Global Pharmaceutical Industry - Sristi

oculoplaniaballtownBiotechnology

Dec 1, 2012 (4 years and 4 months ago)

321 views


1

Global Pharmaceutical Industry
1

-

Intellectual Wealth and Asset Protection


PRABUDDHA GANGULI

103 B Seante, Lokhandwala Township, Akurli Road. Kandivli
East, Mumbai 40010, India

email:
ramugang@vsnl.com


Abstract

This is a commentary on the recent trends in the protection of intellectual assets
in the Global Pharmaceutical Industry. Patenting inventions, enforcing acquird
rights, evolving newer ways of sharing knowledge for effective cooperative
working through di
verse licensing arrangements between organizations are the
key to success in this fiercely competitive industry.

Biographical Notes

Starting as a research scientist, Prabiuddha Ganguli moved to various management
positions in Hindustan Lever. A patent atto
rney and an expert in IPR and information
managfement, he has authored numerous articles in IPR, chemical physics, material
science, chemical processes. His books titled “ Gearing up for Patents … The Indian
Scenario” was published by the Universities Pres
s (India) Ltd in 1998 and “Intellectual
Property Rights… Unleashing the Knowledge Economy “ was published by Tata
McGraw Hill (India) in 2001. He is on the advisory committees of several Institutions in
India and is a member of the editorial board of the j
ournal World Patent Information. He
is currently Advisor, at VISION
-
IPR his firm consulting in IPR, Knowledge Management
and Information Security. E is also Adjunct Professor at the Indian Institute of
Technology, Bombay and a visiting Professor at the Nat
ional Law University, Jodhpur.


Substantial portions of this paper have been incorporated in the author’s book “
Intellectual Property Rights.. Unleashing the Knowledge Economy, Tata McGraw
Hill (New Delhi) (2001) ISBN 0
-
07
-
463860
-
2




Int. J. Technology Management Vol. 25, Nos ¾, 284
-
313 (2003)


2



Pharmaceuticals is o
ne of the most intense “Knowledge Driven” industries, which
is continually in a state of dynamic transition. Human, animal and environmental
health are priority concerns of society. Diversities in life forms and diseases
pose stiff challenge to the desig
n of specific and targeted solutions. The process
of “drug discovery/invention” is elaborate requiring on an average 8
-
10 years at a
cost of US$ 300 million to reach a new drug to the market. The long gestation
period between “learning“, “knowledge gener
ation“ and its transformation to
“value added knowledge“ necessitates the creation of

“Proprietary Knowledge“ which is of paramount importance in establishing and
sustaining a global competitive posture. Patents build fortresses around
inventions, Tradema
rks establish and identify brands, Copyrights provide
protection to accompanying literature, and Designs Registrations cover novelties
in shapes, forms and ornamentation which visually impact consumers. Globally,
these tools of Intellectual Property Right
s (IPR) are key components of strategy
formulation and implementation by Pharmaceutical Corporations. Protected
intellectual assets preserve exclusive markets, maintain profit margins, provide
market access and give freedom to operate. IPR portfolio has no
w become an
effective platform for benchmarking of intellectual assets and innovative
capabilities of corporations, business entrepreneurs and researchers. This is
extensively being used in today’s world of mergers, acquisitions, strategic
alliances, and
collaborations, licensing arrangements and Venture Capital
Funding in Pharmaceutical and Allied Industries. Of the top 50 pharmaceutical
companies, 18 are with their head offices in the USA, 21 in Europe, and the
other 11 in Japan. Worlds patenting activit
ies are also most intense in these
regions.


Pharma
-

Knowledge Chain


Nucleation and growth of modern pharmacology can be traced to the “knowledge
base” of ethnomedical practices. Empirical relationships between identified plant
& animal derived product
s (processed or in natural state) and their physiological
effects formed the basis for treatment of diseases or enhancement of health.
Through generations within indigenous cultures such “know
-
how” has been
transmitted as package of practices which formed
the major component of their
“in training on the job”. This was largely unstructured and most often incomplete
in documentation.


Natural product chemists, phytologists and ethnobotanists initiated the process
of structuring this “Community Knowledge bas
e “ to construct generic
frameworks in terms of classification of species, their pharmacological, medicinal
or cosmoceutical applications, isolating and testing bio
-
active components,
investigating their structural types and attempting their synthesis. Sub
sequent
phases in the conventional “drug discovery/invention” process have been
conceptualization of structures to mimic bioactive compounds, establish

3

synthetic pathways, subject them to in
-
vitro screening followed by tests on
appropriate animal models.
Selected actives move to clinical trials and only few
reach the market after “adequate screening” and statutory clearance by
designated national authorities. In the market place product differentiation and
consumer acceptance are determined by the targeted

and enhanced effective
drug delivery with minimized adverse drug reactions and drug toxicity.


Recent trends in this industry have been to compress the elaborate and time
consuming “drug discovery/invention/process” through functional genomics, bio
-
inform
atics, DNA sequencing, combinatorial chemistry, combinatorial
biosynthesis, high
-
throughput screening techniques coupled with knowledge
management processes.


These modern developments intertwined with traditional approaches, the
growing phase lag between
development of satisfactory legal frameworks in IPR
and rapid advances in bio
-
technology are making the process of acquiring,
enforcing and sustaining intellectual property rights at multiple points in the
“Pharma
-
Knowledge
-
Chain” a very complex process. T
his continual process of
learning, creating “new Knowledge” and further transforming it into “value
-
added
Knowledge” with appropriate “proprietary protection” & “fair distribution of its
benefits” is fundamental to the progress of Pharmaceutical Industry.
The various
facets under the “Intellectual Canopy” pivoted on knowledge are strongly cross
-
correlated and are significantly impacted by all the branches of Intellectual
Property Rights (Fig.1). Additionally, socio
-
political issues involving bio
-
diversity,

ethics and ownership of community knowledge are figuring in the agenda of
several international debates.














Trade Related Intellectual Property Rights (TRIPs) under the umbrella of The
General Agreement on Tariff and Trade (GATT), provide guide
lines for
harmonization of IPR laws in the World Trade Organization (WTO). These are
intended to reduce distortions and impediments to international trade by taking
into account the need to promote adequate & effective protection of IP and
ensuring measure
s including procedures to enforce IPR. The National Laws are
expected to comply with the basic requirements of TRIPs. It should be
Knowledge
access
generate
apply
trade
protect
create
IPR
Fig.1. The Intellectual Canopy
own

4

appreciated that though the treaties on IPR are international in character, their
enforcement is national or at best in some
cases regional. Proper understanding
and exploitation of the IPR laws in various countries would help in global
positioning of pharmaceutical businesses.


Post TRIPs
----

IPR Harmonization Drive


The pre
-
TRIPs era saw the world divided into groups of na
tions: a) allowing
patenting in all fields of technologies (products and processes) and

b)

having restrictive patent laws providing for process patents in most fields of
technologies and non
-
grant of product patents in selected fields such as foods,
agrochem
icals, drugs & pharmaceuticals, chemical entities, etc. Other issues
such as the term of patents, conditions for compulsory licensing, whether
importation should be considered as working of patents, etc., were variably
addressed in existing National Laws.

TRIPs attempted to harmonize the IPR
laws by bringing the disparities into focus and providing guidelines for them. No
agreements are monolithic and these will undergo changes to accommodate the
needs of moving times.


Since the formation of the World T
rade Organization (WTO) on January 1, 1995
several nations have made significant changes in their National Laws governing
IPR which have a direct bearing on the pharmaceutical industry.


On July 8, 1998 the
European Parliament

approved the biotechnology di
rective,
which set the guidelines for legal protection to biotechnology products and
processes within the European Union. This would markedly influence the
pharmaceutical industry in Europe. Since June 1995
USA
changed the term of
patents from 17 to 20 yea
rs. The practice of “ first of invent “ as opposed to “ first
to file “ has been extended to all members of WTO. All patents in force on
8.06.1995, will have a term of 20 years from the date of issue, which ever is
longer. As per this provision several exi
sting patents received extension of their
term. This as had significant effect on the pharmaceutical industry
. The
Japanese Patent
Law was amended on December 14, 1994 with the
amendments falling into two groups, one effective from July 1, 1995 and the
oth
er from January 1996. With effect from July 1, 1995 the term of patents was
made 20 years from the date of filing in Japan. In this group there were other
features dealing with provisions for restoration of lapsed patents, priority based
on filing in WTO c
ountries, etc. The other category effective from January 1,
1996 was replacement of pre
-
grant opposition proceedings to post
-
grant
opposition and procedures for accelerated patents processing. On March 10,
1999 the

Indian

Parliament passed a Patent Amendm
ent Bill which regularized
the transitory “ mail
-
box provision “ (with effect from 1, January 1995) to file
product patents for inventions relating to Drugs, Pharmaceuticals, Agrochemicals
and to grant “exclusive marketing rights“ in these selected field
s only. Other
changes in the Patent Act 1970 have been introduced to meet the immediate
obligations of TRIPs. India also joined the Paris Convention and the Patents

5

Cooperation Treaty w.f. December 7, 1998. In
Spain

the patent law was
amended in January 19
98, removing the requirement that pharmaceutical
companies must make the patented product in Spain before an injunction would
be granted against an accused infringer. Now it is getting easier to obtain interim
injunctions from Spanish courts. In
Argentina

the 1995 Patent Law brought
provisions in line with TRIPs the term of patents to 20 years from the date of
filing, rather than 15 years from the date of grant. The problems of where the old
patent law ends and the 1995 legislation starts have not been sat
isfactorily
resolved. The
Australia
Patent Act was changed

on August

10,1998 to give
pharmaceutical patents an effective term of 20 years to bring it in line with the
laws in USA, Japan and Europe.
New Zealand

joined many countries in
relaxing rules on pa
rallel imports to legitimate distributors and this will affect the
pharmaceutical industry.
Estonia's
patent law has been amended with effect
from 16 June 1998 to cover substances derived by nucleus splitting and to
define that making a product via a pate
nted method constitutes infringement.
The 1994
Mexican

law allows patentability to practically all types of inventions,
including those related to biotechnology. It however introduced the utility factor in
the examination of patent applications. In order t
o comply with the utility
requirements a certain degree of safety must be demonstrated, as a food
product or a drug cannot be considered to have a practical application
(usefulness) unless it is safe. The
New Brazilian Patent Law

passed in April
1996 inclu
des a shortened year transition period before WTO intellectual
property rules come into effect, and protection for pharmaceuticals in the
regulatory pipeline. In
Kuwait,

patents are granted to new industrial products,
innovated industrial methods or means

or new application of known industrial
means or methods. The term 'industry' is intended in its wide meaning, so as to
include agricultural, chemical and pharmaceutical materials, plant species,
microorganism processes and their products.

In contrast

Sou
th Africa

had a
patent law until December 12, 1997, which provided for product patents in drugs
and pharmaceuticals. Interestingly, a new law “ The Amended Medicines and
Related Substances Act “ was brought in force that has serious implications on
drugs a
nd pharmaceutical business. Article 15C of this act states that the
Ministry of Health may, "notwithstanding anything to the contrary contained in
the Patents Act, 1978 (Act No 57 of 1978), determine that the rights with regard
to any medicine under a pat
ent granted in the Republic shall not extend to acts
in respect of such medicine which has been put onto the market by the owner of
the medicine, or with his or her consent." Additionally, the new law, at section
15C(b), allows for parallel importation.


Features in laws pertaining to the generic drug industry are treated in the section
on “ exploding off
-
patent scene “



KNOWLEDGE ASSETS
-

CASE STUDY


Some of the leading Pharmaceutical Companies in the order of their 1997

6

Worldwide sales are Merck & Co. (

$11.3 bn ), Glaxo Wellcome ( $10.9 bn),
Novartis ( $10.5 bn ), Bristol
-
Myer Squibb ( $9.0 bn ), Johnson & Johnson

( $8.6 bn ), Pfizer ( $8.3 bn ), American Home Products ( $8.1 bn ), Smithklein
Beecham ( $7.2 bn ), Hoechst ( $6.4 bn ), and Eli Lilly ( $
6.4 bn ).


Derwent databases were searched for a few companies and their patents were
ranked in the top 8 areas in terms of the International Patent Classification. Their
Patent Profiles in recent years are presented in tables 1
-

5.



Tables 1
-
5


Patenting Profile of
Novartis
YEAR
TOTAL
A61K
031/44
A61K
031/445
A61K031
/70
A61K
000/00
A61K037
/02
A61K
038/00
A01N
00/000
A01H
005/00
C12P 021
02
C07D
000/00
C07C
000/00
C12N
005/10
C07D
401/12
C12N
015/09
1998
611
-
36
36
81
-
-
61
38
-
91
66
-
40
-
1997
713
-
-
42
91
41
-
60
-
-
110
79
45
42
-
1996
489
-
-
-
62
38
-
38
-
-
89
59
33
42
37
1995
387
-
-
-
49
43
30
-
30
-
68
38
35
-
34
1994
274
23
-
-
37
46
24
-
-
22
56
-
23
25
-
pyridine derivatives
piperidine
derivatives
carbohydrates &
derivatives
pharmaceutical
preparations
preps.
contg
. peptides
preps.
contg
. proteins
preservation of human/
plant bodies
tissue culture
Fermentation processes
condensed rings
acyclic
compounds
microorganisms
contg
.
compositions
linked N
heterocyclics
Recombinant DNA
technology


7


Patenting Profile of Bristol-
Myer Squibbs
YEAR
TOTAL
A61K
031/395
A61K
031/44
A61K
031/70
A61K
000/00
A61K
037/02
A61K
031/71
A61K
031/335
A61K
031/505
A61K
031/495
A61K
031/40
C12P
012/02
C07D
305/14
C12D
021/08
C12N
005/10
1998
356
31
-
29
43
-
-
22
21
19
-
-
20
20
-
1997
416
34
-
31
45
-
-
-
-
24
31
-
-
27
24
1996
367
30
28
31
49
-
-
-
-
-
31
25
-
-
-
1995
390
31
-
43
50
33
27
-
-
-
29
-
-
28
-
1994
401
37
-
44
37
36
30
-
28
-
39
-
-
-
-
N as
hetero
ring atom
pyridine derivatives
carbohydrates &
derivatives
medicinal
preparatiosn
med
. preps.containing
peptdides
fermentates
hetrocyclics
with 'O'
as only
hetro
atom
medical preps. with
pyrimidines
hetro cyclics
6M with 2Ns
as only ring
hetro
atoms
5 M. rings with one
N as
hetro
atom
4M rings 1 'O'
hetro
ring atom
fermentation
process
microorganisims
&
compositions
fermentation & enzyme
processes

Patenting Profile of American Home Products
YEAR
TOTAL
A61K
031/55
A61K
031/445
A61K
031/395
A61K
031/44
A61K
031/435
A61K
031/40
A61K
031/495
A61K
031/47
A61K
000/00
C07D
498/18
C07D
000/00
C07D
401/12
C07D
221/00
1998
191
-
34
32
31
29
25
23
-
-
-
39
-
24
1997
173
-
35
40
35
33
-
25
-
24
24
44
-
-
1996
214
23
35
58
35
29
-
34
-
23
-
37
-
-
1995
20
-
39
44
41
35
-
32
39
-
-
37
25
-
1994
179
-
35
52
39
40
-
32
34
-
31
30
-
-
heterocyclics
with
7M rings
piperidine
derivatives.
cyclics
with
N
heteroatoms
pyridine derivatives
6M rings with 1N
as
hetero
atom
5M rings with 1N
as
hetero
atom
6M rings with 2Ns
as
hetero
atoms
Quinoline
&
isoquinolines
pharmaceutical
preparations
condensed rings
with O/ N
heteroatoms
condensed rings
linked
hetero cyclics
2 or more
hetero
atoms
6M
Hetero cyclics
,
1N as
hetero
atom


8



Patenting Profile of Johnson & Johnson
YEAR
TOTAL
A61F
013/15
A61L
015/00
B29D
011/00
A61B
017/04
A61L
027/00
A61M
025/00
A61F
013/46
A61L
017/00
A61B
000/00
A61F
013/20
A61B
017/06
C12Q
001/08
G02C
007/02
G02C
007/02
G01N
033/53
A61F
000/00
1998
524
59
-
51
-
35
28
27
25
-
-
-
-
-
27
-
31
1997
628
58
-
73
-
37
-
29
32
-
33
-
-
107
-
-
-
1996
610
60
-
58
29
-
-
-
38
-
33
-
-
90
-
30
29
1995
512
74
-
45
26
-
-
-
-
28
33
28
-
61
-
-
29
1994
453
63
22
-
-
-
-
-
-
20
21
20
21
35
20
-
-
absorbents, pads
sanitary towels, etc.
chemical aspects, of
dressings, bandages .
plastic products
eg
. lenses etc.
holders or
pkgs
.
needles etc.
materials for prostheses
layered absorbing
materials
analytical
tools/techniques
tampons etc.
needles, holders etc.
materials for sutures
measuring/testing
with enzymes
contact lenses
lenses & lens systems
immunoassays
filters, kits, contra-
ceptive
devices
catheters
hollow probes


Patenting Profile of Merck & Co.
YEAR
TOTAL
A61K
031/55
A61K
031/47
A61K
031/445
A61K
031/44
A61K
031/435
A61K
031/495
A61K
031/40
A61K
031/415
A61K
031/535
A61
031/02
C09K
019/30
C07D
401/12
C07D
000/00
G025
001/13
1998
1024
-
-
128
115
-
82
77
69
67
-
-
-
125
71
1997
1245
83
81
153
151
-
121
40
97
-
-
-
-
154
-
1996
1189
-
-
152
154
93
124
117
93
89
-
-
-
148
-
1995
1195
-
94
126
150
94
114
123
-
-
-
-
-
120
113
1994
1190
-
-
103
148
89
-
119
-
-
83
87
85
-
114
hetero cyclics
with
7M rings
quinolines
&
iso
quniolines
piperidine
&
dervatives
pyridine &
derivatives
6M rings with 1N
as ring
heteroatom
6M rings with 2Ns
as
hetero
atoms
5M rings with 1N
as
hetero
atom
diazoles
&
derivatives.
6M rings with 1 'O' &
1 'N' as
hetero
atoms
medicinal preps.
containing peptides
liquid crystal materials
'N' linked
hetero
-
cyclics
>2 rings
range of
hetero
cyclic compounds
liquid crystal devices

The Patent portfolios (presented in tables 1
-

5) of these companies clearly map
on to their technology ex
pertise, innovation thrusts and business. The distribution

9

of the topics in which patents have been granted to these companies has not
changed substantially in recent years. The generic strengths are listed below:


Company

Expertise profile


Johnson & J
ohnson

Tampons, absorbent Pads, sanitary towels,
supporting & fasteners, holders or package for
needless and sutures, materials for Prosthesis,
Catheters, materials containing layers of different
absorbing characteristics, materials for surgical
sutures or

for ligaturing blood vessels,
Diagnosis/Surgery Identifical analytical biological
materials, various needles, filters, imptantable filters
in blood vessels, prostheses, orthopedics, nursing,
contraceptive devices, lense systems & contact
lenses.

Merck &

Co.

Medicinal preparations & Chemistry of N
-

Heterocyclics liquid crystalline materials containing
saturated or unsaturated non
-
aromatic rings.

Novartis

Medicinal Preparations and Chemistry of N
-
based
hetrocyclics, carbohydrates, proteins, peptides, and
diverse condensed ring systems. Fermentation and
enzyme based processes for preparation of organic
compounds, Tissue culture,. Minor presence in
recombinanat DNA technology.

American

Home Products

Pharmaceuticcal preparations using diverse organic
compou
nds, Nitrogen based heterocyclic chemistry ,
condensed ring systems of O/N.



Bristol
-
Myers & Squibbs




Chemistry of heterocyclics specially involving
Nitrogen, Carbohydrate chemistry, fermentation and
enzyme based processes for preparation of organic
co
mpounds, medicinal preparations using diverse
organic compounds. Some presence in techniques
involving undifferentiated plant and human cells.


These companies appear to have strong proprietary knowledge base and
expertise in traditional organic / biochem
istry specially involving heterocyclics,
methodologies for clinical trials, fermentation techniques, surgical implements,
packaging etc. There is a distinct gap in their knowledge profile with respect to
biotechnology, genetic engineering, combinatorial ch
emistry, genomics etc. As a
part of their long
-
term strategy these companies have initiated several
collaborations with key biotechnology
-
led companies and expert research
groups.



10

In contrast a company such as Genentech has significant knowledge armory in

methods of modern biology and biochemistry as seen from their recent patent
profile in the last few years. (Figure 2).



Fig 2. PATENTING PROFILE OF GENENTECH
1992
1993
1994
1995
1996
0
50
100
150
200
250
YEAR
NO OF PATENTS
IMMUNOGLOB
PROTCHEM
HOSEUKARY
NUCLEICAC
USEMICROG
MUTATION
DNSEQFUP
FORGENINT
RECOMDNA
MONANTB
GENENCOD
ANTBOD
FERPRPPREP
CELLMOD
PROSE
PHARMAPRE


Key to the figure 2

:
PHARMAPRE



mha牭a捥u瑩捡氠m牥ra牡瑩rn猬s
PROSE

---

Proteins having fully defines aminoacids,
CELLMOD

----

Un
differentiated cells,
tissues modified by introduction of foreign materials,
FERPRPREP

---

Preparation of proteins by fermentation or enzyme
-
using processes
, Antbod

---

Pharm preparations involving antibodies,
GENENCOD
---

Mutation or genetic
enginnering

genes encoding animal proteins,
MONANTB

---

Fermentation or
enzyme processes for synthesis od proteins or peptides using monoclonal
antibodies,
RECOMDNA
---

recombinant DNA technologies,
FORGENINT

---

modifying microorganisms by introducing foreign geneti
c material,
DNSSEQFUP

---

DNA sequence coding , Mutation
---

mutation or genetic engineering DNA or
RNA , vectors etc.,
USEMICROG



nu捬敩挠 a捩搠 獥quen捥 en捯d楮iⰠ
NUCLEICAC

---

use of compounds containing two or more mononucleotide
units ,
HOSEUKARY
---

Mutation or genetic engineering using eukaryotes as
hosts for animal cells,
IMMUNOGLOB

---

Mutation or genetic engg, vectors,
isolation etc. use of hosts involving immunogloblobulins.


Technology strengths of Genentech based on its patents profile are ch
emistry of
heterocyclics, proteins, peptides sequencing, manipulation of micro organisms

Using genetic Eng. techniques, human, animal & plant cell lines, tissue culture,
recombinant DNA technology, genes encoding animation processes, DNA

11

sequences coding f
or human proteins, fermentation techniques for targeted

Synthesis, monoclonal antibodies, pharmaceutical preparations etc.


Most biotechnology companies such as Genentech would have developed wide
& diverse profile with expertise in several niche areas of

modern biology,
biophysics, bioengineering including the building up of rich proprietary libraries of
gene sequences,etc. They have been trading with their knowledgebase through
active licensing of their technologies / database banks or are increasingly g
etting
involved in joint research projects involving drug discovery or setting up strategic
alliances with several companies for marketing of their developments. Many
such groups / organizations have become targets for acquisition by large
companies.


EXPL
ODING “ OFF
-

PATENT” SCENE


During the period 1999 to 2013 several best selling drugs of leading companies
valued at over 60 billion dollars (1997 sale value, tables 6 & 7) are due to go

“off patent “. The patent portfolio of some of the traditional pha
rmaceutical
companies discussed in the earlier section indicate that their in
-
house technical
competence is inadequate to meet the threat from global generic drug
manufacturers who have fiercely targeted the bag of off
-
patent drugs.


A “generic” drug is a

formulation containing the same active compound as an
earlier approved drug.

In most countries the active compound has been subject of patents :



if it is a novel chemical compound



or even if known has not been used in medicine,



or a newly proposed use



or dosage of a known drug



or a drug which although recognized as safe and effective has not been used
to a material extent



or for a material time.


Generic products are expected to be bioequivalent to the original branded and
patented drug.













12




TABLE 6


VALUE OF PATENT EXPIRING DRUGS FROM 1999
-

2013 *


[Source : Med. Ad. News
17
, 94 ( 1998)]




YEAR OF
EXPIRY


NUMBER of
DRUGS

Going off
-
patent


WORLDWIDE SALES IN
1997 OF BEST SELLING
DRUGS $ (BILLION)



1999

2000

2001

2
002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013



4

9

9

7

4

8

10

4

6

4

4

2

1

1

3



1.76


8.67

11.56

5.68

2.90

6.57

11.83

2.75

4.96

2.03

2.30

1.24

0.73

1.73

2.80

















13




TABLE 7


PATENT EXPIRY OF BEST SELLING DRUGS 1999
-

2013



[data source: Med. Ad. News
17
, 94 (1998)]





COMPANY



PATENT

EXPIRY

YEAR



BRAND
NAME



INDICATION
FOR


1997
WORLD

WIDE
SALE $

(Million)




I) GLAXO WELCOME


INC


1999

1999

2000

2003

2005


2005

2006

2008

2009


Beclovent

Fortaz

Ceflin

Flovent

Zo
fram


Retrovir

Imitrex

Serevent

Epivir


Asthma

Infections

Infections

Asthma

Nausea &
Vomiting

HIV Infection

Migraine

Asthma

HIV Infection


542.8

426.4

649.4

516.6

616.9


470.7

1085.7

665.8

677.3




ii) HOFFMAN
-
a
-


LA ROCHE


1999

2000

2001


Versed

Roce
phin

Accutane


Depression

Infections

Acne


431.3

1011.4

451.3



iii) MERCK & CO


2000


2001


2001

2005


2006


2007

2009


2013


Vasotec

Pepcid

Mevacor


Prinivil

Zocor


Proscar


Fosamax

Cozaar

Primaxin

Crixivan


Hypertension

Ulcers

Chloesterol
reduction

Hy
pertension

Chlolestrol

reduction

Benign Prostatic
Hypertropphy

Osteoporosis

Hypertension

Infections

HIV Infection


2510.0

1180.0

1100.0


585.0

3575.0


400.00



532.0

681.0

530.0

582.2


14



iv) JOHNSON &


JOHNSON


1999

2000

2004

2004

2006

2007

Niz
oral

Sporanox

Ortho
-
Novum

Procrit

Risperdai

Propulsid

Fungal Infection

Fungal Infection

Contraception

Red Blood Cell

Psychosis

Nocturnal

Heatburn



364.0

537.0

658.0

1109.9

848.0

1045.0


v) BRISTOL
-
MYERS


SQUIBB CO.

2000

2000

2004

2004

2005


20
07

Glucophage

Buspar

Taxol

Paraplatin

Pravachol


Zerit

Diabetes

Anxiety

Ovarian Cancer

Ovarian Cancer

Cholestrol

Reduction

HIV Infection

579.0

443.0

941.0

437.0

1437.0


398.00




vi) PFIZER INC.


2000

2003



2004

2005

2005

2007


Procardia XL

Cardura



Dif
lucan

Zoloft

Zithromax

Norvasc


Hypertension

Benign prostatic
hypertrophy


Fungal Infection

Depression

Infections

Hypertension


822.0

626.0



881.0

1507.0

821.0

2217.0



vii) ASTRA AB


2001

2002


2009


Losec

Pulmicort

Turbuhaler

Trprol
-
XL


Ulcers

Asthma


Hypertension


2815.8

643.9


413.6



viii) ASTRA
-
MERCK


INC


2001


Prilosec


Ulcers


2240.0





ix) SMITHKLINE


BEECHAM


2002

2002

2004

2005

2007


2010



Augmentin

Relafen

Engerix
-
B

Paxil

Kytril


Havrix


Infections

Arthritis

Hepatitis B

Depress
ion

Nausea &

Vomiting

Hepatitis A


1517.0

489.0

584.0

1474.0

366.0


370.6


15



x) ELI LILLY & CO.


2000

2001

2002

2011


Humulin

Profac

Axid

Zyprexa


Diabetes

Depression

Ulcers

Schizophrenia


936.0

2559.0

526.5

730.0




xi) ZENECA


2001

2002

2005


Zestril

Nolvadex

Zoladex


Hypertension

Breast Cancer

Breast Cancer


1035.0

501.0

569.9



xii)

WARNER LAMBERT


CO.



2001

2008



2010


Accupril

Rezulin



Lipitor


Hypertension

Non
-
insulin
-
dependent
diabetes

Cholestrol
reduction


378.0

420.0



865.0




xiii)
ABBOT


LABORATORIES


2003

2008


Biaxin

Depakote


Infections

Epilepsy


1300.0

520.0



xiv)NOVARTIS


2003

2005

2008


Flovent

Lamisil

Lescol


Asthma

Fungal Infection

Cholestrol
Reduction


516.6

628.4

425.8





xv) AMGEN INC.


2013


Epogen


Neupogen


Re
d Blood Cell
Enhancement

Neutropenia

reduction


1160.7


1055.7




xvi) SCHERING


PLOUGH & CO.


2002


2012


Intron
-
A


Claritin


Cancer & Viral
Infections

Allergies



598.0


1726.0


xvii) SANKYO COMPANY


LTD.


2002


Mevalotin


Cholestrol

reduc
tion


1406.7




xix) AMERICAN HOME


2006


Prempro


Menopausal


413.0


16


PRODUCTS


Effexor

Symptoms

Depression


403.2




xx) G D SEARLE & CO.


2001


Ambien


Insomia


396.0



xxi) RHONE
-
POULENC


RORER INC.


2004


Lovenox


Deep vein

Thrombosis


462.0




xxii)TAP


PHARMACEUTICALS


INC
.


2005


Prevacid


Ulcers


628.0



There is no harmonized global approach to the duration patent rights in the
patent system especially for drugs & pharmaceuticals to compensate them for
the time they los
e in the market when their product is in the national statutory
approval process. Some countries consider making and submission of the
generic form of the drug an infringement of the drug during the term of on
-
patent
original drug. Other countries do not c
onsider such an act as infringement but
have provisions to extend the effective term of the patent to compensate the
inventor of the original drug. On these uncertainties the relationship between the
brandname and generic industries have been confrontation
al by prompting
several complex litigations. The delay between patent expiration and generic
competition in several cases is less than three months. The issues are set into a
strategic mosaic of economic, financial, technological, geographic, regulatory,
a
nd other factors. As more major branded drugs go off
-
patent, the innovator
-
generic conflicts will also escalate.


In the USA, generics enter the market through an “ abbreviated new drug
application (ANDA) approval process of the FDA after the patent expira
tion of
the original brandname product. In 1984, the “Waxman
-
Hatch Act”, or “Drug
Price Competition” and “Patent Term Restoration Act” was introduced in the US.
This act hoped to strike at a balance between the terms of patent extensions
provided to for p
atented drugs and for generic companies to use patented
materials (without being considered as infringement before the patent expired )
for preparing their Abbreviated New Drug Applications (ANDAs) to FDA.


To compensate for the exemption from infringing
activity the US Congress
brought in the concept of “ patent term extension “ to compensate companies for
the time they lose in the market during the regulatory process for their “ new drug
application (NDA). Under the amended patent law in USA, the term of

the patent
for applications filed after 08
-
06
-
1995 is 20 years from the effective date of the
US filing. This term can be extended up to 5 years to compensate for delays

17

resulting from interferences, serecy orders or appeals and also to take into
account
of problems securing product clearance for drugs and pharmaceuticals.


For patents filed before 08
-
06
-
1995 the term of the patent became 17 years from
grant or 20 years from the effective date of the USA filing. Pharmaceutical term
extension upto 5 years
for patents filed before 08
-
06
-
1995 would be applicable
for existing patents only to the old term of 17 years from grant and not the new
20
-
year term.


The case of Mevacor from Merck: clearly illustrate the implications of these
patent term extension.




Pat
ent life Mevacor was extended from November 7, 1997 to June 15, 1999
under the terms of GATT when USA changed its patent laws.



The same patent had already been extended to November 4, 1999 by the
Waxman
-
Hatch Act, so GATT does not extend the date upon whic
h generic
competition can begin.



In June 1995 the U.S. Patent Office (PTO) stated that it would not make the
GATT patent extensions additive to the Waxman
-
Hatch patent extensions.
Based on the FDA position and the PTO decision, it appeared that the addi
tional
patent life of pharmaceutical products would be the longer of GATT or Waxman
-
Hatch patent extensions. Consideration of patents for which Waxman
-
Hatch
patent extensions exist shows that the Waxman
-
Hatch patent expiration date
exceeds the GATT patent
extension date. This disparity has already been the
subject of debate between the branded drug and generic drug manufacturers in
the USA.


In an effort to create a reasonably transparent system in USA, the generic drug
manufacturer has to make the followin
g information explicit statements with the
ANDA:




Such patent information has not been filed



Such patent has expired



Such patent will expire on a particular date



Such patent is invalid or will not be infringed by manufacture, use or sale of
the drug for wh
ich the approval is being sought.


The patent holder of the original drug is notified of such an ANDA application.


If the patent holder of the original drug files an infringement suit within 45 days
on receiving the ANDA notification, then the FDA puts th
e approval of the ANDA
on hold for 30 months or till the court gives a ruling on the same. The ANDA
applicant who files all the relevant details as required receives a marketing
exclusivity for a period of 180 days after the applicant receives FDA approval
.

The six
-
month window makes the first drug to market highly profitable and gives

18

the company a substantial lead in establishing its product in the market.


The system of Supplementary Protection Certificates were introduced throughout
the European Communi
ty in 1993. An SPC prolongs certain pharmaceutical
patents, which otherwise would have expired in or after 1993, for a further five
years beyond their original 20
-
year term, or 15 years from first marketing
authorization in Europe, whichever is the shorter
. [Cunningham R, Managing
Intellectual Property, (82),16, September 1998 ]. There is a functioning system in
several countries within Europe which enforce a 10
-
year protection on regulatory
data filed by the first applicant for marketing authorization. At
a later date if
another company applies for authorization of a bio
-
equivalent drug, then it can
avoid repeating the toxicology, clinical studies or pharmacology. However it is
bound by the 10
-
year protection period. If the company wants to get an
authori
zation before the protected period og 10 years, it is expected to do the
complete range of tests required by the regulatory body. Generic drug
manufacturers have to take such regulations into consideration to plan their entry
strategy.


Generic companies
who wish to introduce generic drugs into the UK market can
experiment with patented drugs without fear of infringement allowing them to be
ready to release their drug on to the market as soon as the patent expires. In few
European countries, such as German
y and the Netherlands, submitting samples
prior to the patent expiry is considered an infringement.


From July 1 1999, extensions of up to five years will be available in Australia for
substance and process patents produced by recombinant DNA technology.
The
effective patent life from marketing approval in Australia will then be 15 years.

In 1996 the average term of patent protection in Japan was less than 10 years,
and 2
-
year restoration limit was allowed under Japanese Patent Law. The
Japanese Intellectu
al Property Association (JIPA) wants an end to the rule where
patentees cannot have a patent extended if they apply less than six months
before the patent officially expires, and the abolition of the five
-
year upper limit
on patent restoration.


Canada's
Patent Act amendments, Bill C
-
91, which provide specific exemptions
from patent infringement, allowing a generic drug manufacturer to research and
develop a product and conduct required tests for approval prior to the expiration
of the patent term. The pro
visions also allow manufacturers to stockpile for up to
six months, so that the generic drugs are ready to be shipped as soon as the
patent expires.


The recently approved Israeli patent law allows Israeli pharmaceutical
companies to start trial production

of generic drugs before the patent on the
originator drug has expired in the source country. The policy permits Israeli
manufacturers to export patented drug substances to the United States and
Canada.


19


On August 10, 1998 the Australian Parliament passe
d the Intellectual Property
Laws Amendment Bill 1998, which states that extensions of up to five years may
now be granted for 20
-
year patents for pharmaceutical substances. Also,
manufacturers of generic drugs will be able to undertake activities to achiev
e
pre
-
marketing regulatory approval without violating the patent.


Landmark judgement by the Tokyo High Court on Otsuka vs. Towa was that
Towa's tests for application approval did not violate Otsuka's patent for test
research under article 69, section 1, o
f the Patent Law. In a similar judgement
the Tokyo Higher Court issued September 24,1998 a ruling dismissing an appeal
filed by The Wellcome Foundation Ltd. (U.K.) against the previous decision of
the Tokyo District Court that rejected Wellcome's claim t
hat Kobayashi's
experimental study on a generic version (liquefaction) of Wellcome's aciclovir
antivirus agent had infringed its patents. The Higher Court judgment also
dismissed appeals by Wellcome charging patent infringements by Sawai
Pharmaceuticals, T
aiyo Pharmaceutical Industry Co., Fuji Chemical Industries,
Ltd. and Mect Corp.


The general trend is to allow companies to use patented materials without being
considered as infringement but only for submitting data for statutory approval
processes and f
or non
-
commercial purposes only. The other trend is to
simultaneously compensate the original innovator company with provisions for
appropriate patent term extension to make up for the time lost in getting the
statutory clearances.


In the post GATT period

several Indian Drug companies have shown positive
sign of a transition from being generic drug manufacturers to innovators. Notable
among these are Dr. Reddy’s Laboraories which has recently licensed its new
molecules ( for treatment of diabetes ) to Novo

Nordisk and Ranbaxy which has
filed an Investigational New Drug Application for its product BPH for treatment of
benign prostate hyperplsia. Other companies as Lupin Laboratories, Wochardt,
Nicholas, Sun Pharmaceuticals have also enhanced their focus to
basic research

in search for new molecules.


Intellectual cooperation in Pharmaceutical Industry


Evolving Strategies


Corporate houses are restructuring their businesses and focusing in core areas
and acquiring technical expertise through collaborations,

mergers or acquisitions.
Globally in 1997 there were 426 corporate transactions in the pharmaceutical
sector with an average value of $ 253 million. In 1996 there were 285
transactions with an average value of $ 433 million per transaction.


To offset th
e negative influences of drugs going “off
-
patent” and to “manage the
life
-
cycle” of products the major drug manufacturers are gearing up to meet

20

generic competition by adopting four strategies.


They are:


1.

Develop brandline extensions and seek extended pro
tection through


“ Controlled release formulations “ and apply for new indications.

2.

Enhance investment in R&D in core areas and support initiatives in search of
new bioactive molecules and new chemical entities (NCE). Also lead
sponsored collaboration
s with key academic groups in areas of modern
biotechnology, combinatorial chemistry, genomics etc., with clearly defined
arrangements on ownership of intellectual property. Corporate mergers and
acquisitions have also been completed to enhance cross


fer
tilization of
expertise, and cost effective strategic utilization of mutual intellectual assets.

Evolve and execute productive ways of group working with various
companies (also with competitors if necessary) through appropriate licensing
arrangements and

benefits sharing.

3.

Switch brands to over the counter (OTC) sales, reorganize manufacture,
grant licenses to generic manufacturers just before the patents expire to keep
competition at bay. Alternatively the traditional drug companies have chosen
to selec
tively litigate against drug manufacturers to delay their drug clearance
by FDA on grounds of possible patent infringement. In retaliation generic drug
manufacturers are fighting back claiming unfair blockage of their generic
drugs from entering the market
.


The market for enantiopure drugs was approx $40 billion in 1997. US FDA
considers enantiomers as two separate chemical entities. Thus technologies for “
single isomer pharmaceuticals “ via asymmetric synthesis & chiral resolution are
growing opportuni
ties in areas of traditional chemistry.


Companies such as SEPRACOR Inc have outlined a distinct futuristic strategy.
They have been busy working on
“ improved chemical entity compounds
(ICE) “

by researching on differences between single isomers of rac
emates or
active metabolites derived from parent drugs. They are on the path to improving
pharmaceuticals by enhancing receptor potency, initiating faster onset action,
limiting duration of activity and reducing side effects. To compete against
generics
they have to significantly differentiate their ICE compounds from
generic in terms of safety and efficacy. They have been able to procure


“ use patents “ for their ICEs.


With SEPACOR’s lifecycle management strategy” it patents its ICEs then
licenses the
m to drug companies before their “ composition of matter “ patents
on the parent blockbuster drug are due to expire. This arrangement helps the
drug companies to extend a product’s lifecycle by the term of the ICE patents.
The first such deal was struck w
ith Hoechst Marion Roussel on Fexofenadine in
1993. Hoechst will pay Sepacor an upfront fee plus royalties of 4
-
7% of sales
beginning in 2001.


21


Sepracor plans to bring 19 ICE drugs to the market by 2009. They have struck
several licensing deals with leadin
g drug manufacturers. Schering
-
Plough’s

“composition of matter “ patent on Loratadine (antihistamine ) is due to expire on
2004. By partnering with Sepracor on its ICE it is able to extend the life cycle of
its anti
-
histamine franchise till 4014 when Sepr
acor’s ICE patent expires.
Schering Plough will pay Sepacor an upfront fee of $5 million & 4
-
7% royalties in
future sales. Similar deals have been made with Eli Lily, Janssen
Pharmaceuticals Johnson & Johnson, Pfizer, American Home Products, TAP
Pharmaceut
icals Novartis and others. [RS Rogers CENAR

76
, (48) 1998
]

Contract research is has gained considerable ground in the last few years to
reach a value of $ 3.9 billion growing at a rate of 20 to 30% per annum most of
which is contributed by the pharmaceutic
al industry [R&D Directions
3
, (5), 22
(1997).


Working with high
-
tech companies also involves developing complex licensing
agreements.

For example several small companies with niche technologies have partnered
with very large companies to international
ly market their products. The big
company on behalf of the small company has managed IPR protection in various
countries.



To ensure success in cooperative working one has to clearly understand the
IPR issues related to:




filing of patents globally in th
e relevant markets,



getting the patent claims tested by a set of experts for their validity,




appropriate legal arrangements on transmission of Intellectual property rights
in various geographical regions and countries,




information and material not covere
d by the technology license,




IPR ownership & distribution of benefits on further improvement of the
licensed technology, etc.



A few recent collaborations and licensing arrangements in the pharmaceutical
industry illustrate how synergies are being explo
ited between diverse
organizations.


In a deal signed at the end of 1998 Novartis Agricultural Discovery Institute will
give $25 million to University of Berkeley’s College of Natural Resources over the
next 5 years and also give access to the company’s
plant DNA database &
proprietary technology. In return Novartis will get first crack at developing 30
-

40
% of the discoveries that come from the university. A similar deal was signed
between Scripps Research Institute and Sandoz in 1993. in which Scripps

received $100 million over 5 years. In return Sandoz had first patent rights to all
Scripps discoveries. [ E.Wilson CENAR
76
, (50) 1998 ].



22

Illustrated cooperative arrangements and sharing of benefits between some
organizations have been collated from di
verse sources cited in the Business &
Industry and Business & Management Practices Databases are presented to
highlight the approaches followed in recent times.






Licenses and Collaborations by select Pharmaceutical Companies.

[ collated from Business &

Industry database ]


COMPANY

COLLABORATION/LICENSE ARRANGEMENT

Glaxo
Wellcome Plc.

(GW)

1. GW and the Department of Biochemistry of Rush
-
Presbyterian, Saint Luke's Medical Center, Chicago, Illinois,
signed a three
-
year agreement to collaborate on
osteoa
rthritis research aimed at identifying new disease
-
modifying therapies. GW will make annual payments to
Rush, and Rush will grant GW exclusive first rights for
worldwide license of patented discoveries resulting from the
research collaboration. Rush will r
eceive royalties on any
therapeutic and diagnostic products that are marketed.

2.

GW signed an agreement with Hoechst Marion Roussel


(HMR) to evaluate a family of quinoxaline compounds that
may be useful in HIV non
-
nucleoside reverse transcriptase
inhib
itors (NNRTIs) for treatment of HIV
-
infection. These
compounds were the outcome of a collaborative work
between Bayer and HMR. U.S patent 5,723,461
concerning quinoxalines and synthetic methods has been
received by HMR. The European patent application
EP
0728481 concerning use of quinoxalines in combination
with HIV protease inhibitors has been assigned to Bayer
and EP0657166 concerning use quinoxalines in
combination with nucleosides is assigned to HMR. The
agreement between HMR and GW gives Glaxo Wellcom
e
the worldwide rights to develop and market any drugs
demonstrating antiviral activity that arise from this
collaboration

3. Synaptic Pharmaceutical granted GW of the UK a non
-
exclusive license to certain of its alpha
-
adrenergic receptor
patents and an o
ption to obtain a non
-
exclusive license
under Synaptic's functional
-
use patents for the treatment
of benign prostatic hyperplasia. GW paid an upfront fee of
$2 million to Synaptic.



Pfizer Inc.


1.

Pfizer LTD, a subsidiary of Pfizer Inc. UK and Fuisz

23

Int
ernational LTD, Dublin, signed a development agreement
to conduct research using Fuisz's Ceform Taste Isolation
microsphere technology. This technology is used to produce
microspheres that incorporates a Pfizer new chemical entity.
The resultant microspher
es will be combined with Fuisz's
patented Shearform technology to produce an orally
administered, rapidly dissolving flash
-
dose tablet.

2.

Phytopharm (UK) and Pfizer agreed to jointly develop and
commercialize the P57 appetite suppressant extract, which
comes

from an unidentified (patent pending) plant in South
Africa. Phytopharm licensed an extract from the Council of
Scientific & Industrial Research (South Africa). Pfizer will
pay $32 mil in license fees and milestone payments to
Phytopharm; Pfizer will als
o provide at least $7 mil for an
early development program.

3.

With Warner Lambert’s (W L) Lipitor on patent until 2010,
WL has a licensing and development deal with Pfizer to
develop compounds for congestive heart failure. Pfizer paid
$87 million upfront fo
r the rights to comarket lipitor, will pay
an additional $100 million as new filing and approval
milestones are reached, and will share in the cost of new
clinical trials. Warner
-
Lambert gets its choice of one of three
late
-
stage
-
development Pfizer drugs t
o comarket. Pfizer in
turn gets 50% of incremental sales over regularly ncreasing
baselines agreed upon by the two companies

4.

Synaptic Pharmaceutical has granted GW a non
-
exclusive
license to certain of its alpha
-
adrenergic receptor patents
and an option to

obtain a non
-
exclusive license under
Synaptic's functional
-
use patents for the treatment of benign
prostatic hyperplasia. GW paid an upfront fee of $2 million
to Synaptic.

Merck Inc.

1. Merck extended its 1993 agreement with Synaptic
Pharmaceutical Corp.

for the discovery of compounds that
may be useful in the treatment of benign prosthetic
hyperplasia. The joint research programme is focused on
compounds that selectively block the human alpha
-
1a
adrenergic receptor. Synaptic has two patents that cover th
e
use of selective alpha
-
1a antagofirsts for the treatment of
benign prostatic hyperplasia. Exclusive worldwide rights for
these products have been licensed to Merck.

2. Aurora Biosciences Corp. completed the design and
delivery of three screening subsys
tems to Merck & Company
Inc. Under the terms of an agreement that was signed in
1997, Merck committed more than $33 million in research
funding, license fees, and delivery payments. These
subsystems have been designed and integrated by Aurora

24

to improve hi
gh
-
throughput analysis of screens developed
using Aurora's patented fluorescent membrane
-
potential
sensors for ion channel targets.

3. Merck’s arrangement with Cellomics Inc. involves the
development and delivery of the ArrayScan 2.0 system, a
functional h
igh
-

content screening system. ArrayScan is
designed to improve the efficiency of the drug discovery
process.

4. Merck formalised a collaboration with Isis Pharmaceuticals
Inc. to discover drug candidates for treatment of patients
infected with hepatitis
C. Scientists of these companies will
jointly design, synthesize, and evaluate novel small
molecules. Merck will screen them to identify hepatitisC virus
replication inhibitors. Merck retains the right to
commercialize drugs arising from the collaboration
and Isis
retains the right to use the technology developed in the
collaboration in its antisense program.

5. Merck expanded its June 1996 agreement with Cubist
Pharmaceuticals Inc., for the discovery and development of
novel anti
-
infective compounds. Merck

will license Cubist
compounds and data for inclusion in their collaborative
research program in exchange for research funding and
milestone and royalty payments to Cubist


6. Merck licensed proprietary, non
-
exclusive rights to methods
for screening small
-
molecule compounds from Genzyme
Molecular Oncology. Merck is screening these small
molecules to determine their action against a cancer
-

related
protein called MDM2. Genzyme received an upfront
payment and could receive about $8 million in milestone
payme
nts and royalties on sales if Merck successfully
develops a product through the use of these assay methods.

7. Merck signed a collaborative research, development and
license agreement with Biogen Inc. The arrangement relates
to the clinical development o
f a new class of compounds for
the treatment of inflammatory diseases. The two companies
agreed to will develop an aerosolized anti
-
VLA4 small
-
molecule drug as a treatment for asthma and oral VLA4
inhibitors. Merck has worldwide marketing rights for the
as
thma indications; Biogen retained marketing rights for the
multiple sclerosis indication. Merck paid Biogen a $15 million
fee. Milestone payments could total $130 million.

Bristol
-
Myer
Squibbs
Co.
1. BMS arranged a $50 million license and researc
h pact with
Cytoclonal Pharmaceutics Inc.. The deal calls for the
development of two technologies related to production of
paclitaxel, the active ingredient in BMS's anticancer product

25

(BMS)

Taxol. The agreement focuses on microbial fermentation to
produce pacli
taxel and/or other taxanes and on the use of
specific genes to enhance production. In addition, other
microbial strains could be screened to identify new products
for oncology.

2. BMS and Medarex Inc. signed a $20million collaboration
agreement involving M
edarex's HuMAb
-
Mouse technology.
This technology creates high
-
affinity, fully human antibodies.
BMS is using the technology to create human antibodies to
multiple antigens for use in its drug discovery programme.

3. BMS and Irori, formed a two
-
year strate
gic alliance to
develop an advanced, ultra high
-
throughput combinatorial
chemistry system using Irori's proprietary NanoReactor
technology. This allows BMS to synthesize thousands of
compounds of known structure per week, thus speeding the
drug discovery p
rocess. The deal is valued at about $14.5
million.

4. As part of its continuing effort to develop improved production
processes for paclitaxel (the active ingredient in BMS's
anticancer drug Taxol) , BMS signed an agreement with
Phyton Inc for the commerci
alization of Phyton's proprietary
plant cell fermentation technology, which Phyton had
licensed to BMS in 1995. Phyton's plant cell fermentation
technology represents a new method of producing paclitaxel,
and related substances of potential interest, that
does not
require harvesting cultivated plants.

5.

BMS and Neose Technologies Inc. signed an agreement
whereby Neose will develop and manufacture complex
carbohydrates for two oncologic vaccines being developed
by BMS. Neose is developing these products using

its
patented Multi
-
Transferase Reaction technology, which
employs the natural power of enzymes to produce complex
carbohydratesefficiently and in quantities sufficient for
commercialization.

6.

BMS licensed its monoclonal antibody
-
based cancer
targeting prog
ramme to Seattle Genetics. Among the
tumour
-
targeting compounds is an immunotoxin that has
advanced into clinical trials .

7.

BMS and Chiroscience Group plc. Signed licence
agreements in the area of matrix metalloproteinase
inhibitors for the treatment of can
cer. BMS has licensed
rights to Chiroscience's matrix metalloproteinase inhibitors
programme, including the worldwide rights to two lead
compounds designated D2163 and D1927. Both companies
have agreed to a three
-
year oncology research collaboration
to dis
cover new selective matrix metalloproteinase inhibitors.


26

8. BMS and Unilever have entered into a research and
development agreement under which BMS will obtain rights
to hair follicle research and patents developed by Unilever.
Unilever will receive mile
stone payments as BMS develops
prescription compounds for preventing hair loss. This is the
first time that Unilever has licensed its research technology
to a drug company for the expressed purpose of developing
a prescription product.



Genentech Inc

1. Protein Design Labs Inc (PDL) and Genentech Inc., agreed
to cross
-
license rights to certain intellectual property for
monoclonal antibodies. Genentech will pay a $6 million, up
-
front, non
-
creditable, nonrefundable fee to PDL. Protein
Genentech will receive from Design Labs $1 million up
-
front,
non
-
creditable, nonrefundable fee, for rights to license
particular antibodies under specified patents and patent
applications held by Genentech.

2. PDL granted a nonexclusive license under its a
ntibody
imumanization patents to Genentech Inc. for antibodies to
the antigen HER2, including Herceptin (trastuzumab),
Genentech's humanized monoclonal antibody for the
treatment of breast cancer. Under the agreement,
Genentech paid PDL a $6 million fee f
or the right to license
antibodies for up to six antigens under certain of PDL's
patents and patent applications upon payment of additional
fees. Under the recent license agreement, Genentech will
pay PDL a license fee of $1 million and will pay royalties
under the PDL patents based on product sales. This is the
first license issued under the Genentech
-
PDL agreement.

3. Abgenix Inc. signed a research license and option agreement
with Genentech Inc. allowing Genentech to use Abgenix's
XenoMouse technology to

generate fully human antibodies
for an antigen target in growth factor modulation.

4. Genentech grants patent rights to DAKO to develop
diagnostic kit to detect over expression of HER2, a growth
factor receptor that has been linked to especially aggress
ive
breast cancer . Under the terms of the agreement,
Genentech grants to DAKO a license to Genentech’s patent
and know
-
how for development of an immunohistochemical
(IHC). In exchange, DAKO pays Genentech a royalty on the
worldwide sales of DAKO's IHC de
tection kits.

Eli Lilly & Co

1.

Eli Lilly and Co. and Sepracor Inc. entered into a license
agreement that enables Eli Lilly to exclusively develop and
globally commercialize R
-
fluoxetine , (a modified form of an
active ingredient found in Prozac) , a new ch
emical entity
patented by Sepracor. R
-

fluoxetine, is currently in Phase 1

27

clinical development.

2.

Pharmaceutical Product Development Inc. and Eli Lilly and
Co.,entered into development collaboration in the
genitourinary field. Under terms of this agreement,

a
subsidiary of Pharmaceutical Product Development will
receive worldwide licenses to Lilly compounds that target
medical conditions, including bladder dysfunction and sexual
dysfunction. Lilly will receive license fees and royalties from
products that en
ter the market. Lilly also will receive a first
option to relicense compounds in the future.

3.

Eli Lilly licensed the rights to use Emisphere's oral delivery
technology in the development of oral formulations of two of
Lilly's therapeutic proteins, one in
the field of osteoporosis
and the second in the area of endocrinology. Two milestone
payments were made to Emisphere as part of their alliance.

4.

Eli Lilly Canada and Toronto
-
based pharmaceutical
company Allelix announced an expansion of their research
progr
ams with and investment of over $30 million from Lilly.
The agreement covers two projects: i) to discover new drugs
for central nervous system diseases ii) drugs targeting
eating disorders. The partnership has generated more than
60 patent applications wor
ldwide covering 13 separate
inventions.



Litigations in Pharmaceutical Sector



The highly competitive atmosphere has fueled several litigations in the
Pharmaceutical Industry. Patent Oppositions, suits for revocations of patents,
infringements actions,

challenges involving non
-
disclosure of relevant and
appropriate prior
-
art, hair
-
splitting on claims with respect to closely linked
inventions and prior art, questioning the best mode of practice disclosed,
claiming damages, etc. have been common. Illustr
ative cases such as Glaxo vs
Novopharma on Ranatadine, Genentech vs Eli Lilly, Novo Nordisk & Biogen
human growth harmone patent, Baxter International Inc vs McGaw on Safeline
needles highlight the complex issues. Wars between the Generic
--
Branded Drug
Ma
nufacturers have also taken aggressive positions. A few examples are
included as illustration of the issues involved.

Council of Scientific and Industrial Research (India) vs University of
Mississippi ( USA)

The case of the “Haldi (Turmeric) Patent” revoc
ation illustrates the significance of
documentation of traditional knowledge. US Patent No. 54015404 was granted to
two researchers of the University of Mississippi by the US Patent and Trademark
Office (USPTO) for the use of turmeric powder (haldi) as a
wound healing agent
on March 28, 1995. On October 20 1996, the patent was opposed by the Council
of Scientific and Industrial Research (CSIR), India. The basis was that it did not
satisfy the essential criteria of patentability in terms of novelty because

the use of

28

turmeric powder as a wound
-
healing agent has been well known in India over
several centuries. Thirty
-
two references including the wealth of India, citations
from Journal of Indian Medical Association and ancient treatise on home remedies
were
submitted to the US patent office in support of this opposition. The USPTO
unequivocally rejected all the six claims of this patent on August 13, 1997.

Astra AB vs Han Mi Pharmaceutical Co, Ltd (Han Mi)

This is a recent landmark judgement in Korea.


Th
e dispute centred on competing products for omeprazole oral formulations
marketed by both companies. At the time of Astra's patent application for its
Korean patent, Korea had not yet adopted the product patent system
(subsequently adopted on July 1 1987)
.




Astra applied in Korea for a patent for its omeprazole formulation
manufacturing process, which included the three steps of: 1) mixing the
omeprazole with an alkaline reacting compound; 2) coating the thus
-
formed
core with an inner layer; and 3) coveri
ng the core and inner layer with an
enteric coating.



This was opposed by the Korean Company Han Mi.



Astra's patent was granted on October 1 1992 by the Korean Industrial
Property Office (KIPO) on the basis of novelty and inventiveness of Astra's
process
es and that of the organic combination of the above three
constitutional elements .



Han Mi had also filed a patent application for its omeprazole manufacturing
process claiming that its manufacturing process differed from Astra's patent
as claiming that a

stabilizing agent was added to the omeprazole core.



On April 25, 1995 Astra brought in a patent invalidation action against Han
Mi's .



KIPO trial board issued a decision invalidating Han Mi's patent on September
30 1997. It ruled Han Mi's manufacturing p
rocess patent was invalid on the
grounds that the use of a basic amino acid (L
-
arginine) as a stabilizing agent
for the omeprazole core was an obvious choice from prior art. The trial board
also concluded that no evidence of an unexpected benefit was obtai
ned from
the use of L
-
arginine.



On June 11 1998 the court passed a judgement in favour of Astra, finding
that Han Mi's manufacturing process infringed Astra's patent.



Reliefs granted to Astra are : 1) barring of Han Mi's infringing manufacturing,
market
ing and sales activities; 2) the destruction of all finished and half
-
finished infringing products in Han Mi's possession; and 3) the provisional
enforcement of the above relief.


CellPro vs Baxter Healthcare Corp


After losing the litigation involving
disposable kits for its Ceprate SC stem cell
concentration system CellPro also agreed to appoint Baxter Healthcare Corp as
its exclusive worldwide distributor of a limited number of the product. It also
agreed to settle all issues remaining outstanding in
its ongoing patent litigation

29

with Baxter, Johns Hopkins University and Becton Dickinson & Co for payments
of $15.6 mln. In addition CellPro will discontinue all operations other than the
manufacturing & service functions necessary to support a limited qua
ntity of
Ceprate SC kits. Its European operations have already been discontinued.

Eli Lilly and Co vs Barr


U.S. District Court dismissed two motions by generic drug maker Barr
Laboratories Inc., which was challenging the Lilly’s Prozac patent. Lilly holds

two
patents on Prozac. The patent on the compound expires in February of 2001,
and the one on how Prozac works in the body expires in December 2003. The
court ruled in favor of Lilly on the doctrines of double patenting (obtaining two
separate patents for

identical invention) and best mode disclosed.

Hoechst Marion Roussel vs Andrx Corporation


Hoechst Marion Roussel (HMR) filed a patent infringement suit against Andrx
Corp. related to the ANDA submitted by Andrx on diltiazem, the active ingredient
in Card
izem. This was a ploy to delay introduction of the generic drug into the
market. Until the litigation is resolved, Andrx officials have agreed not to market
their product. From July 1998 until resolution, Hoechst Marion Roussel will make
nonrefundable quar
terly payments of $10 million to Andrx. In the meanwhile
Aetna U.S. Healthcare has sued HMR alleging that such a deal between Andrx
and HMR is unfair and has illegally prevented the introduction of a generic
version of Cardizem CD to the market.

Novo Nordi
sk A/S

In October 1997, Novo Nordisk filed a patent infringement suit in a U.S. District
Court against Genentech Inc., Eli Lilly and Co., Pharmacia & Upjohn Inc., and
Serene Laboratories Inc., who manufacture / market biosynthetic human growth
hormone prod
ucts that compete with Novo Nordisk's Norditropin in USA. It
charges these companies of infringing a Novo Nordisk patent covering
biosynthetic human growth hormone.


In June 1998 Novo Nordisk and Genentech Inc. reached an out
-
of
-
court
settlement on patent
s relating to human growth hormone & insulin. They
mutually agreed to “cross
-
license worldwide “ certain patents relating to human
growth hormone and to the manufacture and production of growth hormone
products Norditropin, Nutropin, and Nutropin AQ. In a
ddition, Novo Nordisk
would receive a worldwide license under Genentech patents relating to insulin
and Genentech will receive some other patents of Novo Nordisk.


In May 1998 Novo Nordisk and Serono Laboratories Inc reached an out
-

of
-
court
settlement rel
ated to the manufacture and marketing of Saizen, Serono's
biosynthetic human growth hormone product. The settlement also covered
Serostim human growth hormone approved in the United States for the
treatment of AIDS.

Amgen Inc. vs Transkaryotic

In April 199
7, Amgen filed a suit against
Transkaryotic Therapies Inc. and Hoechst Marion Roussel Inc. to stop the two
companies from developing gene
-
activated erythropoietin on the basis of patent
infringement. A ruling in April 1998 stated that Hoechst and Transkary
otic

30

Therapies activities are protected under the Waxman
-
Hatch Act. Amgen hopes
to stop Transkaryotic from coming to market with a gene
-
activated erythropoietin
through a preliminary injunction, until the patent issues are resolved.

SmithKline Beecham Cor
p. Vs Chiron Corp.



SmithKline Beecham Corp. (SKB) and Chiron Corp. settled their patent litigation
over the use of certain glyceraldehyde
-
3
-
phosphate dehydrogenase (GAPDH)
promoters (claimed by Chiron), used for expression of recombinant antigens.
Under
the settlement SKB received a nonexclusive worldwide license from
Chiron to use the promoters for production of human vaccines, including
Engerix
-
B, SKB's recombinant yeast
-
expressed hepatitis B surface antigen
-
based vaccine. In exchange, Chiron will rece
ive a license issuance fee and
royalties on sales of vaccines using the promoters.

Hoechst Marion Roussel vs Alliance Pharmaceutical

Hoechst Marion Roussel has initiated a $16.8 million arbitration action against
Alliance Pharmaceutical involving a licens
e dispute for the development of
LiquVent (perflubron), a compound used to treat respiratory disease. HMR
terminated its licensing agreement with Alliance and the development of
LiquiVent in December 1997.

Nycomed Amersham vs Mallinckrodt Medical BV and

Mallinckrodt Medical
GmbH, Molecular Biosystems


Nycomed Amersham filed patent infringement suits in Holland and Germany
against Mallinckrodt Medical BV and Mallinckrodt Medical GmbH, and their
licensor Molecular Biosystems. Nycomed claims that MBI's Opti
son ultrasound
contrast agent licensed throughout Europe to Mallinckrodt and currently before
the European Medicines Evaluation Agency for marketing approval, infringes
Nycomed's European Patent 0 576 521 B1 granted in September 1997.
Nycomed is also pursu
ing patent infringement claims against MBI's Optison in
the USA under its analogous US patent.


Abbott Laboratories vs. Zenith Laboratories & Geneva Pharmaceuticals



Zenith Laboratories had sued Abbott claiming that Abbott interfered with Zenith's
abil
ity to win government approval for and sell a generic version of Abbott's
Hytrin. In an agreement between Abbott Laboratories and Zenith Laboratories
Inc., & Geneva Pharmaceuticals Inc. regarding patents on Hytrin terazosin
hydrochloride, Abbott pays Ivax
(parent of Zenith) $6 million per quarter
beginning July 15, 1998, until Abbott’s patent on Hytrin expires on February 17,
2000. Hytrin is an alphablocker indicated for hypertension and benign prostatic
hyperplasia. After the patent expires or a generic ve
rsion of terazosin
hydrochloride is introduced in the market by any other party , Ivax may market
their generic brand free from claims of patent infringement by Abbott. Geneva
acknowledged the validity of Abbott's patents and agreed not to market its FDA
approved generic terazosin hydrochloride capsules until pending litigation
between parties is resolved.

LifeCell Corp vs Integra LifeSciences Corp.

LifeCell makes a tissue transplant product used for wound
-
healing, burns and
plastic surgery. Integra prod
uces a product called Integra Artificial Skin.
LifeCell Corp., and its competitor, Integra LifeSciences Corp., mutually settled

31

their infringement suits in which Integra had alleged that two

patents related to its
product AlloDerm was being infringed by LifeCell Corp. LifeCell had sued Integra
for anti
-
competitive acts. Integra had licensed the technologies from the
Massachusetts Institute of Technology.


In the settlement both the companies
agreed to dismiss the suits and Integra
agreed to buy $500,000 of LifeCell's common stock over the next three months.
LifeCell gets a royalty
-
bearing license from Integra to use its technology to
develop any products covered by the two patents.

Bayer Corp
vs Physician Sales & Service Inc

Bayer Corp has filed a patent infringement suit seeking against Physician Sales
&Service Inc. alleging that infringement on four of its Multistix patents on urine
test strips. Bayer is seeking an injunction to prevent distr
ibution of the Physician
Sales products until the issues have been resolved
.






Conclusion


The pharmaceutical industry will always remain a growing industry due to
demands of a globally enlarging and aging population with

diverse & changing
life styles. In the new millenium consumers will demand newer methods of
treatment, healthcare and services. Innovation will continually drive this industry.


The deciding factors for profitable growth and survival of this industry w
ill be




efficient use of Knowledge engineering techniques,



structured management of innovation,



authentic documentation



accessing & creating new knowledge, ensuring its protection using
appropriate IPR,



setting up systems to enforce the acquired right
s and



at the same time evolving creative process of cooperative working and
sharing of benefits.


The “ Small “ and the “ Big “ will co
-
exist through mutually beneficial licensing
arrangements. Ethical issues on Information & knowledge ownership by
Corpo
rations with fair sharing of their benefits (Profits) of innovations based on
community knowledge will also have to be sorted.


Acknowledgements


The author is grateful to Mr. Jaideep Verma of Martix Information Services for
the searches he made for this a
rticle in various Derwent Databases. Several
articles figuring in the “Business & Industry and “ Business & Management
Practices “ databases from Dialog ONDISC have been referred to and quoted
and collated in the article. The author collectively acknowledg
es all these

32

sources.