Refusal of a patent under Section 3(d) of the Patents Act, 1970, for the lack of enhanced efficacy still makes rounds in the decisions of the Controllers in India following the Novartis case. In one such case, the refusal of a divisional patent application filed by Zeria Pharmaceutical Co. Ltd. (3630/DELNP/2011) for "A Compound Represented By Formula (5a)" [divided out of 1090/DELNP/2007] was challenged by the applicant in the Delhi High Court. In judgment dated May 27, 2025, in Zeria Pharmaceutical Co. Ltd. vs The Deputy Controller of Patents C.A.(COMM.IPD-PAT) 452/2022, the Delhi High Court was called upon to decide whether the claimed compound was novel and inventive under Sections 2(1)(ja) and patentable under Section 3(d) of the Patents Act, 1970.
Dismissing the appeal, the Court affirmed the refusal of a divisional patent, holding that minor structural modifications of known pharmaceutical compounds, even if they are intermediates, should still demonstrate enhanced therapeutic efficacy as envisaged under Section 3(d) to cross the patentability line under the Indian Patents Act, 1970. Additionally, the Court upheld the refusal of this patent application on grounds of lack of inventive step under Section 2(1)(ja). Passing the landmark judgment on May 27, 2025, the Court quipped that any trivial mill on the run improvement/change/modification, which is not reflective of any creativity and/or invention, is not within the realm of an "inventive step", as per Section 2(1)(ja) of the Act.
Appellant's Case
The appellant argued that the claimed compound is novel and, therefore, patentable under Section 2(1)(j). The appellant argued that Section 3(d) is not applicable to intermediates. The appellant argued and claimed that the subjection invention would improve the manufacturing process of the final drug as it is better in terms of reduced reaction time, has a higher isolation yield and a reduction in impurities of the final product. The appellant argued that the comparative data submitted to prove efficacy clearly demonstrates the superiority of the claimed invention intermediate over the compounds in the prior art document D2.
The appellant argued that D1 "teaches away" from the claimed invention since it teaches a reaction wherein a compound of formula (5a) is avoided and therefore cannot help a person skilled to arrive at the compound of formula (5a) as claimed in the subject application. Additionally, the appellant submitted that since D2 does not clearly disclose the claimed methyl ester compound having the methoxycarbonyl group and obtaining it would involve selections from multiple lists, thus making it non-obvious over D1 and D2. The appellant alleged that the Controller did not take into account the affidavit submitted in favour of inventive step under Section 2(1)(ja). The appellant submitted that the controller erred in concluding that there was no enhanced efficacy under Section 3(d) without considering the submission of experimental data to support this.
Respondent's Arguments
The respondent contended that the patent application was correctly refused under Section 2(1)(ja) and 3(d) of the Patents Act as the claimed compounds were obvious derivatives of compounds as disclosed in documents D1 and D2. The Respondent submitted that the only difference between Example 6 of D2 and the claimed compound of the subject application was the presence of "ethoxycarbonyl" instead of "methoxycarbonyl". The respondent submitted that the subject invention lacked inventive step based on prior art documents D1: EP 0994108 A1 and D2: US 5981557 A.
The respondent stated that a closer look at the citation D2 revealed that a compound formula (II), where "D" represented a hydroxy or a lower alkoxy group or salt, and the compound formula (II) was useful as an intermediate for the preparation of the invention compound (I). Further, "methoxy" was specifically mentioned in col. 31.26 as a lower alkoxy group for "D" in the compound formula (II). The respondent submitted that D1 also disclosed an intermediate compound of formula III used to prepare 2-hydroxybenzoylaminothiazole derivatives in which "A" represented a hydroxyl or lower alkoxy group, including methoxy and ethoxy. This proved that the claimed invention is an obvious derivative of compounds as disclosed in documents D1 and D2.
The respondent submitted that the applicant admitted that, since the claimed compound was an intermediate, it was not possible to determine the "therapeutic efficacy," which meant that if it fell under the purview of Section 3(d) of the Act, its efficacy had not been proved. The respondent argued that the data provided by the appellant pertaining to the process used for the preparation of hydrochloride of a compound of formula (7) rather than the compound of formula (7) whereas the subject application mainly related to a process for preparation of the compound of formula (7) or 7(a), not to the hydrochloride form of formula (7) or 7(a).
Further, the claim granted in the main/parent application related to a process for the preparation of the compound of formula (7) that may optionally be converted to the hydrochloride form. The respondent argued Claim 1 of the subject application fell within the scope of Section 3(d) of the Act as the claimed compound was a mere discovery of a new form in respect of the prior art document D2. Since the claimed compound had no enhanced efficacy in terms of its effect on the process wherein it was used as an intermediate, the claimed compound of the subject application was merely a derivative of the known compound disclosed therein.
Court's Analysis and Decision
The appellant's invention related to a "Compound Represented by Formula (5a)", which was a novel intermediate compound. Intermediate compounds are substances formed during a chemical reaction that are not themselves the final product but are essential to the steps leading to it. Compound 5(a) was one such compound that could help synthesise compound 7(a), a drug that had already been patented by Zeria Pharmaceuticals.
On Obviousness under Section 2(1)(j)
The Court agreed with the findings of the Controller that the substitution of "ethoxy" with "methoxy" was an obvious modification for a person skilled in the art in light of prior art documents D1 and D2. The Court observed that both documents disclose structurally similar compounds. Citing Agriboard International LLC vs Deputy Controller of Patents and Designs, the Court agreed with the Controller's reasoning and analysis of the subject invention and prior art. The Court noted that the Controller identified Example 6 of D2 as the closest prior art. The Court held that the objection under Section 2(1)(ja) relating to lack of inventive step was therefore well-reasoned.
The Court found that Example 6 of D2 identified "ethoxy" as the "D" group, while formula (II) includes "methoxy" as a representative lower alkoxy group. This clearly demonstrated that "methoxy" was explicitly referenced as a lower alkoxy substituent for "D" in compounds of formula (II), thereby confirming its presence in the prior art. The Court held that the Controller rightly noted that document D1 disclosed an intermediate compound of formula III, which is used in the synthesis of 2-hydroxybenzoylaminothiazole derivatives. Given the disclosures in D1 and D2, the Court held that a PSITA would find it routine to arrive at the claimed compound based on these teachings.
On Refusal under Section 3(d)
After analysing the impugned order of the Controller, the Court found that the only structural difference between the two compounds was in the ester group, which was the presence of an ethoxycarbonyl group in the prior art document D2 and a methoxycarbonyl group in the claimed compound under the subject application. These compounds differed by only one CH2 unit in their ester groups. The Court found that under Section 3(d) of the Act, these two compounds were derivatives of each other as they differed only by a methoxy and an ethoxy group. The appellant was unable to show the enhanced efficacy in the claimed compound of the subject application over the compounds in the prior art documents. Therefore, as such, the objection under Section 3(d) of the Act remained unsatisfied and existed, leaving the subject application vulnerable to being patentable, particularly under Section 3(d) of the Act. The Court held that "this Court is in agreement with the findings of the Controller whereby the subject application of the appellant has been refused."
Parting Remarks
This ruling once again affirmed that the need for genuine innovation rather than speculative derivatives is a key to obtaining patents in India. Being an intermediate compound is no guarantee of escaping the scrutiny of Section 3(d). Legally speaking, according to the Court, Section 2(1)(ja) of the Act, an "inventive step" is/has to be more than just a variety and/or add-on variation as it should be beyond the known to anyone who belongs to or is known to the relevant field in which the patent is connected for grant. In this case, the court affirmed the refusal of a patent for an intermediate compound, holding that such compounds can be eligible for patent protection only if they enhance the "therapeutic efficacy" of the final drug.
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