23 Dec 2021

Novartis Ag & Ors. vs Natco Pharma Limited

Introduction

In the present case the plaintiff is seeking a permanent injunction to halt the defendant from launching Ceritinib capsules, which are covered by a patent of the plaintiff. During post-grant opposition, whether patentee rights exist was in question. In this case, the court held that the continuation of an injunction would not be permissible once the patent had been revoked and, thus, the interim order prohibiting the defendant from fresh production of the capsules was suspended.

Facts of the Case

  • Novartis was granted a patent for its novel and inventive patent compound Ceritinib, which treats non-small cell lung cancer. The patent application was filed as a PCT (Patent Cooperation Treaty) application claiming priority since 2007 and was granted a patent on 28 September 2015.
  • Novartis came across NOXALK (Natco Pharma’s product) at a pharmaceutical conference at Kolkata and noticed the launch of “Ceritinib Capsules.”
  • Ceritinib, according to Natco Pharma, is neither novel nor inventive as it falls under the Markush formula, which is disclosed in AstraZeneca's patent or two other patents granted to Rigel. Based on such contentions, Natco Pharma opposed Novartis’s patent by post-grant opposition.
  • The case was filed in High Court by Novartis, seeking a permanent injunction, damages, and restraining Natco Pharma from manufacturing and selling "Ceritinib" capsules.

Issue

Whether patentee rights subsist during post-grant opposition?

Background of the case

On 2 May 2019, the Court granted an interim order directing that the post-grant opposition (for which orders were reserved) be decided by the Patent Office before the next hearing date. On the next date, however, the Court was informed that no orders had been passed in the post-grant opposition proceedings. Following this, an order rescinding the patent was issued on 16 August 2019 based on the lack of novelty in the patent. As a result, Plaintiff submitted that the order passed in the post-grant opposition proceedings had been appealed against and was listed before the Intellectual Property Appellate Board ('IPAB') on 19 August 2019 and that the injunction should continue until the IPAB issued its decision.

Rules

Rights of patentees-Subject to the other provisions contained in this Act and the conditions specified in section 47, a patent granted under this Act shall confer on the patentee:

  1. When a patent covers a product, the patentee has the exclusive right to protect this product from making, using, selling, offering for sale, or importing it in India for any one of the aforementioned purposes, without the consent of the patentee;
  2. Where the patent relates to a process, the exclusive right to prevent third parties, who do not have his consent, from using that process in India and from using, offering for sale, selling, or importing the product obtained directly from that process for those purposes.

Submissions by the petitioner

  • The plaintiff no.1 argued that before filing the patent application they continued the research and development regarding the same and used two compounds namely, Valsartan and Sacubitril in combination to treat cardiovascular diseases. It was found that the combination of Valsartan and Sacubitril achieves greater therapeutic effect than the administration of Valsartan, ACE inhibitors or NEP inhibitors alone. It is stated that the suit patent has been granted in 50 countries and in India, there was no challenge to the grant of the suit patent IN 229051 either at the pre-grant stage or post-grant stage or by way of a revocation petition. It is urged that the suit patent is therefore a well-established patent and is prima facie valid and subsisting and will expire on 16.03.2023.

 

  • It is claimed by the appellant that the suit patent would be infringed by any unauthorised making, use, offering for sale any pharmaceutical composition comprising a combination of Valsartan and Sacubitril irrespective of a pharmaceutical formulation or arrangement thereof. It is stated that the plaintiff sells the drug formulation, marketed under the trade mark Vymada in India and Entresto internationally.

 

  • It is further urged by the plaintiff no.1 that they continued with additional experiment and research and arrived at a supra molecular structure (or supra molecular complex) of Valsartan and Sacubitril. It is stated that being a novel supra molecular structure, plaintiff No. 1 has filed an application for grant of patent in respect thereof and the same is subject matter of Indian Patent application No. 4412/DELNP/2007 dated 08.11.2006. The said application was published on 24.08.2007. It is stated that the said application has been opposed by way of pre-grant oppositions by various parties including the defendant herein. The opposition by the defendant was filed on 06.09.2016 though the patent application was published in 2007 and is pending adjudication.
  • The appellant further stated that through a press release issued by the defendant came to know about the act of the defendant in launching a pharmaceutical composition comprising of the patented combination of Sacubitril and Valsartan tablet under the brand VALSAC as a combination drug. And urged that the defendant's drug formulation cannot be made, used or offered for sale without infringing the suit patent IN 229051. Hence, it is urged that the plaintiff is entitled to prevent infringement of the suit patent and that all integers of Claim I of the suit patent are present in the infringing product of the defendant.
  • Hence, the accompanying suit for permanent injunction, damages and rendition of accounts, a decree of delivery, etc.
  • It is further urged that the defendant has now raised the issue of invalidity of the suit patent and has cited a handful of prior arts for the said purpose. However, at no stage has the defendant taken any steps to challenge the validity of the suit patent. It is only as a counter-blast, now when the present suit for injunction has been filed that the validity of the suit patent has been challenged. It is urged that none of the prior art citations relied upon by the defendant renders the suit patent obvious or lacking in novelty.

Submissions of the respondent

  • The defendant argues that the appellant has misleadingly and falsely stated that the said supra molecular complex is covered under the suit patent IN'051. They state that the invention is nothing but a physical combination aforesaid Valsartan and Sacubitril.
  • It is further stated that the plaintiff has deliberately suppressed the fact that the plaintiff has also a supra molecular complex which is covered by the pending patent application.
  • The product covered, namely, the supra molecular complex is not in any way concerned or related to the suit patent IN'051. It is stated that the plaintiff has also asserted that the product covered by the subsequent application No.4412 was never conceived or contemplated when the invention for the suit patent was made.
  • The defendant has also filed a counter-claim for revocation of the Indian Patent IN'051, on the grounds:
  1. Subject matter of the patent is obvious in nature and does not involve any inventive step having regard to what was publicly known or used or published in India or elsewhere - Lack of inventive step under Section 64(1)(f)
  2. Subject matter of the patent is not patentable under the Act - Claims are not patentable under Section 3(e) read with Section 64(1)(k)
  3. It is urged that the said claims do not satisfy the definition of the term composition as the said claims merely relate to an admixture of an active and a pharmaceutically acceptable carrier.
  4. The subject matter of the Patent under No.229051 is not sufficiently or properly described - insufficient description - ground 64(l) (h).
  5. It is claimed that the subject matter of the patent is not patentable under the Act. Reliance is placed on Section 3(d) read with Section 64(1) (k) of the Act.
  6. It is claimed that the impugned suit patent does not possess any inventive steps and is obvious to a person skilled in the art. Reliance is placed on Section 64 (1) (d) of the Act.

Analysis

Since the post-grant opposition was not decided by the IPAB, the Court held as follows:

  • While the patent rights may crystallize once the opposition is decided, during the pendency of the post-grant opposition, the patentee's rights remain. The court cited the Supreme Court's decision in Aloys Wobben. As such, Section 48 of the Patents Act grants patentees rights that are not affected during the pendency of a post-grant opposition.
  • Natco Pharma was also told to wait for the court's decision before launching the product.
  • In an interim ruling, the court allowed for the sale of stock already manufactured by Natco under the trademark NOXALK (Ceritinib) taking into account the interest of the patients, holding that failing to allow the defendant to sell his product would only hurt the patient community.
  • Natco Pharma has been barred from producing any new stock of drugs containing the "Ceritinib" compound.

Decision

When the post-grant order was issued and the patent was revoked, the court held that:

  1. Rights in a patent are only for the life of a patent that remains granted and which has not been revoked. The manner in which patent rights operate is that they are merely statutory rights and there are no common law rights in patents. Patent infringement actions are maintainable only in respect of granted and live patents. The fact that no infringement action is maintainable in respect of an unregistered or revoked patent is clear from Section 62(2) and Section 11A (7) of the Act. If a patent is not renewed, no infringement action would lie. Similarly, once the patent is published, no infringement action can be filed until the patent is granted, though damages can be sought with effect from the date of publication. Thus, the continuation of an injunction, even for a day, would not be permissible once the patent is revoked.
  2. In light of the factual matrix (specifically, the passing of the order dated 16 August 2019, revoking the patent), the interim order restraining the defendant from carrying out any fresh manufacturing of pharmaceutical preparations comprising the Active Pharmaceutical Ingredient (‘API’) Ceritinib, was suspended.