Nearly two years after Merck initiated an infringement action against Glenmark before the Delhi High Court over its patented diabetics drug sitagliptin (Indian Patent 209816, sold under the brand names Januvia and Janumet), in a May 15 2015 order the Supreme Court upheld the interim protection granted by the Division Bench of the Delhi High Court in favour of Merck, albeit in a limited manner. While restricting Glenmark from manufacturing and selling unfinished formulations of stagliptin phosphate monohydrate (SPM) (sold under the brand names Zita and Zitamet), the Supreme Court allowed Glenmark to sell existing stocks of its products, which are expected to meet market demand for five to six months. The Supreme Court also set a strict timeline for completion of the trial by June 30 2015 to ensure that highly contested commercial cases are disposed expeditiously, which is in the national interest.

Background

Order of Delhi High Court single judge

In April 2013 Merck approached the Delhi High Court seeking a permanent injunction against Glenmark for infringement of its patent for sitagliptin. Merck alleged that Glenmark’s product SPM infringed its patent for sitagliptin as the patent claims covered the active ingredient sitagliptin and any of its salts, including its various stereoisomeric forms. In addition to filing a counterclaim challenging the validity of the sitagliptin patent under Section 64 of the Patents Act 1970, Glenmark argued that Merck was guilty of suppression and had failed to disclose that a separate patent application (5948/DELNP/2005) had been filed for a dihydrogenphosphate salt of sitagliptin, but subsequently abandoned.

In an April 5 2013 order the single judge held that on account of Merck's failure to explain satisfactorily its admission in the patent application for a dihydrogenphosphate salt of sitagliptin, Merck could not be granted an interim injunction.

Order of Delhi High Court Division Bench

While Merck successfully obtained interim injunctions against other generic manufacturers, such as Aprica Pharmaceuticals Pvt Ltd, with respect to its sitaglitin patent, Glenmark presented a substantial challenge. Merck appealed the single judge's order to the Division Bench (two judges). Merck argued that its non-disclosure of other applications for phosphate salts of sitagliptin in India and elsewhere was a minor detail and should not have influenced the decision as to whether Glenmark had infringed its sitagliptin patent or have been the basis for refusing an interim injunction. On the other hand, Glenmark argued that SPM was qualitatively different from sitagliptin per se, such that it had enhanced pharmaceutical qualities, and therefore the manufacture and sale of SPM did not violate the patent for sitagliptin. Further, Glenmark relied on a patent for SPM granted in the United States to assert its enhanced pharmaceutical qualities.

While dealing with the grounds for revocation asserted by Glenmark, the Division Bench highlighted its limitations in addressing technical matters in an interim hearing and examined the three grounds for granting an interim injunction (ie, a prima facie case, the balance of convenience and irreparable harm or injury).

The bench observed that SPM was not found specifically in any of the claims of the sitagliptin patent; the only reference to it was in the specification, where a phosphate salt was mentioned as a possible "pharmaceutically acceptable salt". However, at such a preliminary stage the court could not determine whether a person skilled in the art would have known the phosphate salt as an obvious alternative such that its specific disclosure in the sitagliptin patent was not required. The court held that the question of whether the sitagliptin patent additionally disclosed SPM was left open. Therefore, in a March 20 2015 order the bench held that the sitagliptin patent sufficiently disclosed the active ingredient and to that extent was valid. Second, the bench held that the question of whether the sitagliptin patent sufficiently disclosed a particular combination (of the billions it claimed to cover) could arise on a case-by-case basis on considering whether the combination had a different use, action, function, chemical structure or value such as to exclude it from coverage. For the purpose of the interim hearing, the bench observed that the sitagliptin patent and all its possible combinations (including SPM) shared "a common use or property" and a "common structure" based on the factors relevant to determine the validity of a broad formula based on a Markush patent under the Guidelines for Examination of Patent Applications in the Field of Pharmaceuticals issued by the Indian Patent Office.

The bench also observed that Merck’s abandonment of SPM in the subsequent patent application assumed lesser importance in the context of infringement of the sitagliptin patent. The bench held that Merck’s success or failure in securing a patent for SPM could not serve as the basis for denying inventive step in the sitagliptin patent. Further, the bench held that Glenmark entirely relied on its US patent for SPM, which in turn relied on sitagliptin as a basic element. Therefore, the bench held that the use of sitagliptin without authorisation clearly amounted to infringement under Section 48(a) of the act. Thus, it was held that prima facie infringement of Merck’s Sitagliptin patent had been established.

The bench held that the following issues had to be considered in the case at hand:

  • The public interest in granting an injunction – in this regard, the bench observed that the price difference between the commercial products sold by Glenmark and Merck was not high. Thus, the bench held that allowing Glenmark to sell the drug would not necessarily result in a lowering of the price such as to increase access.
  • Whether the public interest can be overlooked to maintain the integrity of the patent system itself, so that a legitimate monopoly is not distorted – the bench held that it must be mindful of the need to enforce the act, particularly where a strong case of infringement is established.  
  • An infringer which is allowed to operate during a trial may lower the price of the product since it has no R&D expenses to recoup – the bench observed that while this may apply to the infringer, it does not apply to the patentee. Moreover, the bench observed that even assuming that the patentee can survive the financial setback during the trial, prices may not recover.  
  • Glenmark’s decision to release Zita without first challenging Merck’s Januvia or Janumet – the bench noted that one of the grounds on which Glenmark opposed the sitagliptin patent was the violation of Section 8 of the act by non-disclosure of international patent applications for SPM and sitagliptin plus metformin, since they were the "same or substantially the same" as the sitagliptin patent. In this regard, the bench observed that it was reasonable for Glenmark to detect the possibility to challenge the sitagliptin patent in revocation or opposition proceedings when a US patent application for SPM it had filed was opposed by Merck. However, the bench observed that Glenmark had released the drug without initiating revocation proceedings under the act, which would have obviated the need for an interim arrangement. Although the bench cautioned that Glenmark’s right to question the validity of the patent in an infringement was unaffected, it held that the manner of challenge was a relevant factor against it at the interim stage.
  • The combination of the three primary factors (a prima facie case, the balance of convenience and irreparable harm or injury) – the bench observed that in some instances a strong case can offset an equal balance of convenience between parties. With regard to the case at hand, the bench held that Merck had established a prima facie case of infringement. Further, there existed an interim arrangement which secured the interests of both parties and maintained the public interest, and also ensured that the possibility of irreparable harm to the patentee was removed.

In light of this, the bench set aside the order of the single judge dismissing the application for grant of an interim injunction and granted the same in favour of Merck along with certain directions.

Comment

The case at hand reached the Supreme Court with respect to the question of whether Merck was eligible for an interim injunction. Almost two years have passed since the filing of the suit and the judiciary is still grappling with the issue of interim injunctions; there has been little, if any, development in the actual trial of the suit on the merits. Although, the Supreme Court has issued a timeline for completion of the trial, this is not the first time that such directions have been issued: the Supreme Court has issued such timelines in the past and they have not been adhered to (Bajaj Auto Ltd v TVS Motor Company Ltd (2009)9SCC797). This delay in completion of the trial makes interim injunction orders crucial for the parties. It remains to be seen whether this case reverses the trend and results in expeditious trials for a patent infringement matter.

Vindhya Srinivasamani

This article first appeared in IAM magazine. For further information please visit www.iam-magazine.com.