Section 3(D) And the Novartis Case Unveiling The Power And Controversy In India’s Patent Law

INTRODUCTION

The Indian Patent Act, 1970 lays down the foundation for the country’s patent system and defines what can and cannot be protected as an invention. Among its several provisions, Section 3 plays a key role as it lists out matters that are not considered patentable inventions, covering a wide range of exclusions from Sections 3(a) to 3(p).  Out of these, Section 3(d) has attracted the most attention, particularly in the pharmaceutical industry. This provision was introduced to prevent the practice of evergreening, where companies make minor changes to existing drugs to extend their patent protection. Over time, it has become one of the most discussed and debated clauses in Indian patent law, especially after the landmark Novartis AG v. Union of India case, which brought to light the ongoing tension between promoting innovation and ensuring access to affordable medicines.

 

WHAT EXACTLY IS SECTION 3(d) AND THE PROBLEM ASSOCIATED TO IT.

[ Section 3(d): the mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant.Explanation.—For the purposes of this clause, salts, esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of known substance shall be considered to be the same substance, unless they differ significantly in properties with regard to efficacy ] Under the Indian Patent Act, 1970.

Section 3(d) of the Indian Patent Act, 1970, is one of the key provisions that distinguishes India’s patent system from that of many other countries, particularly in the field of pharmaceuticals. According to this section, a mere discovery of a new form of an already known substance, which does not lead to an enhancement in its known efficacy, cannot be patented.

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In simple terms, if a company makes slight changes to an existing drug, such as altering its form, dosage, or composition, it cannot claim a patent unless it can clearly prove that the modification results in a real and measurable improvement in the drug’s therapeutic effect. This provision acts as an important safeguard, ensuring that patents are granted only for genuine and substantial innovations rather than for minor or cosmetic changes intended to extend monopoly rights.

Further, the concept of evergreening refers to a tactic often employed by some pharmaceutical companies to prolong the life of their patents. This is done by making minor alterations to existing drugs, such as changing their dosage, formulation, or salt form and then seeking new patents for these modified versions. Such practices tend to extend monopoly rights, delaying the introduction of affordable generic alternatives in the market. In a country like India, where the availability of low-cost medicines is essential for public health, evergreening presents a significant challenge. To counter this, Section 3(d) serves as an important legal safeguard. It ensures that patent protection is granted only to those pharmaceutical inventions that demonstrate genuine innovation and a clear improvement in therapeutic efficacy, rather than to superficial or incremental modifications.

THE NOVARTIES CASE

In the case of Novartis Vs. Union of India and Ors. (2013) SCR 148, the constitutional validity of Section 3(d) was challenged by Novartis before Madras High Court. However, the patent office rejected Novartis’s patent application covering beta crystalline form of Imatinib Mesylate holding that it is new form of the known substance Imatinib Mesylate (Glivec) and does not show enhanced efficacy even though tests have reveled that the beta crystalline form of Imatinib Mesylate is 30 percent more bioavailable than the known drug. Novartis appealed to the High Court against the decision of the Controller and filed a petition challenging the constitutional validity of section 3(d). The matter related to the patentability of the subject matter was transferred to the Intellectual Property Appellate Board (IPAB), an erstwhile quasi-judicial body which heard appeals against the decision of the Controller. IPAB also upheld the order of the Controller and held that if someone comes up with a derivative of a known cancer drug which has more safety, then whether such patent would be granted in India or not is also matter of debate. Prima facie, it appeared that the present application shall be ought to be rejected because as per Section 3(d), the new form must have enhanced efficacy and not enhanced safety.

Novartis appealed the order of IPAB before the Hon’ble Supreme Court of India. The decision of the Hon’ble Supreme Court (April 2013), in the case of Novartis, clarified that:

“all kinds of beneficial properties of an invention are not eligible to pass the test of enhanced efficacy. Thus, the better physical properties of the invention over the existing drug will not stand for patent protection”

At para 173 of the judgement: “The aforesaid properties, (“physical attribute” according to Manley), would give the subject product improved processability and better and longer storability but, as we shall see presently, on the basis of those properties alone, the beta Crystalline form of Mesylate certainly cannot be said to posses enhanced efficacy over Imatinib Mesylate, the known substance immediately preceding it, within the meaning of Section 3(d) of the Act.”

As per para 180 of the judgement, the Court states: “What is evident, therefore, is that not all advantageous or beneficial properties are relevant, but only such properties that directly relate to efficacy, which in case of medicine, as seen above, it is therapeutic efficacy”.

AFTER ANALYZING

After analyzing the legislative history of Section 3(d), the Hon’ble Supreme Court in the matter of Novartis AG Vs. Union of India, W.P. No. 24760/06, commented, “We have, therefore, no doubt that the amendment/addition made in Section 3(d) is meant especially to deal with chemical substances, and more particularly pharmaceutical products. The amended portion of Section 3(d) clearly sets up a second tier of qualifying standards for chemical substances or pharmaceuticals products in order to leave the door open for true and genuine invention but, at the same time, to check any attempt at repetitive patenting or extension of the patent term on spurious grounds.”

IT WAS FURTHER HELD BY THE SUPREME COURT:

“In the case of medicine, efficacy means “therapeutic efficacy” and physico-chemical properties of substances do not meet the requirement of the therapeutic efficacy.”

It was also held that the patent application must prove the increase in therapeutic efficacy and just increased bioavailability alone may not necessarily lead to an enhancement of therapeutic efficacy, and in any given case, enhanced efficacy must be specifically claimed and established by research data.

In this regard, in para 187 of the Supreme Court judgement, it was further held that:

“………the physio-chemical properties of beta crystalline form of Imatinib Mesylate, namely (i) more beneficial flow properties, (ii) lower hygroscopicity, may be otherwise beneficial but these properties cannot even be taken into account for the purpose of the test of section 3(d) of the Act, since these properties have nothing to do with therapeutic efficacy.”

JUDICIAL PRECEDENTS OF SECTION 3(d):

GRANT OF APPLICATION AFTER OVERCOMING OBJECTION UNDER SECTION 3(d)

Taiho Pharmaceutical v. Controller of Patents (Delhi HC, 2025):

By not identifying any particular 'known substance' in the hearing notice, the appellant was not afforded a fair opportunity to respond to the same, by demonstrating, through comparative research data, that the claimed compound possesses enhanced therapeutic efficacy over the particular 'known substance'. In the absence of such identification, the rejection on the ground of Section 3(d) is not sustainable and warrants a remand for fresh consideration.

Novozymes Biopharma:

In this case, the High Court ruled that Section 3(d) applies to biochemicals beyond just pharmaceuticals. It accepted improved thermostability as a valid form of "enhanced efficacy" for an industrial enzyme, which allowed the patent to be granted. 

University of Miami vs. Controller of Patent: 

This case saw the Intellectual Property Appellate Board (IPAB) uphold an appeal and grant a patent after the applicant addressed objections. The applicant overcame Section 3(d) objections by making strategic claim amendments (eliminating method of treatment claims) and submitting expert affidavits with supporting data. 

Pfizer Products Inc. vs. The Controller of Patents & Designs: 

In this case, the IPAB allowed the appeal against the Controller's order. The key factor was that the Controller had not raised Section 3(d) objections in the initial First Examination Report (FER) or the hearing notice, which was considered a significant point in the appeal. 

REFUSAL OF PATENT APPLICATIONS UNDER SECTION 3(d)

Janssen Pharmaceutica N.V. vs. the Indian Patent Office, order No. 10/2023:

This case involved the fumarate salt of bedaquiline for treating tuberculosis. The application was rejected for failing to meet patentability thresholds, including Section 3(d). Even after the applicant amended the claims and presented multiple arguments, the Patent Office maintained the rejection.

 

Tapas Chatterjee vs. Assistant Controller: 

The Delhi High Court clarified that a patent for a known process can only be granted if it results in a new product or involves a new reactant. This case also emphasized that mere combinations of known processes without any new elements do not meet patentability requirements. 

KEY TAKEAWAYS

It will be a matter of good debate while considering the following situation where a researcher makes changes in the chemical structure of the known drug and the new chemical entity shows a different use than that possessed by a known drug:

Would the applicant be still asked to match the difference between the efficacies of the old drug and the new molecule (where the molecule has a different use)?

Would it be possible for him to prove the new molecule is not ‘mere discovery’ of a derivative of the old drug? Does the applicant have to prove the efficacy given that the new form shows altogether a new use?

Author: Mr. Chetan Wagh, in case of any queries please contact/write back to us via email to chhavi@khuranaandkhurana.com or at  Khurana & Khurana, Advocates and IP Attorney.