Healthy Skepticism International News

March 2007

Letter from Novartis re litigation against India’s refusal to grant a patent for imatinib (Glivec.

Letter from Novartis re litigation against India’s refusal to grant a patent for imatinib (Glivec / Gleevec)

Background

Glivec (Gleevec in some countries) is imatinib mesylate and is used to treat two rare cancers: chronic myeloid leukaemia (CML) and gastrointestinal stromal tumours (GIST). 

The Indian Ambassador in Belgium has explained the key facts about the drug to the European Parliament as follows:

“Since imatinib mesylate controls the cellular action that would cause the cancer to grow but does not cure the disease, patients must take it for the rest of their lives, unless another type of treatment or cure is available. The medicine is produced and marketed internationally by the Swiss pharmaceutical company Novartis and its generic forms are produced by several Indian generic-drug manufacturers. Novartis sells Gleevec in India for US$ 26000 per patient per year. Generic versions of the drug in the Indian market are priced at about US$ 2100 per patient per year or less than one-tenth the price charged by Novartis. Novartis is charging high prices for Gleevec worldwide: from about 25000 USD to more than 50000 USD per patient per year. This price is well above the financial capacity of most of the patients. Novartis points out that only a few number of patients in India are paying the higher price since they have established a Gleevec donation programme. In 2006, about 5000 persons in India benefited from this programme. But India witnesses about 25000 new cases of Chronic Myelloid Leucemia every year.”

(E-DRUG: Novartis case statement by India www.essentialdrugs.org/edrug/archive/200704/msg00055.php)

The pricing of Glivec is unusual in that instead of varying the price according to the level of wealth in different countries Novartis has set a worldwide price. Novartis’ position is:

“At a worldwide price of between $2,000 and $2,500 per month, most patients would not be able to pay for the drug without insurance or reimbursement through their country’s healthcare system. Novartis management firmly believes a drug with such a dramatic potential should be available to all appropriate patients with CML. At the same time, as a breakthrough drug, Gleevec must provide a profit in order to support additional investment not only in further study of it, but also for further research in oncology and other therapeutic areas. The Novartis solution is to make Gleevec available worldwide through special assistance programs.”

(Novartis and the United Nations global compact initiative. www.novartis.com/downloads/about-novartis/ungc_case_study_lee_ tavis.pdf)

These special assistance programs have been a cause of concern for Healthy Skepticism.
(Joana Ramos. New Definition of “Patient Assistance Program” in Brazil. Healthy Skepticism International News 2005 Jan ;23:1 www.healthyskepticism.org/news/issue.php?id=7)

In January 2006 Novartis was denied a patent for Glivec in India under Section 3(d) of the Indian Patents Act 2005. The Indian Patent Office had ruled that Glivec did not satisfy the requirements for novelty and inventiveness. In August 2006 Novartis launched a High Court challenge against that ruling. Novartis also alleges that Section 3(d) is unconstitutional and in breach of India’s obligation under the World Trade Organisation TRIPS (T rade-Related aspects of Intellectual Property rights) Agreement.
(WTO’s explanation of TRIPS www.wto.org/english/thewto_e/whatis_e/tif_e/agrm7_e.htm
Time line according to Novartis www.novartis.com/downloads/about-novartis/glivec-history-india.pdf)

On 26 September 2006 Doctors Without Borders/ Médecins Sans Frontières (MSF) warned that the case may have serious implications for future access to essential drugs worldwide. “If Novartis’ challenge against the Indian patent law is successful, a key safeguard that can protect the production of affordable medicines will be lost,” said Ellen ‘t Hoen, policy director at MSF’s Campaign for Access to Essential Medicines. “People the world over who rely on India as a source for their medicines may be affected if Novartis gets its way.” “The public health safeguards of the Indian Patent law have given hope to many who depend on the manufacture of generics. The Novartis litigation is a direct challenge to those safeguards,” said Leena Menghaney, MSF campaigner in India. (MSF Media release www.doctorswithoutborders.org/pr/2006/09-26-2006_1.cfm)

On 9 October 2006 the Berne Declaration expressed concern that “the changes in the Indian Patent Law requested by Novartis would have consequence on access to affordable essential generic medicines (in particular HIV/AIDS medicines) not only in India but also in all developing countries that import Indian generic medicine. India is today the main provider of affordable generic medicines against HIV/AIDS in the developing countries.” The Berne Declaration stated that they were “shocked that Novartis wants to limit the recognized flexibilities left to the Indian Government under the TRIPS agreement and to undermine its ability to fulfil the right to health.”
(Novartis challenges the Indian Patent Law 9 October 2006 www.evb.ch/en/p25011414.html)

In January 2007 Oxfam called for Novartis to drop the court case against India. Oxfam expressed concern that:

“if Novartis wins its case, access to vital affordable medicines for AIDS and other diseases will be jeopardized.
‘Novartis claims it is simply trying to protect its intellectual property over a single drug. But the truth is this is a direct attack against India’s sovereign right to protect public health,’ said Oxfam’s Make Trade Fair head Celine Charveriat.
Oxfam believes that the Glivec case alone is vital to the thousands of cancer patients in India who may be unable to get affordable generic versions of the medicine in the future. Branded Glivec sells for $27,000 per patient per year in India, but the generic version sells for $2,000 per patient per year.
Novartis says that it gives Glivec for free to poor patients, but Oxfam says this is not a sustainable way of providing medicines. ‘Novartis cannot guarantee to provide Glivec for free for life to the 24,000 new leukemia patients diagnosed in India each year. Corporate philanthropy has its place, but generic competition is the proven way of keeping drug prices affordable,’ said Charveriat.
‘Glivec aside, the global ramifications of the case against India’s patent law could stain Novartis’ reputation forever,’ Charveriat said. ‘There are an estimated 9,000 patent applications waiting to be reviewed by Indian authorities of which roughly 7,000 are believed to be modifications of old drugs. If India is made to change its law, many of these medicines might become patented, and therefore off-limits to cheap generic competition.’”

(Oxfam media release http://web.archive.org/web/20070206122626/http://www.oxfam.org.uk/applications/blogs/pressoffice/2007/01/novartis_lawsuit_threatens_acc.html)

For more information about problems with patents and the pricing of Glivec/Gleevec around the world see: http://www.cptech.org/ip/health/gleevec/ and for more about the Indian patent case see: http://www.cptech.org/ip/health/c/india/

Correspondence between Novartis and Healthy Skepticism

On 7 February 2007 Dominic Atkins, Head of Business Services / Global Policy, Global Public Affairs, Novartis International emailed Peter Mansfield, Director, Healthy Skepticism. Dominic requested that we post a open letter from Novartis on our website. He wrote that the open letter “sets out our rationale for proceeding with the [Indian Glivec patent] case, why we think it is an important matter, and that we feel the case will bring clarity to the issue of intellectual property protection in India, and not adversely affect Access to Medicines.” This letter was also sent to many other organisations and individuals and posted on the e-drug email list. (www.essentialdrugs.org/edrug/about.php)

Within 24 hours Brook K. Baker, Program on Human Rights and the Global Economy, School of Law, Northeastern University, Boston USA posted a response to Novartis’ open letter. Brook described the open letter as containing “one truth, numerous half truths, and several flat out lies.” (Brook Baker. E-DRUG: Perspectives from Novartis: an open letter (2) http://www.essentialdrugs.org/edrug/archive/200702/msg00009.php)

On 12 February Peter replied to Dominic as follows:

“We are willing to post your open letter on our website if you still would like us to do so. We expect that you are aware that there has been some criticism of your letter posted on e-drug. Would you like to modify your letter in response to that criticism before we post it?
We note with interest that you “seek an open dialogue with all groups, one based on mutual trust and tolerance with the aim of long-term success - not only in access-to-medicines initiatives but also in day-to-day business activities”. We are willing to consider a dialogue on that basis with your company. What process and aims do you have in mind?
Would you be willing to post an open letter from us on your website?”

On 10 March Dominic responded:

“Yes I am aware of the criticism of our piece on E-Drug, clearly there are different perspectives on this case but we are leaving our letter as is.  It has also been welcomed as a balanced view on the issues in this case by some.  The most recent version of the position is attached here and we would welcome you posting it on your site.  And in response, yes we would be more than happy to reciprocate by posting an open letter from your organization on our website. 
With reference to the issue of dialogue.  I started in this role last September, with a major aim of my job being better dialogue with the NGO community.  Clearly since that time the India / Glivec issue has come to the fore and taken the majority of attention, but it is still my aim to concentrate on better NGO dialogue in the longer term.  Essentially we want to understand the NGO world and issues better, for the NGO world to understand Novartis and our issues better, and as well as getting valuable external stakeholder input into our business strategies, look at areas that we might work together with certain NGOs to achieve mutually beneficial aims.”

The Healthy Skepticism management group will make a decision about dialogue with Novartis soon. Meanwhile please find below the second version of the open letter from Novartis. It is identical to the first version except for a minor change to the first sentence and deletion of one whole paragraph that Brook Baker had described as containing a lie.

The open letter from Novartis

Why Novartis thinks improving patent law will benefit patients and society
We have received messages of concern regarding our ongoing legal challenge against the Indian patent law, following the denial of the patent for our ground-breaking cancer treatment Glivec®/Gleevec®. We have heard these concerns and want to clarify our perspective. 

In India, Novartis is faced with a globalization dilemma that characterizes many emerging economic powers today: two markets within one country. India has a booming middle class on one hand, and a vast number of extremely poor people on the other. In order to make responsible business decisions, we have carefully considered the following aspects:

Access to our cancer treatment Glivec in India and globally
India as an emerging growth market and global competitor
India’s current role in supplying medicines to the developing world

As a result, in India, we are pursuing a dual, patient-focused strategy. We are aware of the many obstacles poor patients face regarding access to medical care there, and that is why 99% of patients who receive Glivec in India receive it free from Novartis. At the same time, we take affluent India seriously as a formidable power with all the rights and obligations that such status brings with it. As a consequence, we seek to establish effective protection for pharmaceutical innovation in India.

In the following, we outline our approach in more detail:

Novartis has secured access to Glivec both in India and globally
When we launched Glivec, Novartis committed that no patient in need should be denied this life-saving cancer treatment. We fulfilled this commitment by establishing the Glivec International Patient Assistance Program (GIPAP), which is one of the most far-reaching patient assistance programs ever implemented on a global scale. In India, Novartis currently provides Glivec at no cost to more than 6 600 diagnosed patients. Glivec treats two rare cancers: chronic myeloid leukemia (CML) and gastrointestinal stromal tumors (GIST). The GIPAP covers every person in India who is prescribed Glivec and cannot afford this life-saving medicine. For more information, please visit the Max Foundation which administers the program, http://www.themaxfoundation.org.

Sustainable access to medicines in developing countries is complex and requires much more than the availability of generic drugs. Generics alone do not solve the issue. For example, in India the cost of a one year treatment with generic imatinib is USD 2 100, or 4.5 times the average annual income. Even our critics recognize that generic versions of Glivec are not the solution for the poor in India. Furthermore, generic makers in India have yet to come forward with an access program for generic imatinib. 

Glivec is not an exception. As a matter of business principle, Novartis is deeply concerned that patients have access to the medicines they need, as demonstrated by our well-regarded record in social responsibility. 

In 2006, our access-to-medicines program reached 33.6 million patients. Novartis spent
USD 755 million / EUR 582 million last year alone programs and research. We seek to move beyond philanthropy to develop new business models. That is why we engage in many innovative public-private partnerships with efforts spanning a number of disease areas, including our partnerships with WHO to combat leprosy, malaria and tuberculosis. Novartis also established an Institute for Tropical Diseases in Singapore dedicated entirely to drug discovery for neglected diseases. 

We take India seriously as an emerging growth market and global competitor
While we are committed to access to Glivec, it is clear that we seek business opportunities in India’s growing economy. We also compete with Indian companies globally in attractive markets, and the export of copies of our products into richer countries is a major concern to us.

Protecting innovation is the foundation for massive R&D investments made by the pharmaceuticals industry that are vital to medical progress. Companies can continue to bring improvements and innovations to patients and societies only with effective patent laws. For a research-based company such as Novartis, patents are not negotiable. 

That Glivec is a tremendous innovation is widely recognized throughout the scientific community; it has received numerous awards for innovation. Glivec has been awarded a patent in 36 other countries, including China. The journey of Glivec through the patent process in India illustrates the difficulties faced in a country in transition. The Indian patent law creates new hurdles for pharmaceutical innovation, unjustifiably and illegally narrowing what is patentable. 

Respect for intellectual property will strengthen, not weaken, the Indian economy, helping India reach its aspiration of becoming a pharmaceutical powerhouse. Incremental innovation is exactly the area where local Indian companies have made first steps into research and development and registered patents worldwide.

We are seeking clarity. Knowing we can rely on patents in India benefits government, industry and patients because research-based organizations will know if investing in the development of better medicines there is a viable long-term option. 

Our actions in India do not hinder the supply of medicines to the poor
We are contesting the provision of Indian Patent Law that has led to the rejection of the Glivec patent in India. Our case does not challenge provisions that provide for access under international trade agreements, specifically the TRIPS and the Doha Declaration. These flexibilities allow production for export under compulsory licenses that have been issued for public health reasons. They have been put in place to allow poor countries to safeguard access to medicines that do not have sufficient local production capacity. In fact, political agreement on the Doha flexibilities has been reached in order to mitigate impact of TRIPS implementation in India.

Novartis supports the TRIPS conditions that promote access for developing countries. Our patent strategy preempts some of these flexibilities by not filing patents in the poorest countries. Furthermore, we believe that in the case of essential and life-saving medicines, special pricing arrangements in developing countries must, and can, occur within the context of sufficient intellectual property and trade-related safeguards.

Denial of patents for better medicines will not improve patient access to medicines. These restrictions will instead negatively impact patient access by denying new drugs either through research-based pharmaceuticals or, at the appropriate time, through the generic companies. 

Access to medicines in the developing world is a complex problem in which medicine prices and intellectual property rights are but two pieces of the puzzle.  A range of underlying or related issues such as appropriate infrastructure and distribution networks must be addressed in parallel.  This can only be achieved through the collaboration of all involved stakeholders working together to ensure that patients in need receive proper care. We seek an open dialogue with all groups, one based on mutual trust and tolerance with the aim of long-term success – not only in access-to-medicines initiatives but also in day-to-day business activities. 

Thank you for reading this perspective. For more information about this legal challenge and about our extensive corporate responsibility and patient access programs, please visit 

http://web.archive.org/web/20060830134237/http://www.novartis.com/corporate_citizenship/en/index.shtml

The debate continues

It seems the letter from Novartis has not been very effective. On 15 February 2007. Former President of the Swiss Confederation Ruth Dreifuss joined over 300,000 people worldwide - including Archbishop Desmond Tutu, former UN Special Envoy for HIV/AIDS in Africa Stephen Lewis, and Dr. Michel Kazatchkine, the new head of the Global Fund to Fight AIDS, Tuberculosis and Malaria in calling upon Novartis to drop the case against India.
(E-DRUG: Former Swiss President Joins Call for Novartis to Drop its Case in India http://www.essentialdrugs.org/edrug/archive/200702/msg00027.php)

On 11 April 2007 Indian Ambassador in Belgium provided the perspective of the Indian government at an Exchange of views on Novartis case (Sect 3d) organised by the European Parliament as follows :

“Rejection of the patent brought relief to thousands of cancer patients as it prevented a patent monopoly till 2018. The Gleevec patent order rejecting a ‘new form of an old drug’ also set an important precedent for the examination of patent applications related to essential drugs including AIDS medicines. 
Novartis filed cases in the Chennai High Court challenging the order of rejecting the Gleevec patent as well as challenging the constitutional validity of the Indian Patent Law. Novartis’ litigation has raised concerns among other patient groups as the Gleevec patent order set a precedent for the examination of crucial drugs patent applications including those for AIDS treatment. 

Moreover, Novartis challenged the constitutionality of section 3(d) of the Indian Patents Act, which was specifically introduced by the Indian parliament as a safeguard against the misuse of the product patent regime. Novartis, in its petition, claimed that the section is not in compliance with the TRIPS agreement and hence should be declared unconstitutional. 

Section 3(d) is aimed at preventing pharmaceutical companies from obtaining patents on old medicines which would prevent trivial patenting and new use patents. India, while complying with the TRIPS agreement and introducing a product patent regime for ‘new drugs that were invented’, also coupled its law with a safeguard of refusing patents on discovery of new forms or new uses of older drugs to prevent ” evergreening”. This provision is in conformity with TRIPS agreement. This is also in keeping with the 2001 Doha Declaration on the TRIPS Agreement and public health. The Doha Declaration on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and Public Health states that “the Agreement can and should be interpreted and implemented in a manner supportive of WTO members’ right to protect public health and, in particular, to promote access to medicines for all”. 

Further, the TRIPS compliance of any law can be and should be challenged by a government in the Disputes Settlement Body of the WTO and not by a company in an Indian court. The right course for Novartis would be to file an appeal before the Intellectual Property Appellate Board which is headed by a judge and has already been constituted.”

(See: E-DRUG: Novartis case statement by India http://www.essentialdrugs.org/edrug/archive/200704/msg00055.php)

Also on 11 April 2007 Novartis put its position in a briefing sent to members of the International Trade Committee as follows:

“The legal case does not concern access to medicines.  On the contrary, 99% of the Indian patients who take Glivec (circa 6,600 patients in total) receive it from Novartis for free. Worldwide, Novartis is donating Glivec at no cost to approximately 19,000 patients in 80 countries. 

Our legal action in India does not undermine the provisions that allow access to medicines.  Novartis only challenges those provisions of Indian Patent Law which are not currently in compliance with international law. 

Novartis fully supports the TRIPS conditions that promote access to medicines for developing countries and the Doha declaration. 

Our legal case has no impact on pending patent applications for new HIV treatments. Most new HIV treatments are new compounds, thus falling completely outside the scope of the current dispute. 

Our case concerns incremental improvements of earlier compounds. 

Novartis’s position is that such innovations should also be patented.  Our opponents argue that such stepwise innovations do not deserve to be protected as they often bring no additional value. This is however, a strange argument. Patents for incremental innovation do not prolong the life of the original patent.  Thus, generic companies can always produce medicines based on the initial compound when the patent expires if they believe that the incremental innovation does not add value to the original product. 
The case also concerns the conflicting interests of Indian generic manufacturers and the innovative pharmaceutical industry.  Indian generic manufacturers target the middle income populations but not the “real poor”. In India, the generic version of Glivec costs 4.5 times the average annual income. 

A strong patent law is in the interest of India. One third of pending patent applications for pharmaceuticals comes from Indian pharmaceutical firms. Indian companies have a strong interest in having patents for incremental innovations and they have publicly supported our case. 

Novartis contests strongly that our case undermines the supply of affordable medicines to the developing world.  Indian generic companies focus on the developed world and India; only 8% of their sales goes to the developing world outside India.  By contrast, the innovative pharmaceutical industry treats 716,000 HIV patients in the developing world.

Novartis is deeply committed to ensure that patients have access to medicines. In 2006, our access to medicines program reached 33.6 million patients.  Novartis spent USD 755 million last year alone.  Public private partnerships can play an important part.  Novartis is committed to exploring the issue of access to medicines. But, any solution must be sustainable.  Generics and the demise of the patent system is not a viable solution in the long-term. 

As the world’s second largest manufacturer of generic medicines, Novartis understands and recognizes the contribution of generics once drug patents expire. Our concern is with the non-recognition of intellectual property rights that ultimately advance pharmaceutical research and development for better medicines so that patients needs will be met in the future.”

(See: E-DRUG: Novartis response to case statement by India. http://www.essentialdrugs.org/edrug/archive/200704/msg00067.php)

In a report published on 20 April 2007 Paul Herrling, head of Novartis corporate research has called for the creation of a global taskforce to fund and distribute new drugs for neglected diseases in developing countries.

“Herrling believes it is time to set up an independent non-political body of all interested parties to tackle the thorny issue of access to medicine.

“This is now dependent on our goodwill, but governments and NGOs would like to see something more sustainable than the goodwill of big pharma companies,” he told swissinfo.

“This is a much more constructive way to get everyone collaborating towards a solution as opposed to the relatively simple war cry of ‘shoot patents’”.

Herrling suggests that firms could apply for funds to develop drugs for diseases such as malaria and grant licenses for their use in that field, while still retaining the patent for other commercial uses.”

(Novartis wants drugs access overhaul. SwissInfo)

Herrling’s proposal appears to go a quarter of the way towards Healthy Skepticism’s proposal to replace patents entirely with competitive grant funding for research.

See:

Mansfield P. Industry-Sponsored Research: A More Comprehensive Alternative. PLoS Med 2006;3(10): e463 http://medicine.plosjournals.org/perlserv/?request=get-document&doi=10.1371/journal.pmed.0030463

Mansfield P. Introduction to Healthy Skepticism Inc, our reform agenda and methods. 2006 Aug;24:8
http://www.healthyskepticism.org/news/InternationalAug06.php

We will publish a Healthy Skepticism International News issue about Novartis’ Glivec donation program soon. If we decide to enter dialogue with Novartis we will keep our members and subscribers informed.

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