Delhi High Court Revives Gilead’s Patent Application

In a big setback to the Indian Generic Drug-makers, Delhi High Court has allowed the writ petition filed by Gilead Pharmasset LLC against the Union of India for an adverse order passed against it by the Deputy Controller of Patents & Designs. The Deputy Controller had rejected Gilead’s application for failing to satisfy the criterion under section 3(d) of the Indian Patents Act, 1970 stating that the invention lacks efficacy in the eyes of law. Gilead has developed a drug called Sovaldi (INN-sofosbuvir) which is effective in curing Hepatitis C Virus (HPV). The drug is significant in terms of invention because of its low toxic levels and shorter duration of treatment which gives it an edge over earlier treatments involving Interferons (IFNs) and drug Virazole (INN-Ribavirin). IFNs didn’t had a long lasting effect on the virus while Virazole had severe side-effects like causing anemia and increasing level of toxins in the body. If the stats are to be believed, there are approximately 170 million patients worldwide that suffer from HCV Virus with 18 million being from India only. Gilead agreed to grant license over the drug to seven drug makers in India to fulfill the demand, but the agreed price couldn’t convince Generic Drug-makers and therefore to protect its interest, Gilead applied for patent in India.

The proceedings before Deputy Controller in the Parent Order were invoked under section 14 of the Act because of the pre-grant opposition filed by Natco Pharma and Delhi Network of Positive People (DNP+) that opposed the application under various grounds enumerated in section 25 of the Act. The controller rejected the oppositions that alleged lack of novelty and non-obviousness by taking cue from the approach of authorities in US and Japan with respect to the same patent. However, it accepted their contention under section 3(d) which bars patent-ability of an invention which is new form of a known substance and doesn’t results in enhancement of known efficacy of the substance. It supplemented its assertion by referring to the Supreme Court’s judgment in Novartis v. Union of India case, in which it was stated that efficacy stands for therapeutic efficacy which can be proved by clinical trials. The application was thus rejected. However, rather than filing an appeal before the Intellectual Property Appellate Board (IPAB), Gilead filed a writ Petition alleging violation of Principles of Natural Justice.

The detailed judgment of the High Court came out only on 30^th January, 2015 after the initial order was released on 22^nd January, 2015. But the contents of the detailed judgment are pretty surprising. The ground for violation of Natural Justice raised by the applicant sustained because the Deputy Controller didn’t issued (or may be failed to issue) notice to the applicants regarding the applications filed by the opposers under section 25 of the Act. Not to mention the fact that in his order, it was observed that the controller had significantly copied the contents of the application (Yes… “lifting of para and verse from opponents application” as the order puts is) which technically raised suspicion for bias against the applicants. The High Court thus allowed the writ and remanded the matter before the controller for a fresh decision.

Now it will be interesting to see how the Controller decides this matter. For it had succinctly rejected applicant’s submissions before it without proper reasoning and by taking inferences from a document on record, which it didn’t supplied to the applicants before hearing begun under section 14. The matter will require addressing technical questions like whether change in orientation of a component, which not only satisfies the novel and inventive step criterion, but also enhances the effectiveness of already existing compound is sufficient to satisfy ‘efficacy’ norm of the Patent Law? If no, then what “significant” (as pointed out in the order) level of enhanced therapeutic efficacy is required to satisfy the requirement stated under section 3(d)? Besides, can only reports of clinical trials can prove improvements in therapeutic efficacy or well-reasoned scientific data like cytotoxicity data would also suffice. The controller rejected the rationale of Delhi High Court’s decision in Roche v. Cipla without supplying a proper reasoning for the same. This time, Controller will be required to elucidate as to whether substitution of one chemical group with other is akin to orientation of a compound’s group, given that both result in enhancing the curing ability of the compound?

The case study in hand presents a good example of as to why developed countries lose faith in Indian authorities when it comes to Intellectual Property Rights. First they misuse Public Policy norms to favor small corporations and now they go to the extent of violating Rules of Natural Justice. Union of India has decided to appeal against the order of High Court, of which there is no need. Just because you went till Supreme Court doesn’t means you have done your job. Successful Execution of policies requires balancing the needs of masses with the genuine business needs of the corporates, not biased actions intended to garner accolades from media and high-profile activists.

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