Novartis v.

Union of India & Others

The patent application at the center of the case was filed by Novartis in India in 1998, after
India had agreed to enter the World Trade Organization and to abide by worldwide intellectual
property standards under the TRIPS agreement. As part of this agreement, India made changes
to its patent law; the biggest of which was that prior to these changes, patents on products
were not allowed, while afterwards they were, albeit with restrictions. These changes came
into effect in 2005, so Novartis' patent application waited in a "mailbox" with others until
then, under procedures that India instituted to manage the transition. India also passed certain
amendments to its patent law in 2005, just before the laws came into effect, which played a
key role in the rejection of the patent application.

The judgment rendered by the Supreme Court is one of the landmark judgements of the
Supreme Court. The decision came as a relief for millions of people around the world to have
access to medicines at a low cost, thus preventing the pharmaceutical industries from
“evergreening” their patents. While the judgement is seen as a means to ensure the
availability of life-saving drugs at an affordable price to people in India and elsewhere, at the
same time the decision defined the scope of Section 3(d) of the Indian Patents (Amendment)
Act, 2005. In the said matter, the Supreme Court refused to grant a patent to a drug of
Novartis AG on the basis that the said drug did not involve an invention which is capable of
being patentable under Indian law.
Brief Facts Of The Case
In 1997, Novartis, a Swiss based pharmaceutical giant filed an application to grant patent to
an anticancer drug Glivec which is used to treat Chronic Myeloid Leukemia (CML) and
Gastrointestinal Stromal Tumours (GIST) on the basis that it invented the beta crystalline salt
form (imatinib mesylate) of the free base, imatinib.. It is a critical drug which is patented in
about 35 countries of the world.

However during those days, India did not grant patent to pharmaceutical products and
agrochemical products. It was in the year 2005 in India; the drug products became the
subject of patent in compliance with the TRIPS agreement. India thereon revised its patent

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law and started granting patents on pharmaceutical drugs. Subsequently in 2006, the Madras
Patent Office refused the patent application of Novartis for its drug Glivec stating that the
said drug did not exhibit any major changes in therapeutic effectiveness over its pre-existing
form, which was already patented outside India. The said decision was based on Section 3(d)
of the Indian Patents (Amendment) Act, 2005 which provides a known substance can only be
patented if its new forms exhibit “enhanced efficacy”. The Patent Office did not find any
enhanced efficacy in the drug Glivec and, therefore, considered it incapable of patentable
under Section 3(d) of 2005 Act.

In May 2006, Novartis filed two writ petitions under Article 226 of the Indian Constitution
before the High Court of Madras – one appealing against the order of Madras Patent Office
rejecting its patent request and the other contesting that Section 3(d) of the Indian Patents Act
is not in compliance with TRIPS and is vague, arbitrary and violative of Article 14 of the
Constitution.

The Madras High Court refused the Writ Petitions of Novartis holding that it did not have
jurisdiction to determine whether a domestic law is in contrary to international treaty, so it
cannot decide whether Section 3(d) is in compliance with TRIPS. As far as Section 3(d) is
considered, the objective of the Amending Act was to prevent evergreening and to make easy
the access to life-saving drugs to the citizens. Therefore, it cannot be considered to be vague
and arbitrary.

The new phase of litigation started in Intellectual Property Appellate Board, which is an
appellate body of patent controller. IPAB considered the beta-crystalline form of imatinib
mesylate as new and an inventive step but refused to grant a patent to the drug of Novartis
since it was hit by Section 3(d) of the Act. Novartis challenged the said order by filing
Special Leave Petition before the Supreme Court.

OBSERVATIONS OF SUPREME COURT

The main issues that came before the Supreme Court were-

1. Whether the invention is in consistent with Section 3(d) of the patent act?
2. Interpretation of Section 3(d) of the patent act?
3. Whether the invention qualifies for the test of novelty and inventive for the alleged
product?

The Supreme Court adopted the following approach-

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1. Court observed that the product was one of the new forms of the substance and not the
whole substance. It has always existed in the original amorphous form. The product thus
has to qualify the test laid down in Section 3(d) of the Patent Act.
2. The Section clearly specifies that a new form of the substance in not patentable under
Indian law unless it enhances its “known efficacy”.
3. Novartis contended that the physico-chemical properties of the polymorph form of the
imatinib molecule, i.e. better flow properties, better thermodynamic stability and lower
hygroscopicity, resulted in improved efficacy and hence is patentable under Indian law.

The Apex Court rejected this contention stating that in the case of medicines, efficacy means
“therapeutic efficacy” and these properties while they may be beneficial to some patients do
not meet this standard. The Supreme Court also held that patent applicants must prove the
increase in therapeutic efficacy based on research data in vivo in animals.

The Supreme Court held that the true intention to enact section 3(d) was to prevent the
concept of evergreening and thus if the invention does not fulfil the test of Section 3(d), it
cannot be granted a patent. The court further specified that this case should not be interpreted
to mean that Section 3(d) bars all incremental inventions. It is with regard to the field of
medicine especially in cases of life-saving drugs, a great acre and caution needs to be taken
so as to protect the right to life of the masses.

CONCLUSION

The SC judgement comes as a huge relief for those people who can’t afford the lifesaving
drugs manufactured by these big pharma giants. These companies who have already made
billions of dollars prevent people from purchasing the drugs at low price thus endangering the
very life of the poor people by acquiring patents over their drugs. The importance of patent
cannot be denied to prevent a new invention provided such invention is available to all the
individuals at a reasonable rate. On the contrary, companies like Novartis are putting the life
of these poor people at stake by obtaining a monopoly over its drugs. However, the Supreme
Court in its judgement made clear that India is a developing country and the availability of
medicines at a cheap price is necessary for the lives of 1 billion people. The Supreme Court is
thus justified in its decision thereby prohibiting the liberal approach in granting patents and
granting patents only to genuine inventions as against frivolous inventions.

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