Apr 19, 2020 | Indian Patents Act 1970, IPR & Business, Startups
Recently in June 2021, Sun Pharmaceutical Industries Ltd, Indian multinational pharmaceutical company headquartered in Mumbai, Maharashtra, settled a patent litigation with Celgene Corp, a subsidiary of Bristol Myers Squibb. This litigation was regarding submission of an Abbreviated New Drug Application (ANDA) for a generic version of Revlimid (lenalidomide capsules) in the US by Sun Pharma.
Revlimid (lenalidomide) in combination with dexamethasone is indicated for the treatment of patients with multiple myeloma and is a single agent which is also indicated as a maintenance therapy in patients with multiple myeloma following autologous hematopoietic stem cell transplant. It is approved in the U.S. for the treatment of patients with mantle cell lymphoma (MCL) whose disease has relapsed or progressed after two prior therapies, one of which included bortezomib. Lenalidomide is on the World Health Organization’s List of Essential Medicines.
Abbreviated New Drug Application (ANDA) is an application that is filed at FDA to get approval for generic drug where the innovator drug is already approved. Typically, generic drug is equivalent to an innovator drug product in terms of dosage, form, strength, route of administration, quality, performance, characteristics and intended use. All approved products, both innovator and generic are listed in FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (Orange Book).
ANDA application passes through 4 levels of certifications where paragraph IV certification is very critical. It requires applicant to establish that the generic drug for which ANDA is filed does not infringe any existing patent rights of the third parties. To understand patent infringement, it is important to know rights of a patent holder. In a given jurisdiction where patent is granted, a patent holder has right to prevent third parties from making, using, selling, offering for sale and even importing the patented product. Violation of any of the rights of the patent holder or patentee is called as infringement.
In this case, Celgene had a patent on Revlimid and upon ANDA filing by Sun Pharma, Celgene filed a lawsuit for patent infringement against Sun Pharma. Licensing is one of the popular ways, the companies adopt to settle the patent litigation in exchange of royalty payment. The word “license” means “permission”, which may be granted by the patent holder on certain terms and condition for a specific period of time by executing an exclusive or non-exclusive license agreement. In this case, Celgene agreed to grant license to Sun Pharma, for a specific amount of money to be paid by Sun Pharma as royalty, to manufacture and sell the drug, subject to the U.S. Food and Drug Administration approval. By providing license, Celgene would allow Sun Pharma to manufacture and sell an unlimited quantity of generic lenalidomide capsules in the U.S. from Jan. 31, 2026.
Before this case between Celgene and Sun Pharma, other Indian companies, Cipla Ltd., Natco Pharma Ltd., Cadila Healthcare Limited and Dr. Reddy’s Laboratories Ltd. and the U.S.-based Alvogen had settled patent litigations for Revlimid with Celgene. Celgene granted patent license to all these companies, required to manufacture and sell an unlimited quantity of generic lenalidomide in the United States beginning after January 31, 2026. However, these company’s ability to market lenalidomide in the U.S. will be contingent on its obtaining approval of an Abbreviated New Drug Application.
By Bindu Sharma and Deepa ES
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Apr 18, 2020 | Indian Patents Act 1970, IPR & Business, Patent, Startups
After working hard on the new idea, investing money, resources, it’s time to fulfil the dreams, set-up new business, bring new product in the market. IP protection is an important step to secure innovation to prevent others from copying it. Is there anything else that is required to be done much before it? Following are the most crucial issues to be considered by an inventor to help him in enhancing quality of research and file the patent application in a cost-effective manner:
Prior art search: Get a thorough prior art search done right in the beginning when you conceive a new idea. The scope of the search should not be limited to the granted patents, but the published patent applications and paper publication should also be searched. The search shall be done globally using various paid or unpaid databases to identify the closest and the most relevant patents/patent application that would help you to assess the novelty of the invention. Prior art search also is helpful in drafting of the patent specification. Prior art search is an essential and crucial step to give shape to your idea and hence it’s a good idea to take professional help to get the search done.
Maintain confidentiality: Inventors often are extremely passionate and enthusiastic about their invention. Having invented something feels great and one feels like disclosing it to the world. But stop! It is strictly essential to maintain strict confidentiality of the invention till the patent application is filed. One of the critical requirements of getting a patent is that invention shall be novel on the date of filing. Hence, never disclose, publish or make your invention available to public till you file a patent application for the same. Additionally, do have an NDA (Non-Disclosure Agreement) with your attorney as well for the same before initiating discussion on filing patent application. A classic example is when Archimedes solved the problem of checking the purity of a gold crown without damaging the crown. While taking a bath, he noticed that the level of the water in the tub rose as he got in and realized that this effect could be used to determine the volume of the crown. Archimedes then ran in the street naked, so excited by his discovery that he had forgotten to dress, crying “Eureka!”.
Documentation: Documentation of an invention is extremely critical. Stepwise documentations shall be done and the novel features of the invention, existing technical problem which your invention overcomes, how your invention works shall be highlighted. Explain the process or the product with drawing and\or flow diagrams. Thorough understanding of the invention by your attorney is necessary. Don’t get lazy to fill the invention disclosure form if given by your attorney in order to describe the invention systematically. Consider the cost: Understand why and in which county (ies) or jurisdiction (s) you want to file a patent application. Choosing to file provisional or complete application, PCT application or convention application or filing in India based on your requirements can really help you to manage your finances and to identify the timelines. Spend some time with your attorney to understand the procedure to work on the most cost-effective package.
Explore options other than patent: Depending upon kind of product, it is advisable to explore other option for protection of the innovation in the form of copyrights, design or trademark. Being an inventor requires tremendous amount of effort and taking invention in right direction, in right manner is imperative to protect it appropriately and to reap the benefits.
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Nov 27, 2019 | Patent
In order to file a patent application outside India, for Indian residents, it is required to seek permission from Indian Patent Office and this permission is called as Foreign Filing Permission or Foreign Filing License. According to Section 39 of the Indian Patent Act, 1970, if an applicant is a resident of India but is interested in filing a patent application in a foreign country, the applicant has the below-mentioned options:
Option 1: Filing an application at the Indian Patent Office under section 7 and wait for 6 weeks before filing in the foreign county of their choice including PCT. If there are any issues regarding the invention or its subject matter, the Controller is expected to provide necessary directions, including secrecy directions, within 6 weeks. In the absence of any such directions within this timeframe, the applicant is free to file applications outside India.
Option 2: Obtain permission from Indian Patent Office to file patent application directly in the foreign country without filing an application in India.
This permission is known as foreign filing permission and is required to be submitted by the applicant to the Indian patent office on Form 25, “On application for permission for applying patent outside India under section 39 and rule 71(1)”. The fee for submitting Form 25 is INR 1600 for natural persons, start-ups, small entities or educational institutions and INR 8000 for large entities. There is a 10% additional fee which is applicable for filing in physical mode. The details required for such a form include applicant details, inventor details, and the reason for which the applicant is seeking the foreign filing license. Along with the Form 25, the applicant is required to submit the details of the invention in the form of a complete specification and the drawings enabling the Controller to review the invention in light of subject matter relevant to defence purpose or atomic energy, if any, which the applicant is planning to file in the foreign country.
The Controller usually takes approximately 21 days of time to examine and provide his approval for the request. However, if the invention is relevant for defence purposes or related to atomic energy, the Controller will not grant permission to file patent in a foreign country without the prior consent of the Central Government of India. In case of inventions relating to defence or atomic energy, a period of 21 days shall be counted from the date of the receipt of clarification/consent from the central government.
It is interesting to note that if the invention is relevant for defence purpose or atomic energy, the Controller shall not grant permission to file patent in foreign country without the prior consent of the Central Government. This section shall not apply in relation to an invention for which an application for protection has first been filed in a country outside India by a person resident outside India.
Non-compliance with provision of Section 39
As per section 40 of The Patents Act, an application shall be deemed abandoned if contravention of section 39 is found.
Further, as per section 118, violation of directions given under section 35 or contravention of section 39 may result in imprisonment for 2 years or payment of a fine or both.
Conclusion
If the applicant is a resident of India and wishes to file an application in a foreign country, the applicant can either file the application in India and wait for 6 weeks to subsequently file in the required foreign country or the applicant can take a Foreign Filing permission from Indian Patent Office and file directly at the respective foreign country without filing in India.
Author: Dharini Dinesh
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Nov 16, 2019 | General
In Vitro Diagnostics (IVDs) are devices as defined in section 201(h) of the Federal Food, Drug, and Cosmetic Act. According to section 351 of Public Health Services act, IVDs are biological products. Similar to any other medical devices, IVDs are also subjected to premarket or postmarket controls. IVDs are generally also subject to categorization under the Clinical Laboratory Improvement Amendments (CLIA ’88) of 1988.
Some examples of IVDs are:[1]
- Hepatitis or HIV tests
- Clinical chemistry
- Coagulation test systems
- Urine test strips
- Pregnancy tests
- Blood sugar monitoring systems for diabetics
- Receptacles manufactured specifically for medical specimens
Classification Of IVDs By FDA
FDA has classified the IVDs into three classes, Class I, Class II, Class III. The classification has been based on the level of regulatory control that is necessary to reasonably assure the safety and effectiveness of the devices.
The Code of Federal Regulations lists the classification of existing IVDs in 21 CFR 862, 21 CFR 864, and 21 CFR 866.
|
CLASSIFICATION |
LEVEL OF RISK |
|
CLASS I |
NO PUBLIC HEALTH RISK OR LESS PERSONAL HEALTH RISK |
|
CLASS II |
LOW PUBLIC HEALTH RISK OR MODERATE PERSONAL RISK |
|
CLASS III |
MODERATE PUBLIC HEALTH RISK OT HIGH PERSONAL RISK |
|
CLASS IV |
HIGH PUBLIC HEALTH RISK |
IVDs & Covid-19
In terms of immediacy and global demand, SARS-CoV-2 presents a totally different opportunity and challenge compared to all other IVDs tests. The number of SARS-CoV-2 tests already being carried out worldwide most likely outstrips all other infectious disease testing.[2]
But, there are some IVDs that seriously exist and help in further diagnosis of corona virus infection.
The IVDs and SARS CoV-2 & COVID-19 have several enlisted:
- DIAGNOSTIC TESTS: Tests that detect the designated corona virus and the infection with SARS Cov-2 virus. These include molecular tests and molecular tests and antigens tests.
- SEOLOGY/ ANTIBODY AND OTHER ADAPTIVE IMMUNE RESPONSE TEST
These are the tests that detect anti bodies in the body of a person. These anti bodies are IgM, IgG. But the limitation of these tests are that these cannot be used when the person is currently infected.
- TEST FOR MANAGEMENT OF COVID-19 PATIENTS
There are some tests that are authorized for the use in the management of the patients with COVID-19 infection. These are basically bio markers to test the inflammation in the body.
IVDs though are useful, but they do possess risks when used without knowledge. They are:
- There is a risk of false positive and false negative results with all in-vitro diagnostic tests.
- Failure to follow the IFU may affect test performance and impact the validity of the test result.
- Positive results need to be considered alongside other clinical information such as past medical history, results from diagnostic testing and history of exposure.
- A false negative result may occur due to inadequate sample collection, storage, and/or handling, therefore, a negative test result does not eliminate the possibility of SARS-CoV-2 infection.
- When self-swabbing is required, it can be difficult to ensure that a sufficient sample has been obtained. It is important to follow the instructions for use carefully.
- Some tests may not have been evaluated for use in asymptomatic individuals (i.e. individuals without signs and symptoms of respiratory infection). The test performance may differ in these individuals.
- The IFU may specify that the test must be used within a number of days post onset of symptoms.
- The predictive value of the test (probability of a given result being a true result) depends on the prevalence of the disease.
Approval needed in case of IVDs
Step 1
Medical devices and IVDs are regulated by the Drug Controller General of India (DCGI) within the Central Drugs Standard Control Organization (CDSCO), part of the Ministry of Health and Family Welfare. The regulatory framework for medical devices is based on the Medical Device Rules, 2017. In India, only few Medical Devices and IVDs need approval and go through a lengthy approval system. A full list can be found in the CDSCO’s Notice on the classification of medical devices and IVDs. This is not an exhaustive list. CDSCO does not maintain a single list of regulated devices, but rather subjects devices to regulation through the Drugs and Cosmetics Rules, the Medical Device Rules 2017, and subsequent Gazette Notifications, which should be reviewed prior to making a final determination of a device’s regulatory status.
Step 2
The person manufacturing the IVD or medical device has to appoint an Authorized agent to interact with CDSCO on his behalf. The agent should comply with all the requirements.
Step 3
Class B, C, and D IVDs require in-country performance testing through the National Institute of Biologicals (NIB) or an accredited lab. Class D IVDs require performance testing through the National Institute of Biologicals (NIB). Class B and C IVDs require performance testing through an accredited Indian lab, though CDSCO may instead accept existing reports for such products with approval in a major regulatory market.
Step 4
The next step includes, compiling the applications, including manufacturing facility information, device technical information, ISO 13485 certificate, IFU, testing results (if applicable), clinical data (if applicable), proof of approval in the US, EU, Australia, Canada, or Japan, plus proof of approval in home country (satisfied by CFS/CFG).
Step 5
Then, we can file an application for registration/Import license with CDSCO and pay the required fees. The documents should be English.
Step 6
The CDSCO reviews applications and may require a Technical Presentation. Approximately 25% of applications require a formal Technical Presentation. The Technical Presentation is an in-person meeting with the CDSCO to discuss the product in more detail. A representative from the manufacturer (such as an engineer) is expected to attend this meeting along with the India Authorized Agent.
Novel devices will also undergo a Subject Expert Committee (SEC) review. Devices novel to the Indian market (new technology, material, intended use) may face additional regulatory hurdles. CDSCO may require clinical studies conducted in India prior to regulatory approval, or the agency may issue a restricted approval. A restricted approval could include a requirement to actively collect and submit post-market data. The SEC meeting will include local clinicians and other experts who will weigh in on the acceptability of the existing clinical data.
Step 7
The CDSCO issues an Import License in Form MD-15. Following the implementation of the Medical Device Rules, 2017, the processes for obtaining device registration and import licensing were combined in India. Accordingly, the CDSCO does not issue Registration Certificates under the Medical Device Rules, instead issuing market authorization for foreign devices through the Import License (Form MD-15).
The License does not expire; however, license retention fees are due every five years.
Step 8
Once approved, only the Indian Authorized Agent may import products. However, one can obtain multiple registrations for the same device through different Authorized Agents.
This is an improved outline of the process for approval. The CDSCO may choose to audit the submission and request more documents, which will add time to the IVDs approval.
Author: Apoorva, ICFAI Law School, ICFAI University, Dehradun
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[1] https://www.tuvsud.com/en-in/industries/healthcare-and-medical-devices/medical-devices-and-ivd/medical-device-market-approval-and-certification/invitro-diagnostic-medical-devices-directive
[2] “In Vitro diagnostics and the corona virus pandemic”- Liz Thorn
https://www.europeanpharmaceuticalreview.com/article/127199/in-vitro-diagnostics-and-the-coronavirus-pandemic/
Jan 20, 2019 | Indian Patents Act 1970, IPR & Business
An over- simplification of licensing is monetizing the intellectual property of your invention by allowing third parties such as companies to license the intellectual property for various purposes that involve manufacturing, marketing and selling. A patent, trademark, copyright, trade secret, a tech algorithm, or techniques or procedures or know-how are all examples of intellectual property. Subject to the provisions of the licensing agreement, when an invention is given for licensing to a licensee, the organization is empowered with the ability to manufacture; market and sell the invention. The process of Licensing of the technology is completed upon execution of Technology License Agreement (TLA) between the Licensor and licensee whilst the inventor is given royalties by the licensee as a consideration for the said agreement.
It is of paramount importance that the terms and conditions of License Agreement are explicitly agreed by both parties and is in a written form.
Why license an innovation to a company?
The fundamental reason that inventors license their patents for royalties is so that they can focus exclusively on attempting to create rather than managing to manufacture, monetize, or distribute each of their inventions. Inventors can create intellectual property and then license the rights to another company to bring the product to market through a patent license agreement. For many innovators who may not have the resources to bring their invention to market on their own, this serves as a viable option.
Licensing inventions for royalties can also help inventors access new markets and expand the reach of the invented product. If an inventor intends to expand into a market where he has limited experience or in an industry across the borders or want to endorse a licensee who has similar products in the market and where the invention could be optimally used in, the inventors decide to license their patent.
Structure of a License Agreement
Licensee: Selecting an appropriate licensee to meet the requirements is one of the first crucial steps in licensing an intellectual property for royalties.
Scope: The scope of the license is determined by the licensor (inventor) which clarifies specifications of the intellectual property. The questions involved are whether the licensee is allowed to access the IP rights as a whole, or will the licensee only be allowed to use the patent for a precise task, for instance, manufacturing or distribution worldwide or in specific jurisdiction. The valid duration of such intellectual property license along with restrictions on geographical locations and various markets is important to be negotiated.
There are no specific requirements of the license to either be exclusive or non-exclusive. It solely depends upon choice of the parties. The license may contain a prohibition on the parties competing in the jurisdictions in which they operate; the contents of the contract will factor in the determination.
In order to receive protection against similar inventions or otherwise, a patent must be compulsorily registered or filed for priority protection, and the patent license must be in writing and registered under section 68 of the Patents Act 1970.
Validity of License Agreements
A license agreement, as previously said, should be in writing with all pertinent terms fully outlined. Would just a term-sheet, to the contrary, suffice as a legitimate license agreement? PVR Pictures Limited vs. Studio 18[1], the Delhi High Court delved at this issue. The parties had agreed in this matter to enter into a term-sheet agreement (TSA) under which PVR would be the exclusive licensee for distribution rights in respect of selected cinematic pictures for which written agreements would be executed. PVR accused Studio 18 for infringement, claiming that by refusing to enter into an agreement with PVR on the film, Studio 18 was infringing on PVR’s rights. PVR asked for ad interim relief against the defendant. The issue was whether PVR is Studio 18’s licensee for the film Short Kut, and if so, whether it is entitled to an ad-interim injunction. The courts held that the TSA does not signify a license agreement because the parties did not intend for the TSA to become a binding contract and a license as defined by the Copyright Act; and because PVR failed to develop any legal right or copyright for the grounds of suit, PVR cannot seek specific performance or an ad interim injunction.
Hence, the license terms must not only be in writing but should also be in the form of a binding definitive document for a valid License Agreement.
Terms of a License Agreement
A license agreement must be extensively drafted to provide for specific details of the rights and the limitations imposed on the licensee in the exercise of such right. The definition of licensed property, the geographical features for which licenses are granted, the right given to the licensee to further sublicense the property, clauses regarding revocation of the license, royalty or consideration for the grant of license, dispute resolution, cessation, all of which are inherent areas of the agreement.
To ensure that the licensee cannot claim that the IP has been transferred to it, the license agreement must be carefully drafted, and certain license constraints must be included. There have been certain cases where the licensor has executed an exclusive license and the licensee claims that the IP has been assigned. Indian courts have looked at the essence of the contract, notably the royalty payment clauses, to assess whether a transfer should be interpreted as an assignment or an exclusive license in a number of cases.
In Deshmukh and Co. (Publishers) Pvt. Ltd. vs. Avinash Vishnu Khandekar and Ors[2], the Court looked at the difference between assignment and licensing of Copyright. It was iterated that the essence of a document, not the manner of words used, must be considered when determining whether it is an assignment or just provides a license. The question usually arises in the context of whether the right in question has been partially assigned or licensed exclusively; the distinction is subtle but significant.
The copyright is not conveyed if the consideration is in the form of royalties or a portion of profits rather than a direct payment. It would be a publishing and selling license. In this situation, the payment of royalty rather than substantial money intended to be a sale, stands against partial assignment.
Consequently, the licensing provisions must unambiguously declare that it is a license (whether exclusive or non-exclusive) and clarify the contractual terms. More significantly, the royalty payment clause should be formulated carefully that it does not imply that any direct payment is made in exchange for Intellectual property assignment.
Improvements, enhancements, and revisions to IP are the responsibility of the IP owner.
Licensee can design and develop an enhancement to an existing technology or a component that improves the technology’s use or functionality. The new innovation could be the result of modifying the licensed IP to make any improvements, or it could be the outcome of an innovation related to the use of the licensed IP. These improvements signify advancement in the licensed technological field that improves the initial IP’s usage, functionality, efficiency, productivity, or other attributes. A license agreement must indicate what designates an improvement, and the ownership of such improvement and all property created as a result of it.
Mandated registration of License Agreement
When a license agreement is intended to be performed, the issue of whether the registration of the agreement is mandatory arises. If required by law, what are the consequences of non-registration? The Patents Act, the Trademarks Act, and the Designs Act all require license agreements to be registered, although the Copyright Act does not. The Indian Stamp Act, 1899 (the “Indian Stamp Act”) governs the transfer of intellectual property rights in the form of licenses, assignments, and sales, among other things.
Quantification of Royalty
As previously mentioned, when an inventor licenses his invention to a third party, the two parties engage into a license agreement in which the licensee acquires the patent rights and the licensor receives a fixed sum of money each time the product is sold.
The royalty is a fixed sum paid to the licensor or inventor as consideration, and the licensing royalty rate is a percentage of the net or gross profit selected to constitute the royalty. The quantification of royalties may heavily depend on the negotiations between the parties and merchantability of the invention. The Licensor may be in violation of The Competition Act, 2002 (the “Competition Act”) if it attempts to set extortionate prices as a result of its dominating market position. The test of accuracy of the royalty is reasonability.
The accuracy of the royalty base would determine the reasonableness of a royalty. The royalties is calculated on an individual basis. The Competition Commission of India (“CCI”) has adjudged on numerous cases regarding royalty rates assessment. It has been iterated that offering different licensing prices to different users for the same technology is in violation of FRAND requirements. Further, the CCI determined that Ericsson imposed unjustified royalties because no alternative technology for its patents 2G, 3G, and 4G standards was available.[3]
Even-though, licensing an invention comes with certain limitations and risks, the license agreement allows parties to expand the inventions to various jurisdictions and markets which aligns with the primary visions of licensor and reach larger targeted audience.
By Vinita R. Gaud, Pravin Gandhi College of Law
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[1] PVR Pictures Limited vs. Studio 18 2009 SCC OnLine Del 1878
[2] Deshmukh and Co. (Publishers) Pvt. Ltd. Vs. Avinash Vishnu Khandekar and Ors 2006 (2) BomCR 321
[3] Telefonaktiebolaget LM Ericsson (PUBL) v. Competition Commission of India, 2016 SCC OnLine Del 1951
