[Reader-list] Novartis Case

[A. Mani]

All related movements should do something about this.

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Novartis Must Not Win This Case



Amit Sen Gupta



"Capital is as terrified of the absence of profit or a very small
profit as nature is of a vacuum. With suitable profits, capital is
awakened; with 10 per cent, it can be used anywhere; with 20 per cent,
it becomes lively; with 50 per cent, positively daring; with 100 per
cent, it will crush all human laws under its feet; and with 300 per
cent, there is no crime it is not willing to dare, even at the risk of
the gallows."



WHEN Marx wrote about the crimes Capital can commit, given the right
circumstances, the present intellectual property system was just being
born. A hundred and fifty years later, perhaps nothing exemplifies
better, Capital’s thirst for profit, as the current regime of
intellectual property protection. It is a system that seeks to
generate super profits through monopoly control over knowledge. When
applied in the medicines sector, it translates into millions of deaths
and destitution for an even larger number. Today, products to treat a
range of diseases are denied to those who need them most because they
cannot pay for them. It is denied to them not because these medicines
cannot be produced at affordable costs, but because a few
multinational corporations treat the knowledge as their property and
sell these medicines at exorbitant prices. They also use the monopoly
created by patents, to prevent other companies from producing and
selling these drugs at much lower prices.



CURRENT PATENT SYSTEM:

A CRIME AGAINST HUMANITY

The current patent system, as part of the global intellectual property
regime, has assumed proportions that are unthinkable. It is the
perpetrator of one of the longest standing, persistent and nefarious
crimes against humanity. It denies a majority of humankind the
benefits that can accrue through advances in science. Nothing
illustrates this better than the impact of the HIV/AIDS epidemic in
Africa. Half the continent of Africa has virtually lost two decades –
developmental and health indicators at the turn of this millennium in
2000, were worse than in the 1980s. A major reason for this has been
the decimation of the most productive section of the population – in
many countries over 1/3rd of people in the 15-45 age group are
infected by HIV/AIDS. A whole generation suffered and died, not
because HIV/AIDS could not be treated, but because those who had the
knowledge to make the necessary medicines used their patent monopoly
to sell the medicines at costs that almost nobody in the African
continent could afford. In 2001, the annual cost of treating one
patient of HIV/AIDS was $10,000. Some African countries would have had
to spend more than half their GDP to procure these medicines for those
who needed them. The tragedy is that these medicines need not have
been so expensive. In 2003 the Indian company Cipla, finally started
selling the same medicines at $250 per annum – at 1/40 th the earlier
cost! Even this was high, and the same drugs can be accessed today at
less than $100, for a year’s supply.



India was mercifully spared the effect of medicine patents till 2005
because it had one of the most progressive patent laws in the world,
enacted in 1972. That has however now changed and the signing of the
WTO agreement in 1994 also marked India’s accession to a patent system
that puts profits before people. India’s earlier patent act worked on
a very simple principle. It said that patents (a monopoly over use of
a product) would be allowed in all sectors except the two that were
most vital for human existence – food and health. So patents on
medicinal products were not allowed in India and new medicines could
be manufactured by a range of Indian companies without hindrance. This
is why Cipla was able to manufacture and supply HIV/AIDS medicines at
a fraction of the earlier costs. Much of this enabling environment for
Indian companies changed when India amended its Patent Act in 2005 –
after completing the ten year transition period allowed when India
signed the WTO agreement in 1994.



HISTORY OF NOVARTIS’

BATTLE IN INDIA

A clear example of profiteering at the cost of peoples’ lives, in
India, has been the case related to a vital anti-leukemia (blood
cancer) drug called Imatinib mesylate. The drug was introduced in 2001
and has quickly become the key drug that is used to treat a form of
leukemia, called chronic myeloid leukemia (CML). For patients
suffering from CML the drug is the difference between a healthy life
and a death sentence.



Imatinib mesylate has been patented in many countries by the Swiss
MNC, Novartis, which sells the drug under the brand name of Glivec. In
India, the initial patent application for the medicine was rejected by
the patent office in 2006. Novartis persisted in its efforts to get a
patent and appealed to the Patent Appellate Board. When the Board
rejected Novartis’ application again, the company challenged the
decision in the Chennai High Court. Not only that, it also challenged
a key provision of the Indian Patent Act that had been cited by the
Patent office while rejecting the Glivec patent application. The
Chennai High Court rejected both the appeals by the Swiss company.
Novartis has, however, continued to persist in its efforts to secure a
patent for its drug. The final step is its, now pending appeal, before
the Supreme Court of India.



In the Supreme Court Novartis is now challenging the interpretation of
a crucial section of India’s Patent Act – Section 3(d). When India
amended its patent laws in 2005, the parliament tried to ensure that
the amended law would contain some safeguards against rampant
profiteering by foreign MNCs. One of these safeguards introduced was
this section. Section 3(d) essentially stipulates that trivial changes
in existing molecules cannot be basis for fresh patenting. Such
trivial patenting (known as ‘evergreening’) is an old ploy used by
drug companies to extend their monopoly. Companies first apply for a
patent for the basic molecule and then attempt to extend the life of
their monopoly by subsequently applying for fresh patents after a few
years on as lightly different version of the original molecule.



In the case of Glivec, the original patent was filed by Novartis in
1993 for the ‘amorphous’ molecule of the chemical, Imatinib Mesylate.
An amorphous salt is what exists in nature and is usually a mixture of
different variants. In the late 1990s Novartis filed a fresh patent
for the Beta variant of the molecule, which is already present in the
amorphous salt that they had earlier patented. They also claimed that
the Beta variety is better absorbed by the body. The 1993 patent was
not recognised in India as at that time Indian law did not allow
patenting of medicines. When the law was changed in 2005, Novartis
applied for a patent for the Beta variety of the salt. The patent
office rejected the patent and opined that under Indian law a slightly
modified version of a known molecule cannot be patented. The patent
office also said that the patent application does not fulfill two
necessary criteria for patenting – novelty, and inventive step. The
beta salt of Imatinib was not an entirely new product, and neither was
there any major inventive step involved in preparing a purified beta
salt from the existing amorphous salt.



As we mentioned earlier, Novartis’ subsequent appeals in the patent
appellate board and Chennai High Court were rejected. Interestingly
Novartis also challenged Section 3(d) of the Indian Act in the High
Court, claiming that it was in violation of India’s obligations at the
WTO. The Chennai High Court pointed out that domestic courts cannot be
asked to give an opinion regarding international treaties and
obligations, and Novartis should take its complaint to the dispute
settlement mechanism in the WTO. Novartis, has never done so and
clearly Section 3(d) does not violate international obligations.



This time around, in the Supreme Court, Novartis has decided to use a
novel plea. Instead of challenging Section 3(d) itself, they now argue
that the section has not being properly interpreted. The section says
that minor variations in an existing molecule cannot be patented
unless there is a ‘significant’ enhancement in efficacy of the
medicine. Now Novartis claims that since the Beta variant is better
absorbed (by about 30 per cent) it constitutes a significant
enhancement. Clearly Novartis and its panel of expensive lawyers are
clutching at straws! The patent office, while rejecting the company’s
earlier patent application, had stated that anybody trained in
chemistry would know that an amorphous salt is made up of different
variants, and it is common knowledge that the variants are likely to
have slightly different properties. However, it is this trivial piece
of research that is the basis for the entire case that Novartis is now
fighting.



NOVARTIS: PHILANTHROPIST

PAR EXCELLENECE!

How much would Novartis gain if its patent were to be upheld? The
mathematics speaks for itself. A month’s supply of Glivec costs Rs
120,000 – way beyond the means of more than 99 per cent of Indians.
Remember that the drug has to be taken lifelong. Yet the same drug is
sold by several Indian companies at a price of Rs 8,000 for a month’s
supply – 1/15th of what Novartis charges! Marx talked about capital
willing to dare any crime for a 300 per cent profit, here Novartis is
fighting for a 1500 per cent profit! At the heart of Novartis’ battle
is a $ 4 billion plus global market for Glivec – about Rs 20,000
crores, which is equal to the entire union health budget of India for
2010-2011.



Novartis tries to give a different spin to the whole issue of access
to the medicine. It claims that price is not an issue in India because
‘eligible’ patients are covered by a programme called GIPAP – Glivec
International Patient Assistance Programme. The only problem with
Novartis’ spin on the issue is wrong mathematics. Novartis claims that
it supplies the drug, free of cost, to about 11,000 leukemia patients
in India. The Cancer Patients Association in India estimates that
there are over 100,000 patients in India who suffer from chronic
myeloid leukemia and that 20,000 odd new patients are added every year
(the disease has an annual incidence of 1-2/100,000 population per
year). Studies also show that the disease strikes earlier in India –
among a younger age group – than in Europe and North America. Yet,
Novartis’ publicists glibly continue to claim that all ‘eligible’
patients in India are cared for by GIPAP.



The GIPAP programme itself is an interesting case study. Novartis has
regularly flogged it to claim credit for an act of charity. How
altruistic is the GIPAP programme? The programme was launched in 2002
and Novartis claims that it reaches 35,000 patients in 80 countries.
In 2003 the New York Times carried an investigative report that blew
the lid off the claims of altruism. The NYT report (as well as another
report from Argentina) documents how GIPAP has been used by Novartis
to first create a demand for Glivec and then to pressure governments
and heath management organisations to reimburse the cost of the
medicine. The NYT reported: “In wealthier countries like South Korea,
Hong Kong and New Zealand, Novartis, meanwhile, has encouraged
patients who have received free drugs to become advocates, pressing
public health systems to pay high prices for the drug. One company
document declared that drug donations along with media campaigns and
legal tactics were part of a concerted plan to win reimbursement for
Glivec”.



The story gets even murkier. The website, www.healthyskepticism.org
documents GIPAP’s record in Argentina and reports of a case filed in
the country’s court: “The Program kept a 3-month reserve supply of
Glivec for the patients. When the doses for the first phase of the
treatment were delivered to the patients, including a 30 day supply to
cover their immediate initial needs, the patients or their relatives
were instructed to retain an attorney to start legal proceedings
against the health care institutions which did not include Glivec in
their formularies. After that, the provision of Glivec by the
Foundation through their GIPAP Program was stopped. The investment by
Novartis consisted of a single treatment [ie, for one month] and then
the company recovered its so-called donation by forcing the health
care institutions to buy the product”….”the claim also details other
illicit practices, such as the making of secret payments of bribes to
doctors in order to position Glivec in Argentina, or the giving of
gifts to oncologists”.



NOVARTIS:

THE VICTIM!

Novartis has consistently played the victim in the Glivec case. It
says that it is not fighting the case to make money but to uphold the
principle that it deserves credit for the investment it has made in
research to develop the drug. What Novartis does not tell us is that
Glivec was granted ‘orphan drug’ status in the United States and was
therefore eligible for  tax rebates equal to half the cost of clinical
testing (the major cost for drug development). We turn to what Brian
Druker, one of the scientists involved in developing Imatinib while
working in Oregon Health and Science University Cancer Institute, has
to say. In a signed article in Livemint in 2007, Druker wrote: “In the
recent debates on patents, pharmaceutical prices and access to
essential medicines, the critical role of scientists and resources of
the public sector and academic institutions involved in medical
research have often been overlooked. As one of the scientists behind
the development of the medicine ‘Imatinib’ (marketed as Glivec by
Novartis), which has allowed the effective control of a devastating
form of cancer, I have witnessed the vital role that academic
researchers and public institutions play in bringing new medicines to
the market.



“Many scientists, if not most of those I have collaborated with in
these settings, are engaged in research primarily motivated by the
pursuit of knowledge as a means to help patients. For many of these
scientists it is, therefore, of great concern that the results of
their efforts can’t reach patients and save lives because of pricing
strategies and patent policies such as “patent evergreening” (minor
changes to existing molecules designed to extend patent monopolies)
used by partners further down the drug development process”.



Druker, goes on to relate how a large portion of the research was made
possible because of public funding and how the company was actually
not very interested, initially, in pursuing the research on a cure for
CML. He writes: “My work in Oregon on a therapy for CML was primarily
funded by public sources, particularly the National Cancer Institute.
My persistence with scientists at Ciba-Geigy (now Novartis) helped to
keep the development of Imatinib on their agenda despite uncertainty
from product managers. As Imatinib progressed through early and late
clinical trials and demonstrated outstanding results, scientific and
media interest in our discovery increased. The approval of Imatinib by
the FDA in May 2001 for use in CML was the culmination of a 10-year
project for me, something I had dreamed of since medical school”. And
yet, Novartis laments that it is not being given due credit for its
‘original’ research!



CORPORATE GREED Vs

LIVES OF MILLIONS

Let us complete the Novartis story in India. What Novartis is
challenging in the Supreme Court of India is not just the order
denying the company a patent for Glivec. Novartis is challenging the
very heart of the Indian patent act and its attempt to balance the
rights of patent holders with the needs of the Indian people for
access to treatment that is affordable. Section 3(d) of the act has
been used several times by the Indian patent office to deny patents
for other similar trivial inventions, especially in the case of
HIV/AIDS medicines. If the section is diluted or overturned, all these
cases will be reopened. Not just that – it will open the door for a
flood of applications, many of which were not filed by companies
because of the existence of Section 3(d). So the case can have
implications for access to medicines not just for CML patients but for
a whole range of patients who are today able to access cheaper drugs
made by Indian companies. These patients are located not just in India
but in over a hundred countries in Asia, Latin America and Africa. For
example, over 80 per cent of all patients in developing countries who
consume HIV/AIDS medicines are able to do so because Indian companies
supply them at an affordable rate. This is a case that Novartis must
not win because it is not about corporate pride. It is a case that
sets corporate greed against the lives of millions across the world.


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Best

A. Mani








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