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Bolar: A Boon for Generics

Issued: September 01 2011

The amendment of the Indian Patents Act in 2003 introduced the Bolar provision in form of Section 107A, which permits third-party experimentation with any patented drug to enable the generation of data, required to be submitted to a drug control authority, without considering it as an act of infringement. Section 107A states that any act of making, constructing, using or selling a patented invention solely for uses reasonably relating to the development and submission of information required under any law for the time being in force, in India, or in a country other than India that regulates the manufacture, construction, use or sale of any product, is not to be considered as infringement. Thus, this provision provides a generic drug manufacturer an opportunity to make or use a patented product or process without the patent owner’s permission even before the patent expires. The generic drug maker can then market their own version of the patented drug as soon as the patent expires. The provision was introduced to facilitate quick availability of a generic version of a drug soon after the expiry of a patent at an affordable price.


 

Article 30 of TRIPS provides an exception to the rights conferred by a patent, thereby allowing a window to the member countries to provide exceptions that do not unreasonably conflict with a normal exploitation of the patent, taking into account the legitimate interests of the patent owner and also those of third parties. Thus, Bolar is doubtlessly TRIPS-compliant. Many other countries, including Canada, China, Japan and Australia, have introduced the Bolar provision into their laws for providing early access to generic version of drug. Otherwise, the patentee would get an extended term to enjoy patent monopoly for marketing the patented drug even after expiry of the patent, while the generic companies would be in the process of obtaining marketing approvals.


 

According to a recently published report of the Confederation of Indian Industry, the Indian pharmaceutical industry was estimated to be worth US$4.5 billion in 2010 with annual growth estimated to be 8% to 9%. India exports generic medicines worth about US$11 billion and ranks first in the world among generics exporting nations. The Indian pharmaceutical industry is considered to be one of the world’s largest and most-developed, while the Indian pharmaceutical market has grown to more than US$10 billion, registering a moving annual total based value-wise growth rate of 20.4% over the previous year’s corresponding period for the 12 months ending July 2010.


 

Indian drug manufacturers have played a crucial role in providing low cost life saving drugs to the consumers in least developed and developing nations. According to another study published in the Journal of the International AIDS Society, Indian firms met more than 80% of total AIDS medicines requirement in the period between 2002 and 2008 and accounted for 65% of the total value of AIDS medicines purchased in 2008. The Indian Bolar provisions will provide further impetus in this direction and will help in early availability of newer offpatent molecules at a fraction of cost of the branded product.


 

Indian lawmakers are very much concerned about adequate availability of cost-effective drugs to consumers. Recent judgments by Indian courts have also echoed these sentiments in Roche v. Cipla, the Bayer v. Cipla patent linkage case and Novartis’s Glivec case. The cost and affordability of the drug has been an important consideration in these judgments.


 

The Indian pharmaceutical sector has tremendous opportunities for generic drugs in the times ahead. It has been reported in the Economic Times that Gilead Sciences, a US pharmaceutical giant, licensed four Indian companies to manufacture and sell low-cost versions of three of its new anti-HIV drugs. This first-of-its-kind agreement, which was entered into in July 2011, involves Ranbaxy Laboratories, Matrix Laboratories, Hetero Drugs and Strides Arcolab. These companies can make and sell the drugs in about 100 countries at affordable prices, and are bound to royalty payment. Reportedly, the three drugs covered in the agreement are Elvitegravir, Cobicistat and Quad. Presently, the drugs are in late-stage clinical development.


 

In the famous Bayer v. Cipla case, Bayer, which holds a patent for the drug Soranib, filed a writ against the Union of India praying that the Drug Controller General of India (DCGI) be directed to disregard Cipla’s request for regulatory approval for the generic form of the patented drug. Cipla argued that Section 107A of the Patents Act clearly exempts from patent infringement any of acts of making, using or even selling a patented invention, in so far as such acts are necessary to obtain information for the filing of a drug regular application before the Drug Authority. Cipla argued that such an action of patent evaluation by the Drug Authority while granting regulatory approvals shall deny the entity the benefit of the Bolar provision that aimed for quick entry of generic drug soon after the expiry of patented drug. The matter was decided in favour of Cipla, thereby allowing Cipla to seek regulatory approval from the DCGI prior to the expiry of Soranib patent.


 

It is inevitable for a developing country like India to frame policies which allow generic manufacturers to enter the market with cheaper and equally-effective generic products while simultaneously ensuring that legitimate interests of patent owners are protected. Judicious implementation of the Bolar provisions will go a long way in ensuring easy and cost-effective availability of the drugs in the market soon after expiry of the drug patent.



 

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About the Author

 Anuradha Salhotra is managing partner and a founder of Lall Lahiri & Salhotra. With experience of more than 26 years in handling all forms of intellectual property rights, Salhotra is regarded as an authority on intellectual property law in India due to her experience in protecting and enforcing IP rights. She is a sought after advisor in areas of licensing, technology transfer and prosecution work for both trademarks and copyright.

 

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