Natco plea for export permission of two patented drugs may trigger several patent battles

(Article published in Pharmabiz http://www.pharmabiz.com/article/detnews.asp?articleid=43173&sectionid)

As the Patent Control office here is scheduled to take up on February 28 for preliminary hearing the case of Hyderabad-based Natco Pharma seeking permission to manufacture and export two patented drugs to Nepal, a fresh series of patent battles on compulsory licensing is on cards.

Coming up as a test case after the amended Patent Act of 2005 came into effect, the favourable stand of Government on granting permission for patented drugs to be manufactured for exporting may trigger a slew of applications from other companies and possible legal cases from the multinationals that are going to be hit badly. However, the government may get more time to take a stand as it is just the first hearing on the case.

Armed with an import licence from the Nepal Government, Natco in September filed application for exporting anti-cancer Erlotinib, patented by Swiss manufacturers Roche last year in the country under brand name Tarceva and Sunitinib, patented by Pfizer under the brand name Sutent.

A spokesman of Natco said they have also filed an interlocutory petition questioning the sanctity of calling the patent holders for forwarding their representation on the case as the Government had the jurisdiction to allow the compulsory licence. ``At the first hearing, nothing decisive is going to happen as we are going to sit and work out on the terms and conditions of the case. It is pure discretion of the government to grant permission and there is no time limit fixed to take a decision also,'' company secretary Adinarayanan told Pharmabiz.

However, the case has already attracted a lot of attention from across the globe as it is the first of its kind in the country and if sanctioned, second of the sort in the world after Canada allowing to export an anti-AIDS drug TriAvir, patented by GlaxoSmithKline, to Rwanda. The so-called compulsory licence is a recognised legal instrument contained within the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). TRIPS does not stipulate exactly when countries might need to use such a provision and it is a flexibility built into the agreement that leaves it up to governments. Under Section 92A of Indian patent law, companies can apply for a licence to export copies of patented drugs to a country that requests it.

Natco, which intends to produce 30,000 tablets of erlotinib and 15,000 of sunitinib, has offered the patent holders a five per cent royalty, in line with the WTO requirement to provide remuneration.