Public interest groups working in the health sector in the world have pooh-poohed the Swiss pharmaceutical company Novartis' argument that there will  be no impact on the availability of generic version of its blood cancer drug Gleevec as a fallout of the on-going case in Supreme Court in India.

Novartis had recently argued that Gleevec (imatinib mesylate) will continue to be (generically) available under the Transition Clause in the Indian Patent Law regardless of the legal outcome of its ongoing case in the Supreme Court, the final hearing on which will begin on March 28 this year.

Novartis was referring to the Transition Clause which is also known as the ‘Automatic Licensing’ clause in India’s Patent Law. This means that Indian companies already producing a generic version of a drug—if this production began before January 1, 2005—do not have to negotiate for a voluntary license or request a compulsory license from the government but can continue to produce the product, provided a 'reasonable royalty' is paid to the patent holder.

Refusing to bite the argument, the public interest groups say that if Novartis finally manages to obtain a patent in India, by having managed to change the law, production of generic versions of imatinib by companies that do not already produce it may no longer be possible.

Even for companies who already produce generic versions of imatinib, there are still many concerns. What a 'reasonable royalty' entails remains very undefined and could potentially increase the price of the generic drug and thus affect its availability. Patient groups also fear that once a patent is granted and thus a stronger right for the patent holder exists, generic producers may become subject to legal actions (infringement suits) by the patent holder.

The imatinib mesylate patent application was the first application in India that was rejected on the grounds that 'it is a new form of a known medicine.' The decision of the Supreme Court to reverse this decision could determine how the patent office decides other applications covering new forms of essential medicines. Unlike imatinib, many other drugs may not have been in generic production before January 1, 2005, and therefore Indian producers will not be able to apply the automatic licensing clause. This limits the generic competition needed to keep prices down.