NEW DELHI -- India's Supreme Court rejected Monday a patent bid by drug giant Novartis (IW 1000/61) in a landmark ruling that activists say will protect cheap generic drugs and save lives in developing nations.
Novartis fought a seven-year legal battle to gain patent protection for an updated version of its blockbuster leukaemia drug Glivec, arguing the compound was a significant improvement because it is more easily absorbed by the body.
But in a ruling that went to the heart of patent law in a country known as the "pharmacy to the world", the top court said the compound "did not satisfy the test of novelty or inventiveness" required by Indian legislation.
India's law restricts pharmaceutical companies from seeking fresh patents for making minor modifications -- an industry practice known as "evergreening" -- and the ruling enables generic drugmakers to continue copying Glivec.
Leena Menghaney, a lawyer with medical charity Medecins Sans Frontieres (MSF), said Monday's ruling was "a big relief" that would save lives in India and elsewhere in the developing world.
"Breakthrough, innovative medicines will still get patents in India but the judgment means drug companies cannot keep seeking patents for small changes to one drug," she told a news conference.
The legal case was the highest-profile of several being pursued by multinationals in the Indian market, set to touch $74 billion in sales by 2020 from $11 billion in 2011 according to the PricewaterhouseCoopers consultancy.
Novartis, which reported net profit of $9.6 billion in 2012 on sales of $56.7 billion, condemned the judgement, saying it "discourages innovative drug discovery essential to advancing medical science for patients."
"The ecosystem in India to encourage investment is not there. We have been boxed in from all sides," Novartis India managing director Ranjit Shahani said in Mumbai. He said the company would continue to invest "cautiously" in India.
The Supreme Court upheld the view of India's Intellectual Property Appellate Board, which refused to grant Novartis protection in 2009 on the grounds that the amended form of Glivec was not vastly different from the earlier version. The Madras High Court had also rejected Novartis' arguments in 2007.
