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Pharma Sales Post Covid-19 Lockdown

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Disruptions from Covid-19 pandemic have caused limited access to physicians for Pfizer’s marketing and sales teams have had. If ‘the novel Coronavirus pandemic hamstringing the company’s sales team,’ there could be a slowdown in new prescriptions and a sales hit in the second quarter, said the global CEO of Pfizer, on April 28, 2020. He further said, ‘new prescriptions for a range of its products will decline as patients continue avoiding in-office physician visits.’

Pfizer is not only the company facing such situation. In fact, the entire pharma industry is encountering a tough headwind for the same reason. However, being very specific on the quantum of sales hit – on the same day, ‘Merck, with a heavy presence in physician-administered drugs’, predicted an adverse impact of US$ 2.1Billion on sales, from COVID-19.

Physical absence of, virtually the entire pharma field force in the field for strict compliance of social distancing during the lockdown period, causing a crippling effect on the new prescription demand generation activity. This possibility was hardly imagined by anyone in the industry. Which is why, the current situation is too challenging for pharma sales and marketing leadership teams to respond, with a sustainable strategic approach. Moreover, most of them don’t yet seem to be accustomed with charting any pivotal demand generation activity, sans field force.

Further, the meaning of ‘Patient-Centricity’ in the post lockdown period – still maintaining ‘social distancing’ norms, is expected to undergo considerable changes. This may include development of newer health care practices for many customers, which they started practicing during the lockdown period. However, no one can exactly predict, as on date, whether such changes will continue for a long term, as we move on. In this article, I shall deliberate on a likely scenario in the pharma selling space post Covid-19 outbreak, based on research studies. This is primarily because Covid-19 could be with us for a long time.

Covid-19 could be with us for a long time:

As reported, on the day 35 into the world’s largest lockdown, India, reportedly, was failing to see an easing of new cases similar to what hot spots such as Spain and Italy have recently experienced with more intensive Covid-19 outbreaks. Even today, the scale and duration of the pandemic are very uncertain, so will be the necessity of maintaining social or physical distancing guidelines. This possibility gets vindicated by what the Director General of the World Organization said on April 22, 2020: ‘Make no mistake: we have a long way to go. This virus will be with us for a long time.’ Thus, shutdowns in different forms, is expected to continue for some time in India.

‘Covid-19 pandemic to last for minimum two years’ with its consequent fallout also on the pharma industry:I

Interestingly, ‘India began its containment measures on March 25, when its outbreak showed only 564 cases.’ As on May 03, 2020, the recorded Coronavirus cases in India have sharply climbed to 39,980 and 1,323 deaths. India is now expected to prepare exiting the 54-day lockdown in phases from May 17, 2020, with a few limited relaxations even before that date. However, as the BBC news of April 9, 2020 also points out, the country may not afford to lift the lockdown totally – everywhere, for everyone and for all the time, anytime soon, for obvious reasons.

The April 30, 2020 report from the Center for Infectious Disease Research and Policy at the University of Minnesota, confirms this situation. It says: ‘The Coronavirus pandemic is likely to last as long as two years and won’t be controlled until about two-thirds of the world’s population is immune.’ This is because of the ability to spread from asymptomatic people, which is harder to control than influenza, the cause of most pandemics in recent history. Thus, the Coronavirus pandemic is likely to continue in waves that could last beyond 2022, the authors said.

Many countries around the world are already facing similar issues for exiting Covid-19 lockdown. It has been observed that easing the lockdown is a tricky policy choice, as it triggers a fresh wave of infection, as recently happened in advanced countries, such as, Singapore and several other nations.

It is, therefore, clear now that shutdowns need to continue in different forms in India as different waves of Covid-19 infections strike, in tandem with scaling up of requisite testing and health infrastructure to manage those outbreaks, effectively.  Consequently, its impact on the pharma industry is likely to continue with its unforeseen fallout, prompting the same old question, yet again, why the oldest commercial model remains pivotal in the pharma industry.

The oldest commercial model remains pivotal in the pharma industry:

About a couple of years ago from now, an interesting article of IQVIA, titled, ‘Channel Preference Versus Promotional Reality,’ highlighted an important fact. It said, one of the oldest commercial models of using medical or sales representatives to generate product demand through personal communication with each doctor, and other key stakeholders, is still practiced in the pharma industry, both as a primary medium and also to communicate the message.

The same model continues in the pharma industry, regardless of several fundamental challenges in the business environment. Curiously, erosion of similar models in many other industries, such as financial and other services, in favor of various highly effective contemporary platforms, is clearly visible. Some of these fundamental challenges involve an increasing number of both, the healthcare professionals and also patients they treat, moving online.

This has been happening since some time – long before Covid-19 outbreak. Today, many patients want contemporary information on the disease-treatment process, available alternatives and the cost involved with each. These patients also want to communicate with their peers on the disease for the same reasons, before they take a final decision on what exactly they would like to follow. A similar trend is visible, at a much larger scale, with medical professionals, including top drug prescribers.

Healthcare customers’ increasing digital preference was captured well before the Covid-19 outbreak:

The rise of digital communication as a global phenomenon, was deliberated in the June 04, 2019 ‘Whitepaper’ of IQVIA, titled ‘The Power of Remote Personal Interactions.’ It captured an increasing digital preference of healthcare customers much before Covid-19 outbreak. For example, according to IQVIA Channel Dynamics data1, there was a 26 percent decline in total contact minutes for face-to-face detailing in Europe, since 2011.

Another 2018 IQVIA survey reported, 65 percent to 85 percent of representatives were saying that access to physicians is becoming harder. The paper also indicated that the rise of digital and multichannel communication with healthcare professionals has been far from uniform across countries, with Japan leading the world, followed by the United States.

India is an emerging power in the digital space, today. Thus, I reckon, it has immense opportunity to leverage digital platforms in healthcare, especially to effectively address the current void in the demand generation activity of drug companies. The key question that needs to be answered: Are pharma customers developing new habits during, at least, the 54-day national lockdown period?

‘It takes about 18 days to 254 days for people to form a new habit’:

According to a study, titled ‘How are habits formed: Modelling habit formation in the real world,’ published on July 16, 2009, in the European Journal of Social Psychology, it takes anywhere from 18 days to 254 days for people to form a new habit. Thus, changing preferences of many healthcare consumers, including doctors and patients, at least, in the 40-day period of national lockdown in India, may trigger a change in habits of many patients. This change may further evolve over a period a time.

Such changes would demand a new and comprehensive ‘Patient-Centric’ approach from pharma players, as well, having a clear insight on the dynamics of the changes. Gaining data-based insight on the same, pharma sales and marketing leadership would need to develop a grand strategy to deliver ‘patient-group’ specific desired outcomes. One of these approaches could be, triggering non-personal sales promotion on digital platforms.

Triggering non-personal sales promotion on digital platforms:

Dealing with future uncertainty calls for non-conventional and innovative strategies, such as, generating brand prescription effectively even without personal promotion. Thus, to tide over the current crisis, triggering non-personal sales promotion on digital platforms, appears to be the name of the game. In a 2018 IQVIA survey, looking at the multi-channel landscape in life sciences, 54 percent of the 250 respondents from pharma and biotech were found already using virtual interactions, such as e-Detailing, or were planning to assess the approach.

What is required now is to rejuvenate the initiative, with a sense of great urgency. Covid-19 pandemic has the possibility and potential to expedite a strong pull in this direction, responding to a new ‘customer-centric’ approach, as prompted by the evolving scenario, triggered during the 54-day long stringent lockdown period. This is especially considering the fact that it takes about 18 days to 254 days for people to form a new habit.

Further, as Bloomberg reported on May 02, 2020, “coming up with a vaccine to halt Covid-19, in a matter of months isn’t the only colossal challenge. The next big test: getting billions of doses to every corner of the world at a time when countries increasingly are putting their own interests first,” which may take quite time.

Conclusion:

One thing for sure, the sudden outbreak of Covid-19 pandemic has made all ongoing and robust strategic business plans somewhat topsy-turvy. Most pharma companies were compelled to floor the break-pedal of several business operations, including prescription demand generation activity of field sales forces, during the lockdown period.

At this time, many healthcare consumers, including patients, tried various remote access digital platforms to continue with their treatment or for a new treatment of common ailments, besides procurement of medicines. Two primary drivers, in combination with each other, prompted those individuals to try out the digital mode. One, of course, the stringent lockdown norms, and the other being the fear of contracting Covid-19 infection, if the prescribed personal distancing standards are breached – just in case.

This position may lead to two possibilities – one, involving the patients and the doctors and the other, involving field staff/doctors/hospitals/retailers, etc. During, at least, the 54-day long lockdown period, if not even beyond May 17, 2020 – those patients may develop a sense of convenience with the digital platforms. This may lead to a new habit forming, which has the potential to create a snowballing effect on others – through word-of-mouth communication. The process may signal a shift on what ‘Patient-Centricity’ currently means to the pharma players.

The other one, I reckon, involves with the continuation of strict social or physical distancing norms for an indefinite period. This could seriously limit field-staff movement and meeting with the doctors, hospitals/retailers, besides many others, and more importantly would lead to a significant escalation of cost per call. The question, therefore, is: Will pharma selling remain as before, post Covid-19 lockdown? Most probably not. If so, a new task is cut out, especially for the Indian pharma leadership team, to chart a new ‘Patient-Centric’ digital pathway, in pursuit of sustainable business excellence.

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Multifaceted Coronavirus Narrative Raises Multiple Questions

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Last night, amid the national lockdown, many people followed Prime Minister Modi’s video message, broadcasted on April 03 at 9 am for all, ‘to challenge the darkness of Coronavirus together – with a Diya, candle, torch or flashlight, at 9 pm for 9 minutes, from their respective balconies.’ That was the 12th day of 21-day lockdown, when the deadly microbe – Covid19 infected, tested and detected cases climbed to 3,577 in the country, with the death toll rising to 83. This is against 564 - the total number of confirmed cases in India when the lockdown commenced on March 24, 2020.

With all this, a mind-boggling narrative is developing at an accelerating pace. It’s not just about the rogue microbe – rampaging the world hunting for its prey. But also pans over multiple dimensions of its fallout, impacting virtually everything, for all. People of all sections of the society are participating, deliberating or debating on this issue, as the invisible camera of destiny rolls on. Unprecedented!

That’s the real world where, despite fear of an unknown future, most people prefer freedom of expression while playing a constructive role in containing the menace, collectively. We are witnessing a similar scenario – the world over. But, more in the democratic nations. Relatively enlightened citizens will always want to participate in this emerging chronicle, shaping the overall narrative and help sharpening the nations Covid19 policy further – instead of being passive onlookers.

Meanwhile, the objective of maintaining physical distancing during 21-day national lockdown period and beyond must be achieved, regardless of any public discord on its mechanics. This has to happen, primarily because of the TINA factor. Likewise, it’s also a prerequisite that the lockdown is handled efficiently, with meticulous advance planning, deft and dignified handling of any situation, by all and for all. That said, the good news is, newer scientific, evidence-based data are revealing more actionable pathways, in this multifaceted narrative.

A multifaceted narrative raises multiple questions:

As I wrote above, Covid19 narrative is multifaceted and not just one dimensional. It’s true beyond doubt: ‘If there is life, there is the world.’ But, that has to be a life with dignity, a life that help protect families and facilitates contributing to the nation, in different ways – enabling a scope of fulfillment of all.

In this article, I shall, explore some important facets of the evolving narrative on the Covid19 outbreak to drive home this point. In that process some very valid questions, as raised by many, also deserve to be addressed. Some of these include:

  • Covid19 is a war like situation where no questions are asked about the strategic details of a warfare, why the same is not being followed today? In a war some collateral damages are inevitable, why so much of noises now?
  • Why has Covid19 created a general panic with stigma attached to it?  
  • Panic is avoidable, but is the threat real. If so, why?
  • Why people violating national lockdown by migrating from the job location to respective hometowns – increasing the risk of the disease spread, must be brought to their senses mostly through the harsh measures?
  • In the absence of any vaccine or an effective curative drug, why all decisions of policymakers must be blindly accepted by all, during national lockdown and maybe beyond, as if there is ‘not to reason why, but to do or die?’

Let me now explore each of these questions.

A war like situation?

No doubt Covid19 is a war like situation, but with some striking dissimilarities between a conventional war and this war. A conventional war is fought by a well-trained and well-armed defense forces with already developed a gamut, against a known and visible enemy nation.

Whereas, the war against Covid19 is against an invisible and unknown microbe’s sudden attack, being fought in India by a limited army of health care professionals and workers. They fight this war, mostly without adequate or no battle gear, like Personal Protective Equipment (PPE), testing kits and ventilators, supported by a fragile health care infrastructure.

Moreover, in the conventional warfare, the type of advance information and intelligence that the Governments usually possess against the enemy nations, can’t be matched by any private domain experts.

Whereas, Covid 19 still being a lesser known entity to medical scientists, as on date, the remedial measures are still evolving. Only scientific-evidence-based data can create actionable pathways for combat, spearheaded by the W.H.O. Thus, most people expect the nation to comply with, at least, the current W.H.O guidelines for health-safety of the population.

Further, in the cyberspace, several latest and highly credible research data are available for all. These are being well-covered by the global media as a part of the narrative. Thus, unlike conventional warfare, external experts may know as much, if not even more than the Government on Covid19.

Some avoidable show-stoppers:

There are several such avoidable show-stoppers. For example, when one reads news like, ‘Delhi Government Hospital Shut As Doctor Tests Positive For Coronavirus,’ or something like, ‘Indian doctors fight Coronavirus with raincoats, helmets amid lack of equipment,’ alongside a jaw-dropping one, ‘India Sends COVID-19 Protective Gear To Serbia Amid Huge Shortage At Home,’ chaos in the narrative takes place.

In the tough fight against Covid19 menace, these much avoidable fallout may be construed as show-stoppers, if not counterproductive. Many may advocate to pass a gag order against revelation of such difficult to understand developments, and keep those beyond any public discussion. Instead, why not order a transparent enquiry by independent experts to find facts – holding concerned people accountable?

Why has the disease created so much of panic with stigma attached to it?

This is intriguing because, according to the W.H.O – China Joint Mission report on COVID-19, around 80 percent of the 55924 patients with laboratory-confirmed COVID-19 in China, had mild-to-moderate disease. This includes both non- pneumonia and pneumonia cases. While 13·8 percent developed severe disease, and 6·1 percent developed to a critical stage requiring intensive care.

Moreover, The Lancet paper of March 30, 2020 also highlighted, in all laboratory confirmed and clinically diagnosed cases from mainland China estimated case fatality ratio was of 3·67 percent. However, after demographic adjustment and under-ascertainment, the best estimate of the case fatality ratio in China was found to be of 1·38 percent, with substantially higher ratios in older age groups – 0·32 percent in those aged below 60 years versus 6·4 percent in those aged 60 years or more, up to 13·4 percent in those aged 80 years or older. Estimates of the case fatality ratio from international cases stratified by age were consistent with those from China, the paper underscored.

Even the Health Minister of India has emphasized, ‘around 80-85 percent of cases are likely to be mild.’ He also acknowledged: “My biggest challenge is to ensure that affected people are treated with compassion, and not stigmatized. This is also applicable for the health care workforce, which is working hard to counter this epidemic. It is through concerted, community-owned efforts, supported by the policies put in place by the government that we can contain this disease.” This subject, surely, needs to be debated by all, and effectively resolved.

Panic is avoidable, but does a real threat exist with Covid19?

As The Lancet paper of March 30, 2020 cautions by saying - although the case fatality ratio for COVID-19 is lower than some of the crude estimates made so far, with its rapid geographical spread observed to date, ‘COVID-19 represents a major global health threat in the coming weeks and months. Our estimate of the proportion of infected individuals requiring hospitalization, when combined with likely infection attack rates (around 50–80 percent), show that even the most advanced healthcare systems are likely to be overwhelmed. These estimates are therefore crucial to enable countries around the world to best prepare as the global pandemic continues to unfold.’ This facet of Covid19 also requires to be a part of the evolving narrative to mitigate the threat, collectively, with a robust and well thought out Plan A, Plan B, Plan C….

Violation of lockdown increases the risk manifold, but… 

There isn’t a shade of doubt even on this count, in any responsible citizen. Besides individual violation, recently a huge exodus of migrant laborer’s ignoring the lockdown raised the level of risk for others. This exodus should have been stopped at the very start, by better planning and with empathy and dignity by the law enforcing authorities, as many believe. Curiously, even the current Chief Justice of India (CJI) commented, on March 30, 2020: “The fear and the panic over the Coronavirus pandemic is bigger that the virus itself,” during a hearing on the exodus of migrant laborers from workplace to their respective hometowns, due to Covid19 lockdown.

To mitigate the risk, the CJI advised the Government to ensure calming down ‘the fear of migrants about their future, after being abruptly left without jobs or homes because of the 21-day lockdown to prevent the spread of Coronavirus.’ The Court felt, ‘the panic will destroy more lives than the virus.’ Thus, the Government should “ensure trained counsellors and community leaders of all faiths visit relief camps and prevent panic.”

The CJI also directed the Government to take care of food, shelter, nourishment and medical aid of the migrants who have been stopped. This appears to be the desirable pathway of preventing the migrant exodus, causing greater risk to people, requiring better planning, deft situation management with empathy and dignity, by the law enforcing authorities. However, individual violations, if any, can be addressed by intimately involving the civil society, against any possibility of the disease spread.

Whatever decision the policy makers take, must be blindly accepted by all:

In this area, all must first follow what the Government expects us to do. Maintaining strict compliance with such requirements. But, some people do ask, is it in total conformance with the steps W.H.O recommends following? At the March 30, 2020 issue of the Financial Times reported, the W.H.O’s health emergency program has outlined four factors that might contribute to the differing mortality rates in Covid19 outbreak:

  • Who becomes infected?
  • What stage the epidemic has reached in a country?
  • How much testing a country is doing?
  • How well different health care systems are coping?

Many members of the civil society are also keen to know these facts, and may want to seek clarification, if a gap exists anywhere. After all, Covid19 outbreak has brought to the fore, an unprecedented future uncertainty of unknown duration, involving not just life, but a sustainable livelihood and a dignified living in the future, for a very large global population, including India.

Conclusion:

There seems to be a dose of chaos in an otherwise reasonably controlled scenario. One option of looking at it as a pure law and order issue, which needs to be brought to order only with a heavy hand. The second option is to accept it as a golden opportunity to take all on board, by clearly explaining what people want to know – with reasons, patience, persuasion, empathy and compassion, as is happening in many countries.  Of course, without compromising on the urgency of the situation. This is a challenging task, but a sustainable one. Overcoming it successfully, will possibly be the acid test of true leadership, at all levels. However, the slowly unfolding narrative on the ground, doesn’t appear to be quite in sync with the second option.

In the largest democracy of the world, people want to get involved in a meaningful discussion on Covid19 crisis, collectively – based on evidence-based scientific data. Then, it’s up to the policy makers to decide what is right for the country and in which way to go. In tandem, fast evolving, multifaceted Coronavirus narrative, I reckon, will keep raising multiple questions.

As the disease spreads, the pathways of combating it decisively, is being charted by different experts, led by the World Health Organization (WHO). This is being widely covered by the mainstream global media, even in the din of a cacophony. Nonetheless, it is generally believed that a true relief will come, only after a vaccine is developed and made available and accessible to all sections of the world. Till such time a ‘hide and seek’ game, as it were, is expected to continue.

By: Tapan J. Ray  

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Revocation and Denial of Patents on Patentability Ground in India: The Fallout and the Road Ahead

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On November 26, 2012, the Intellectual Property Appellate Board (IPAB) reportedly denied patent protection for AstraZeneca’s anti-cancer drug Gefitinib on the ground that the molecule lacked invention.

The report also states that AstraZeneca suffered its first setback on Gefitinib in June 2006, when the Indian generic company Natco Pharma opposed the initial patent application filed by the global major in a pre-grant opposition. Later on, another local company, GM Pharma, joined Natco in November 2006.

After accepting the pre-grant opposition by the two Indian companies, the Indian Patent office (IPO) in March 2007 rejected the patent application for Gefitinib citing ‘known prior use’ of the drug. AstraZeneca contested the order through a review petition, which was dismissed in May 2011.

Prior to this, on November 2, 2012 the IPAB revoked the patent of Pegasys (Peginterferon alfa-2a) – the hepatitis C drug of the global pharmaceutical giant Roche. Interestingly Pegasys was granted patent protection across the world.

Though Roche was granted a patent for Pegasys by the Indian Patent Office (IPO) in 2006, this was subsequently contested by a post-grant challenge by the large Indian pharma player – Wockhardt and the NGO Sankalp Rehabilitation Trust (SRT) on the ground that Pegasys is neither a “novel” product nor did it demonstrate ‘inventiveness’ as required by the Patents Act of India.

It is worth noting, although the IPO had rejected the patent challenges by Wockhardt and SRT in 2009, IPAB reversed IPO’s decision revoking the patent of Pegasys.

Similarly the patent for liver and kidney cancer drug of Pfizer – Sutent (Sunitinib), which was granted by IPO in 2007, was revoked by the IPAB in October, 2012 after a post grant challenge by Cipla and Natco Pharma on the ground that the claimed ‘invention’ does not involve inventive steps.

A twist and turn:

However, on November 26, 2012 in a new twist to this case, the Supreme Court of India reportedlyrestored the patent for Sutent. Interestingly, at the same time the court removed the restraining order, which prevented Cipla from launching a copy-cat generic equivalent of Sunitinib.

The key reason:

All these are happening, as the amended Patents Act 2005 of India includes special protections for both patients and generic manufacturers by barring product patents involving ‘incremental’ changes to existing drugs. This practice is called “evergreening” by many.

It is worth noting, such ‘incremental innovations’ qualify for the grant of patents across the world including, Europe, Japan and the USA and that reason prompted initiation of a raging debate throwing strong arguments both in favor and against of this issue, though the subject conforms to the law of the land.

‘Incremental innovation’ still a contentious issue in India:

As on today in the Indian Patents Act 2005, there is virtually no protection for ‘incremental innovation’, as the section 3(d) of the statute states as follows:

“The mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant.

Explanation: For the purposes of this clause, salts, esters, ethers, polymorphs, metabolites, pure form, particle size isomers, mixtures of isomers, complexes, combinations and other derivatives of known substance shall be considered to be the same substance, unless they differ significantly in properties with regard to efficacy.”

The apprehension:

A published report on ‘Patentability of the incremental innovation’ indicates that Indian Patents Act 2005 was formulated by the policy makers keeping the following points in mind:

  • The strict standards of patentability as envisaged by TRIPS pose a challenge to India’s pharmaceutical industriy, whose success depended on the ability to produce generic drugs at much cheaper prices than their patented equivalents.
  • A robust patent system would severely curtail access to expensive life saving drugs.
  • Grant of a product patents should be restricted only to “genuine innovations” and those “incremental innovations” on existing medicines, which will demonstrate significantly increased efficacy over the original drug.

Is it ‘MNC Interest’ versus ‘Indian Interest’ issue?

Many domestic stakeholders reportedly are looking at this particular subject as  ‘MNC Interest’ versus ‘Indian Interest’ in the realm of intellectual Property Rights (IPR). While others holding opposite view-points counter it by saying, this is a narrow and unfair perspective to address the much broader issue of fostering innovation within the Indian pharmaceutical industry helping capacity building, attracting talent and investments, while creating an IPR friendly ecosystem for the country in tandem.

Incidentally many MNCs, as reported by a section of the media, have demonstrated proven long-standing commitment to India, as they have been operating in the country with impeccable repute for a much longer period than most of the domestic pharmaceutical players, if not all, spanning across all scale and size of operations.

Are the patent challenges under section 3(d) being used as a ‘business strategy’?

Some observers in this field have expressed, although ‘public health interest’ is the primary objective for having Section 3(d) in the Indian Patents Act 2005, many generic companies, both local and global, have already started exploiting this provision as a part of their ‘business strategy’ to improve business performance in India.

This game seems to have just begun and may probably assume unhealthy dimension, if not openly debated and appropriate remedial actions are taken, as will deem necessary by the law makers keeping in view the long term, both global and local, implications of the same.

The beginning of the dispute:

As we know, way back in 2006 IPO refused to grant patent to the cancer drug Glivec of Novartis on the ground that the molecule is a mere modification of an existing substance known as imatinib. However, Novartis challenged the decision in the Supreme Court of India and in September, 2012, the final arguments in the Glivec case commenced. The matter is now sub judice.

Experts have opined that this interesting development has put Section 3(d) of the Indian Patents Act 2005 to an ‘Acid Test’ and the final verdict of the apex court will have the last say on the interpretation of this much talked about section of the statute.

Industry observers from both schools of thought – pro and against, are now waiting eagerly for the final outcome of this long standing dispute with bated breath, as it were.

Differing view points on impact:

Though the domestic stakeholders, including the local pharmaceutical industry, by and large, have expressed satisfaction with the law having taken its own course, the adversely affected companies articulated their strong disappointments with the developments. These companies argue, since valid patents were granted across the world for all these products, they had deployed significant financial and other resources starting from the regulatory approval process to market launch of such products in India with reasonable confidence.

Now with the such revocation and denial of patents, the concerned companies feel that  they will have to suffer significant financial losses besides high ‘Opportunity Costs’ for these molecules in India.

Interestingly, neutral observers have reportedly opined that this contentious issue, if not addressed appropriately and sooner by the government keeping in view the global business climate, will ultimately leave a lasting negative impression on the global community regarding the quality of IP ecosystem and investment climate in India, which consequently could lead to far reaching economic consequences extending even beyond the pharmaceutical industry of the country.

However, most of the local stakeholders advocate that there is no need to have a relook at it, in any way.

Opposition from the domestic industry:

It has been reported that a detailed study commissioned by the ‘Indian Pharmaceutical Alliance (IPA)’ and authored by Mr. T. C. James, Director, National Intellectual Property Organization, and a former bureaucrat in the ‘Department of Industrial Policy and Promotion (DIPP)’, articulated as follows:

“There is no clinching evidence to show that without a strong patent protection regime innovations cannot occur, that minor incremental innovations in the pharmaceutical sector do not require patent protection and that Section 3(d) of the Patents Act is not a bar for patenting of significant incremental innovations.”

In his report Mr. James also criticized large ‘Multinational Companies (MNCs)’ for “exploring strategies to extend their hold on the market, including through obtaining patents on minor improvements of existing drugs.”

The author continues to argue in favor of the section 3(d) the as follows:

  • It will be incorrect to conclude that Section 3 (d) is not compatible with TRIPS Agreement.
  • It has stood the test of time and does not introduce any unreasonable restrictions on patenting.
  • It is a major public health safeguard as it blocks extension of patent period through additional patents on insignificant improvements paving the way for introduction of generics on expiry of the original patent.
  • Pharma companies need to be given incentives for undertaking more research and development, but removing section 3(d) will be counterproductive.
  • A good marketing strategy for the companies would be to concentrate on R & D in diseases which are endemic to countries like Brazil, China and India which are fast emerging as major economies.

IPA challenges: 86 pharmaceutical patents granted by IPO fall under Section 3(d):

A study by the Indian Pharmaceutical Alliance (IPA) indicates that 86 pharmaceutical patents granted by the IPO post 2005 are not breakthrough inventions but only minor variations of existing pharmaceutical products and demanded re-examination of them.

Possible implications to IPA challenge:

If the argument, as expressed above in the IPA study, is true by any stretch of imagination, in that case, there exists a theoretical possibility of at least 86 already granted product patents to get revoked. This will indeed be a nightmarish situation for innovators of all caste, creed and colors, irrespective of national or multinational background.

Recapitulation of ‘Revised Mashelkar Committee Report’:

In August 2009, the Government accepted the revised report of the ‘Mashelkar Committee’, which observed the following:

1. “It would not be TRIPS compliant to limit granting of patents for pharmaceutical substance to New Chemical Entities only, since it prima facie amounts to a statutory exclusion of a field of technology.”

2. “Innovative incremental improvements based on existing knowledge and existing products is a ‘norm’ rather than an ‘exception’ in the process of innovation. Entirely new chemical structures with new mechanisms of action are a rarity. Therefore, ‘incremental innovations’ involving new forms, analogs, etc. but which have significantly better safety and efficacy standards, need to be encouraged.”

Could it have an impact on FDI?

Keen observers of these developments have reportedly expressed that revocation of granted patents or denial of patents on patentability criteria for the molecules, which hold valid patents elsewhere in the world, is sending a very negative signal to the global community and vitiating, among others, the Foreign Direct Investment (FDI) climate in the country. However, many local experts interpret this observation as mere ‘posturing’ at the behest of the MNCs’ interest.

The point to ponder:

The innovator companies have been arguing since quite some time that innovation involving any New Chemical Entity (NCE) never stops just after its market launch. Scientists keep working on such known molecules to meet more unmet needs of the patients within the same therapeutic class.

They substantiate their argument by citing examples like, after the discovery of beta-blockers, incremental innovation on this drug continued. That is why, from non-cardio-selective beta-blockers like Propranolol, the world received cardio-selective beta-blockers like Atenolol, offering immense benefits and choices to the doctors for the well being of patients.

Thus, global innovators reiterate very often that such examples of high value ‘incremental innovation’ are important points to ponder in India.

Patent challenge is a legal process, but…:

The proponents of ‘no change required in the Section 3(d)’ argue with gusto that ‘Patent Challenge’ is a legal process and the law should be allowed to take its own course.

However, the opposition counter-argues that the main reason in favor of Section 3(d) being that the provision will prevent grant of frivolous patents and the ultimate fallout of which will result in limited access to these drugs due to high price, is rather difficult to accept. This, they point out, is mainly because the Government is now actively mulling  a structured mechanism of price negotiation for all patented drugs to improve their access to patients in India.

Conclusion:

The spirit of ‘public health interest’ and avoidance of frivolous patents behind Section 3(d) of the Indian Patents Act is indeed commendable.

However, exclusion of almost all kinds of ‘incremental innovation’ for not meeting the very subjective and highly discretionary ‘efficacy’ criterion in the above section could prove to be counterproductive in the long run, even for the domestic players. The reason being, many such innovations will help enhancing safety, efficacy and compliance, besides other properties, of already existing molecules meeting various unmet needs of the patients.

Looking from a different perspective altogether, restrictive provisions in Section 3(d) could well go against the public health interest in the longer term, especially when the government is considering a mechanism of price negotiation for the patented drugs in India, as stated above.

Thus weighing pros and cons of both the arguments, in the finer balance of probability in terms of net gain to India as a nation, I reckon, appropriate legislative amendment in the section 3(d) of the Indian Patents Act 2005 will give a much required boost and incentive to pharmaceutical research and development in India.

This long overdue course-correction, if dealt with crafty win-win legal minds, will be able to protect not only high value “incremental innovations” of all innovators, global or local, in pursuit of significantly better and better drugs for the patients of India, but at the same time will effectively address the genuine apprehensions of ‘evergreening’ through frivolous patents.

…Or else should we wait till the final verdict of the Supreme Court comes on the Glivec case of Novartis?… Keeping my fingers crossed.

By: Tapan J. Ray

 

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