On 20 December 2016, Justice RK Gauba of the Delhi High Court heard an interlocutory application under Order 39 Rules 1 and 2 of the CPC filed by Bayer Intellectual Property GmbH in a suit concerning IN225529(3275/DEL/1998) against Ajanta Pharma Ltd. Bayer asserted that the patent covered vardenafil, a drug used to treat erectile dysfunction, and that Ajanta was manufacturing and selling the drug under its brand Valif.
Bayer vs. Ajanta
The 20 December hearing resulted in an ad interim injunction against Ajanta, and an ex parte injunction against two exporters of the drug. On 4 January 2017, Ajanta filed an application under O39R4 to vary the terms of the injunction. Ajanta’s application was based on multiple factors, including jurisdiction, but primarily invoked Franz Xavier Huemer v. New Yash Industries to plead that non-working of a patent disentitles its holder to injunctive relief. Curiously, Ajanta appeared to suggest that it was not infringing since Section 48 does not explicitly cover export.
In response, Bayer pointed out that the exclusive right under Section 48 covered manufacture regardless, and cited Novartis v. Cipla to argue that although non-working could be a ground for revocation before the Controller, it’s no defence for infringement.
The suit patent claims the compound, its derivatives, and pharmaceutical compositions containing them from a priority date of 12 November 1997. The patent was granted to Bayer Healthcare AG, which assigned it to Bayer’s IP holding company in 2013. Contrary to industry practice, Bayer has filed Form 27 to disclose the working of the patent, as mandated by Section 146 of the Patents Act for the years 2013, 2014, 2015, and 2016. In all these filings, Bayer has admitted that the patented invention has not been worked commercially in India because it is evaluating the market for the product.
Globally, Bayer began marketing the drug through a co-promotion agreement with GlaxoSmithKline since 2001.
Justice RK Gauba quoted extensively from Franz Xavier Huemer to hold that in light of the facts before him, the balance of convenience favoured Ajanta. More importantly, he found that the “self-interest of the patentee” had to be “balanced against the larger public interest”. What’s interesting here is the way in which Justice Gauba conceptualises “public interest”. While Indian courts have historically viewed “public interest” in pharma patent litigation as the interests of the patients who need access to the patented drug, this order denies injunctive relief on the ground that it would lead to “not only loss of employment, but revenue to the state as well”.
What’s so spicy about this?
- The facts of this case (alleged infringement through exclusively export-oriented manufacture) raise the question of TRIPS-compliance. At the TRIPS Council in 2011, the Indian delegation expressed the understanding that the denial of injunctive relief in such a case would derogate from extant TRIPS standards (particularly Art. 31. F, which requires unauthorized uses of a patented invention to be predominantly for the supply of the domestic market).
- It demonstrates that an alert defendant canavoid long periods spent under the cloud of an ex parte ad interim
- The availability of Bayer’s unambiguous Form 27 filings is another indicator that some amount of reform has occurred in the patent office and in industry.