New Delhi: The Delhi High Court has issued an order favourable to Swiss pharma giant Novartis by allowing an appeal by the company in a matter related to approval of patent for its cardiovascular drug combination valsartan and sacubitril, while observing that the examination and opposition process though statutorily structured to proceed parallelly are independent and separate in pre-grant opposition.

In an appeal filed by Novartis against companies including Hyderabad-based Natco Pharma, the division bench of Delhi High Court set aside an order from a Single Judge which asked the Patent Controller to give a hearing to Natco Pharma before finalising a pre-grant opposition matter regarding the drug combination.

The Court observed that the examination process is initiated by the controller and the opposition process is to allow external inputs to be placed for the consideration of the controller enabling the official to make a well-informed decision regarding the grant of patent application.

Notwithstanding the rejection of an opposition, the Controller is legally as well as statutorily bound to independently examine the patent application based on the FER as well as on its enquiry on whether the patent is liable to be granted in law.

The examination process involves an in-depth assessment of the patent application, ensuring it complies with the statutory requirements for patent approval and facilitates a thorough and independent evaluation of the application by the examiner and the Controller.

“Maintaining a clear distinction between the examination and the opposition process is essential to not only fulfil the underlying objectives sought to be achieved but are also fundamental in ensuring that the sanctity and efficacy of each stage is maintained,” said the Order by Justice Yashwant Varma and Justice Dharmesh Sharma, on January 9, 2024.

“….we are of the firm opinion that the examination and opposition process though statutorily structured to proceed parallelly are independent and separate. It would be wholly incorrect to understand the provisions of the Act and the Rules as contemplative of convergence or merger,” concluded the Order. The Court also observed that the opponents in the matter had the right to raise or pursue objections to the grant of patents in terms of Section 25(2) of the Patents Act, which is a post-grant opposition.

The Controller of Patents issued an order on December 14, 2022 after hearing the pre-grant opposition from various parties. However, Natco approached the High Court arguing that a pre-grant opponent would have the right to represent against both voluntary amendments as well as those that may be directed by the Controller.

It argued that the consideration of the patent application alongside the representations of opposition are not liable to be viewed as operating in separate silos. The proceedings, according to Natco, clearly merge and thus obligating the Controller to place all pre-grant opponents on notice of any amendments that may be directed by it.

Addressing this argument, the Division Bench said, “To merge the process would be to compromise the rigors of examination since external inputs, though valuable, are best considered within the distinct and specific framework of the opposition. Merging these distinct processes would render the entire system unwieldy and counterproductive, quite apart from negatively impacting the legislative policy of expeditious consideration.”

The dispute on patentability is on a patent application filed by the company, which was published by the patent office on August 24, 2007 inviting pre-grant oppositions. The first pre-grant opposition was filed by Indian Pharmaceutical Alliance (IP Alliance) on May 26, 2016, followed by Natco on September 6, 2016. This was followed by another eight pre-grant opposition filed between August, 2017 and November, 2022.

Examining the order passed by the Single Judge, the Division Bench said, “We find that the impugned judgment failed to test the allegation of violation of the natural justice principles on the bedrock of prejudice and manifest injustice. It also failed to bear in consideration the highly belated objection which was preferred by Dr. Kanchan Kohli, a day after the closure of hearing on PGOs and for which no plausible explanation was proffered.”

The Court advised the Controller and the Courts to ensure that the pre-grant opposition right is not abused and the examination process inordinately delayed or derailed by the filing of serial objections.

It added that an amendment proposed by the applicant in order to comply
with a directive of the Controller is placed on a pedestal distinct from any voluntary amendment that the applicant may choose to introduce. The opponent’s right to a hearing pertains specifically to the representation stage and does not grant them the entitlement to intervene in the broader examination process, it added.

The opponent can claim a right of hearing only if the Controller is satisfied and is of the opinion that the representation merits consideration. A mere filing of a representation would not prompt or precipitate issuance of notice under Rule 55(4). The matter becomes contentious only once the Controller takes cognizance of the representation and issues notice to the applicant.