Natco pushes ahead with bid to compulsorily licence anti-cancer drug from Bayer

Natco Pharma, an Indian generic pharmaceutical company, has lodged an application with the Indian Patent Office requesting the grant of a compulsory licence to produce a generic version of Bayer’s anti-cancer drug Nexavar.  If granted, this would be the first-ever compulsory licence issued by the Indian Patent Office and would set the bar for future applicants.

Natco’s application was published by the IPO and public submissions will be accepted until 12 October 2011.  (SpicyIP has a link to Natco’s application and an analysis of specific grounds of the application here.)

The Indian Patents Act allows a person to apply for a compulsory licence 3 years after the grant of a patent.  Applications can only be made after a voluntary licence has been sought by the applicant from the patentee.  Relevantly subsections 84(1) and (5) of the Act provide that:

(1) At any time after the expiration of three years from the date of the sealing of a patent, any person interested may make an application to the Controller alleging that the reasonable requirements of the public with respect to the patented invention have not been satisfied or that the patented invention is not available to the public at a reasonable price and praying for the grant of a compulsory licence to work the patented invention.

(5) The Controller, if satisfied that the reasonable requirements of the public with respect to the patented invention have not been satisfied or that the patented invention is not available to the public at a reasonable price, may order the patentee to grant a licence upon such terms as he may deem fit.

Natco’s application argues that Nexavar, which is used to treat liver and kidney cancer, is exorbitantly priced and inaccessible to the vast majority of patients in need of treatment.  The application highlights that:

  • a one month prescription of Nexavar (which is not manufactured in India) costs approximately US$6,000 (whereas Natco says it can manufacture a one month prescription for US$180 and that it would provide the tablet free of cost to patients who could not afford to pay); and
  • Nexavar is not manufactured in India and is only available from certain pharmacies in large cities.

Bayer responded to Natco’s application, stating that: “We cannot speculate on the impact that the Compulsory License would have at this point in time.  Bayer will review the application argumentation and decide on further steps after the conclusion of our review.”  Bayer is also currently engaged in litigation with Cipla, another Indian generic pharmaceutical company, which has already launched a generic version of Nexavar without Bayer’s consent.

In recent years, the spectre of compulsory licensing has loomed over innovator pharmaceutical companies in India with many local companies and healthcare professionals pushing for greater use of the compulsory licensing provisions to reduce the cost of medicines and improve patient access.  With the next move in Bayer’s hands, it will be interesting to follow the development of this issue.

About the Author

James Ellsmore
James is a senior associate with King & Wood Mallesons' Intellectual Property team in Sydney. James assists clients to resolve intellectual property disputes, with a particular focus on patents, pharmaceuticals and the life sciences. He has acted for a variety of clients in matters concerning patent infringement and revocation proceedings in the Federal Court of Australia, patent opposition proceedings before the Commissioner of Patents, and matters arising from patent licence and technology agreements. James also has experience in the preparation of commercial, R&D and IP agreements for leading universities, research organisations and pharmaceutical companies. He also advises clients on regulatory issues affecting clients in the industrials, consumer and health sectors.
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