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SC ruling sets a higher bar for what the pharmaceutical industry can declare a patentable innovation

The Supreme Court has rejected the plea of Swiss pharmaceutical giant Novartis for a patent on its leukaemia drug Glivec, in a ruling that could ripple through the developing world and affect the fundamentals of the pharmaceutical revenue model. Upholding earlier decisions of the Intellectual Property Appellate Board and the Madras High Court, the court fortified Section 3 (d) of the Patents Act, which requires companies to prove "therapeutic efficacy" when they tweak a molecule or put a known substance to a new end. In the Glivec case, it ruled that better bio-availability by itself was not reason enough for a patent, unless it contributed to more effective treatment.

This ruling helps those who would have otherwise been priced out of life-saving care (Glivec costs about Rs 1,42,000, compared to Rs 9,500 for generic versions). It appears to be in line with the public health imperative recognised by the Doha Declaration of the TRIPs agreement. Novartis, though, has argued that Glivec is patented in 40 countries, and that India's seeming disregard for intellectual property could freeze investment here. Other pharma majors like Roche and Pfizer are also locked in patent disputes in the courts. They argue that if patents are eroded, then the resulting chill on innovation would end up slowing the production of new drugs, hurting the public interest. Of course, access must be balanced with the incentive to create. Pharmaceutical companies invest a great deal of money and effort to produce new drugs, and if generic companies could simply reverse-engineer them, it could discourage invention. The court's ruling in this case, though, only sets a higher bar for patentable creation. Innovation will have to be a solid leap forward for companies, not just sitting back after a single blockbuster drug and fiddling with its composition for decades afterwards. This ruling could be a bracing force for the industry, making it chase after genuine breakthroughs. It could be argued that modifications to minor ends also deserve their own rewards, but that must be separately worked out patents are a 20-year monopoly, a take-it-or-leave-it proposition that leaves much of the public underserved in times of desperate need.

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