Court not to issue administrative directions when a quasi-judicial authority is seized with a proceeding

A writ petition filed by Panacea Biotech Limited for reconstitution of the Opposition Board in a Post grant proceeding was rejected by the Hon’ble Bombay High Court as the Court held that as the Post grant is still pending before the Patent Office, it would refrain from issuing any directions,  letting the parties to get their rights adjudicated before the forum provided under the Act.

Panacea Biotech Limited was granted a patent, IN272351 for a vaccine and the grant was published in favour of the Patentee in the Patent Office Journal, on 1 April 2016. Post grant Oppositions were filed by Shantha Biotecnics Private Limited and Biological E Limited. The Controller General of Patents constituted an Opposition Board as per the provisions of the Patents Act, 1970. The Controller of Patents circulated the copies of the recommendations received from Board to the Patentee. The Patentee wrote to the Controller General, complaining that the recommendations suffer from glaring lacunae and they be discarded and new board be constituted. The Patentee also filed a writ Petition Challenging said Opposition Board recommendations and requesting that new Opposition Board be constituted.

The Controller General replied to the letter /complaint of the Patentee and held that it will not be proper to issue any such administrative directions when the

Controller is in midst of quasi-judicial proceedings. The Controller General of Patents clarified that the Petitioner/Patentee can take all such contentions available in law and fact about the recommendation in the pending proceedings.

The Court also reviewed the reply of the Controller General and completely agreed with the findings therein. The main question as per the Hon’ble Bombay High Court in the present case was whether the Court should examine this case under the extraordinary jurisdiction under Article 226 of the Constitution of India in midst of the proceedings pending under Section 25(2) of  the Act before the Controller of Patents. The answer as per the Court is No due to the following reasons: –

  1. The Court held that the self-contained scheme of expert adjudication is provided for under the Patent Act and Rules and it would be incorrect for the Court to issue a direction merely because the petitioner says that the recommendation is flawed;
  2. The court also held that to check if the recommendation in question is faulty, the Court will have to enter into the merits of the recommendation and will have to sit in appeal to assess the merits;
  3. The Court also distinguished the present case with the case relied upon by the Petitioner/Patentee, that is, the order of the Supreme Court in CIPLA Limited Vs. Union of India and others – (Civil Appeal No(s). 8479 – 8480 of 2012 dated 27 November 2012). The Court held that, in the Cipla case, the patent was finally revoked without giving a copy of the recommendation to the patentee, and the Supreme Court held that not furnishing of the recommendations violated the principles of natural justice. As per the Hon’ble Bombay High Court such a situation does not exist in the present case as the matter is yet to  be concluded and a copy of the recommendation is given to the Patentee and the Opponents;
  4. The Court also held that there is nothing improper when the Controller General of Patents observes that he will not issue administrative directions when a quasi-judicial authority is seized with the proceedings. Controller General has made it clear that the Petitioner can argue all issues about the recommendation of the Opposition Board before the Controller of Patents.

In view of the above findings the Court rejected the Writ Petition.

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Interim arrangement necessary in infringement cases

In a suit for patent infringement the Delhi High Court restrained the Defendants (ZTT India Pvt. Ltd. ) from infringing Patent numbers 241433 and/or 280211 relating to optical fibres till the next date of hearing.

The suit for infringement was filed by Sterlite technologies Pvt. Ltd. against ZTT India Pvt. Ltd. for Patent numbers 241433 and/or 280211. The Plaintiffs argued that the technical parameters of the Optical fibres of the Defendants are the same as that of the Patentee and the same cannot be arrived at without use of Patentee’s technology.

The Hon’ble Court held that the Patents have a limited life and time for determination of infringement is long. The Court also held that in such long time infringer would have reaped substantial benefits from such infringement, more so, because they have not borne the cost of innovation.

The court therefore held that an interim arrangement is necessary in infringement cases. In view of the same, the Ld. Court passed an interim order restraining the defendants from infringing patent numbers 241433 and/or 280211 till the next date of hearing.

Draft Patent Rules by the Ministry of Commerce and Industry for comments from stakeholders

The Ministry of Commerce and Industry (Department for Promotion of Industry and Internal Trade) has published Draft Patents Rules 2019 to further amend the Patents Rules, 2003.

The rules with regard to filing of English translation of priority document (Rule 21) and timeline for filing of Form-27 (working statement under Rule 131) and Form-27 have been proposed revisions.

Objections or suggestions, if any, have to be addressed to Shri Sushil K Satpute, Director, DPIIT, Ministry of Commerce and Industry, Government of India, Udyog Bhawan, New Delhi-110011 or can be sent by e-mail at sushil.satpute@nic.in.

 

Order refusing UOC’s Patent application for Enzalutamide set aside by the DHC and the matter remanded back for reconsideration

An order of the Assistant Controller of Patents and Designs (Controller) vide which The Regents Of The University Of California’s (UOC) application for grant of patent Application No. 9668/DELNP/2007 was rejected, has been set aside by the Delhi High Court (DHC) and the matter has been remanded back to the Patent office for reconsideration.

The UOC filed a Writ petition before the DHC impugning an order dated 08.11.2016 passed by the Assistant Controller of Patents and Designs (Controller) whereby UOC’s application for grant of patent (Application No. 9668/DELNP/2007) was rejected. The UOC’s principal claim in the application is in respect of the compound ‘Enzalutamide’. Five pre grant oppositions were filed by five different pre grant opponents challenging the grant of the application. Whilst the Controller, accepted that the said compound is novel and not anticipated in view of cited prior art documents, he rejected the patent application on the ground that the claimed invention lacked inventive steps.

The impugned order has been set aside by the Delhi High Court the matter has been remanded for reconsideration afresh. The Delhi High Court has held as follows:-

  1. The UOC raised a grievance regarding non-compliance of principles of natural justice and stated that Fresenius Kabi oncology Ltd., one of the opponents had produced a prior art document, “the Bohl document” first time during the course of hearing. The UOC also contended that the written submissions filed by Fresenius Kabi oncology Ltd., infact further expanded the submissions made by them during the course of the oral hearing and UOC had no opportunity to deal with the same. Fresenius Kabi oncology Ltd., stated that since the UOC had filed its written submissions, much after filing of submissions by them, UOC had full opportunity to controvert the arguments taken. The Court held that the Controller cannot ignore relevant material that is produced before him at a pre-grant stage as pre grant opposition is a part of the process of examination by the Controller.
  2. The Court, however, did not filed weight in the contention of Fresenius Kabi oncology Ltd. The Court held that post hearing written submissions cannot expand the scope of submissions made in the oral hearing. Such submissions are clearly meant to record only the oral submissions made at the hearing in order to assist the decision maker. There is no scope for entertaining additional arguments after the oral hearing is concluded. If the Controller intends to take into account any additional arguments raised after oral hearing is concluded, he is, obviously, required to put the applicant to notice regarding the same. In the aforesaid view, the Court held that the impugned order inasmuch as it accepts the arguments raised by Fresenius Kabi oncology Ltd., after conclusion of the hearing, cannot be sustained.
  3. It was also contented by UOC that since the Post- Grant Oppositions and the documents produced alongwith oppositions, subsequently, were not supported by an affidavit, and therefore, the representation could not be accepted. The Court however did not agree with the contention of UOC and held that there is no requirement that a pre-grant opposition be supported by an affidavit. Section 25(1) of the Patents Act merely requires the said opposition to be in writing. Form 7A (the Form in which the pregrant opposition is required to be filed in terms of Rule 55 of the Patents Rules) also does not require any verification or affirmation. The reliance placed by the UOC on Section 79 of the Patents Act was also considered to be misplaced. The Court held that Section 79 of the Patents Act mandates that evidence before a Controller can be submitted by way of an affidavit but the Controller also has the right to accept oral evidence. It is not the import of Section 79 of the Patents Act that documents, which are available in public domain, be ignored by the Controller unless supported by an affidavit.
  4. The next contention considered by the Court was whether the impugned order is vitiated as the Controller had failed to consider the affidavit affirmed by Prof. Michael E. Jung and Mr Schafer and Dr. Charles L. Sawyers filed supporting the case of UOC. Fresenius Kabi oncology Ltd., submitted that the UOC had not referred to the affidavits of the experts at the hearing or in the written submissions and, therefore, it was not open for UOC to assert that the affidavits had been ignored.
  5. The Court held that in technical matter, like the present case, even a minor change in a compound used as a drug can bring in about significant changes in its therapeutic value. In this view, the affidavits affirmed by Mr Schafer and Dr. Charles L. Sawyers could not be considered as irrelevant. The Court also noted that the submissions of the UOC clearly indicate that the affidavits are part and parcel of the submissions. The Court held that even if it is accepted that the affidavits were to be rejected as being irrelevant, the Controller was required to indicate the same in his decision. However, the impugned order is completely silent on the affidavits submitted by them.

Natco Prohibited from Manufacturing Generic Ceritinib

The Delhi High Court through order dated 2nd May 2019 prohibited Natco Pharma Ltd. from manufacturing generic Ceritinib capsules in a suit for infringement of Indian patent number 276026 (IN276026) of Novartis AG.

IN276026 relates to the compound Ceritinib, a drug for the treatment of non-small cell lung cancer (NSCLC). The Plaintiff contested that this drug, which forms part of a broader group of 2,4-diamino pyrimidines, is novel and inventive. Earlier patents granted to AstraZeneca and Rigel Pharmaceuticals in relation to said broad group of compounds did not disclose formula 2 of the suit patent or the compound Ceritinib within the scope of said formula 2. However, the Plaintiff sought a license from AstraZeneca in the U.S.A to obtain freedom to operate. The Plaintiff also disclosed that they had two additional patents, namely, IN240560 and IN232653 which related to the broad class of 2,4-diaminopyrimidines. The Plaintiff also submitted that a post-grant opposition against IN276026 filed by the Defendant was pending before the Indian Patent Office. The opposition board’s recommendations were in favour of the Plaintiff and the hearing in the opposition had been concluded.

The Defendant chose to launch Ceritinib capsules under the brand name Noxalk® even while their opposition was pending at the Indian Patent Office.

The Defendant challenged the novelty and inventive step of the molecule Ceritinib and asserted that the broad Markush formula disclosed in AstraZeneca’s and Rigel’s patents as well as in Novartis’s earlier patents covered Ceritinib. The Defendant also asserted that the Plaintiff while obtaining patent term extension in the U.S.A claimed that Ceritinib was also covered by the U.S equivalent of IN240560 and that this was an evergreening attempt as while IN240560 expires in India in 2024 the suit patent is valid till 2027.

The Defendant, based on the decision of the Supreme Court in Aloys Wobben and Anr. vs. Yogesh Mehra and Ors. AIR 2014 SC 2210, also contended that once a post-grant opposition is filed, the rights in the patent are yet to be crystallised till the post-grant opposition is decided.

After hearing both the parties the Court concluded the following:

  1. The drug license to the Defendant’s product was granted in January 2019, that is, after the post-grant opposition was filed and after the opposition board had given its recommendations. The Defendant launched their generic Ceritinib on 20th March 2019 while the decision in the post-grant opposition was pending. Thus the Defendant chose to launch the product during the pendency of the post-grant opposition. While the Supreme Court in Aloys Wobben held that patent rights would crystallise once the post-grant opposition is decided, the scenario of the Opponent opposing the patent launching a product in infringement of the very same patent did not arise in that case. The Court further held that the rights granted to the Patentee under section 48 of the Patents Act are not affected during the pendency of the post-grant opposition even though they may crystallise once the opposition is decided. The Court was of the opinion that the Defendant should have waited till the decision in the post-grant opposition was issued before launching their product.
  2. The Court further observed that considering that the drug was for the treatment of non-small cell lung cancer, stopping the sale of the Defendant’s product which was already manufactured would not benefit the community in any manner. Based on the same the Court permitted the Defendant to continue marketing their products which had already been manufactured but estopped them from undertaking any fresh manufacture of pharmaceutical preparations of Ceritinib until the next date of hearing.
  3. The Court further directed the hearing officer in charge of the post-grant opposition at the Patent Office to issue a decision in the post-grant opposition prior to the next date of hearing in the Court.

INTERIM INJUNCTION AGAINST DR. REDDY LABORATIES FOR LORCASERIN

On May 6, 2019, Delhi High Court granted interim injunction to Eisai Co. Ltd. and Arena Pharmaceuticals (collectively called Eisai) against Dr. Reddy’s Laboratory Ltd. (DRL) in respect of their anti-obesity blockbuster drug Lorcaserin.

The suit was in respect of Eisai’s Indian patent No. 215528 covering Lorcaserin and its pharmaceutically acceptable salts including Lorcaserin Hydrochloride and Lorcaserin Hydrochloride Hemihydrate. Lorcaserin is used for treatment of obesity and sold by Eisai under the brand Belviq.

The case is particularly interesting and one of its kind where both the Defendants and the Plaintiffs did not have a product in the Indian market and the cause of action was based on the Defendants taking steps to obtain regulatory approval and their intention to launch their product in the market.

The contentions of the defendants were as follows:

  • Non-Working of patent for more than 10 years since grant and 15 years since date of patent, disentitles interim injunction.
  • Plaintiffs have admitted in IPO and EPO prosecutions for subsequent patents that lorcaserin HCl hemihydrate is not disclosed, taught, or enabled in the suit patent. Therefore, as Defendants approval relates to Lorcaserin HCl hemihydrate, therefore Defendants’ activities fall outside the scope of the patent.
  • Suit patent is invalid in light of section 3(d) of the Patents Act.

Hon’ble Mr. Justice J.R. Midha held that the plaintiffs have made out a strong prima facie case for grant of interim injunction against the defendants for the reasons given hereunder:-

  • Admissions by Defendants:

    • Mr. Girish Parhate, Director (Regulatory Affairs) of the defendants, in his statement dated January 14, 2019 admitted that their drug is covered by the plaintiffs’ suit patent.
    • The admissions made by the defendants in US patent application 2014/0187538A1 and in the pre-grant opposition filed by the defendants against the plaintiffs’ pending Indian Patent Application No. 311/KOLNP/2009 for LHH that the PCT application corresponding to the suit patent i.e. WO2003/086306 discloses Lorcaserin and hydrochloride salt of Lorcaserin and method of preparing thereof.
    • Section 3(d): The suit patent is in the nature of an originating/genus patent and the various subsequent patent applications are for improvement/selection inventions, which specifically disclose and claim a particular “species‟ of the genus patent, i.e. the hydrochloride hemihydrate form. Merely because the plaintiffs have applied for a patent separately for a specific species of the genus, it does not mean that the species patent cannot be granted or that the species patent would not fall within the coverage of the genus patent (i.e. the suit patent in the present case). Grant of a subsequent patent, which is an improvement invention, does not take the said forms out of the first/basic patent, which in the present case is the suit patent.

 

  • Non-working of patent: The defendants had a remedy to seek a compulsory License under Sections 83 and 84 of the Patents Act, 1970. However, the defendants, instead of applying for either a voluntary license or a compulsory license, decided to go ahead on their own volition and seek a marketing approval. The non-working of a patent particularly for a pharmaceutical product cannot have a bearing on the rights of a patentee under Section 48 of the Patents Act, 1970.

 

  • Balance of convenience: The Court held that the balance of convenience for the grant of interim injunction lies in favour of the plaintiffs as the defendants have evidently not “cleared the way” before going ahead with obtaining a marketing approval for launch of the infringing drug.

 

  • Costs: the Court held that the plaintiffs are entitled to the costs from the defendants. However, the order as to quantum of costs is deferred till the final decision of this suit. Both the parties have been directed to submit the actual cost incurred by them. The parties have been also directed to submit their estimate of future cost before the commencement of trial so that the parties shall have notice of actual cost that the other side estimate would be incurring in the course of litigation and the parties have an opportunity to take appropriate decision as to manner in which to conduct the litigation.

The matter will is now listed before the regular bench on July 4, 2019.