Download - Tapan Ray Indian School of Business, Hyderabad March 2, 2009 INDIAN PATENT ACT 2005 - An Overview
Tapan Ray
Indian School of Business, HyderabadIndian School of Business, HyderabadMarch 2, 2009March 2, 2009
INDIAN PATENT ACT 2005 - An Overview
Founded in 1965 Over 75 Members Research-based International & large Indian Pharma Companies
Affiliated to International Federation of Pharmaceutical Manufacturers & Associations (IFPMA), Geneva, Switzerland and World Self-Medication Industry (WSMI), France
3 Fundamental Beliefs - Adherence to TRIPs Compliant IPR - Ethical Sales Promotion based on IFPMA Guidelines and OPPI Code of Conduct - Adherence to International GMP & Quality Standards
Organisation of Pharmaceutical Producers of Organisation of Pharmaceutical Producers of India (OPPI)India (OPPI)
Healthcare Policy – An Overview
IPR Scenario in India & Indian Patent Act 2005 – Key Concerns
• Definition of Patentability• Data Protection• Scope of Compulsory Licensing• Pre-Grant Opposition• Enforcement of Patent Act
Patented Products Pricing
IP Index
ContentContent
Policy-sets that influence the Pharmaceutical Industry
Healthcare Policy Industrial Policy Health Safety Policy
• Access to medicines• Cost-effective medication• Regulating the physician and consumer behaviour • Generic promotion/ substitution
• Promoting SMEs• Strengthening R&D• Protection of IPR• Sustaining Industry- Institution Linkages• Supporting technology transfer and capacity development
• Ensuring Quality in manufacturing• Efficacious treatments• Innovations in drug delivery• Safety in medicines
Source: EXIM Research
Policy Framework Supporting Policy Framework Supporting Pharmaceutical IndustryPharmaceutical Industry
National Pharmaceutical Pricing Authority (NPPA) Department of Pharmaceuticals Ministry of Health & Family Welfare
- Central Drug Standard Control Organization (DCGI)
Ministry of Science & Technology - Department of Biotechnology
Drugs & Cosmetic Act, 1940 - Key Schedules: Schedule D1, D2, H, K, M, Y (2005)
Regulatory Authorities in IndiaRegulatory Authorities in India
Central Drugs Controller Office– New drug approval– Clinical research– Safety
Port– Import and Export
Central Drug Laboratory– Analytical testing
State Drugs Controller Office– Manufacturing – Inspections
Regulatory RolesRegulatory Roles
Countries Govt. Payment
Out of pocket
payment
Insurance Others
United States 44.3% 13.7% 35.8% 4.9%
Japan 80% 20% - -
Australia 71% 16% 7% 5%
France 77.5% 20.5% 2%
Germany 75.1% 11% 13.9%
Canada 72% 17% 11%
UK 81% 3% 16%
Spain 72% 20.5% 7.5%
Italy 73.7% 26.3%
India : 80% out of pocket payment and 20% from others
India’s Healthcare Context is India’s Healthcare Context is UniqueUnique
Doctor’s Fees 9%
Medicines 15%*
Diagnostic Investigations & Pathological Tests 24%
Hospitalization 17%
Transport 20%
Miscellaneous 8%
Others 7%
* 60% towards taxes and trade margins
15% of Total Household Cost for Individuals
Source: National Survey of Health, 2003
MedicinesMedicines
Households72%
Firms 5%
Local Government2%State Government
13%
External Aid2%
Central Government6%
Source: National Health Accounts – 2001-02, MoHFW, GoI
Proportion of Health Expenditure by Financing Source
Sources of Financing Healthcare Sources of Financing Healthcare Services in IndiaServices in India
Source: Network, November 2004
• This 350 mn. people are largely clustered around urban centres where health care facilities exist
Percentage of WHO regions lacking access to essential medicines
Access of Medicines to All Proves Access of Medicines to All Proves to be a Challenge to be a Challenge
650 Mn. (no access
to medicines)
350 Mn. access to medicines
150 Mn. – Formal sector
200 Mn. – Largely above Poverty line
300 Mn.
Above Poverty line
350 Mn.
Below Poverty line
Pharma Industry role is restricted to this sector
Formal Sector: Those employed with the Public or Private Sector
Need of these patients are primarily for essential medicines
Access to Innovative MedicinesAccess to Innovative Medicines
NATIONALINTEREST
SCIENCE &TECHNOLOGY
ANDR&D
AVAILABILITY &
MEDICINEPRICES
HEALTHCARENEEDS
INTELLECTUALPROPERTY
RIGHTS
Ideal IPR Policy for Ideal IPR Policy for IndiaIndia
First Indian Patent Law : 1856
Patent Designs and Protection Act : 1872
Protection of Inventions Act : 1883 to 1970
India signed WTO : 1st January 1995
Indian Patents (Amendment) Act, 2005
Patent Law in India – A BackgroundPatent Law in India – A Background
5Enter Clinical
Testing
5Enter Clinical
Testing
250Enter
Preclinical Testing
New Product Development is Risky, New Product Development is Risky, Time-consuming and ExpensiveTime-consuming and Expensive
Sources: 1) Increased Length and Complexity of the Research and Development Process. Chapter 1 in: PhRMA Pharmaceutical Industry Profile 2003.
2). Tufts Center for the Study of Drug Development. Impact Report, Vol 8, Num 6, November/December 2006
Phase I 20–80 Healthy Volunteers Used
to Determine Safety and Dosage
Phase III1,000–5,000 Patient Volunteers Used to Monitor
Adverse Reactions to Long-Term Use
Additional Post-Marketing Testing
Phase II100–300 Patient Volunteers Used to Look
for Efficacy and Side Effects
FDA Review Approval
Preclinical TestingLaboratory and Animal Testing
Discovery (2–10 Years)
Compound Success Rates by Stage
5,000–10,000Screened
1Approved by the
FDA
Years
88
66
44
22
00
1010
1212
1414
1616
Cost to Develop New Biotech Products Is Estimated to Average $1.2 – 1.7 BnCost to Develop New Biotech Products Is Estimated to Average $1.2 – 1.7 BnCost to Develop New Biotech Products Is Estimated to Average $1.2 – 1.7 BnCost to Develop New Biotech Products Is Estimated to Average $1.2 – 1.7 Bn
Target Identi-
fication
Target Vali-dation
Lead Identifi-
cation
Lead Optimis-
ation
CandidateMedicine
Pre-Clinical
Clinical Phase I
Clinical Phase II
Clinical Phase III
~ 6-12 months 0 years 10 years 20 years
Basic Research Development
Source: Pharmaceutical Sector Inquiry - Issue Nov. 2008 – Page No.51
MA
Pricing
ProductLaunch
Life Cycle of a Medicine – Pre-launch PeriodLife Cycle of a Medicine – Pre-launch Period
Currently engaged in medium levels of research:- NDDS- Contract Research- Specialised Generics- Biogenerics- NCEs / NMEs (the ultimate aim)
R&D in IndiaR&D in India
Ranbaxy
Dr. Reddy’s
Glenmark
Wockhardt
Zydus Cadila
Piramal Healthcare
Lupin
Biocon & others
Research done by Research done by Major Indian CompaniesMajor Indian Companies
R&D Status of Indian CompaniesR&D Status of Indian Companies- NCEs- NCEs
21 Pre-clinical Stage
7 Phase 1
16 Phase II
2 Phase III
Expected to launch 3 NCEs worth sales around U.S.$ 500 Mn. by 2015
R & D Spend: How Top Sectors Fare
Source: Capitaline Plus
Pharma Spends More Than All Industries Put Together
51%
25%
11%
5% 4% 3%
51%
26%
11%
5% 4% 3%
0
10
20
30
40
50
60
Pharma Automotive Oil/Refining IT Software Elec. Equipment Engineering
2006
2005
Indian Industry – R&D SpendIndian Industry – R&D Spend
Developed countries : 2% of GDP
In India : 0.6% of GDP (stated to be 2% by 2011)
R&D Funding StructureR&D Funding Structure
R & D Spend - Pharmaceuticals
Almost 7 - 8% of 2006 Trade Sales
@ Constant $ (1 = INR 40)
Source: IDMA
Year $ Mn
1995 31
2000 71
2005 409
2006 522
Indian Pharmaceutical IndustryIndian Pharmaceutical Industry
India : 7 – 8% (U.S.$ 522 Mn.)
Growth : 26%
U.S. :19% (U.S.$ 52.2 Bn. of total revenue)
R&D Spend of Pharmaceutical R&D Spend of Pharmaceutical IndustryIndustry
2002-03
2003-04 2004-05 2005-06 2006-07
Filed 11,466 12,613 17,466 24,415 28,882
Examined 9,538 10,709 14,813 11,569 14,119
Granted 1,379 2,469 1,911 4,320 7,359
Source: Commerce Ministry, GoI
Patent Application StatusPatent Application StatusPharmaceuticalsPharmaceuticals
Definition of Patentability
Data Protection
Scope of Compulsory Licensing
Pre-Grant Opposition
Enforcement of Patent Act
Indian Patent LawIndian Patent LawAreas of ConcernAreas of Concern
TRIPS Allows NCEs, Polymorphs, Chiral Isomers, New Indications etc.
Section 3(d) of the Patent Act – “Salts, esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of known substance shall be considered to be the same substance, unless they differ significantly in properties with regards to efficacy.”
PatentabilityPatentability
Date of filing of patent for invention 1
Date of expiry of patent for Invention 1
Date of filing of patent for improvement
Date of expiry of patent for improvement
Anyone is free to use the patent of invention 1 when the term for that is over. The innovator or anyone else who has patent for the improvement will have rights to his patent only. There is no extension of patent term as per the Indian Patent Act
Evergreening… A MisconceptionEvergreening… A Misconception
Objectives: 1. To ensure genuine pre-grant opposition2. To eliminate opposition in seriatim The need:1. Ensure that Innovation is not put to undue disadvantage for delay in Pre-grant proceedings.
2. Need to introduce statutory time limits for setting up hearings by the Controller and disposing off pre-grant matters for ‘Accountability’
Pre-Grant Opposition by Pre-Grant Opposition by RepresentationRepresentation
Recommendations: 1. Pre-grant opposition must be filed within 6
months of publication
2. Pre-grant opposition must be disposed within 12 months of commencement of pre-grant proceedings.
3. If not concluded within 12 months, provide equivalent Patent Term Restoration.
Pre-Grant Opposition by Pre-Grant Opposition by RepresentationRepresentation
TRIPS Article 39.3
"Members, when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products, which utilize new chemical entities, the submission of undisclosed information or other data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use.. In addition, Members shall protect such data against disclosure, except where necessary to protect the public, or unless steps are taken to ensure that the data is protected against unfair commercial use."
Regulatory Data ProtectionRegulatory Data Protection
Date of filing of patent for invention 1
Date of expiry of patent for Invention 1 and introduction of generics
Date of mandatory Data Protection Date of expiry
of mandatory Data Protection
*Anyone is free to use the patent of invention 1 when the patent term expires. There is no extension of patent term with mandatory data protection of the innovator for a specified period.
20 Years
5 Years
Scenario 1
Mandatory Data Protection is Mandatory Data Protection is ‘Evergreening’… A Misconception‘Evergreening’… A Misconception
Date of filing of patent for invention 1
Date of expiry of patent for Invention 1 and introduction of generics
Date of mandatory Data Protection for Innovations
Date of expiry of mandatory Data Protection for Innovations
*Anyone is free to use the patent of invention 1 when the patent term expires with one’s own data. There is no extension of patent term with mandatory Data Protection of the Innovator for a specified period.
20 Years
5 Years
Scenario 2
Mandatory Data Protection is Mandatory Data Protection is ‘Evergreening’… A Misconception‘Evergreening’… A Misconception
Preserving a climate that supports Innovation is more important than ever.
Enforcement of PatentEnforcement of Patent
WTO TRIPS Agreement - Article 28.1(a)WTO TRIPS Agreement - Article 28.1(a)
Member countries agree to ensure exclusive rights to patent holders for a limited period of time
“Prevent third parties not having the owner’s consent from the acts of: making, using, offering for sale, [or] selling” the product for the duration of the patent
Current StatusCurrent Status
Last year at least 4 patents were infringed (mailbox applications?)
No one knows when these cases will get resolved
No known strong deterrent for patent infringement
Serious adverse commercial impact on the innovators
Is the sanctity of granting patents in India getting lost?
A Definition of Patent LinkageA Definition of Patent Linkage
A regulatory system under which marketing approval of generic drugs is not granted until the expiration of original drug’s patent
Whose Responsibility?Whose Responsibility?
Governments, not Patent Offices, are bound by the WTO TRIPS Agreement
It is the responsibility of all relevant Government Departments/Ministries to ensure that TRIPS obligations on patent protection are met
Communication Process EssentialCommunication Process Essential
The process of gaining marketing approval for patented pharmaceutical generally rests with the Ministry of Health of a WTO Member State
For WTO members to meet TRIPS obligations communication between the Patent Office
and the Ministry of Health is critical to prevent premature approval of generic copies of patented drugs
Patent Linkage ProcessEstablishes the communication process
between the Health Ministry and the Patent Offices to prevent marketing approval of generic drugs before expiration of patents
Ensures that one Government Department/Ministry does not impair the efforts of another Government Department/Ministry to provide effective intellectual property protection as required by Article 28 of the WTO TRIPS Agreement
What will it do?What will it do?Ensures that Health Regulatory Authorities do
not unintentionally undermine the ability of the Government to meet WTO TRIPS obligations
Establishes Patent Linkage between Health Regulatory Authorities and Patent Office officials
Helps Health Regulatory Authorities not to approve marketing rights of products under patent or are under patent review or approval process
Patent Linkage in the United StatesPatent Linkage in the United States
US FDA maintains a listing of pharmaceutical products known as the Orange Book
The Electronic Orange Book is also available via the internet at: http://www.fda.gov/cder/ob/
US FDA does not authorize the marketing approval for a generic copy of a pharmaceutical product protected by a patent listed in the Orange Book
Patent Linkage in EuropePatent Linkage in Europe
Instead of Patent Linkage the period of data exclusivity is for 10/11 years
Patent Linkage Around the WorldPatent Linkage Around the WorldCountry Description
Australia Health Authorities do not provide marketing approval for a generic copy which would infringe an existing patent.
Bahrain In progress
Canada Canada has a system similar to that of the U.S. FDA., where Health Regulatory Authorities will not provide marketing approval for pharmaceutical products protected by patents listed in the equivalent of the FDA Orange Book.
Chile In progress
China State Food and Drugs Administration (SFDA) must be satisfied that no patent is being infringed before it will issue marketing approval. If there has been litigation over a patent, SFDA will wait until the appeals process has been exhausted before acting.
Patent Linkage Around the WorldPatent Linkage Around the WorldCountry Description
Dominican Republic – Central America FTA (DR-CAFTA)
In progress
Jordan Marketing approval for a pharmaceutical product is not permitted during the period of patent protection.
Mexico Applicants seeking marketing approval for generic pharmaceutical products in Mexico must certify that their patent rights are not infringed. Health Regulatory Authorities then check with the Patent Office, which must respond within ten days to confirm whether a patent is involved. While Health Authorities will accept an application of marketing approval during the patent period, grant of marketing approval will be delayed until the patent expires.
Patent Linkage Around the WorldPatent Linkage Around the World
Country Description
Morocco In progress
Oman In progress
Singapore Similar to the U.S. System, applicants seeking marketing approval for generic pharmaceutical products in Singapore must declare that the application does not infringe any patent.
U.A.E. U.A.E. Health Regulatory Authorities will not provide marketing approval for pharmaceutical products that remain under patent protection in the country.
Necessity of Patent LinkageNecessity of Patent Linkage
Government grants patent and must ensure their protection through regulatory system
Will encourage innovators
Will help Indian Companies to avoid similar problems when they will launch their NCEs as systems will be already put in place
Will help avoid unnecessary enormous litigation cost and time
The Procedure ExistsThe Procedure ExistsThe procedure (Patent Linkage) of
checking Patent Status of a product before granting Marketing Approval already exists in Form 44 of the DCGI
Unfortunately it is not implemented
Form 44(See rules 122 A, 122 B, 122 D, and 122 DA)
Application for grant of permission to import or manufacture a New Drug or to undertake clinical trial.
I/we _____________________________________________of M/s. __________________________________________________(address) hereby apply for grant of permission for import of and/or clinical trial or for approval to manufacture a new drug or fixed dose combination or subsequent permission for already approved new drug. The necessary information / data is given below:
Particulars of New Drug: (1) Name of the drug:(2) Dosage Form:(3) Composition of the formulation:(4) Test specification:(i) active ingredients:(ii) inactive ingredients:(5) Pharmacological classification of the drug:(6) Indications for which proposed to be used:(7) Manufacturer of the raw material (bulk drug substances):
(8) Patent status of the drug:
Data submitted along with the application (as per Schedule Y with indexing and page nos.) A. Permission to market a new drug :-
(1) Chemical and Pharmaceutical information(2) Animal Pharmacology(3) Animal Toxicology(4) Human/Clinical Pharmacology (Phase I)(5) Exploratory Clinical Trials (Phase II)(6) Confirmatory Clinical Trials (Phase III) (including published review articles)(7) Bio-availability, dissolution and stability study Data(8) Regulatory status in other countries(9) Marketing information:(a) Proposed product monograph(b) Drafts of labels and cartons(10) Application for test license
B. Subsequent approval / permission for manufacture of already approved new drug:(a) Formulation:(1) Bio-availability/ bio-equivalence protocol(2) Name of the investigator/center(3) Source of raw material (bulk drug substances) and stability study data. (b) Raw material (bulk drug substances)(1) Manufacturing method(2) Quality control parameters and/or analytical specification, stability report.(3) Animal toxicity dataC. Approval / Permission for fixed dose combination:(1) Therapeutic Justification (authentic literature in pre-reviewed journals/text books)(2) Data on pharmacokinetics/pharmacodynamics combination(3) Any other data generated by the applicant on the safety and efficacy of the combination.D. Subsequent Approval or approval for new indication – new dosage form:(1) Number and date of Approval/permission already granted.(2) Therapeutic Justification for new claim / modified dosage form.(3) Data generated on safety, efficacy and quality parameters.
A total fee of rupees __________________________________________(in words). _________________________________________) has been credited to the Government under the Head of Account _________________________________________________________________ (Photocopy of receipt is enclosed).
Dated _____ Signature __________________ Designation ________________Note- Delete, whichever is not applicable.
~85% of All Patented Medicines will have a Therapeutic Equivalent
Patented Drugs
(1) Includes new salt, new formulations, new combinations, new manufacturer or patents for new indications Source: Lu and Comanor (1998), OPPI, FDA, BCG Analysis
76%
15.7%8.3% (1)
Therapeutic Equivalents will exist.
Empirical evidence suggests ~15% of new patented drugs are NMEs with significant therapeutic advantage.
Post 2005 only 2.3% of the Indian pharma market l consists of drugs that have no therapeutic equivalent.
97.7% of the market will be generic or the products will have therapeutic areas.
Will Patent Laws Fuel Price Increases?Will Patent Laws Fuel Price Increases?
650 Mn. (no access
to medicines)
350 Mn. access to medicines
Free Market Price
Negotiated prices for Government procurement
Industry to support Government efforts to provide Access
2-pronged Approach
The Way Ahead…The Way Ahead…Ensuring Access in Control Free Pricing Ensuring Access in Control Free Pricing
RegimeRegime
Hasten reforms to attract players
Mandatory insurance in organised sector
Health insurance for farmers, labourers
Promote Health InsurancePromote Health Insurance
Based on 5 Criteria
1. Term of Exclusivity
2. Scope of Exclusivity
3. Strength of Exclusivity
4. Barriers to full I.P. Exploitation
5. Enforcement
Ref. Meir Pugatch, University of Haifa – The Journal of World Investment & Trade
Pharmaceutical I.P. Index to Pharmaceutical I.P. Index to Benchmark IndiaBenchmark India
Country I.P. Index (2007)U.S.A. 4.67
Singapore 4.40
U.K. 4.37
Chile 3.00
Israel 2.89
Brazil 2.00
China 2.62
India 1.80
Ref. Meir Pugatch, University of Haifa – The Journal of World Investment & Trade
Pharmaceutical I.P. IndexPharmaceutical I.P. Index