2 February 2022

Compulsory Licensing In View Of Pandemic: Bajaj Healthcare Requests For License To Manufacture Baricitinib

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Bajaj Healthcare has made a request to the Indian Patent Office for a Compulsory License to manufacture a drug named Baricitinib. The request is made under Section 92 of the Patents Act, 1970...
India Intellectual Property
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Bajaj Healthcare has made a request to the Indian Patent Office for a Compulsory License to manufacture a drug named Baricitinib. The request is made under Section 92 of the Patents Act, 1970 wherein Bajaj Healthcare cited national emergency as a ground for granting the compulsory license.

Baricitinib is a drug for treating rheumatoid arthritis (RA) in adults whose disease was not well controlled by tumor necrosis factor (TNF) inhibitors. It acts as an inhibitor of Janus kinase (JAK), blocking the subtypes JAK1 and JAK2.

However, in the recent times, during the pandemic, Baricitinib has been used in combination with Remdesivir to effectively treat Covid patients. Baricitinib inhibits the intracellular signaling pathway of cytokines such as IL-2, IL-6, IL-10, interferon-γ, and granulocyte macrophage colony-stimulating factor, thereby improving the lymphocyte count and preventing entry of the coronavirus into the cell.

Eli Lily and Company, originally based in the United States, is the authorized licensee for Baricitinib. In the backdrop of the second wave of COVID in India, NATCO Pharma approached the Controller of Patents on 3rd May 2021, to request for a Compulsory License (CL) for manufacturing Baricitinib. This way they could make the drug easily accessible for a greater population of the country during the pandemic. NATCO cited a circumstance of national emergency among others under Section 92 of the Patents Act, 1970 to obtain CL for the drug Baricitinib from the Central Govt. of India.

However, the Licensee, Eli Lily inked a royalty-free, non -exclusive voluntary licensing pact with NATCO and five other Indian drug manufacturers, for manufacturing and commercialization of Baricitinib. With this, NATCO Pharma withdrew its appeal for CL for Baricitinib on May 17, 2021.

Bajaj Healthcare (BHL) failed to get the voluntary license from Eli Lily despite their repeated attempts. Therefore, BH has moved the Indian Patent Office to grant compulsory license for manufacturing & supply of the Covid drug Baricitinib (both Active pharmaceutical Ingredients and formulation) on 26th May 2021. BHL stated that the price of Baricitinib sold by Eli Lilly in India is not affordable to the public and that it can manufacture the same drug at an estimated price of Rs 14 (for 1mg), Rs 18 (2 mg), and Rs 28 (4 mg) tablet as opposed to Eli Lilly's drug, the entire course of which, costs about Rs 45,220 per patient.

A voluntary license requires the licensee to provide permission for commercialization of the stated drug whereas, the CL does not require the permission of the licensee for the same. This way the covid drug can be manufactured and distributed at a faster pace and may help in controlling the soon anticipated third wave of Covid in India.

So far, India has issued compulsory license just once since Independence. The legal basis for providing compulsory license in the Indian Patents Act is in line with the international agreements. NATCO Pharma was granted a compulsory license in 2012 for generic production of Bayer Corp's Nexavar, a life-saving medicine used for treating liver and kidney cancer. The CL was granted based on a test laid down under section 84(1) of the Indian Patents Act, 1970 (amended in 2005). Accordingly, the sole ground for granting the compulsory license was to make the life – saving drug more affordable for people residing in the country.

However, granting a compulsory license, under section 92 of Indian patents Act,1970, on the grounds of national emergency, to manufacture a drug for which a voluntary license has already been granted to other manufacturers in the same country, may not set the right precedence to other product manufacturers in similar scenarios. A scenario where the patent owners have already provided voluntary license to a few manufacturers within the country, may not suffice as a national emergency in the true sense. Granting a compulsory license to one manufacturer while others are already working with a voluntary license might just provide a market share for the manufacturer with the compulsory license, but not benefit the country's population in any manner.

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