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Bayer : High court's Nexavar ruling strikes a blow for patient's rights in India

07/19/2014 | 11:35am US/Eastern

MUMBAI: Paving the way for cheaper liver and kidney cancer medicines, the Bombay High Court in a landmark judgment on Tuesday dismissed US pharma major Bayer Corporation's challenge to an order by the Controller of Patents granting compulsory license to Indian company Natco to make and sell the drugs. Bayer holds the international and Indian patent for the drug, Sorafenib Tosylate, sold under the brand name Nexavar, administered to cancer patients to reduce pain and slow the growth of cancer cells.

"Medicine has to be made available to every patient and this cannot be deprived/sacrificed at the altar of rights of patent holder,'' observed a division bench of Chief Justice Mohit Shah and Justice M S Sanklecha. The court held that it did not find any reason to interfere with the Controller's order under the Patents' law ``to the extent it holds that the patented drug is not available to the public at reasonably affordable price.''

Bayer sells the drug at Rs 2.84 lakhs per month of therapy, while Natco proposes to sell it for Rs 8,800. The court also agreed that the requirement of all the patients for the drug was not being met.

"The law of patent is a compromise between the interest of the inventor and the public. In this case, we are concerned with patented drug, i.e., medicines to heal patients suffering from cancer. Public interest is and should always be fundamental in deciding a lis (legal dispute) between the parties while granting a compulsory license for medicines/drugs,'' said the judges.

This was the first instance when the issue of compulsory licence had up before the authorities and the court after India became a signatory to the Trade Related Aspects of Intellectual Property Rights (TRIPS) and the Doha Declaration in 2001. The court remarked that that it ``would have far reaching impact as it would govern the issue of grant of compulsory license in respect of patented drugs.''

Bayer was issued the patent for the drug in 1999 in the US and in India in 2008. Patent rules give the company exclusive rights to sell the drug for 20 years. However, a compulsory license can be granted three years after the patent is granted, on the fulfillment of three conditions: reasonable requirement of patients for the drug is not satisfied, the drug is not available to patients at an affordable price, and it is not "worked in India". Natco applied to Bayer for voluntary license in 2010 but it was rejected. Natco then approached the Controller for grant of compulsory license, which was given in 2012 and upheld by the Property Appellate Tribunal in 2013. Bayer challenged the orders in the high court.

Bayer claimed that it had spent over S114 billion in discovering the drug and also claimed that it was making drugs available at a subsidised cost through its patient assistance program. Natco, however, filed an affidavit of an expert claiming Bayer had recovered its investment in one year of the drug's sale. Natco also pointed out that the Nexavar enjoys an "Orphan drug" status, enabling Bayer to get back half of the R&D spent on it from the US government. The court said Bayer had refused to furnish its audited accounts to justify its case, and pointed out that Natco was asked to pay a 7% royalty to the US company.

(c) 2014 Bennett, Coleman & Company Limited

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