Bombay High Court dismisses Bayer’s plea: India’s first Compulsory licence continues as IPAB’s decision upheld by the Court.

July 16, 2014

In a hearing on plea filed by the German drug manufacturer Bayer AG, the Bombay High Court has dismissed the challenge against Intellectual Property Appellate Board’s (IPAB) decision that allowed Natco Pharma Ltd to manufacture and sell generic versions of Bayer’s patented drug Nexavar (Sorafenib Tosylate).

Although the detailed order is awaited, as per the news published in LiveMint , Justice M.S. Sanklecha has stated that “We don’t see a reason to interfere with the order passed by IPAB and, therefore, the case is dismissed”.

Earlier in 2012 the Indian Patent Office had granted its first Compulsory Licence to Natco for producing generic version of Bayer’s patented medicine Nexavar (Sorafenib Tosylate), which is used in the treatment of Liver and Kidney cancer. While the multinational giant was selling the drug at INR 2.80 lakh for a month’s course, Natco promised to make available the same at a price of about 3 % (INR 8800) of what was charged by Bayer. Aggrieved by the Controller’s decision, Bayer had immediately moved IPAB for stay on the order alleging that the grant of Compulsory Licence was illegal and unsustainable. On September 14, 2012 the Board had rejected Bayer’s appeal holding that if stay was granted, it would definitely jeopardize the interest of the public who need the drug at the later stage of the disease and that granting stay would affect the right of access to affordable medicine of the patients.

Last year on March 4, 2013 the IPAB had rejected appeal filed by Bayer the Controller General’s decision granting Compulsory Licence to Natco Pharma Ltd. (Respondent) for Bayer’s patented drug Nexavar (Sorafenib Tosylate). The IPAB had rejected all the contentions raised by Bayer in their appeal including notice not being given to appellant (opportunity at the prima facie stage), genuine attempts not being made by the Respondent to secure licence from Appellant, reasonably affordable price and working of patented invention in the territory of India. On the percentage of royalty that was to be paid by the Natco to Bayer (6% that was fixed by the Controller), IPAB had increased it by 1 percent but had not change any other terms and conditions of the licence.

As of now the said drug is available in the Indian market in three brands Bayer’s Nexavar, Natco’s Sorafenat and Cipla Ltd’s Soranib. Interestingly Bayer was banking on Cipla’s presence in the market and had contended at the IPAB that CIPLA has been selling the disputed drug at Rs 30,000 and until declared as an infringer, its presence cannot be considered illegal and should be taken into reckoning to see if the reasonable requirement of the public is met. The Board had however held that the requirements and conditions for grant of compulsory licence must be decided with reference to the patentee alone and not a party whose presence itself is litigious and that for deciding whether the conditions of Section 84 (that provides for the grant of Compulsory Licence) are satisfied, it will not take into account the presence of CIPLA.

Bayer now has the option to move the Supreme Court against the Bombay High Court’s order.

For more information please contact us at :