Bayer-Natco Stivarga Infringement Case Simmers In India

Bayer is battling Natco in another high-profile infringement suit in India, this time pertaining to its anticancer Stivarga (regorafenib). The case has many legs and is to be re-heard by a single judge on the orders of a division bench.

 

Bitter rivals Bayer AG and Natco Pharma Ltd. are engaged in another legal spat in India. This time the German multinational has hauled Natco to the Delhi High Court over the alleged infringement of its Indian patent pertaining to Stivarga (regorafenib).

The case is delicately poised: Bayer had an early win but Natco, which has a pending revocation petition before India’s Intellectual Property Appellate Board (IPAB) against Bayer’s patent as per case documents, fought back sharply to ensure that its appeal was allowed. The Indian company has highlighted, among other aspects, the huge price differential between its product Regonat (regorafenib), which was launched on 27 June, and Stivarga (sold as Nublexa and Resihance in India).

Round one in the Stivarga case went to Bayer, with a 5 July interim order by a single judge restraining Natco from infringing Bayer’s Indian Patent No. 240207 concerning the product.

Natco, however, moved swiftly to challenge the single judge’s order that hinged on a previous case ruling pertaining to Sterlite Technologies Ltd. versus ZTT India Pvt Ltd in the optical fibers segment. Natco claimed, among other aspects, that the 5 July ruling did not account for the “balance of convenience” and the "prejudice" that would be caused to it if the interim injunction was allowed.

A two-judge bench hearing Natco’s appeal last week set aside the 5 July ruling and ordered that the application for interim injunction be re-heard by the single judge “on merits”. Importantly, the bench has asked the single judge to “pass a fresh order "uninfluenced" by the order in Sterlite Technologies Ltd or the order dated 5 July” and set the date of the hearing for 17 July. Bayer told Scrip that it would review the order passed by the Division Bench and "decide future course of action."

There’s little love lost between the two companies in India. Natco hadsuccessfully pursued a compulsory license for Bayer’s Nexavar (sorafenib tosylate) some years ago. In 2012 India approved its first compulsory license in the area of medicines, allowing Natco to self-manufacture and sell a version of Nexavar for just over 3% of the price that the German company sold it for in India at the time. (Also see "India rejects Bayer Nexavar CL appeal " - Scrip, 16 Dec, 2014.)

Details Of Initial Order

Bayer had initially moved the Delhi High Court seeking a permanent injunction against Natco after it found out from “various sources” about Natco’s plans to commercialize regorafenib in India and that the tablet strength was identical to its commercial regorafenib products Stivarga, Nublexa and Resihance. Bayer had also disclosed Indian Patent No. 215758 which related to “Carboxyaryl Substituted Diphenyl Ureas” and that the patent does not cover regorafenib, case details stated.

Natco, however, claimed that while applying for Patent No. 215758, Bayer disclosed the subject matter of Patent No. 240207 and made a claim with respect regorafenib but subsequently deleted the same.

Justice Rajiv Sahai Endlaw on 5 July restrained Natco from infringing Bayer’s patent No. 240207. The single judge “straightaway” asked Natco’s counsel why the interim order of the Sterlite Technologies Ltd. V. ZTT India Pvt. Ltd. case (an order again by Endlaw) should not be passed till the completion of pleadings and hearing of the application for interim relief, case details said.

ZTT had been restrained from marketing optical fibres, which apparently had the same technical parameters as those produced with the patented technology by Sterlite. Endlaw had in the Sterlite-ZTT case observed, among other aspects, that a patentee, even after succeeding in a suit, in the absence of any interim order, is entitled only to profits earned by the defendant and which do not reflect the profits which the plaintiff would have earned if there had been no infringement. The Sterlite order was, however, passed ex-parte and the judge observed that “at this stage, it is not possible to form an opinion, even prima facie.” 

A similar order hinged on the Sterlite vs ZTT case was passed by Endlaw on 5 July in a case between Bristol Myers Squibb Holdings and Natco pertaining to BMS’s Eliquis (apixaban), though the latest position on this could not immediately be verified.

Division Bench Sends Case Back

Natco, however, appealed against the single judge order pertaining to Stivarga and claimed that in particular there is “no satisfaction recorded” of Bayer having made out a prima facie case or that the balance of convenience is in its favor or that it would suffer irreparable hardship if the injunction was not granted.

The order also overlooked the fact that Natco’s product is already on the market, it said among a string of arguments. Natco also underscored that a bottle containing 28 tablets of Bayer’s product was priced at INR36,000 or INR40,000 while its product comes at INR9,000 per bottle. The Hyderabad-based company added that it is prepared to provide medicines to 2,000 patients “free for life.”

Bayer raised a number of concerns as part of its arguments. It noted that Natco had, without pursuing its revocation application pending before the IPAB to its logical conclusion, risked introducing its product in the market. This was “dishonest and done knowing fully well” that the product sought to be introduced by it was already covered by a valid patent held by Bayer, the German multinational alleged.

Bayer also argued that the mere fact that the genus of the formula for regorafenib was disclosed in Patent No. 215758 would not preclude it from being granted a patent in respect of a specific species thereof  - i.e. for the drug regorafenib.

The division bench, in its order dated 11 July, however, specifically observed that the 5 July order was not an ex-parte one, unlike the order (Sterlite vs ZTT) adopted by the single judge. Besides, there is “no formation of an opinion” of Bayer having made out a prima facie case in its favor for grant of an interim injunction, it maintained.

The bench also noted that the 5 July order restraining Natco from infringing the suit patent does not lend itself to “sufficient clarity.” “There is a possibility, given the wording of the impugned order that it might lead to further litigation on whether in fact there has been compliance or not with the said order,” the bench said while referring the case back to the single judge.