BMS Wins Ruling That Could Crimp India's Thriving Generics Business

(MoneyWatch)  Bristol-Myers Squibbb just won a ruling in an Indian court that could put generic makers there on the defensive. For years, the Indian drug business has grown primarily from making generics. Companies like Dr. Reddy's, Ranbaxy, Cilpa and Hetero Drugs have chosen to copy compounds marketed in the West rather than do their own R&D.

But in a case that pits BMS against Hetero, a court has ruled that Indian drug regulators should not grant marketing approvals to drugs that may be in violation of patents. According to LiveMint, the ruling states:

It is expected that the DCGI [Drug Controller General of India], while performing statutory functions, will not allow any party to infringe any laws and if the drug for which approval has been sought by the defendants is in breach of the patent of the plaintiffs, the approval ought not be granted to the defendants.

The case involves BMS's cancer drug, dasatinib. BMS has been selling the drug in India under patent protection since 2006 under the name Sprycel. The ruling is in place until March, when the court gives the issue another hearing.

Linking product approvals to patent status is a controversial issue. On the one hand, it seems unfair that companies who go to the expense of developing and patenting their drugs should find governments approving copycat products.

On the other hand, bodies like the DCGI and the FDA are ill-equipped to do the necessary legal research on patent statuses prior to making approvals. Some say they should stick to what they are good at -- which is the science, not the law -- and leave the litigation to others.

LiveMint says:

This so-called patent linkage necessarily means that DCGI, who is responsible for approving drugs in India after ensuring their safety and quality, will also have to look at the patent status of the drug before granting permission for marketing.

This, experts said, could potentially halt the approval process for generic drugs in cases where the original has a patent in India. The denial of approval could also potentially last through the entire life of the patent, which could be at least a decade in some cases.

See an international history of patent-approval linkage regulations here.