Indian drug makers can export patented meds for approval: Delhi High Court
NEW DELHI: Indian generic drug makers have the fundamental right to make, sell and export patented medicines for purposes of regulatory approval and clinical trials, the Delhi High Court ruled today.
"The right of manufacturers/producers of medicines and of fine chemical producers, to make, construct and sell including by way of export, a patented invention, for the purposes prescribed in section 107A (of Patents Act) is a fundamental right protected by Article 19(1)(g) of the Constitution and the sale cannot be curtailed except by express law," Justice Rajiv Sahai Endlaw said.
The ruling came as the court allowed state-run pharma company Natco and generic drug maker Alembic Pharmaceuticals to export two patented medicines of German drug major Bayer's for clinical trials and regulatory approvals abroad as allowed under section 107A of the Patents Act.
Natco and Alembic, however, were directed to undertake that during the life of the respective patent, they will not export the respective patented invention for purposes other than those specified in section 107A.
Section 107A of the Act explains what will not constitute infringement of a patent and includes selling of a patented invention for the purposes of development.
The drugs in question were Bayer's cancer drug Sorafenib marketed under the name of Nexavar, whose generic version Sorefenat was being exported by Natco, and the German company's blood thinning medicine Rivaroxaban, a generic version of which was being exported by Alembic.
The court disposed of Bayer's pleas against the two Indian companies, saying that sale by a non-patentee of a pharmaceutical product solely for the purposes prescribed in section 107A would "not be infringement and cannot be prevented".
The court noted that section 107A permitted sale of a patented product during the term of the patent but only for the purpose of obtaining regulatory approvals for making and marketing the patented product after the expiry of the patent.
Bayer, in its plea, had contented that once the patented invention is permitted to be sold by way of export for regulatory approvals, the court will no longer have the jurisdiction to ensure that the exports are used for that purpose only.
Rejecting the contention, the court said the Patents Act was concerned with protection of the rights of the patentees in India only and not outside India.
"Neither our legislature, nor this Court can impose any condition on the use of the goods exported once they reach the destination country," it said.
It further said that "the laws of this country are only concerned with the sale by way of export from this country being for the purposes prescribed. As long as the sale by way of export is declared to be for purposes of section 107A and there is nothing to suggest that it is otherwise, no fetters can be imposed."
Natco has a compulsory licence for selling Sorefenat in India and the court said that grant of compulsory licence would not come in the way of the Indian company exercising its rights under section 107A.
"I thus hold that Natco as a non-patentee cannot be deprived of making, constructing and selling by way of export a patented invention for purposes specified in section 107A for the reason of having been granted the compulsory licence," the judge said.
The court had in March 2014 restrained the sale of Sofranet covered by the compulsory licence overseas.
The court had allowed Natco to export a small quantity, of less than 15 grams, for the purposes of clinical trials.
Later, in November 2014, the court had ruled that Natco could export one kilogram of the active pharmaceutical ingredient Sorafenib for the purpose of clinical trials.
Alembic wanted to export its generic version of the blood thinner to Brazil and Palestine for regulatory clearances.
"The right of manufacturers/producers of medicines and of fine chemical producers, to make, construct and sell including by way of export, a patented invention, for the purposes prescribed in section 107A (of Patents Act) is a fundamental right protected by Article 19(1)(g) of the Constitution and the sale cannot be curtailed except by express law," Justice Rajiv Sahai Endlaw said.
The ruling came as the court allowed state-run pharma company Natco and generic drug maker Alembic Pharmaceuticals to export two patented medicines of German drug major Bayer's for clinical trials and regulatory approvals abroad as allowed under section 107A of the Patents Act.
Natco and Alembic, however, were directed to undertake that during the life of the respective patent, they will not export the respective patented invention for purposes other than those specified in section 107A.
Section 107A of the Act explains what will not constitute infringement of a patent and includes selling of a patented invention for the purposes of development.
The drugs in question were Bayer's cancer drug Sorafenib marketed under the name of Nexavar, whose generic version Sorefenat was being exported by Natco, and the German company's blood thinning medicine Rivaroxaban, a generic version of which was being exported by Alembic.
The court disposed of Bayer's pleas against the two Indian companies, saying that sale by a non-patentee of a pharmaceutical product solely for the purposes prescribed in section 107A would "not be infringement and cannot be prevented".
The court noted that section 107A permitted sale of a patented product during the term of the patent but only for the purpose of obtaining regulatory approvals for making and marketing the patented product after the expiry of the patent.
Bayer, in its plea, had contented that once the patented invention is permitted to be sold by way of export for regulatory approvals, the court will no longer have the jurisdiction to ensure that the exports are used for that purpose only.
Rejecting the contention, the court said the Patents Act was concerned with protection of the rights of the patentees in India only and not outside India.
"Neither our legislature, nor this Court can impose any condition on the use of the goods exported once they reach the destination country," it said.
It further said that "the laws of this country are only concerned with the sale by way of export from this country being for the purposes prescribed. As long as the sale by way of export is declared to be for purposes of section 107A and there is nothing to suggest that it is otherwise, no fetters can be imposed."
Natco has a compulsory licence for selling Sorefenat in India and the court said that grant of compulsory licence would not come in the way of the Indian company exercising its rights under section 107A.
"I thus hold that Natco as a non-patentee cannot be deprived of making, constructing and selling by way of export a patented invention for purposes specified in section 107A for the reason of having been granted the compulsory licence," the judge said.
The court had in March 2014 restrained the sale of Sofranet covered by the compulsory licence overseas.
The court had allowed Natco to export a small quantity, of less than 15 grams, for the purposes of clinical trials.
Later, in November 2014, the court had ruled that Natco could export one kilogram of the active pharmaceutical ingredient Sorafenib for the purpose of clinical trials.
Alembic wanted to export its generic version of the blood thinner to Brazil and Palestine for regulatory clearances.
