Delhi HC allows Natco, Alembic to Export Rivaroxaban of Bayer

NEW DELHI: In a recent order passed by Delhi High Court, the court has granted the permission to Indian pharmaceuticals companies, Alembic and Natco to export German drug maker Bayer's blood thinner brand 'Xarelto' (Rivaroxaban).

The court has also directed the Indian pharmaceutical companies Natco and Alembic to use the Bayer's medicine for research and development purposes only.

Last year, Bayer filed an application in the Delhi High Court to injunct Alembic Pharmaceuticals Ltd. (Alembic) from making, selling, distributing, advertising, exporting, offering for sale and in any manner directly or indirectly dealing in RIVAROXABAN and any product that infringes Bayer's patent IN 211300 and for ancillary reliefs pleading i) that the subject patent is registered in the name of Bayer and is titled OXAZOLIDINONES AND THEIR USE.

After that Natco filed a counter affidavit in the writ petition inter alia pleading that Natco had not exported any products subject matter of Compulsory Licence the exports of which instances were given by Bayer were by third parties without notice, consent and knowledge of Natco that under the scheme of the Drugs and Cosmetics Act, 1940 (Drugs Act) permission is routinely granted for export of API to various countries upon compliance of certain conditions, there are similar provisions in the western countries as well including Europe that the Patents Act also provides that export of a patented product for generation or submission of regulatory permission is not an act of infringement that the export for which permission was sought by Natco from Court was also for regulatory purposes that such exports are not at all covered by the Compulsory Licence that the activity of conducting studies for regulatory approval is squarely covered under Section 107A of the Patents Act that Natco had never exported the finished product SORAFENAT to any party outside India for commercial purpose.

According to Bayer, Alembic was infringing its patent on the blood thinner by exporting and dealing in the drug, Rivaroxaban. Alembic had argued that exporting its version of the drug was well within the provisions of Section 107 A. Bayer, however, claimed that Alembic had exported 90 kgs of the drug worth Rs. 3 crore and that the export of such a large quantity was not as per this section.

In its verdict, the court has has ruled in favour of the Indian companies, allowing them to continue with the exports for clinical development and regulatory purposes.

Though Section 107A prescribes the ―acts which are not to be considered as infringement of patent rights‖ but there is no provision in the Patents Act prescribing as to what is infringement of patent rights or what acts constitute infringement of patent rights. However, Section 48 reproduced;

"48. Rights of patentees.—Subject to the other provisions contained in this Act and the conditions specified in section 47, a patent granted under this Act shall confer upon the patentee— (a) where the subject matter of the patent is a product, the exclusive right to prevent third parties, who do not have his consent, from the act of making, using, offering for sale, selling or importing for those purposes that product in India;

(b) where the subject matter of the patent is a process, the exclusive right to prevent third parties, who do not have his consent, from the act of using that process, and from the act of using, offering for sale, selling or importing for those purposes the product obtained directly by that process in India.",

Justice Rajiv Sahai Endlaw stated, "I've held their exports to be permissible."

Pratibha Singh, counsel for Alembic said, "The court has reiterated that the growth of the pharma industry in India cannot be stunted in such a manner by stopping exports for exploratory purposes which is a recognised exception under TRIPS (Agreement on Trade-Related Aspects of Intellectual Property Rights)."

Read the full Judgement Below