Looking back, patent laws in India have come a long way. India's patent history began in 1856 with Act VI, which encouraged innovations and sharing of creations between inventors. Based on the British Patent Law of 1852, Act VI was in effect for 30 years. When the British amended the laws in 1800s, India followed suit. In 1911, the Indian Patents and Design Acts came into effect whereby a Controller was installed to manage patent-related issues. When India gained independence from Great Britian, the Patent Act of 1970 was introduced to spur innovation and economic growth. It abolished the product patent system based on the "Ayyangar Committee Report, 1959," which examined the factors influencing the high prices of the drugs and pharmaceuticals in India. The Patent Act has been revised three times since then and made compliant with the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement in 2005.
India has since enforced a set of strict patent laws, and foreign players are facing obstacles in the review process, patent tracking, and pregrant and postgrant opposition, says Ajaykumar Sharma, associate director, pharma and biotech, healthcare practice of Frost and Sullivan (South Asia and Middle East). The interpretation of different sections of the Patent Act of 2005 and review of application remain the biggest challenge. This challenge is increased by the lack of trained manpower that further delays the review process. The Indian Patent Office, additionally, does not have an efficient database system to facilitate searchable full text databases of all patents and applications. Foreign players continue to face an increase in pregrant and postgrant opposition by generic-drug companies. Litigation and infringement cases usually take longer to resolve.India has enforced stricter patent laws compared to other countries such as South Africa. For a drug to be patentable in India, the invention has to be novel (i.e., new to the industry), inventive, and industrially applicable. In contrast, weak patent standards and the absence of a patent agency in South Africa have resulted in the granting of a high number of patents yearly. In 2008 alone, South Africa issued a total of 2442 patents.
The Indian patent agency has set a higher bar for patent approval that is frustrating pharmaceutical manufacturers who are deeply concerned over the agency's standpoint of intellectual property in the country. In Novartis' case, the company is challenging the efficacy clause stated in Section 3(d) of the Indian Patent Law. However, the Indian agency views its decision as a move to curb the "evergreening" practice, whereby a drug is tweaked slightly in a bid to extend patent protection. Specifically, the Novartis patent application was denied on the grounds that the drug lacks innovation because it is considered a salt formulation of the drug and not a new drug altogether.
If Novartis gets its way with the patent, the decision could result in a flood of new patent applications and possibly threaten patients' access to essential drugs tagged at affordable prices. More significantly, it may upset India's position as a generic-drug manufacturer and role to provide affordable drugs to other developing countries.
The Indian Patent Law has also made provisions for the Controller of Patents to issue compulsory licenses to deal with extreme or emergency situations. Recently, it gave approval to Natco Pharma to produce the generic version of Nexavar. As a result, Natco is able to price the drug at $158 for a 120-tablet package.