The Intellectual Property Office in India authorized a Hyderabad based pharmaceuticals company called NatcoPharma Ltd. to copy and sell Nexavar. Nexavar is a generic version of patented cancer treatment owned by a German drug maker Bayer AG. It is used for the treatment of liver and kidney cancer. This is the first time for an Indian company to have granted the compulsory license to market a patented drug.
Bayer obtained Nexavar’s patent right for the Indian market in 2008. The dosage of Nexavar for one month costs Rs. 2.8 lakh. NatcoPharma initially approached Bayer for a license to commercially manufacture Nexavar and got turned down by Bayer. Subsequently Natco applied for a compulsory license to allow them copying the Drug and market it in the Indian market.
A compulsory license permits a generic drug producer to make and sell its own version of a patented drug without according permission of the patent owner. Natco in its application claimed that Bayer had failed to meet the needs of the local market. Section 84 of the Indian Patent Act contains the provision that allowsany entity to apply, three years after the grant of a patent, to the patent office for a license to sell a generic version of the drugon the ground of unavailability at a reasonable price or unfulfilling the requirement of the public.
The Controller General of Patents in the same order fixed the price of the drug at Rs. 8,880 for Natco who must pay 6% royalty of the net sale to Bayer. With this order India too has matched several developing countries including Brazil and Thailand who have invoked the same provision to increase citizens access to expensive and life savings drugs.
The story was first published in INTELLECT Issue no.1, dated April 2012