Novartis AG and Anr. v. Cipla Ltd.
I.A. No.24863/2014 IN CS(OS) No. 3812/2014
Date of decision: 09.01.2015
Delhi High Court
Plaintiff held a Patent for INDACATEROL (for Chronic Obstructive Pulmonary Disease). Plaintiff filed a suit against the Defendant towards infringement of the said Patent.
On 22nd October, 2014 the Defendant made a representation to the Department Of Industrial Policy & Promotion (DIPP) under Section 66 and Section 92(3) of the Patents Act, 1970 seeking revocation and/or compulsory license on notifications by Central Government.
Plaintiff came to know about the Defendant’s launch of INDACATEROL on 30th October, 2014 through newspaper report in a newspaper “The Economic Times”.
The product of the Plaintiffs was sold under the mark/brand ONBREZ.
On 9th December, 2014, the Plaintiff filed the present suit for permanent injunction restraining infringement of Patent and other incidental reliefs.
• Controller of Patent was satisfied with the novelty, inventiveness and industrial application of the compounds claimed. After full security and strict examination Controller of Patent has granted Indian Patent No. 222346 (Suit Patent) to the Plaintiff No.1. It has not been challenged by anyone. It is an old registration. The Plaintiff No.1 has got the exclusive rights to use the patent. No person has a right to infringe the same.
• Defendant in order to earn easy profit has infringed the suit patent knowingly that it is exclusive ownership of Plaintiff No.1.
• It is a valid patent. No evidence contrary to its validity has been produced, therefore, the Plaintiffs are entitled to protection for their patent and an order of injunction against Defendant who is infringing the suit patent. The present remedy is only the efficacious remedy available in law to protect its statutory right of exclusivity granted vide Section 48 of The Patents Act, 1970.
• Defendant has filed a detailed representation under Section 66 and 92(3) of the Act on 22nd October, 2014, seeking that the Central Government be pleased to revoke the said suit patent IN222346, on the reasons that the patented product is not available for patients or doctors to prescribe.
• Defendant has an expertise in manufacturing respiratory drugs and its products are available at almost one-fifth of the price of Plaintiff’s drug.
• There being no justification for not making the products in India by the Plaintiff, thus the patent rights are liable to be revoked and the defendant be permitted to make the product.
• Plaintiff No. 1 has failed to make the product available to the patient population in India.
• Court, which exercises powers to revoke a patent, ought to take `working of the patent’ into consideration while adjudicating an application for injunction, more so in the light of the fact that the working of patents is essential.
• Drug of the Defendant should not to be injuncted. The same would be available for the patients.
• The Defendant has launched the drug in October 2014, and has made substantial sale of about 12,148 units of the drug.
• Defendant has filed on record several articles which establish that COPD has assumed epidemic proportion in India. These articles have been in public domain since the last many years. Being a patentee, it is the duty and obligation of Plaintiff No.1 to make the drug available to the ever increasing patients in India.
• As the patentee has failed to take any step, the public interest should prevail, and an injunction should not be granted and the Defendant is entitled to manufacture the drug.
• Section 48 of the Patent Act, 1970 does not help the case of the Plaintiffs as the opening lines of the Section 48 stipulates that the same is “subject to other provisions of the Act”. Thus, the right of a patentee to prevent others from manufacturing or offering for sale a patented drug is subject to other provisions of the Act.
• Section 83 is the relevant provisions under the Patent Act which deals with “working” of a patent. The principles laid down in Section 83 would definitely apply in the cases of infringement. It is not merely meant for adjudicating the application of compulsory licensing.
• Defendant has admitted in the reply as well as representation made before the Government that the patented drug is an effective and it is convenient to the patients and when administered in combination with other drug, the same has proven to be quite beneficial and in fact in the reply, the Defendant has suggested and agreed to deposit royalty at a rate i.e. a percentage of its sale.
• These admissions of the defendant prima facie establish that it is a valid patent and the product manufactured by the defendant is infringing one.
• So, the very fact that Section 92(3) has been mentioned is sufficient admission in this case on behalf of the Defendant for the purposes of disposal of the injunction application and also an admission that there is an infringement.
• It is submitted that the Defendant can sell its drug cheaper as it has not invested huge sums in research and development like the Plaintiff and in clinical trials demonstrating the quality and safety of the drug.
• The Plaintiff has also fulfilled public interest by actually supplying the patent drugs as per the demand in Indian market and are committed to additional supply of product in question if there is a unfulfilled requirement.
• Defendant has failed to produce the scientific data showing requirement of Plaintiff’s product to meet the category of COPD patients in India and the short fall of such requirement. It cannot be only Plaintiffs responsibility to provide COPD treatment to the entire Indian population and all drug manufacturers including the Defendant share the equal responsibility of fulfilling public interest.
• There is no obligation in law that the Plaintiff must manufacture the patented drug in India which is already being marketed by Lupin and the same is easily available.
• Patent rights are often considered as highest in the category of monopoly rights in the regime of Intellectual Property. This is due to the reason that patent right is absolute monopoly position where a patentee can prevent any person misusing the patent from manufacturing the project or arrive at the product through a process which is subject matter of patent. Thus, patentee being a right holder which is a privilege granted by a Sovereign State can enjoy this position of monopoly of manufacturing or making the process for a limited period of time to the exclusion of others.
• The right of patent is statutory in nature and the said right stems from the Statute.
• Section 48 confers on the patentee, his agents and licensees the exclusive rights to make, use, exercise or distribute invention in India. The rights of the patentee are infringed if anyone makes and supplies or commercially uses and the patentee may be granted interim order, subject to the condition if the patent is valid.
• It is not incumbent upon the Plaintiff in case of infringement to show that the Plaintiff has suffered commercial loss.
• In F. Hoffmann-La Roche Ltd. vs Cipla Ltd., Division Bench of Delhi High Court has observed that the court has to see the tenability and the credible nature of defence while deciding the grant or non-grant of injunction. If the Defendant’s case is found to be tenable and there are serious questions as to validity to be tried in the suit, then the interim injunction in the case may not be granted.
• It is apparently evident that the Defendant itself has acknowledged the efficacy and inventive steps of the suit patent. The Defendant in its representation filed on 22nd October, 2014 under Section 66 and 92(3) of the Act petition before DIPP has acknowledged the efficacy of the Plaintiff’s drug namely INDACATEROL as preferred choice of physicians which is an acknowledgement of high degree of novelty and inventiveness of the patented compound. Rather in the reply to the interim application, the same was admitted. In reply, the offer was also made by the Defendant to pay the royalty to the Plaintiff.
• It is the admitted position that the Defendant’s packaging is showing INDACATEROL Maleate as active ingredient.
• In the present case prior arts cited by the Defendant are unexplained and the Defendant is taking inconsistent position and also goes on to state that the product under patent which is INDACATEROL Maleate is highly efficacious in curing the COPD and thus desirable by the Defendant when the Defendant is itself making the other drugs for curing COPD which according to the Defendant’s own saying are not adequate.
• It can be said that the Plaintiff is have been able to establish a case of prima facie valid patent on record.
• The alleged prior arts which the Defendant is duty bound to explain as it is the defendant who has urged the case of prior arts cannot be said to be prior arts in real sense of the term due to the Defendant’s inability to explain the same properly as to how the same leads to workshop result or anticipated piece of art and further taking the position that the products under the patent is highly efficacious.
• From the above said reasons it appears that no serious challenge is made and addressed before Court of prior art. Therefore, the submission of the Defendant has no force at present.
• Defendant has not filed any expert affidavit in order to show that the impugned drug launched by the Defendant does not infringe the suit patent of the Plaintiff.
• On the other hand, the Plaintiffs have also filed on record the analysis of Defendant’s product in the affidavit of Alessandro Allodoli in support thereof. As per expert opinion, the inhalation powder in the Defendant’s product contains INDACATEROL which confirms infringement.
• It is settled law that an interim injunction may be granted if the Defendant has applied for a compulsory licence but he infringes the patent during a period when his application is still pending.
• Plaintiffs are not expected to flood the market with INDACATEROL without reasonable demand. Medical practitioners have various options of drugs to choose from including that of the Defendant.
• Before introduction of the INDACATEROL of the Plaintiffs, it is Defendant’s drugs (among others) which were prescribed treatment for COPD patients. If the Defendant, despite being leading marketer of COPD drugs over last several decades, could not alter the number of COPD patients in need for treatment, the Defendant cannot take the advantage of the Plaintiffs of not fulfilling the demand of COPD drug. As admitted by the Defendant that COPD cannot be cured but only treated and therefore, the Plaintiffs are correct in saying that the Defendant is merely relying on COPD data to raise the issue of public interest in order to infringe the suit patent.
• With regard to the argument of the Defendant that the Plaintiff is not manufacturing the drug in India is concerned, the requirement of law is limited to working the patent in India so that the same is available to public at large. It is not essential that the patent must be worked by manufacturing the patented product in India.
• The arguments of the Defendant have no force that the rights conferred under Section 48 are subject to Section 83. The argument of this nature would go against the scheme of the Act. The Act does not mandate that no patent protection would be granted to a patentee unless the local manufacture is undertaken.
• Therefore to say that public interest is a complete exception to the patent would not be correct as otherwise the rights granted by the sovereign towards monopoly would be undermined by too broadly interpreting the public interest. The ground of public interest can be invoked once the court finds that damages is adequate relief which has been held in the line of authorities emerging from US where the courts have imposed heavy sums upon the Defendants towards permitting the usage of patents.
• It is clear that the grounds which are available for the person interested while seeking an application for the compulsory licensing or revocation of the patent on the ground of non working of the patent could be urged before the relevant authority which will consider the matter and cannot be imported as a matter of defence to the suit for infringement as the civil court hearing the suit for infringement cannot transgress within the domain of the authority/ controller/ central government which are distinct functionaries having their powers and considerations specifically defined under the specific provisions of the Act.
• On the basis of the admissions of the Defendant, it can be said that the Plaintiff is able to establish a case of prima facie valid patent on record.
• It appears to the Court that suit patent is a valid patent as the efficacy of invented compound, subject matter of suit patent, is admitted by the Defendant.
• From the entire facts and material placed on record, it is clear that prima facie, suit patent is a valid patent. No credible defence is made. The Defendant has infringed the suit patent.
• The balance of convenience and irreparable harm shall not be caused to the Defendant in as much as the Defendant has recently launched the product in the market in October 2014 and the Plaintiffs have immediately filed the suit before the court.
The Defendant was restrained from infringing the suit Patent till the pendency of the suit. As far as non-working of Patent and other issues, the Defendant was given a liberty to apply for compulsory license.
The order is under challenge before the Division Bench of the High Court of Delhi