Ranjan Narula Associates
                                        March, 2016

Controller refuses plea for compulsory licensing
This article summarizes the latest decision on an application filed by Lee Pharma, a Hyderabad based pharmaceutical company to grant Compulsory licence for AstraZeneca’s drug Saxagliptin.

There have been two earlier cases in the pharmaceutical industry regarding compulsory licensing.
  1. The first one was Natco’s application for Bayer’s Nexavar drug that was successful.

  2. The second application was from BDR Pharma for BMS’s Dasatinib that was rejected.
  1. An application under Section 84(1) of patents Act, 1970 was filed by the Lee Pharma Ltd. (Applicant) on 29/06/15 seeking the grant of Compulsory License for manufacturing and selling the compound SAXAGLIPTIN, which was protected by patent number 206543 titled “A CYCLOPROPYL-FUSED PYRROLIDINE BASED COMPOUND”.
  2. The patent for drug SAXAGLIPTIN was primarily owned by Bristol Myers Squibb Company (BMS), however later assigned to AstraZeneca AB.
  3. The grounds for making the application were as follows:
    1. That the reasonable requirements of public with respect to the patented invention have not been satisfied;
    2. The patented invention is not available to the public at a reasonably affordable price; and
    3. That the patented invention is not worked in the territory of India.
  4. By the notice of 12th August, 2015 the applicant was informed that a prima facie case has not been made out for making an order under Section 84 and requested for hearing under Rule 97(1).

The Controller on the basis of following findings refused the application of Lee Pharma for seeking a Compulsory License:

a) Reasonable requirements of the public met/not met:

The Controller rejected this ground on the basis that applicant failed to show:

  1. What is the requirement of the public with respect to SAXAGLIPTIN in India in context of the number of Type II DM patients requiring the same. The applicant did not submit any specific data/evidence with respect to exact number of patients requiring only SAXAGLIPTIN for the treatment of type-II DM.
  2. Comparative requirement of the drug Saxagliptin vis-a-vis other DPP-4 inhibitor drugs was not substantiated by the applicant.
b) Patented invention was not available to the public at a reasonably affordable price:

The Controller rejected the ground as the applicant failed to show:

  1. The exact quantitative requirement of SAXAGLIPTIN in terms of number of patients requiring it or whether it is in shortage. The Controller was of the view that in the absence of data it is difficult to conclude whether manufacturing in India is necessary or not.
  2. The applicants have based their contentions on mere assumptions without giving authentic data/statistics to show that there is shortage of SAXAGLIPTIN in the Indian Market, thus not satisfying the Clause (a) of Section 84(1).
  3. The applicant’s contention that the patentee has failed to provide the invention to the public at large also fails as its counterparts are being used by a large number of patients which are available at relatively same price. The applicant fails to show the number of patients not being able to obtain the tablet because of its price.
  4. As per the Statistics available the % shares of the diabetic and the sales why the manufacturing of SAXAGLIPTIN in India is not being done, because % share of sales in India is less despite having large % share of the diabetic patients. No evidence is led pointing any shortage of the said drug in India because of its importation only.

The Controller therefore rejected Lee Pharma’s application for the grant of a compulsory license as the applicant had failed to provide evidence and satisfy the Controller regarding any of the grounds as specified in Section 84(1) of the Act.
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