Suspense as Ipab set to rule on Bayer-Natco row

The Intellectual Property Appellate Board (Ipab) has concluded the hearings (that began  on January 23) on the issue of the compulsory licensing (CL) of Bayer’s anti-cancer generic drug Nexavar (sorafenib tosylate).

Ipab is expected to pronounce its order on March 4. According to industry sources, the forthcoming order acquires significance, given that the department of pharmaceuticals is said to be working on a draft policy on price negotiation for patented drugs.

Sources said once the negotiation formula works out, it would nullify the possibility of a CL.

“Apart from Natco and Bayer, the controller of patents, too, had participated in the hearings,” a source tracking the developments said.

The controller of patents had decided to grant a CL to Natco on the ground of affordability of the drug. Natco had applied for the CL of Bayer’s Nexavir claiming that the drug major was offering the drug at an exorbitant price while a CL would bring down the price significantly.

While Bayer’s drug is priced at a little over `2.8 lakh a month, Natco has been promising to sell the drug at less than `8,900 a month.

After a prolonged legal battle and hearings at the controller’s office, the controller of patents, in his 62-page order, had granted a CL to Natco, despite the patent in favour of Bayer remaining in force.

As per the order, Natco is allowed to manufacture and sell the drug in India at `8,800 a month. This would mean a supply of 120 tablets to patients suffering from liver and kidney cancer.

Natco has also been ordered to pay a royalty of 6% to Bayer on net sales. The CL is valid till the expiry of Bayer’s patent in 2021. Additionally, the controller of patents had also ordered Natco to supply the drug free of cost to “at least” 600 patients.

During the course of the arguments, Bayer told the controller of patents that Cipla, another Indian company, had been selling the drug at Rs30,000 a month. By disclosing thus, Bayer was seen to be trying to counter Natco’s argument that drug supplies were insufficient.
However, the order from the controller of patents had refused to take the presence of Cipla in the market on record since an infringement case against Cipla is still pending adjudication.

In its appeal with Ipab, Bayer had argued that the controller of patents had erred in its decision and had not allowed the company to utilise the provisions of the law before a generic player is allowed to market its drugs.

According to the regulations in force, a generic player has to wait for three years before seeking the approval to market a generic after a patent is granted.