Section 3(d) and Novartis v Union of India: Case Analysis

1. The provision

Section 3(d), as substituted in 2005, excludes from inventions:

the mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant.

The Explanation provides that salts, esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of a known substance shall be considered the same substance, unless they differ significantly in properties with regard to efficacy.

Purpose. To prevent evergreening: extending protection over a drug by patenting minor variations (a new salt, crystal form or dosage) as the original patent nears expiry. The provision was added in 2005 as part of the bargain for introducing product patents.

2. Facts

Imatinib, a molecule that inhibits the enzyme behind chronic myeloid leukaemia, was disclosed and claimed in Novartis's US patent of 1993 (the “Zimmermann patent”). Novartis later developed the beta crystalline form of imatinib mesylate, sold as Glivec (Gleevec in the US), and filed an Indian application in the mailbox in 1998. When the mailbox was opened in 2005, generic manufacturers and the Cancer Patients Aid Association filed pre-grant oppositions. In 2006 the Assistant Controller in Chennai rejected the application, including under s.3(d).

3. Procedural history

• Madras High Court (2007). Novartis's writ petitions challenged s.3(d) as incompatible with TRIPS and as vague and arbitrary under Article 14. The court held it had no jurisdiction to test domestic law against TRIPS, and that s.3(d) was not vague: “efficacy” in pharmaceutics means therapeutic efficacy, a standard any skilled person understands. Novartis did not appeal this.
• IPAB (2009). Held that the beta crystalline form met novelty and inventive step but was barred by s.3(d), since Novartis had not shown enhanced therapeutic efficacy.
• Supreme Court. Novartis appealed directly under Article 136. Judgment was given on 1 April 2013 by Aftab Alam and Ranjana Prakash Desai JJ in Novartis AG v. Union of India, 2013 INSC 198.

4. Issues

1. Was the beta crystalline form of imatinib mesylate a new product involving an inventive step, or was it already disclosed in the Zimmermann patent?
2. Did it satisfy s.3(d): did it show enhanced efficacy over the known substance?
3. What does “efficacy” mean for a medicine?

5. Holdings

1. Legislative history. The Court traced Indian patent law from 1856 through the Ayyangar Report and the TRIPS debates in Parliament, and concluded that s.3(d) and the s.2 definitions were meant to set a high standard for pharmaceutical inventions and to prevent evergreening. It described the provision as a second tier of qualifying standards for chemical and pharmaceutical substances, beyond novelty and inventive step.
2. The known substance. The Court held that imatinib mesylate was a known substance from the Zimmermann patent. The beta crystalline form was a polymorph of a known substance and so fell within the Explanation, and the question was whether it showed significantly enhanced efficacy.
3. Efficacy means therapeutic efficacy. For a medicine, “efficacy” is the ability to produce a desired or intended therapeutic result. The test is to be judged strictly. Physico-chemical properties of the beta form (better flow, thermodynamic stability, lower hygroscopicity) are useful for manufacture and storage but are not therapeutic efficacy. The Court left open whether every property beneficial to patients would qualify, but said that not all advantageous properties count.
4. Bioavailability. Novartis claimed about 30 per cent greater bioavailability than the free base. The Court held that increased bioavailability does not necessarily mean enhanced therapeutic efficacy; it must be shown, with research data, that it leads to better therapeutic results. No such evidence had been produced, and the comparison was with the free base rather than with the known mesylate salt.
5. Coverage and disclosure. Novartis argued that the Zimmermann patent “covered” imatinib salts but did not “disclose” imatinib mesylate, so the mesylate was new. The Court rejected the argument that there could be a gap between what a patent claims and what it discloses: allowing a broad claim in one patent and then a second patent on what falls within it would extend the monopoly beyond twenty years. It found on the facts that imatinib mesylate was in any case known from the Zimmermann patent and its US prosecution history and publications.
6. Result. The appeal was dismissed. The Court added that it did not hold that incremental inventions are never patentable in India; s.3(d) does not bar them if they show enhanced efficacy.

6. TRIPS compatibility

Novartis argued in the Madras High Court that s.3(d) breached TRIPS Article 27. The High Court left that question to the WTO, where no member has brought a challenge. India's position is that TRIPS does not define “invention” or “inventive step”, so members may set their own standards, and that the Doha Declaration (2001) confirms the right to interpret TRIPS to protect public health. The Philippines adopted a similar provision in 2008.

7. Significance

• Glivec was sold by Novartis at a price far above Indian generics; the decision kept generic imatinib available in India and for export.
• It confirmed that patentability of pharmaceutical derivatives in India needs evidence of therapeutic benefit, usually clinical or comparative data in the specification or filed during examination.
• The coverage-disclosure holding limits secondary patents that claim compounds falling within an earlier genus patent.

8. Later developments

The Delhi High Court has since applied s.3(d) in disputes over secondary patents, holding in several cases that the test calls for comparison with the closest known substance and evidence of therapeutic benefit. In AstraZeneca AB v. Intas Pharmaceuticals (Delhi High Court, 2020–21), on dapagliflozin, the court treated a genus patent and a later species patent on the same compound as raising the coverage-disclosure problem identified in Novartis, refusing to let the patentee assert a later species patent while saying the earlier genus patent disclosed the compound. Pre-grant oppositions under s.3(d) remain the main tool of patient groups.

How this is examined

As a short note (Q7(a), 2024): provision, facts, the four holdings, and two lines of critique. As an essay on evergreening or s.3(d), add the legislative history, TRIPS compatibility, the Philippines comparison and later Delhi High Court cases.