Singh&Singh | Malhotra&Hegde | View firm profile
Co-authored by Ms. Vanditta Malhotra Hegde, Managing Partner – Singh&Singh | Malhotra&Hegde and Mr. Rishi Mody, Senior Associate, Singh&Singh | Malhotra&Hegde
In the mayhem caused by the COVID-19 pandemic, it isn’t far-fetched to say that, at present, almost every topic of discussion starts with or includes either or all of the following words – “COVID”, “Quarantine”, “Vaccine”, “Cure” and/or “Unlock”. With India being subjected to over a hundred days of lockdown restrictions, the only hope for most people to go back to their pre-coronavirus lifestyle is a medicinal cure for COVID-19, in the form of a treatment or a vaccine.
As far as treating COVID-19 is concerned, the undisputed frontrunner seems to be Remdesivir which is an antiviral drug invented by the American pharmaceutical behemoth, Gilead Sciences Inc. While Gilead ought to have rejoiced on account of the various validations, approvals, and grants that its Remdesivir received worldwide, there were setbacks and resistances that it faced in numerous countries. A few examples of such roadblocks are: (a) a public outcry on Remdesivir receiving exclusivity lead to Gilead voluntarily rescinding Remdesivir’s “orphan drug” status in the U. S. A.; (b) Chile and Israel openly announcing that it will immediately invoke a compulsory license on any life-saving drug (which in this case would be Remdesivir) thus preventing Gilead from being able to make any demands in respect of the licensing terms of Remdesivir in Chile or Israel; (c) forty seven other “Least Developed Countries” having similar powers as Chile/Israel due to the relevant TRIPS/WTO provisions which interestingly also enabled Bangladesh to launch a generic version of Remdesivir over two months ago; and (d) several non-governmental organisations in India petitioning the government to revoke the patents that had been granted to Gilead on Remdesivir as recently as February, 2020. It is needless to mention here though that nothing trumps the fact that Remdesivir was patented/approved in many countries, some of which have comparatively stringent patent laws such as India, and it is likely that an applicant of a patent would much rather have its patent accepted and granted and thereafter face oppositions from local organisations, than not have a patent granted altogether. This is especially so in the case of India, as Gilead eventually managed to convert the resistance it initially received into endearing accolades as it awarded royalty free voluntary non-exclusive licenses to develop, manufacture, sell and export Remdesivir to four indigenous pharmaceutical companies.
Sometime between March, 2020, and April, 2020, when a few non-governmental organisations began protesting against the grant of patents to Remdesivir in India, various provisions of the Patents Act, 1970, of India were being explored by the legal and pharmaceutical fraternity to ascertain the final outcome of such protests, as well as to determine the achievable measures that entities such as the government or third party local pharmaceutical companies could take to, for the lack of a better phrase, usurp the patent seemingly under the pretext of attending to the health needs of the country at a time when the pandemic was rapidly spreading. As such, most people would agree that India’s patent law has a fair share of provisions and sections which could be invoked in such a scenario and ‘revocation’, ‘compulsory licensing’, ‘compulsory licensing on notifications by the central government’, ‘acquisition of a patent by the government’, ‘power of the government to use inventions for the purposes of the government’ and so on are only a few examples of the same. Notably, invoking a compulsory license by competitor generic pharmaceutical companies would, in all likelihood, get ex facie denied as, at that point of time, it had not even been three months since the grant of the Remdesivir patents, let alone the laid down pre-requisite of three years. In any case, it is not ludicrous to presume that if the government had sensed any amount of high-handedness on the part of Gilead, it wouldn’t hesitate to intervene to either override that pre-requisite on account of a national emergency or use/acquire the patents suo moto by way of government-owned laboratories or by way of taking over the patents only to further license it to those companies who were interested in a compulsory license at the first instance.
It is pertinent to note that Gilead is no stranger to such provisions of the Indian law as it has, in 2006, awarded licenses for its AIDS drug called Tenofovir to as many as ten local pharmaceutical companies after its patent on Tenofovir received heavy opposition, and in 2014, Gilead entered into licensing arrangements for its Hepatitis C drug called Sofosbuvir to seven domestic pharmaceutical companies. However, even though the scheme of things were very different back then as they are in the unprecedented year of 2020, most stalwarts in this area of expertise were almost convinced that there wouldn’t be a need of any harsh steps by the government against the interests of Gilead and that the latter would eventually enter into voluntary license arrangements with a few of the same pharmaceutical companies as it had done in the past instead of foregoing its rights and interests upon Remdesivir on the whole. Another option that Gilead had was to launch Remdesivir at an affordable rate or even launch at a marginally higher rate but at the same time, initiate a number of corporate social responsibility programmes such as COVID-19 facilities and centres which would use its Remdesivir for free to those patients who are in need and cannot afford the commercially sold products as well as “Compassionate Use Programmes” which has been an initiative that various multinational healthcare companies have been employing for their blockbuster drugs. The latter option has been used by a number of innovator pharmaceutical companies to evidence the fact that if on one hand they couldn’t launch their patented products at affordable rates as they needed to recover the astronomical costs that were incurred on the research and development of the novel medicines, on the other hand they had the capability of identifying those patients which were in dire need of their patented products but couldn’t afford them. All these recourses go a long way to show that irrespective of the fact that a patentee utilises an extensive amount of resources for each invention and would otherwise prefer to equalise the same with commensurate revenues, the patentee has a plethora of options to serve the general welfare of the public at large whilst receiving its ‘Return on Investment’ sooner or later.
Be that as it may, ultimately, Gilead went on to issue non-exclusive voluntary licenses for Remdesivir without charging any royalties to four Indian pharmaceutical companies, two of which i.e. Cipla and Hetero have already launched their Remdesivir products under the brands “Cipremi” and “Covifor” respectively. What’s interesting is that one of the main caveats by Gilead in these voluntary licenses was that the licenses remain royalty free until a vaccine for COVID-19 is readily available and it so happens that within fifteen days of Cipla and Hetero launching their versions of Remdesivir, the Indian Council of Medical Research as well as Bharat Biotech have come out with highly optimistic press releases for the latter’s COVID-19 vaccine called “Covaxin” which is slated to be launched within a few months. While such a short timeline does seem herculean and daunting, the result of this would be that Cipla, Hetero and the other two Indian pharmaceutical companies which received a license from Gilead for Remdesivir would no longer be able to enjoy the said licenses without royalties. Nonetheless, in the larger scheme of things, with “Cipremi” and “Covafor” being available for COVID-19 patients right now and “Covaxin” being available for the public at large in the foreseeable future, and with each of these products bringing revenue to their respective companies, the current scenario sure seems like a win-win situation for all parties concerned as we enter the second half of 2020.