The Supreme Court on Monday dismissed Swiss drug multinational Novartis AG's attempt to win patent protection for its cancer drug Glivec, ending a seven-year battle over the issue.
The decision sets a benchmark for several intellectual property rights disputes in India, where many patented drugs are beyond the reach of the average person. At the same time it is a serious blow to Western pharmaceutical companies seeking to boost sales in India.
A bench of Justices Aftab Alam and Ranjana Prakash Desai dismissed the claim of Novartis for extended exclusive rights for a new variety of Glivec, saying a new substance has been used in the medicine. However the Indian law grants limited patent rights to newer forms of existing molecules.
Novartis wasn't surprised, as had made it pretty clear last week that it did not expect a positive judgement. At a news conference in Mumbai on Wednesday, Novartis had said that going by recent decisions in cases relating to intellectual property rights, the "most likely" scenario is that the company would lose patent protection on Glivec (See: Novartis expects 'negative' SC verdict in Glivet patent case).
Paul Herrling, corporate research head of Novartis, said that the spate of rulings over the past year curbing drug patents in the country, and the compulsory licences issued to generic drug companies, were a concern for research-based companies.
"Looking at recent cases, the mood in India makes it more likely that we would have a more negative response," he said in the hastily-summoned teleconference.
The judgment, which was keenly watched by both Indian and global pharmaceutical companies though with opposing hopes, will clear the hurdles in the way of the manufacture of more generic cancer drugs in India.
Glivec is the trade name of chemical beta crystalline form of imatinib mesylate compound used in the treatment of chronic myeloid leukemia (CML) and malignant gastrointestinal stromal tumours.
Glivec is one of highest-selling drugs for the Swiss company, with global sales of nearly $4 billion. Treatment with this drug costs a patient around $36,000 per year.The same treatment with generic drugs manufactured by Indian companies would cost just Rs8,000.
Advocate Pratibha Singh, appearing for Indian drug firms Ranbaxy and Cipla, which had opposed Novartis' plea, said that the judgment is a victory for Indian companies as they can now manufacture cheaper drugs so long as there is no patent over a medicine.
''Patents will now be granted only for genuine inventions and not on repetitive inventions. The Supreme Court said there was no new invention in the Novartis' drug,'' she said.
She also said there should be no fear that foreign firms would be affected by Monday's verdict since as long as they have genuine inventions, patents will be given to them.
In its judgement, the apex court held that 'imatinib mesylate' used in Glivec is a known substance and Novartis can't claim patent over the drug for using this chemical.
Novartis had approached the apex court in 2009 against the order of Chennai-based Intellectual Property Appellate Board (IPAB), which had rejected its claim for a patent which it had sought in 2006.
Novartis' claim was opposed by Indian pharma companies manufacturing generic drugs as well as by health aid activists in the apex court. They claimed that Novartis was indulging in ''ever-greening'' of a patent by simply changing the composition of the ingredients of the drug.
A patent on the new form would have given Novartis a 20-year monopoly on the drug.