Relooking Section 3(d) Through Judicial Lens

Patentability of derivatives of known substance particularly drugs find a tough and bumpy road at Patent office in India since the introduction section 3(d) amendments in 2005.This amendment remain the hall mark of the shift of Indian patent regime from process patent to product patent particularly for food drugs and chemicals. The intention of the framers of section 3(d) amendments was to introduce these changes in section 3 under chapter II ‘inventions not patentable’ as negative provision with positive covenant. This provided a clear leeway to obtain patents on improvement of known substances which is otherwise are seen as an evergreening of patents. It is in this context Supreme Court in Novartis AG v Union of India (2013) case ruled that Section 3(d) put no bar on the patent protection for all incremental inventions involving chemical and pharmaceutical substances. The court categorically ruled that it would be a grave mistake to interpret the judgment to mean that Section 3(d) was amended with the intention to put a bar on all incremental inventions. Though this landmark judgement cleared the mist of negativity surrounding the interpretation of section 3(d) yet the prosecution of inventions claiming derivatives/improvements of known substance particularly drugs is a tough call for patent law practitioners.

Identifying the known substance

The first stage in dealing with claims containing new form of known substance is to identify the known substance in the closest prior art document. Examiners as a practice raise section 3(d) in every case without even identifying the known substance. The applicant at times struggles hard to compare the immediate or near similar compounds. Though IPAB in Fresenius Kabi Oncology Limited v. Glaxo Group Limited & Anr, [IPAB decision 1st April 2003] clearly observed that identity of the known compound must be clearly disclosed to the applicant in para 56 of this judgment reproduce below: –

“56. It is true that it is the patentee who must prove the enhanced therapeutic efficacy of his invention. But in a revocation the applicant must plead and prove that it is hit by S.3(d) and that it has the same therapeutic efficacy as the known substance. Then the respondent will counter it either by proving that it is not a derivative of a known substance or by proving that though it is only a new form of a known substance he has shown that it has enhanced therapeutic efficacy. In the present case, there are no such pleadings. It is not enough to plead that because Ex1 and 2 are admitted prior arts, this is only a new form of those compounds. That is vague. It is only when the pleadings show how the invention is one kind of a derivative of known substance the patentee will have to explain how the grant of patent is justified because of the enhancement of therapeutic efficacy. In this case the pleadings are not adequate. We hold that the S.3(d) ground has not been proved.” [Emphasis Add]

This case clearly set the road map for all the contested cases involving the understanding of section 3 (d) objections whether it is in the revocation proceeding or at the prosecution stage before the Controller. However, in some cases this direction of the IPAB is not followed and the objection raised under section 3 (d) fall short of identifying the known substance against which the applicant is required to test the therapeutic efficacy of the claimed substance. Therefore, the identification of known substance is sine quo non on the applicability of section 3(d) failing which sustaining the objection under this section would be difficult in the court. Though the IPAB ruling in Fresenius Kabi case was on a revocation application but its applicability on the objection raised by the controller under section 3(d) cannot be ruled out.

Rejecting patent without disclosing the identity of known substance

Recently in DS Biopharma Limited vs The Controller Of Patents And Designs And Anr., the contesting appeal counsel relied on the ruling of IPAB in Fresenius Kabi case to challenge the order of the Controller in which section 3(d) objection was raised without identifying the known substance against which the appellant was required to test and prove the therapeutic efficacy of the claimed substance. In its ruling dated 30th August 2022 Delhi high Court was critical in its observation to clarify that an objection raised under Section 3 (d) by the Controller is not maintainable unless the alleged ‘known substance’ is first identified in hearing notice sent. The High Court ruled that this primary precondition for an objection under Section 3(d) to be raised and sustained by Controller must be clearly made out.

“19. Therefore, holistically read, the Appellant has not had adequate opportunity to deal with the objection under Section 3(d) in as much as apart from merely specifying the said objection for the first time in the hearing notice, the manner in which the said objection was attracted was completely absent.

20. In the absence of the proper identification of the known substance in the hearing notice and a lack of proper opportunity being afforded to respond to the objection under Section 3(d), the impugned order is not sustainable.” [Emphasis added]

The High court appears to be implicitly guided by the IPAB ruling of the Fresenius Kabi case, which means that this ruling has now laid down the rules which would make it obligatory for the Controller to follow the conditions listed below while raising objections under section 3(d).

1. To identify the ` known substance’ and state its structure in the hearing Notice.
2. To state clearly reasons to show that the claimed substance is a ‘derivative’ or a ‘new form’ as compared to the ‘cited known substance’.
3. To provide clear support through citations or otherwise to sustain the objection that cited known substance and the claimed substance have the same known efficacy

Test Of Enhanced Efficacy

In a first landmark judgment relating to interpretation of section 3(d) being Novartis AG v Union of India (2013) where Supreme Court provided a clear definition to term enhanced efficacy and ruled that where applicant claims a medicine meant to cure a disease the efficacy test can be only “therapeutic efficacy”. Court categorically observed that not all advantageous or beneficial properties are relevant, but only such properties that directly relate to therapeutic efficacy are relevant. That means there is no bar on the patentability of derivatives or improved compounds of known substances /compounds of chemicals or pharmaceutical substances. The so-called incremental improvement in the known substances can qualify for patents if the claimed compounds are different in terms of therapeutic efficacy. For this purpose, the identity of the known substance must be established so that a clear comparative difference in efficacy is drawn during examination and prosecution of the patent.

Ending on a positive note

The BS Biopharma case rulings is welcomed by the practicing patent law attorneys as it is further step towards better understanding of the objections raised under section 3 (d). The patent applicant would now be in an informed and better position to deal with objection raised under section 3(d) to prove efficacy of the claimed substance over the cited and explained known compound by the Controller. It is expected that the patent office will issue further guidelines to the examiners and controllers on section 3(d) in view of the BS Biopharma case. All the court decisions discussed above added more clarity to the judicial interpretation of section 3(d) and it is expected that patent examiners and controllers would now use their discretion judiciously while raising objections under section 3 (d). An expert advice in the dealing with section 3 (d) objections to avoid delay or rejection of patent would be useful for the inventor seeking patents on inventions involving incremental improvement on known substances.