as do the Global Fund,’ says Michelle Childs, Director of Policy and Advocacy at Médecins Sans Frontières (MSF). ‘So what happens in India can immediately affect other countries and set a precedent for them.’

The problem with patents

Novartis is challenging a clause in the Indian law, ‘Section 3d,’ that prevents drugs being patented that are modifications of existing drugs, a tactic known as ‘evergreening’ used to extend patent periods. The company originally failed to patent Glivec in India as it was discovered before the country was forced to start patenting drugs in 2005. The latest patent application is based on a salt form of Glivec (imatinib mesylate), which, although being easier to absorb, is arguably no more effective.

Studies have found the majority of global research and development (R&D) money is used to produce these minor variations, leading not only to high prices but a lack of genuinely new drugs.

‘About 85 per cent of all new drugs are proven to be little or no better, clinically, than existing drugs,’ says Donald Light, professor of comparative healthcare at the University of Medicine and Dentistry of New Jersey. ‘They are all better than placebo but they are not better than last year’s drug that was better than placebo.’

As these cases move through the Indian courts, the bottom line remains that they could significantly impact access to medicines for the world’s poor.

This is at odds with the pharmaceutical industry argument that the patent system is there to allow companies to receive more money to make new medicines. Producing new drugs is, they say, such an expensive business that only the big companies can afford to do it.

‘These are potentially dangerous substances so you really need to do a lot of research,’ says Mark Grayson, deputy vice-president of Pharmaceutical Research and Manufacturers of America (PhRMA). ‘You need to do clinical trials, even after the drug is on the market; you need production plants to be sterile, drugs need to be safe, all these costs need to be borne and they are not cheap.’

What they fail to mention is that the majority of R&D for developing new drugs is publicly funded. This was the case for Glivec, which was also awarded ‘orphan drug status’ in the US, allowing Novartis to receive tax breaks that paid for a large proportion of the clinical trials.

e-MagineArt.com under a CC license<br /><br />

‘The vast majority of the original research on Glivec came from charities and the government,’ says Jamie Love, Director of Knowledge Ecology International (KEI), an intellectual property pressure group. ‘But at the very end Novartis comes in and gets a patent on it and makes a couple of billion dollars a year.’

These mammoth profits are generated by aggressive pricing. When this court case began in 2006, Novartis sold Glivec for $2,200 per person per month, while the generic version was produced in India for a tenth of that price. That companies could be facing such huge losses to generic competition has wound up the neoliberal press in the US with the Wall Street Journal calling it a ‘drug disaster.’

Countries are allowed by the World Trade Organization to produce generic drugs if there is a major public health imperative, a practice known as compulsory licensing. India issued its first compulsory licence in March, ordering German drugmaker Bayer to allow a generic manufacturer to make its cancer drug Nexavar (sorafenib) for one-thirtieth of the usual $5,000 price tag. India’s patent controller argued that not only had Bayer failed to make the drug ‘reasonably affordable’, it had failed to supply the drug in large enough quantities, a decision Bayer is challenging in the courts.

‘With a patent comes obligations, one of which is you make your medicine available in the quantities needed,’ says Michelle Childs.

Targeting the poor

As these cases move through the Indian courts, the bottom line remains that they could significantly impact access to medicines for the world’s poor. If both Novartis and Bayer win, the floodgates could open for companies to challenge the laws and licences that allow generic drug production.

With the vast majority of profits in the pharmaceutical sector being made in wealthy countries, why are poor countries being targeted so aggressively? The answer, like so many others, relates to inequality. While not currently profitable, poorer countries are seen as ‘emerging markets’ because of their burgeoning middle classes.

Most of the people affected by high drug prices will die knowing nothing about patents, laws, licences or pharmaceutical companies

‘The drug companies see India as a market of 100 million, although that’s less than 10 per cent of the population,’ says Jamie Love. ‘These are the people they care about, as they are the ones with enough money.’

This desire to keep the Indian élite onside may be why Novartis’s chairperson Daniel Vasellareportedly donated hundreds of ancient Indian sculptures to a Mumbai museum last month. But most of the people affected by high drug prices will never visit a museum. And most will die knowing nothing about patents, laws, licences or pharmaceutical companies.

‘The people we work with on the ground have no idea what’s going on right now in the courts,’ says Eldred Tellis. ‘But we do, and we know that Novartis losing is their best chance to live.’

 

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