India: Product Patenting in the Indian Pharma Sector

In the recent times the Indian pharma sector has been marked by dynamic changes. The Patent Act of 1970 as amended on March 22, 2005 marked the end of a protected era and has brought in a new phase in the integration of India into the global pharmaceutical market. The new amendment further makes copying of post-1995 patented drugs illegal. At the same time the amendment granting product patents has been hailed to be opening vast opportunities to the Indian Pharmaceutical firms. A look at the sector shows that large companies like Ranbaxy, Nicholas Piramal, Dr Reddy's, Wockhardt, Lupin etc, have been investing heavily in R&D and are planning to launch their own-patented molecules all over the world. Wockhardt in order to bring innovative and advanced drugs in speciality areas to India, has signed an in-licensing agreement with Life Sciences Investment Limited (LSI), a UK based company, to market and produce Vitrix, a patented product for the treatment of vitiligo, a pigmentation disorder for which the active pharmaceutical ingredients shall be imported from LSI .

As India enters product patent regime the impact of such a move would definitely have on the Indian pharmaceutical industry, health care industry etc., and therefore the legal machinery enforcing these regulations demands attention. In the pharma sector today, according to studies, India produces 22% of the global generic market. It can be said that in the last decade, after liberalization, Indian industry has focused on the world market and brought about structural and fundamental changes, like investing in research and accessing global market.

The regulatory system focused mainly on process patents has helped to establish the foundation of a strong and highly competitive domestic pharmaceutical industry along with helping it to emerge into a world supplier of bulk drugs and medicines at affordable prices not only to common man in India and the developing world. Admittedly it cannot be overlooked that the introduction of product patents will, however bring forth significant changes and divides within the industry. It cannot be denied that the process patent helped the Indian Pharmaceutical Industry to flourish into a world-class generics industry but the product patent regime would turn out to be more favorable to players with built-in scientific and technical resources.

In this context a recent decision by the High Court of Madras can be discussed. In Wockhardt Ltd. v. Hetero Drugs Ltd. & Ors 2006 (32) PTC 65 (Mad.) (DB), the appellant was the holder of Process patent, Exclusive Marketing Rights and Drug License for the manufacture of pharmaceutical preparation namely, Nadifloxacin 1% cream. The first respondent had started manufacturing and selling the same product infringing the patent and EMR granted to the appellant. Appellant was already holding the Process Patent for an admixture compound. By 2002, the Appellant made an application for Product Patent, which was treated as a mail box application. In the mean time, the first respondent applied for manufacturing license to manufacture Nadifloxacin 1% cream by adopting US Patent 1981 and Japan Patent 1983 under the trademark Nadiderm. In 2004 the Drugs Controller General granted license to the respondents and they started manufacturing and selling Nadifloxacin 1% cream. The question arose as to who could be the manufacturer and as to whether the appellant in this case could claim exclusive right over the EMR and the process patent. According to the respondents, the appellants could not claim invention of the product, since the first respondent obtained manufacturing license for the impugned product from the Drug Controller General. As a regular marketing license of a drug is to be preceded by a trial-manufacturing license for the purpose of clinical trial, the first respondent had been manufacturing the impugned product prior to 2004 itself. Moreover the first respondent contended that they had followed only the process adopted by the US and Japanese Patents and hence, as such the appellants could not claim EMR and the Process Patent.

The court observed that the Patent Office had granted both Process Patent and EMR in favour of the appellant. The appellants had obtained Process Patent with effect from the date of application in 2000 and the appellant had also applied for Product Patent after the amendment of the Act. Further it held that EMR being a short-term arrangement the appellant would suffer irreparable damage because of elapse of that period. It granted injunction in favour of the appellant, thus granting protection to the appellant’s exclusive rights for its product, the Nadifloxacin 1% cream. The case thereby proves the liberal approach and the bent of mind of the court towards products patent.

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