India Won't Patent Minor Modifications In Drugs

from the closing-the-loophole dept

Tue, Aug 7th 2007 6:34pm — Mike Masnick

While many people are aware of how dangerous software patents are to innovation in the software space, not nearly as many feel the same way about pharmaceutical patents. However, there is increasing evidence that pharmaceutical patents are harming healthcare in a variety of ways, often by slowing the pace of innovation by locking up important concepts and making them too expensive. Recently, India was pressured to update its patent system to cover pharmaceuticals (in many countries, pharma patents are a relatively recent addition), though the rules state that drugs created before 1995 cannot receive patent protection. However, drug makers have long learned that a great way to artificially extend patent protection on a drug is to make a tiny modification and then get a new patent. That's why you now see Clarinex on the market from the maker of Claritin. Claritin went off patent, so the maker came out with Clarinex, advertising that it was much better, even though that doesn't actually seem to be the case.

It seems that pharma firm Novartis tried to use this little trick to sneak in patent protection in India for a leukemia drug that came out before 1995. It tried to get a patent on a slightly modified version of the drug, which would then let it ban the sale of generic versions of the non-patented version of the drug. Luckily, as pointed out at Against Monopoly, an Indian court has denied the request, since Indian law says patents should only be granted for new products, or ones where there's a significant improvement -- which is not at all true in this case. That means generic makers can continue to market their drug in India and many, many more leukemia patients will be able to afford the medicine. Novartis, of course, whines that this will slow down drug development, but the evidence suggests exactly the opposite. Having a truly competitive market increases the incentive for real innovation. What Novartis wants is to focus on marginal, useless innovation for the sake of keeping monopoly profits.

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Filed Under: patents, pharmaceuticals
Companies: novartis

12 Comments

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yangyang (profile), 7 Aug 2007 @ 8:18pm

"What Novartis wants is to focus on marginal, useless innovation for the sake of keeping monopoly profits." Not certain USELESS innovation is a good business model
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Anonymous Coward, 7 Aug 2007 @ 8:49pm

Re: Not certain USELESS innovation is a good busin
It's been working for years in the pharmaceutical industry, one of the most profitable industies worlwide. Useless innovation is profitable precisely as outlined in Mike's article.

Another example is Prilosec vs. Nexium - which confirms Mike's observation.

I had used Prilosec for years. with good results when the patent expired and it became available over-the counter.
Sometime later, my doctor suggested a change to Nexium. It costs quite a lot more because it was new and not available as a generic or over the counter.

Motivated by the higher cost, I read the chemical makeup of the two. Even though I'm not a chemist or otherwise technically qualified to judge, they seemd so obviously similar that I talked it over with my pharmacist.

He whispered (really) - and actually looking over his shoulder - told me that there was no practical difference between them. I continued with over-the counter Prilosec, with the same good results.

If Prilosec is safe enough to sell over-the-counter now, why wasn't the exact same medicine safe enough for OTC sales while the patent was still in force?

Simple - they make more money selling drugs via prescriptions.

That's why they advertise prescription drugs directly to consumers - "ask your doctor if this crap is for you". (it's funny how many times they aren't even clear about what "illness" you're supposed to be suffering from - just ask for a prescription, sucker.)
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yangyang (profile), 7 Aug 2007 @ 9:02pm

Re: Re: Not certain USELESS innovation is a good b
I see your point, but it is more about useless patents rather than useless innovation.
I think Mike made a typo and it should be 'useful innovation'. The big drug companies can then put down patents and make big profits on these innovations. They would thus be generating new drugs, not trying to profit from slightly changed old drugs.
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dorpus, 7 Aug 2007 @ 9:10pm

Oh yes, innovation is just so easy.
So tell me about these pizza-eating 25-year-olds who invent a cure for AIDS in their garage?
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Michael Ward, 7 Aug 2007 @ 10:03pm

Patent Law in India
You wrote: "It tried to get a patent on a slightly modified version of the drug, which would then let it ban the sale of generic versions of the non-patented version of the drug."

This doesn't make any sense. How can this cause the sale of a non-patented drug to be banned? Have you made a small error of interpretation?
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Ryan (ex-techdirter), 8 Aug 2007 @ 5:58am

It's all about business models!
So having worked in both tech and Pharma/Biotech I actually admire India's view on patents in this particular case.

Generic drugs are a useful incentive to get drug firms to innovate and lower costs of non-novel drugs. The answer's simple to be honest, pay for performance ... if a drug is a non-substantial improvement then payors,i.e. insurance firms/governments should only pay a fractional increase on the generic cost (which currently isn't happening).

Drug firms should still be given a premium for truly novel drugs as this is will keep driving innovation!
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Killer_Tofu (profile), 8 Aug 2007 @ 6:12am

Wish our system over here was more like that.
Then again, judges have been making some good decisions lately.
Maybe we will get there within my lifetime.
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Sanguine Dream, 8 Aug 2007 @ 7:03am

Re: Patent Law in India
I'm only guessing here but I think he was trying to say that a company would patent a slightly altered version of an existing drug in order to maintain the facade of telling customers that they need this "new" drug (that would be to maintain their already high profit margin) and also to stop generic variants of their "new" drug from coming up on the market (that would be competition). Well that's I'm thinking he was tyring to say.
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SNB, 8 Aug 2007 @ 10:15am

Patent Law in India
Yeah, you'd make a great point if the information were accurate, and I'm no apologist for pharma, but the issue here is that although the basic molecule was known before 1995, Novartis is actually the company that made the modifications that allowed it to be effective as a cancer treatment in the human body. I'd say that's a pretty major improvement, not minor at all. The generic versions available were made by copying the Novartis drug and putting them out there while their patent application was pending so it's actually the generic companies who put no money into R&D of this drug that took advantage of loopholes.
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SailorRipley, 8 Aug 2007 @ 11:36am

Re: Patent Law in India
I'm not an expert either, but here's how I think it works (don't jump on the particulars, just trying to illustrate the principle that's at work (as far as I can tell))

Let's say a company invented and patented aspirin. It now can ban any generic version of aspirin, meaning that any generic version of a drug with the core ingredients of aspirin (hence, what effectively makes it aspirin) is banned.

At some point, patent runs out and the company now "invents" this new aspirin with strawberry flavor and receives a new patent for that. And it can continue to ban any generic version (even generic versions of the previous "version" of aspirin), because this new patent, although it is for the "new" product, it essentially still (or rather again) covers the same medically relevant components.

Basically, these "follow-up" patents are awarded much too easily, when the difference between the original and subsequent version is too small/insignificant
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Mischa, 8 Aug 2007 @ 12:46pm

Re: Re: Re: Not certain USELESS innovation is a go
I think Mike's right. The drug companies don't really want to do 'useful innovation'. (Well an individual scientist might but the business as a whole doesn't.) The companies want to do as little innovation as possible, less work on their part. Hence the 'useless'.
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