Opinion » Lead

Updated: April 3, 2013 00:19 IST

Calling big pharma’s bluff

Dwijen Rangnekar
Comment (21)   ·   print   ·   T  T  

The lesson from the Supreme Court ruling on Gleevec is that pharmaceutical multinational corporations need to focus research on genuine innovations rather than on ways to evergreen their patents

The much awaited Supreme Court judgment on Gleevec has been delivered. Novartis has failed in reversing the rejection of its patent. And, predictably — like a scratched record — there have been suggestions that pharma investments in India will dry up and take flight to China. At each twist of this case, Novartis has produced such bluster. We need to pay attention to the judgment as it is a nuanced handling of difficult questions concerning a hastily drafted section — Section 3(d) of the Indian Patents Act, which allows new forms of existing drug formulations to be patented only if they result in increased efficacy. The judgment adopts a gentle caution in parsing out Section 3(d); yet, it is firm in reading 3(d) as a “second tier of qualifying standards” for patentability. Further, the judgment also stands out by reprimanding the “artful drafting” of patent applications adopted by big pharma.


To begin, it is useful to draw out some of the chronology concerning Gleevec that the judgment reveals. The story of the patent begins with Jurg Zimmerman’s invention of derivatives of N-phenyl-2- pyrimidine-amine, one of which in freebase form was called “Imatinib,” and together constituted a U.S. patent application (no. 5,521,184) granted on May 28, 1996 (which, the judgment terms “the Zimmermann Patent”). Subsequently, a European patent was also acquired. Later, a patent application was filed for the beta crystalline form of Imatinib Mesylate (the subject in dispute) in January 2000. Initially rejected, the patent was awarded in May 2005 following Novartis’s appeal to a U.S. appellate court. What is interesting is that the filings for new drug approval, submitted in April 1998, was for Gleevec, and a filing for original drug approval in February 2001 was for Imatinib Mesylate. Confusing as this may seem, the judgment highlights this to establish that Imatinib Mesylate was covered by the Zimmerman patent and that Gleevec was its market name. Any remaining doubt, the judgment notes, is extinguished by the application for patent term extension: “This application leaves no room for doubt that Imatinib Mesylate, marketed under the name Gleevec, was submitted for drug approval as covered by the Zimmermann patent.”


One of the useful aspects of the judgment is in distilling the significance of “context” in giving meaning to statute. Early on, it notes that to understand the import of the various amendments introduced in the third amendment to the Patent Act, 1970 — to come into full compliance with TRIPS — it is “necessary to find out the concerns of Parliament … What was the mischief Parliament wanted to check and what were the objects it intended to achieve through these amendments?” In this respect, the judgment recalls not only the heated Parliamentary debate, but also the concerns of public health practitioners the world over, and of public statements and petitions from U.N. agencies and civil society organisations. With India being the leading global supplier of bulk drugs, formulations and generic Antiretrovirals (ARV), the global concerns layered domestic worries about affordability of drugs.

Evidence in a widely cited study by the National Institute of Health Care Management, Changing Patterns of Pharmaceutical Innovation, is telling. Between 1989 and 2000, the U.S. Food and Drug Authority approved 1,035 new drug applications — of these, 65 per cent contained active ingredients that were already on the market (i.e. incrementally modified drugs), 11 per cent were identical and only 15 per cent were considered a “highly innovative drug.” Mischief like this results in a patent thicket around a single molecule to delay generic entry which Section 3(d) seeks to avoid. Consequently, the Supreme Court heralds Section 3(d) as a “second tier of qualifying standards for chemical substances/pharmaceutical products in order to leave the door open for true and genuine inventions but, at the same time, to check any attempt at repetitive patenting or extension of the patent term on spurious grounds.”

The significance of this rendering of Section 3(d) is borne out in the Supreme Court’s mix of caution in parsing out the section and firm pronouncements on patent drafting. Section 3(d) states, 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 or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such process results in a new product or employs at least one new reactant.

And, has the following explanation appended: For the purposes of this clause, salts, esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of known substance shall be considered to be the same substance, unless they differ significantly in properties with regard to efficacy.

Madras HC reading

Recall that the Madras High Court’s reading that efficacy is a pharmacological idea associated with the ability of a drug to produce a desired therapeutic effect independent of potency, i.e. “healing of disease.” And, the Intellectual Property Appellate Board (IPAB) had noted with respect to enhanced efficacy that “it is not possible to quantify this term by any general formula” and that an assessment would “vary from case to case.” In revisiting these readings, the Supreme Court also had the views of Shamnad Basheer (as an intervenor-cum-amicus) and Anand Grover (Counsel for Cancer Patients Aid Association). The latter had argued for a strict reading of 3(d) which would see efficacy entirely in pharmacological terms. While Basheer agreed that all advantageous properties may not qualify under 3(d), he held that increased safety and reduced toxicity should be seen favourably. Even as the Supreme Court recalls the concerns that author 3(d) — thus, urging a “strict and narrow reading” for medicines — it prefers to delay definitive pronouncement and allow for jurisprudence to develop on this matter. Yet, it is firm in noting that enhancements in the “physical properties” of a product would render a patent application foul of 3(d).

It is here that the evidence — either in the patent applications or submitted later through affidavits to Controller were found wanting in establishing enhanced efficacy. Take for instance the “Massimini” affidavit, filed before the Controller and directed at 3(d), where two points emanate. First, that the beta crystalline form of Imatinib Mesylate is highly soluble, and second that it demonstrates a number of improved physical properties (e.g. flow properties, thermodynamic stability). Yet, in probing, it becomes clear that the comparison is to Imatinib — and not Imatinib Mesylate, where the latter is the “known substance” in terms of 3(d). Which leaves the issue of increased bioavailability — and here the court finds “there is absolutely nothing on this score apart from the adroit submissions of the counsel” and dismisses the argument.

On drafting

A final aspect of the judgment that needs highlighting is the pronouncement concerning drafting. The careful interrogation of the sequence of events leading to the patent application for the beta crystalline form of Imatinib Mesylate opened up gaping holes in the claims made by Novartis. These included that Gleevec was “‘disclosed” in the Zimmerman patent and this point is also implied by Novartis’s legal notice to NATCO in the U.K. to stop production of its generic version, VEENAT. In response, Novartis argued that even while Gleevec could be claimed by the Zimmerman patent, it was not fully disclosed in an enabling manner. Thus, seeking to differentiate between claims and disclosure. This wonderful legalese was eloquently rejected by the Supreme Court; both, in terms of U.S. legal history that was cited and in terms of the argument’s merits. And it’s useful to quote at length: “We certainly do not wish the law of patent in this country to develop on lines where there may be a vast gap between the coverage and the disclosure under the patent; where the scope of the patent is determined not on the intrinsic worth of the invention but by the artful drafting of its claims by skilful lawyers, and where patents are traded as a commodity not for production and marketing of the patented products but to search for someone who may be sued for infringement of the patent.”


Looking back over the last several years, it is useful to recall the several lapses committed by Novartis. It failed to heed petitions by health groups and civil society to drop the case. For that matter it failed to also heed the wisdom of its own shareholders who urged it to withdraw the challenge. And at the Supreme Court along with losing the case, we also find that the Gleevec patent application “appears to be a loosely assembled, cut-and-paste job, drawing heavily upon the Zimmermann patent.”

The judgment should be well noted and celebrated. It recalls the context of 3(d) and reminds us of the matters of concern that punctuated its crafting. While the section may have been hastily drafted and insufficiently specified, it has the elements to withstand ever-greening. Pharma companies will always be rewarded for their inventive work and effort — and by drawing in a secondary qualifier, they will have to focus their efforts on genuine inventions rather than overlapping patents.

(Dwijen Rangnekar is Associate Professor of Law at the University of Warwick, U.K. E-mail:

More In: Lead | Opinion

Everyone and author - please read Kannan's comment and think why India and other
socialist countries failed to produce one single drug to treat cancer or other modern deadly
diseases? If profit making by ever-greening Glivec by Novartis is so unethical, how is it
ethical that the generic companies in India are given license by the Supreme Court to make
profits by producing a drug that they did not discover? Why are the readers so selective in
their outrage?

from:  Govinda
Posted on: Apr 3, 2013 at 15:48 IST

Very good judgement by the SC, proud of them. This will prevent pharma companies from trying to make "new drugs" which are just a slight alteration of the old ones and patent them. Medical drugs have become a very good source of profit by these companies, and its well time that they are stopped. Novartis need not threaten India by pulling out its R&D, sooner or later they will have to pull out from other countries.

from:  Nitya
Posted on: Apr 3, 2013 at 14:42 IST

TRIPS agreement on IPR is based on few basic principles , Balanced
Protection is one of the important principles . It underscores need of
balance between private right(incentives to create ) and public
interest (ability to use or access to creation). It is also balance
between long term(societal benefit) and short term(incentive benefit).
Thus it clearly states that purpose of invention or creation, seeking
protection, must also lead to enhanced societal and economic benefit ,
leading to a better life.This is the idea underlying IPR
protection.Going by above mentioned principle of WTO , Effort of
Novartis to evergreening must be repudiated and it merely indicate
intent to exploit the poor and ill in furtherance of its own interest
in guise of innovation.Keeping law and legality aside , a view on
conditions prevailing in India would amply clarify the verdict .
. 25 lakh cancer patient at any point of time.
. 5.56 lakh died in 2010 alone , of which 71% in age group of 30-69

from:  ashutosh
Posted on: Apr 3, 2013 at 14:32 IST

European and American companies are out to bleed poorer countries by the
so called patent protection. The wisdom of introducing the protection by
our country has helped us. If they threaten to close, let them go, they
have no markets as big as India.

from:  Anil Paul
Posted on: Apr 3, 2013 at 14:22 IST

A proper judgement has been given considering all aspects of the case. Mr. R. Kannan, your worry is not accurate. SC has only said that evergreening of patents is not the way to make money. It did not say that if genuine inventions are there, then patents will not be granted.

from:  vishwanath
Posted on: Apr 3, 2013 at 13:45 IST

Why do people forget the richness and quantum of Ayurvedic and
traditional medicines that are available from India to the entire world?
So it's unfair to say that India has not produced drugs. A good
percentage of the drugs that are 'needed', and which the pharma
companies are designing / producing are meant for NCD and lifestyle
diseases. The Larger Public Good should take precedence over Unfair
Private Profit.

from:  swarna
Posted on: Apr 3, 2013 at 13:27 IST

Thanks Hindu as always giving better perspective to this SC verdict. I
commend SC for the foresight.
Here I would like our legislators to take extra effort to amend and
keep updating our laws to make it tight and cover all aspects. I hope
appropriate authorities will follow up with amendments to law.
Innovation & IP protection should be upheld for the genuine efforts of
inventor but, ever-greening should be discourage rightfully...... its
double edge swords, we should be careful in balancing as it will guide
our emerging economic and our innovation mindset for generation to

from:  samvj
Posted on: Apr 3, 2013 at 13:13 IST

The Supreme Court of India has pronounced a judgement in favour of
humanity, a decision the world should take note of. People must come
before profit, and excess profit at that.

from:  D Mahapatra
Posted on: Apr 3, 2013 at 12:40 IST

Proud to be an Indian. Kudos to our Justice system. Maa tere salaam.

Posted on: Apr 3, 2013 at 12:34 IST

The SC verdict is entirely logical. If i have a patent on something for a stipulated time, then if i wish to further my patent period then i need to present an improved version of my patented thing. If i do not do that, then why should i be given a patent?
The big pharma companies must realise that unless they price their products in a cost-competitive manner, they are always going to lose out to the generic drug makers.

from:  Mukut Ray
Posted on: Apr 3, 2013 at 11:48 IST

One has to remember almost all of the modern pharmaceutical medicines
available have been produced by profit making drug companies and it is
also the virtue of profit which drives research and innovation. India
or the Socialist/Communist nations do not have one drug which came out
of their economic system. If all countries pass similar laws(including
ones against ever greening the patents) the drug companies will not
have the huge amount of money needed to allocate to R&D and there will
be fewer new, necessary drugs available. The generic companies many
times virtually copy drugs which did not come out of their
capital(money or knowledge) but still have a halo of rectitude around
them. If all companies are generic usurpers there will be no new
drugs. It may seem well now but what will happen if there is a new
deadly bacterial infection which is resistant to all present
antibiotic and you need a novel one.. Will the generic companies offer
one from their

from:  kannan r
Posted on: Apr 3, 2013 at 11:20 IST

The landmark verdict of SC will enable affordable treatment to a large
section on our population. It is appreciable that Novartis invested in
inventing the drug "Glivec", but it is unjustified to charges so high
that even higher middle class cannot afford it. What is the use of
invention when it is out of the reach of those who need it. Also it is
wrong on the part of Novartis to file a patent for ineligible drug.
Novartis says the decision of SC will hamper investment in R&D in
India, rather this decision will discourage such type of manipulations
and will encourage only genuine innovations. This verdict is a
statement of caution for all those other MNCs who are engaged in such
unethical practices.

from:  Akshay Dhadda
Posted on: Apr 3, 2013 at 10:16 IST

Hail the supreme court for its historic judgement. The judgement
encourages only true and genuine innovations but not some cheap tricks
played by witty lawyers in filing patent application. The supreme
court analysed 3(d) carefully and pronounced it as secondary
qualifier. This judgement should serve as an eye opener for those
pharma companies which file patent applications just for the sake of
having more patents but not concerned about efficacy of the product.
It is evident that the government drafted the patent act hastily, the
government should amend the act and make sure that there are no
loopholes which can be played around by pharma companies. Last but not
the least, I hope this judgement doesn't serve as retrograde for
pharma companies. Geninue innovation is always valued.

from:  ranjithp
Posted on: Apr 3, 2013 at 09:35 IST

Today, big and small companies alike forget the spirit of a patent. A
patent protected the interests of the inventor (by preventing others
from profiting from it without paying) while society benefits from the
knowledge being available to everyone for further enhancements. It is
high time that patents *require* arms-length patent fees between the
research and manufacturing arms of even the same company; and make the
patent available to any other manufacturer for the same fee. It will
protect the interests of the inventor.

Other research centres must be able to take patent-protected formulae
and make further innovation based on that knowledge. The value addition
may be used by a manufacturer paying royalties to both research firms. I
feel that such a change in law that encourages innovation and research
by guaranteeing financial benefits while making knowledge open is the
need of the hour.

from:  Thomas George
Posted on: Apr 3, 2013 at 09:33 IST

Very well written article. It seems section 3 (d) of patent act is the life line of our health policy in order to get affordable drugs at reasonable prices.

from:  Arun Sivagurunathan
Posted on: Apr 3, 2013 at 09:24 IST

Thank you Hindu for publishing this brilliant article which gives a lot of insights about the
ruling. The honorable supreme court has performed a great service to the nation and the
public on the whole. This landmark judgment should be cited and used actively by right
groups to deter pharma companies from ever greening phoney innovations !

from:  Gajamani
Posted on: Apr 3, 2013 at 08:05 IST

Thanks to very lucid contents of the article, readers would know
relevance of protecting intellectual property, rights of companies
holding patents and impact of the latest Supreme Court verdict on the
drug industry's Research & Development (R & D) efforts in India. It is
unfortunate that some responses to the verdict are not only contrary
to the spirit of law but also are extremely alarmist. Those can be
simply ignored.
The interests of the patient-consumers are central to any drug
discovery. Although it is true that cost of R & D efforts of drug
companies cannot be overlooked, it is simply wrong to ignore Indian
patient- consumers and charge an ugly and astronomical price just
because they have nowhere to go. It is hoped that multinational drug
companies in India would take the Supreme Court verdict in the instant
case in right spirits and charge affordable prices for their drugs.

from:  Narendra M Apte
Posted on: Apr 3, 2013 at 07:40 IST

The is immediate need to initiate global debate on the present model
of providing healthcare on purely commercial terms. The system has
already started rotting with the sighs of hundreds of millions of
patients, both poor and rich who, knowingly or otherwise become
victims greed. What need to be debated is the limit of profits that
can be allowed in the name of innovation.Unlimited profits of 200 to
500% and more, have been leading to utter corruption and unethical
overmedication resulting in much more suffering than caused by disease
Perhaps, there is need to switch over to tradition Indian model
wherein the healthcare was supposed to be truly noble profession with
service to humankind as the prime motive.

from:  Ravi Gupta
Posted on: Apr 3, 2013 at 07:27 IST

Nicely put!
There are some parallels that seem evident in Big Pharma's approach towards drugs and that of NRA's approach towards Gun Control in the US.

from:  Abhinav
Posted on: Apr 3, 2013 at 07:16 IST

It is not fair to say that MNC loosing a patent war will force all others to move there investment to other countries aka China. MNC will take there business to location where they can make money. Patent is only one part of there profitability engine. Especially when the patent was really not a geninune patent.

from:  Sandip
Posted on: Apr 3, 2013 at 05:34 IST

Prof. Rangnekar, a very well informed article, indeed. I am infact amazed by the ill-informed articles in New York Times, WSJ, CNN, etc where they certify the ruling as "failing to protect intellectual property rights". Rather than being weak on IPR, this ruling of the Supreme Court is more about misuse of IPR

from:  Amit
Posted on: Apr 3, 2013 at 02:54 IST
Show all comments
This article is closed for comments.
Please Email the Editor



Recent Article in Lead

Takeaways from the Obama visit

Twenty years ago, the talking points of U.S. policy were to ‘cap and eventually eliminate’ the subcontinent’s nuclear programmes. Now, to have the U.S. President at the Republic Day parade in 2015 while negotiators worked out ways to operationalise civil nuclear cooperation shows how far India-U.S. ties have progressed »