The final hearings in the German pharma major Bayer's appeal against India’s first-ever compulsory licence issued on sorafenib tosylate (Nexavar) will begin at the Intellectual Property Appellate Board (IPAB), Chennai on January 23.

According to sources, the hearing on this crucial issue is expected to conclude very soon. In its appeal, Bayer is arguing that the Patent Controller erred in the decision to grant a compulsory licence (CL), and should have allowed the company more time to ‘work’ the patent, over and above the three years entitled under law. Indian CL provisions require a generic competitor to wait three years after the grant of a patent before an application for a licence to market a more affordable generic version can be filed.

On the other hand, Natco is currently defending the Patent Controller’s decision before the IPAB. India’s Controller of Patents deemed that Bayer had failed to price the drug at an affordable level and had made insufficient efforts to make the medicine available.

The issue dates back to March 9, 2012, when the then Indian Patent Controller P H Kurian issued the first-ever CL to Hyderabad-based Natco Pharma to manufacture an affordable generic version of sorafenib tosylate, the anti-cancer drug for which Bayer had obtained a patent IN215758 in India in 2008.

However, after the patent controller issued the CL to manufacture the Bayer's patented anti-cancer drug sorafenib tosylate, the German drug major filed an appeal against the compulsory license order before the IPAB in Chennai and has in particular sought to have the operation of the CL order stayed till the appeal hearings are completed and IPAB passes its decision.
However, the IPAB in September 2012 rejected the German drug major Bayer's request for a stay order against the grant of compulsory license on its anti-cancer drug Nexavar to Natco Pharma.

Earlier, the patent on the cancer drug sorafenib tosylate was granted to Bayer in March 2008. After that the generic company Natco applied for a CL in July 2011, which was granted by the Indian Patent Controller in March 2012.

The CL allows a more affordable version of sorafenib tosylate to be produced and marketed, and brought the price of the patented drug down from over US$ 5,500 per month to $175 per month - a reduction of 97 per cent. Under the terms of the compulsory licence, Bayer is being paid a six per cent royalty on sales by Natco.