Indian Patent Office Rejects Compulsory Licensing Application: BDR Pharmaceuticals Pvt. Ltd. Vs Bristol Myers Squibb

India issued its first CL last year for a Bayer’s kidney liver cancer drug Nexavar to an Indian generic manufacturer Natco on all three grounds of section 84 (1) including reasonable requirement of public not being met, non availability of drug on affordable prices, and non-working of the invention in the territory of India. This decision by the Indian government that lead to the issuing of CL encouraged more domestic generic manufacturers to go ahead with filing more CL applications for patented drugs.

The term compulsory license is used to describe a number of mechanisms for non – voluntary authorizations to use patents. The most important global norm for the use of compulsory licenses is Article 31 of the WTO TRIPS Agreement, which addresses uses “of a patent without the authorization of the right holder, including use by government or third parties authorized by the government.

Recently, the Controller General of Patents (hereinafter Controller) in India has rejected BDR Pharmaceuticals Pvt. Ltd.’s application for CL for Bristol Myers Squibb’s (BMS) cancer drug SPRYCEL. SPRYCEL is a brand name in which the active pharmaceutical ingredient is DASATINIB, used by patients with Chronic Myeloid Leukemia which is covered in patent number IN203937. The drug has received Orphan Drug Status in USA, Europe and Switzerland. The Controller rejected the compulsory license application made by BDR for stating that BDR has failed to make out the prima facie case for the making of an order under section 87 of the Act.

BDR had requested for compulsory license of DASATINIB on March 4, 2013. BDR claimed that DASATINIB is a suitable chemotherapeutic option for the treatment of Chronic Myeloid Leukemia and is prescribed when a patient is resistant or develops resistance to the drug IMATINIB, in view of the improved tolerance and efficacy of the drug. BDR Pharmaceutical also submitted that the price of each tablet sold by the patentee is INR 2761/- which works out to INR 1, 65,680/- for 60 tablets per month per patient and about INR 19, 88,160/- per year per patient. BDR on the other hand submitted that it will make drug available to the public at a proposed price of Rs. 135/- per tablet which will work out to Rs. 8100/- per month for the treatment of Chronic Myeloid Leukemia patient and moreover the drug will be offered free of cost to a certain percentage of patients suffering from Chronic Myeloid Leukemia as determined by the cancer specialist.

BDR Requested for Voluntary Licence

In the present case, BDR sent a letter dated 2nd February 2012, to BMS requesting for a voluntary license for manufacturing DASATINIB in India.

In response to BDR’s letter,  BMS raised certain queries by their letter dated 13th March 2012 such  as “facts which demonstrate an ability to consistently supply high volume of the API, DASATINIB, to the market”, “facts showing your litigation history or any other factors which may jeopardize Bristol Myers Squibb’s market position”, “quality related facts and in particular compliance with local regulatory standards and basic GMP requirements”, “quality assurance systems due diligence”, “commercial supply teams”, “safety and environmental profile”, “risk of local corruption”.

BDR took this reply of Bristol Myers Squibb as ‘clearly indicative of the rejection of the application for voluntary licence’ and did not pursue the matter and made no further effort to arrive at a settlement and made an application of compulsory licence on 4th March 2013.

Notice of Prima Facie Case not being made out

After a review of the BDR’s CL application by the Controller, a notice was issued stating that a prima facie case was not being made out for the making of an order under Section 84 of the Act as ‘the applicant has not acquired the ability to work the invention to the public advantage’, in the absence of the requisite approval from DCGI, and ‘the applicant has also not made efforts to obtain a licence from the patentee on reasonable terms and conditions’. BDR filed a request for hearing with the Patent Office on May 13, 2013.

BDR’ Arguments and Controller’s Decision

In the hearings fixed by the Controller, BDR submitted that by not specifically replying to the request for voluntary licence, the patentee could have continued to correspond asking for more and more information and kept the request for voluntary licence in abeyance. Moreover, the patentee could have also used the information sought from the applicants against the applicants themselves in ongoing suits for patent infringement.

BDR further argued that if the patentee avoids to specifically rejecting the request for voluntary licence or does not address the terms for grant thereof, the application for compulsory licence could be indefinitely delayed for want of specific denial from the patentee, unless the Ld. Controller exercises his powers in appreciating the efforts made by the applicant towards fulfilling the requirements of Section 84(6)(iv). In considering the application field under this section, the Controller shall take into account,—

(iv)   as to whether the applicant has made efforts to obtain a licence from the patentee on reasonable terms and conditions and such efforts have not been successful within a reasonable period as the Controller may deem fit.

The Controller stated that the contentions of the applicant are misplaced and ‘explanation’ to Section 84(6) of the Patent Act, 1970, clarifies beyond doubt that a patentee cannot indefinitely prevent an applicant for voluntary licence from making an application for compulsory licence under Section 84 of the Act. At the most, if at all, the patentee can prevent a prospective applicant for six months from making an application for compulsory licence.

The Controller further stated it is evident from the proceedings that the applicant realized his mistake and thereafter tried hard to somehow justify the inaction of not replying at all to the letter of the patentee dated 13th March 2012 due to which these submissions can only be termed as afterthought.

BDR also contended that to the utter surprise of the applicant, in the April 2012 issue of ‘Indian Business Law Journal’, the attorney for the patentee publicly declared that the strategy on behalf of the patentee was ‘to keep the potential licensee of a compulsory licence engaged without a clear outright rejection’ and continue with fresh queries. This lead the applicant to conclude that there would be no purpose in responding to the said letter of the patentee seeking more information, because any response on the part of the applicant would have been treated by the patentee on these lines or in the same manner as publicly stated by their attorney.

On this contention made by the applicant, the Controller stated that the applicant ought to have appreciated that a statement/opinion given by the attorney       of the patentee in a journal cannot be taken as evidence against the patentee in the present case.

On BDR’s arguments on ‘reasonable period’ the Controller stated that if the applicant really believed that the ‘reasonable period’ is something less than ‘six months’ why did he not take action in accordance with his beliefs. That is, after making an offer on 2nd February 2012 to the patentee and after receiving the patentee’s reply dated 13th March 2012, why did the applicant wait till 4th March 2013 to file the present application.

Moreover, the Controller stated that the term ‘efforts’ is not accompanied by the qualifying term ‘reasonable’ and the applicant ought to have appreciated that the duty cast upon the applicant to make ‘efforts’ is absolute and inflexible and without exceptions.

The Controller also stated that the decision to grant a voluntary licence, particularly on as subject matter covered by a patent, is an important decision for a patentee. While, it is possible that some of the queries raised by the patentee may not be strictly reasonable, it is natural that the patentee may seek additional information from the requesting party to satisfy himself about the credentials and capability of the said party. The Controller held that the applicant did not make efforts to obtain a licence form the patentee on reasonable terms and conditions.

The applicant sought to argue that the three substantive requirements under section 84(1) namely, (a) non-satisfaction of reasonable requirements of the public, (b) non-availability at a reasonably affordable price, and (c) not worked in the territory of India, have been met singularly and independently satisfied by the applicant due to which any irregularity in procedure/timeline may be either waived or condoned or declared to be not applicable.

The Controller however stated that the stage for making a ruling on the applicability of the grounds of Section 84 on merits has not yet arrived. The Controller further held that the deliberate intent on part of the applicant to refrain from entering into any kind of dialogue with the patentee for the purpose of securing the grant of voluntary licence, and the exercise of a deliberate choice to only invoke the provisions relating to compulsory licences without taking the requisite steps laid down by the law, cannot be classified as an ‘irregularity in procedure/timeline’, which can be waived or condoned or declared to be not applicable.

The controller thus held that a prima facie case for issuing a CL under Section 87 is not made out and rejected the application of CL.

Last year India bore the brunt of issuing CL to Bayer by the Global MNCs alleging that India’s patent decisions side with the domestic generic industry. However, the current decision clearly indicates that decisions relating to compulsory licensing would be judiciously based on the merits of the case and patent rights would be lawfully protected. It is to be seen whether this decision will be challenged by BDR at IPAB or not.

About the Author: Ms. Harsha Rohatgi, Patent Associate, Khurana & Khurana, Advocates and IP Attorneys and can be reached at: harsha@khuranaandkhurana.com

2 thoughts on “Indian Patent Office Rejects Compulsory Licensing Application: BDR Pharmaceuticals Pvt. Ltd. Vs Bristol Myers Squibb”

  1. do and give yur’s full efforts to bring generic version of dasatinib and ponatinib as soon as possible in india, as no indian(99%) can afford such expensive drugs and are waiting to die………………….

Leave a Reply to s.s.saggu Cancel reply

Categories

Archives

  • March 2024
  • February 2024
  • January 2024
  • December 2023
  • November 2023
  • October 2023
  • September 2023
  • August 2023
  • July 2023
  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • September 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010