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Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: Twitter: Dereklowe

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February 17, 2010

Drug Patents in India

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Posted by Derek

The Wall Street Journal has a good article on drug patents in India. Many readers will remember the days when those three words didn't have much chance of appearing together in a sentence, but that all changed in 2005, when the country changed its laws to recognize chemical substances as well as process patents:

When India finally adopted its expanded patent law, it was widely hailed and multinational firms began expanding with gusto. They now sell their latest branded medicines here, expecting the burgeoning middle class and slowly growing health insurance system will pay for them. Pharmaceutical manufacturing has boomed, as has the clinical trial industry.

But little noticed at the time was that the new law sets a higher bar than Europe and the U.S. for approving patents, says D.G. Shah, head of the Indian Pharmaceutical Alliance, a Mumbai-based industry group.

Among the tougher provisions is one that says patents be will granted only when products are more efficacious—a provision the Indian patent office has used to deny several patents, he says.

Improved efficacy, as you might imagine, can turn out to be in the eye of the beholder. Glivec, Tarceva, Viread, and (most recently) Nexavar are drugs that have fallen into this particular pothole. And I have to say, hearing someone from the Indian drug industry lecture about patent quality is a bit hard to take. ((Update: why is that, you ask? Look here for one explanation).

"The U.S. would grant a patent to a piece of toilet paper," says Amar Lulla, chief executive of Cipla, the Indian generics drugmaker. "Just because the U.S. granted a patent, doesn't mean it should be valid."

In its Tuesday decision to dismiss Bayer's appeal, the Delhi High Court made a blistering attack on the company's efforts to block copies of its cancer medicine Nexavar. Calling the appeal "a speculative foray," the court added that "the petitioner, no doubt, is possessed of vast resources and can engage in such pursuits."

Now, I'm not saying that we don't have some poor quality patents. Every country's patent office has allowed junk to issue; the key thing is to try to cut the junk down to a minimum. But I still can't quite figure out what the Indian courts are up to (other than protecting their own generic industry and forcing down the price of drugs, of course). Take a look at this story from the Times of India on the recent Nexavar ruling. I realize that it's hard to tell if it's a news item or an editorial, but have at it anyway.

That article decries "patent linkage", which seems to be the idea that marketing approval for a drug might have something to do with its patent status. Well. . .I sort of thought it was supposed to, when it comes to generic versions. What else is a patent good for, if not for a period of exclusivity? If I'm interpreting this correctly, the Indian courts regard drug patents as granting an exclusive period for a company to market its drug under its own particular brand name - but anyone else can hop right in with the same substance, of course; the patent makes no difference there.

Am I grasping this correctly? If not, I'll be glad to be set straight. And if I am, then what, exactly, is Indian drug patent law supposed to accomplish? And why would any drug-inventing company be so foolish as to rely on it?

Comments (33) + TrackBacks (0) | Category: Business and Markets | Patents and IP


1. Anonymous on February 17, 2010 11:18 AM writes...

I have no idea how the Indian patent system works, but if the following is correct:

If I'm interpreting this correctly, the Indian courts regard drug patents as granting an exclusive period for a company to market its drug under its own particular brand name - but anyone else can hop right in with the same substance, of course; the patent makes no difference there.

Then Indian patents would be time limited trademarks and not patents in the traditional sense.

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2. Will on February 17, 2010 11:28 AM writes...

Well, presumably Cipla will be granted approval sell sorafenib, and Bayer could then sue for infringement of the Indian patent covering the compound.

Essentially it sounds like what is called an "at-risk launch" here in the US. I guess India doesn't have a (generic?) equivalent to the Hatch-Waxman act to keep the lawyers busy? I'm sure Derek has a post somewhere explaining how this process works in the US

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3. Anonymous on February 17, 2010 11:30 AM writes...

If luvin Bollywood is wrong, then I dont want to be right.

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4. Anonymous on February 17, 2010 11:31 AM writes...

Many of the drug companies in India are pursuing their own innovator drugs. If any of them successfully brings a product to market, I wonder how their opinion might change on the utility of the patent system

I can't believe you didn't link to your Ranbaxy process patent story after the comment by the CEO of Cipla

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5. sigma147 on February 17, 2010 11:34 AM writes...

Cipla is notorious for it's patent-busting activities in India. I attended a talk in Mumbai in 2005 where the head of BD for Cipla stated quite clearly that they considered exclusivity on drugs for third-world diseases (malaria, tuberculosis, and more recently HIV) to be immoral and unenforceable. Essentially, their take is that the western pharmas aren't going to sell these drugs at a fair price to third-world markets, so it's fair game for Cipla to do so in the interests of human decency or somesuch.

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6. schinderhannes on February 17, 2010 11:35 AM writes...

You have to give credit to the Indian inventiveness! (Not in inventing drugs but in interpreting patents and more specifically tehir consequences).

Bayer is granted a patent on Sorafenib as a substance not only on the name Nexavar thus it is not a limited trademark thingy. (as emntioned in the comment above).
But - the India equivalent of an FDA is only controlling if a drug is safe and efficacious (nicely shiwn by Bayer, thanks again), if someone happens to file its formulation of a substance.
So the Drug Controller General of India granted marketing approval to Cipla cause their is no "patent linkage" foring said agency to control if a patent is breached.
This does not mean Bayer is not holding the patent but Bayer now has to sue Cipla for breaching the patent, and this will be a lot more problematic and take a long time whilst Cipla is selling the drug all that time. I bet they have enough appeals courts to take this tragic comedy past the patent lifetime of Sorafenib in India.

Net effect: patent is granted but unenforcable, thus useless.
Congrats India!
You are on a good route to fair trade and all the rest.

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7. Will on February 17, 2010 11:44 AM writes...


Yes, Cipla would be able to see the generic equivalent while the infringement lawsuit was ongoing, but that is exactly what happened in the US prior to 1984.

If Bayer wins the lawsuit, they would presumably win damages - I don't know how likely they would be to win, or how fair the damages awarded would be (in Bayer's eye) - maybe the WTO would get involved.

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8. sigma147 on February 17, 2010 11:44 AM writes...

Schinderhannes has it correct. As an aside, the Indian courts move at a glacial pace. I've seen news accounts of legal proceedings taking upwards of 20 years for relatively simple cases such as wrongful dismissals. I recall when India signed onto the WIPO in 2005 - loads of companies started to flood into the Indian CRO space to take advantage of the new Indian stance on IP. I have long held that their acceptance of WIPO standards wouldn't be worth a glass of warm spit until and unless some of these issues made their way through the Indian court system. Sad to say it seems I may be correct here. It looks like they've simply managed to move the goalposts and it's still business as (pre-2005) usual.

And who ever said outsourcing wasn't fun? I'm sure that the companies doing business in India are taking a second look at how their IP will be handled by their Indian contractors.

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9. Stopfakedrugs on February 17, 2010 11:53 AM writes...

The Indian drug industry is made up of genuinely good manufacturers and those who produce cheap and substandard copies (counterfeits to you and me). India is well placed to provide low cost drugs to the developing world, but the patent laws are also used as a smokescreen. If a patent is not recognised in India then a product can be made for export and sold to a third country where the IP is also not recognised. Such drugs have been detained supposedly "in transit" at ports in Europe, where the IP is recognised. There is much debate in Indian pharma press about the definition of counterfeits -they take it more on a quality angle than an IP angle - but the bona fide, above-board Indian manufacturers must take the lead in driving out the charlatans and criminals hiding behind the patent system.

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10. Anonymous on February 17, 2010 12:42 PM writes...

The Indian "scofflaw" attitude about pharma patents isn't about disrespect for international intellectual property's about staving off civil unrest and outright rebellion by millions of poor citizens who find they cannot afford to pay for medicines while their richer compatriots can. They refuse to accept that death it socialism or whatever. Only in the US will 30 million uninsured quietly accept their fate...the rest of the planet is not that other places that would lead to armed revolution. It's a basic "human rights" issue.

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11. PharmaHeretic on February 17, 2010 12:54 PM writes...


//The Indian "scofflaw" attitude about pharma patents isn't about disrespect for international intellectual property's about staving off civil unrest and outright rebellion by millions of poor citizens who find they cannot afford to pay for medicines while their richer compatriots can.//

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12. A Nonny Mouse on February 17, 2010 1:01 PM writes...

Let's face it, CIPLA was founded by the person who persuaded Indira Ghandi to revoke all patent law in India. Thus, that long tradition is being carried on.

They are the largest manufacturer in the Indian home market but, in contrast to many other Indian pharmaceutical manufacturers, have not really ventured outside on the country as its key motivation is supply low cost drugs to the Indian population which would not otherwise be able to afford it.

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13. Mike on February 17, 2010 1:56 PM writes...

"What else is a patent good for, if not for a period of exclusivity? "

The FDA can grant exclusivity to a drug, regardless of whether a patent exists or not. You could easily envision a system that does not depend on patents.
The US patent system is broken, hence the TP remark.

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14. processchemist on February 17, 2010 2:33 PM writes...

So long, global free market (where the western companies MUST follow the laws, and the asian ones can do whatever they want)?
In our field the crisis is provoking (marginal?) changes.
Let's begin from a short and interesting editorial from Trevor Laird (DOI: 10.1021/op9002664): not all approved generics on the market behave as they should - poor bioequivalency (issues: API impurity profile, polimorphism, formulation). So what? Someone is stretching the BE data in the ANDAs and nobody sees nothing?

Second: in the EC only euro GMP certified producers are now allowed to import
their products. Panic in the broker community. Such a shame.

Third not so recent: since last year the indian law says that if you want to perform a clinical trial in India the API must be produced in India. Prices are rising a bit on their side.

Fourth: EC states that some chinese export prices can be classified as dumping practices. China asks the WTO for a sentence capable of neutralizing the EC one.

Now these remarks about India patent laws.
The problem is that the global amount of available money is shrinking, and that the newcomers don't want to loose their slice of the pie (and his size). We (all?) know far too well what we lost in the last few years.
It seems that the western fair (?) play is deteriorating, and India and China are fighting back. They're different, a lot. At least indian companies played the multinational game with some western style. China is using is sovereign fund as a new kind of panzerdivisionen.

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15. Hap on February 17, 2010 2:56 PM writes...

1) I guess the "we're doing this to make drugs affordable for our people" reasoning will be tested when their own companies make their own drugs. I suspect that that reason is hogwash (is Cipla selling most of its "generics" in India or elsewhere?), and that it is more to support their domestic businesses than to help their poor (at least in the short term).

2) Considering the quality of some of the chemistry in their patent-busting attempts, one would have to assume that either the chemists involved aren't being honest, or the generics companies will be readily distinguishable from the external producers by having drugs that don't work (sort of like counterfeiters being advertised as being a benefit to the poor by giving them the pretense of availability to drugs they can't afford). Crappy chemistry in generics doesn't benefit anyone other than the companies selling the generics.

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16. Tayschrenn on February 17, 2010 3:32 PM writes...

"And why would any drug-inventing company be so foolish as to rely on it?"
You are assuming a rational drug manufacturing management and companies who invent/discover drugs, both are dubious assumptions.

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17. alig on February 17, 2010 3:43 PM writes...

Novartis stopped its Indian expandtion and moved to China because India refused to grant a patent for Gleevec. It seems that pharma companies are willing to use CROs in India, but are all setting up major sites in China. This could be a result of Indian IP laws.

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18. Will on February 17, 2010 4:27 PM writes...

Cipla has approved ANDAs for 8 drugs, not nearly as many as Teva or Ranbaxy

I do believe other generic companies purchase api's from Cipla, so it would be hard to tell exactly how many Cipla products are available abroad

I'm sure when Cipla begins selling its Nexavar equivalent in India, it will price the drug at cost, with nary a penny of profit to be had

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19. Anonymous on February 18, 2010 2:38 AM writes...


Cipla has 135 active Drug Master Files registered with FDA. Honestly I don't know where to find how many manufacturers registered products based on Cipla API's.

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20. A Nonny Mouse on February 18, 2010 4:04 AM writes...

Having much of Cipla's (world class) facilities, their central labs have a dedicated floor to FDA regulation work (with about 75 very new Agilent and Shimadzu HPLCs......). They do work mainly with joint venture partners such as in the UK where they are focussing on non-CFC inhalers. A lot of this export business was necessary as the only way they could import materials was by offsetting by exports; I don't know if this is still the case though.

As for other questions about "Western" values, what about Malta (in the EU region, but with no patent laws.....)where the Italians (Dynamit) are manufacturing fexofenadine which goes into the "approved" generics (as it is a different manufacturing process)? What about Switzerland and South Africa where material from India and China comes in before being "beatified" (a true term used in their documentation)?

I'm afraid that looking at all of these issues from a rarified medicinal chemistry viewpoint is all well and good, but once you have crossed over you see quite an underbelly of the pharmaceuticals business.

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21. processchemist on February 18, 2010 4:28 AM writes...


Malta is now part of EC and their IP laws are aligned with the rest of Europe.
Yes, there are "paper laundries" based in South Africa and Switzerland. Yes, not only small companies use their services.

Cipla a world class, cutting edge technological company? I've some doubts. I remember vaguely a Cipla patent covering amorphous citalopram obtained by spray drying... (good technology? maybe. But what about bioequivalence?)

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22. Anonymous on February 18, 2010 4:30 AM writes...

#20 Underbelly......insight
Big pharma is in cahoots with the low cost, low quality drug manufacturers of chindia (WYSIWYG). There is a plethora of sleazy quid-pro-quo biz going on.....
There can be lots of tough *regulations* as *window-dressing* but without enforcement action they are almost worthless, as already noted above with regard to patent litigation......

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23. Anonymous on February 18, 2010 10:01 AM writes...

Switzerland's chemical and pharmaceutical industry rose to such a level because they initially refused to recognize German patents. The Japanese, when their economy began to industrialize, were primarily known for copying everything. There's no reason why India wouldn't take the same path.

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24. A Nonny Mouse on February 18, 2010 10:18 AM writes...

# 20
Well, fexofenadine is definitely being made in Malta for the "approved" generics at Amino owned by Dynamit (don't get me started on fexofenadine though; a 17 year extension on a "more pure form" patent......).

I'm certainly not saying that Cipla is world class in its chemistry but certainly in the quality of its chemical, formulation and analytical facilities. I would certainly prefer to take their material rather than from other Indian companies that I have seen.

As for the Swiss patent laws, it is certainly true that many patents were never valid there and they were able to make many chemical intermediates that could not be done in other countries. I don't know if this is still true, but it as long ago as the mid-90's.

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25. RenegadeSci on February 19, 2010 3:25 PM writes...

What a nightmare... There is no reason to work on something if you have no right to your work. iTunes has a great Cambridge lecture on patents and why they were granted.

If I remember the story correctly, a family in London in the 16th or 17th century figured out how to make surgical tweezers. It was technology to make a life saving effect for even the brutal medicine of the time. Well, the knowledge was kept secret. It was passed down to the children for a generation, until an untimely death lead to the loss of knowledge for many years.

Maybe they can put the people in charge of the trains in India in charge of the patents. Its nuts. It's not about science, but marketing. No reason to develop.

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26. juju124 on February 19, 2010 9:22 PM writes...

The Indian pharmaceutical industry is good at copying and reverse engineering the process. Over the last few years I have made many trips to India to Help companies set their R & D like here.MY DUTIES INCLUDED HIRING AND TRAINING PERSONAL IN NEW TECHNIQUES OF DRUG DISCOVERY AND ORGANIC METHODOLOGY.
These are my observations

1) The quality of Graduate education is so poor that Ph.d's in from Indian universities are equivalent to Masters here.
2) No cutting edge research paper comes from Indian universities
3) According to Citation Index Indian journals are listed at No 22 but chinese authors from China at No 5
4) In the next 5 years China will overtake India as they have economics of scale and displace India
5) Innovation being the key does not find a place in Indian pharma's lexicon
6) Most of the management is top down and there is little or no training once hired. Seminars are far and few in Between
7) An average boss keeps all information to himself and refuses to train his people.
9) I graduated from IIT Bombay in 1972 before coming to grad school here. Our commencement speaker was Mrs Indira Gandhi and what she said still rings true IN MY EARS TODAY. . TEH STAT OF Indian Science TODAY SHE SAID can be summarized as follows " UNDO REDO IS ALL WE DO."


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27. processchemist on February 20, 2010 2:44 AM writes...


Few observations. In my experience there's much difference between the indian companies. Dr Reddy's and Jubilant DO have some really good chemists (I'm talking about process chemistry). It's quite hard that the acquisition of western structures (by Dishman, Piramal, Glenmark) did not contribute to the technological assets of others. And Glenmark and Cadila, at least, entered in co-development/licensing partnerships with Big Pharma. probably I'm talking about a minority of companies, but these are pure facts (corporative behaviours are a different story).

I strongly contest the assertion about China. If indian academic papers are of poor quality, a recent bibliometric study of publications coming from China showed that the high impact factors come from crossed references between chinese authors. Only smoke in the eyes.

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28. vvhome on February 22, 2010 7:31 PM writes...

Later comments have, as is common in blog commentary, digressed from the main story. But it is quite obvious that no one, including Derek, knows what the Bayer case was about. That's the problem with heresay. The WSJ article is a smooth blend of fact and fiction. The Bayer case is not a patent case at all. Bayer was trying to get the Courts to legislate from the bench. The High Court has, rightly, refused. If anyone of you is actually interested in reading the judgement, here's the link: You'll find that the judges were not trying to help Cipla steal Bayer's hard earned money. And, surprise, Cipla is not even a party to the case. Bayer sued the Government of India (actually the Drug Controller General of India, the Indian equivalent of the FDA).

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29. Herbalist about medicinal plants on May 7, 2010 2:35 AM writes...

Since the 1970s, India has become a drug producer for the developing world, revolutionizing the treatment of diseases like AIDS, tuberculosis and malaria with low-cost generics. It now makes one-fifth of the world's generics, according to PricewaterhouseCoopers.

Europe maintains that nothing in the agreement would prevent India from continuing to play this role and that it has no desire to force measures on India that it is not ready to espouse.

"The EU is fully committed to ensuring that people in the world's poorest countries can access affordable medicines," said John Clancy, the EU's trade spokesman in Brussels. "Nothing in the proposed free trade agreement would limit India's freedom to produce lifesaving medicines for export. The EU Commission has even proposed a legally binding clause in the negotiations to this effect."

But such assurances haven't convinced critics.

Another round of EU-India negotiations - April 28 in Brussels, with the goal of signing a completed agreement by October.

The negotiations have been held in secret. A leaked draft of the negotiating text from February 2009, which the Associated Press has seen, contains controversial measures that would extend patent protection up to five years to compensate for drug-approval delays and introduce the concept of "data exclusivity," which restricts the ability of generics companies to rely on data from brand-name companies, potentially forcing them to do their own costly, time-consuming clinical trials.

The most current draft contains similar provisions, according to people familiar with the document who declined to be identified by name because of the confidential nature of the talks.

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30. Natazia on May 14, 2010 6:43 AM writes...

Ranjit Shahani, President of the Organization of Pharmaceutical Producers of India released the following statement on Intellectual Property Day concerning the effect drug patent protection is having on innovation in India:

Innovation, research and patent protection are critical to introducing new drugs into the market. Innovations and effective drugs are inseparable, as diseases constantly mutate and many have inadequate treatments

Without patent protection, innovations decline, as R&D needs immense investments. Due to high, ever-increasing R&D costs, only two in 10 approved medicines earn more than the average cost of developing a new drug. Statistics are telling: a new drug discovery cost around $138 million in 1975, $318 million in 1987 and more than $1.3 billion in 2006.

As we take a look at drug patents on Intellectual Property Day, we must not forget the important role they play in keeping India and the world healthy. With viruses that mutate constantly - HIV/AIDS, H1N1, and TB - incremental innovations are imperative to stay one step ahead in the war against disease. If all innovations are protected to expand treatment options, millions of patients in India and worldwide will benefit. At stake are not just patents, but the lives of millions.

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31. anonymous on December 24, 2010 3:59 AM writes...

Once an intermediate, always an intermediate?
The other day, while I was having a heated discussion with 2 fellow bloggers about the patentability of repurposed drugs i.e. patenting of new use of a known drug, we hit a road block with regard to patent value of an intermediate. The question raised was "Will a newly found first use of an already known intermediate be patentable in India?"
I am rephrasing the question for the purpose of this discussion.
“Will the exclusion criterion elaborated in Section 3 (d) of the Indian Patents Act exclude the patentability of the first known use of the intermediate?”
Whenever the exclusion pertaining to new use of a known substance has been discussed we hav.......for more, log on

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32. modern furniture on May 13, 2014 5:27 AM writes...

Very good post. I am facing a few of these issues as well..

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33. Porada Furniture on August 8, 2014 12:13 AM writes...

Having read this I believed it was extremely informative. I appreciate you spending some time and energy to put this short article together. I once again find myself spending a significant amount of time both reading and posting comments. But so what, it was still worthwhile!

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