Of Patents & Patients....

In a landmark ruling, the Supreme Court has rejected a patent bid by Swiss drug giant Novartis for a cancer drug, thus paving the way for access to cheap generic drugs and affordable healthcare.
Novartis fought a seven-year legal battle to gain patent protection for an updated version of its blockbuster cancer drug Glivec, arguing that the compound was a significant improvement because it is more easily absorbed by the body.
But in a ruling that went to the heart of patent law in India, known as the ‘pharmacy to the world’, the apex court said the compound ‘did not satisfy the test of novelty or inventiveness’ required by Indian legislation.
Indian patent laws restrict pharmaceutical companies from seeking fresh patents for making only small modifications – an industry practice known as ‘evergreening’ – and the ruling enables generic drug makers to continue copying Glivec.
Medecins Sans Frontieres (MSF) says Glivec – often hailed as a “silver bullet” for its breakthrough in treating a deadly form of leukaemia – costs over Rs.1.2 lakh a month in its branded form while the generic version is available in India for around Rs.8,000.
 Novartis, which reported net profit of $9.6 billion in 2012 on sales of $56.7 billion, condemned the judgment, saying in a statement it “discourages innovative drug discovery essential to advancing medical science for patients”.
“This ruling is a setback for patients that will hinder medical progress for diseases without effective treatment options,” said Ranjit Shahani, managing director of Novartis India.
The Supreme Court upheld the view of India's Intellectual Property Appellate Board, which refused to grant Novartis protection in 2009 on the grounds that the amended form of Glivec was not vastly different from the earlier version.
The Madras High Court had also rejected Novartis’s arguments in 2007.
Global drug makers say India's generics industry reduces commercial incentives to produce cutting-edge medicines and Novartis has warned it might stop introducing new drugs in India.
At the same time,the market is difficult to ignore and is set to touch $74 billion in sales by 2020 from $11 billion in 2011,according to industry estimates.
THE CASE
In 1997, Novartis filed a patent application to have exclusive rights to manufacture Glivec and to restrain Indian firms from making generic variants. It claimed that the drug was more stable and more soluble. While the Patent Controller in Chennai denied Novartis a patent, the case reached finally reached the SC in 2009.
THE RULING
A bench of justices Aftab Alam and Ranjana Prakash Desai refused to give credence to Novartis’s claim that 'Imatinib Mesylate', a substance used in the cancer drug, is a new product and the outcome of an invention. The court held that a repetitive patent was not permissible.
GLOBAL SIGNIFICANCE
The apex court judgment can pave the way for access to cheaper drugs as a one-month dose of Glivec costs around Rs.1.2 lakh. Generic drugs manufactured by Indian companies, will cost around Rs.8,000 per month. If Indian law allowed global drug firms to extend the lifespan of patents by making minor changes to medicines, it would have adversely affected the country’s $26-billion generic drug industry, which supplies much of the cheap medicine used in the developing world.
ADVANTAGE GENERIC
Nearly 10 years ago, Mumbai-based Cipla began selling generic anti-retro viral drugs (to suppress HIV virus) at one tenth of the price MNCs charged. The firm took advantage of Indian laws that allowed local companies to make such drugs as long as they used a process that differed from the original patented process.
Cipla sold the medicne to international aid agency MSF at $350 per patient a year, which was between $10,000 and 15,000 in the market, on the condition that they gave it to patients for free.

SpiceJet flies past AI

Even as the market continued to shrink, budget airline SpiceJet has overtaken Air India as the third-largest domestic carrier in February.
The airline flew a fifth of the all Indian passengers on the back of its ‘Big Sale’ scheme offering million air tickets at Rs.2,013,apiece, which has helped ensnare a portion of the flier bases of both Jet Airways and Air India.
According to latest figures given by aviation regulator Directorate General of Civil Aviation (DGCA), SpiceJet flew 20.4% of all domestic passengers in the country in February this year against 18.4% in January. Meanwhile, Air India’s market share dipped from 20.3% to 18.9% in February and so did Jet Airways’ from 20% to 19.1% in the same month.

BJP rejig

The Bharatiya Janata Party has re-inducted Narendra Modi into its parliamentary board, sending the clearest signal yet that the Gujarat chief minister and the party’s governance mascot will be its face in the next elections.
Modi, who was inducted into the board after a six-year gap, was the only chief minister to find a place in BJP’s top decision-making body announced by its president Rajnath Singh. Several close supporters of Modi also found prominent places in the rejig, underscoring his primacy in BJP’s line-up of prime ministerial aspirants.
Modi, who wrecked the prime ministerial ambitions of his colleagues in the BJP with the Gujarat win, can be expected to play a larger role in shaping the BJP’s electoral message for the next polls. A formal announcement of his candidature for the top post is unlikely in the immediate run as it could push the JD(U) out of the NDA, increasing the comfort level of the ruling UPA.
The composition of the Rajnath Singh team gave tell tale signs of Modi’s growing clout in the organisational set-up. While Modi managed to get the leadership clip the wings of Advani acolyte Ananth Kumar, he ensured the induction of his loyalist Amit Shah as general secretary. Shah is expected to handle important portfolios in the organisation. Other vocal Modi loyalists in the party, who routinely lock horns with the chief minister’s political adversaries on public platforms, also found berths in the new team. One of them, CP Thakur, who was made a vice-president, said the BJP would now persuade Nitish Kumar to accept the candidature of Modi. The list of office-bearers, which was put to a series of consultations and several changes, has taken care to appease important sections of the organisation. Rajnath Singh, who is keen to avert a repeat of his last tenure, marked by internecine squabbles, consulted all senior leaders, besides the RSS top brass. Singh, sources said, succeeded in getting the Gujarat chief minister to abandon his reservations over the inclusion of Muralidhar Rao as general secretary and SS Ahluwalia as vice-president. Rao, who was with the Swadeshi Jagran Manch, enjoys the backing of the RSS. The party president also managed to sideline senior leaders from Uttar Pradesh who have failed to shore up BJP’s chances in the state. Singh, who made Varun Gandhi a general secretary, dropped leaders such as Kalraj Mishra from the central team. Similarly, he sent senior leader from Himachal Pradesh Shanta Kumar to retirement.
Yashwant Sinha, a bitter critic of former BJP president Nitin Gadkari, could not find a place in the central team after the proposal to accommodate him was resisted strongly by Gadkari and his patrons in the RSS. Sinha had threatened to contest the presidential election if the party decided on a second term for Gadkari, whose business group Purti was accused of questionable dealings. Sinha on Sunday welcomed the changes.
Jaswant Singh’s marginalisation in the BJP appears complete as the party leadership did not accommodate him in any of the central panels. Singh used to be an important member of the parliamentary board before his rebellion against the party.

Petrol price cut

Oil companies have cut petrol rates by Rs.1.02 a litre because of a decline in international oil prices and a favourable rupee-dollar exchange rate, which also trimmed their revenue losses on diesel substantially.
“We have decided to cut petrol prices by 85 paise without tax from Tuesday,” an Indian Oil spokesman said. Effectively, petrol is cheaper by Rs.1.02 per litre in Delhi pumps.
This is the second petrol rate cut after state oil firms reduced its price by Rs.2.40 per litre on March 15, citing $5.3 a barrel fall in global crude oil rates.
There is about $1.5 per barrel gain in the average crude oil imported by domestic refiners since last price revision. Even global petrol rates have also dropped by over $3 per barrel. With almost stable rupee-dollar exchange rate, it was expected that oil firms would cut petrol prices soon, officials in the oil ministry said. The exchange rate is a crucial factor in determining fuel prices because India imports 80% of crude oil it processes.
International prices of petrol have gone down from $122.74 per barrel to $119.23 per barrel. Rupee-dollar exchange rate has also declined marginally from Rs.54.40 to Rs.54.28 during the same period. Following this, it has been decided to pass on the benefit to customers, IOC said in a statement.
IOC, Bharat Petroleum and Hindustan Petroleum generally align pump prices of petrol with international rates on fortnightly basis.
Executives in IOC, BPCL and HPCL say that they decided to reduce petrol rates despite not recovering their old revenue losses on the fuel, which is about Rs.1,150 crore in 2012-13. Companies incurred the revenue losses because they held petrol rates when international oil prices soared.

Car sales fall 20% in March

After a free fall in February, car sales in India for the month of March hit another record low, leading to the overall car sales moving into a negative territory for the entire fiscal, the first in a decade. Passenger car sales for the last month of the financial year ended March 31, fell over 20% led by an across-the-board sharp decline posted by leading car makers that included Maruti Suzuki, Hyundai India, Tata Motors and Volkswagen, among others.
The prevalent glum macroeconomic environment, uncertain fuel prices and rising interest rates have taken a toll, constraining customers to defer car purchases. The offtake has remained low despite historic high discounts of over 10% to 15%. With no positive stimulus on the horizon, industry players expect the tough times to continue in the first half of current fiscal year too.
The decline is steeper on account of large base of March last year, which saw the highest ever sales for the passenger vehicles due to festive season in some parts of the country and delayed Budget leading to people advancing the purchase due to fear of price hike post Budget.
Analysts forecast a single-digit growth of passenger vehicle market, with things likely to take off in the second half
The secondlargest car maker Hyundai India posted a decline of 13.5% to 33,858 units as against 39,122 units sold by the company in the domestic market for the same period last year. The struggle continues for Tata Motors, as its sales in March dropped over 67% to 12,347 units. General Motors and Ford India too posted a double digit decline of 14.94% and 41.61%, respectively.
The ones with utility vehicles in their portfolio, continue to buck the trend and this is despite increase in excise duty for utility vehicles in the recent Budget.
M&M posted a growth of 13% by selling 25,847 units in March. Led by the strong showing of Innova and the new Etios and Liva, Toyota Kirloskar grew 7% and Renault India posted over 7-fold growth to over 8,000 units in March, with its SUV Duster accounting for 70-80% of its sales.
And the story is not too different for two wheelers. The country’s largest two wheeler maker Hero MotoCorp posted a 11% decline in March selling less 4,68,283 units, TVS Motor Company too registered a de-growth of over 10% to 1,43,239 units. Honda Motorcycle and Scooters India and India Yamaha Motor recorded a sales growth of 14% and 20% respectively on the back on entering into new segments.
Lower plant utilisation and reduced shifts have become the regular feature and this hugely impacts industrial productivity, which has been suffering for long and that has direct impact on the commercial vehicle sales. Tata Motors posted higher ever domestic volumes this fiscal to 56,813 units, yet the sales were down 2.15% year on year. Eicher branded trucks and buses recorded sales of 4,962 units in March 2013, as compared to 6,051 units in March 2012, representing a decline of 18%.

Navi Mumbai Airport update

Mumbai’s second international airport in Navi Mumbai will get further delayed with Maharashtra chief minister Prithviraj Chavan announcing in the state legislative council that he can’t give a timeline for acquisition of the 291 hectares of land needed more for the project.
“The new international airport at Navi Mumbai needs about 1,160 hectares of land for pure aviation purpose, while 225 hectares are required for other purposes near the airport. Of the 1,160 hectares land required for aviation, 291 hectares are yet to be acquired,” Chavan said.
“In 2006, when the project was proposed, the estimated cost was Rs.4,766 crore, but now the estimated cost has risen to Rs.14,573 crore,” Chavan said. He said 291 hectares of private land has to be acquired yet. “But the government can’t give a timeline. It is our effort to finish this work as fast as possible.”
The chief minister informed the House that the original plan was to build an airport that could handle 40-lakh passengers per year, but now the planned size has been expanded to 60-lakh passengers a year.
Typically, an international airport takes about seven years to get commissioned from the time of basic construction, while the land acquisition takes at least 2-3 years.
This means the project work may start only in 2015 or 2016, and the airport will not be ready before 2023, said officials in the urban development department familiar with the project.
Bhaskar Jadhav, minister of state for urban development, said, “The formula for providing compensation in many projects in Navi Mumbai has been to give 12.5% of the developed land to the owners whose land has been acquired. But now, most land owners are demanding 30% of land, which isn’t possible. We are checking if a financial compensation package can be worked out or giving 22.5% land to the project-affected people can be a solution. No decision has been taken yet.” Many landowners, including farmers, are already agitating against the acquisition drive, and with the general elections just over a year away, most parties have decided to support the farmers’ agitation and other project-affected people who are resisting land acquisition. Indications are that the acquisition process could take a couple of years more.
The airport is expected to reduce the burden on Mumbai’s Chhatrapati Shivaji International Airport, which currently handles about 700 landings every day. The ministry estimates that the capacity of this airport will reach saturation by the end of 2014.

Double whammy

The combined output of eight core sector industries, which together account for 38% in the Index for Industrial Production, contracted for the first time since 2005, falling 2.5% in February. Further, the HSBC India Manufacturing Purchasing Managers' Index (PMI) indicated that expansion of output from Indian factories was at its slowest in 16 months in March, in the wake of wilting demand at home and overseas. The survey-based index dropped to 52 in March from 54.2 in February.
Together, the latest data suggests industrial growth is unlikely to improve on the 2.4% recorded in January, denting hopes of the economy rebounding from the expected decade-low 5% GDP growth last fiscal to the 6.5% targeted by the government for the year ending March 31, 2014.
However, addressing the media in Tokyo, Finance Minister P Chidambaram remained sanguine, predicting the economy would expand 6.1-6.7% this fiscal.
Chidambaram promised more reforms and said the economy could absorb up to $50 billion of FDI per year.
Five of the eight infrastructure sectors — coal, natural gas, crude, fertilisers and electricity — reported negative growth in February. Cement bucked the trend with a 3.9% growth while refinery products and steel rose 4.3% and 0.5%, respectively.
The 4.1% decline in electricity output in February, the first since September 2005, seems to have hit manufacturing activity, suggests the PMI.

The latest data is likely to trigger more downgrades in growth prospects for the current year after the 4.5% GDP growth reading for October-December quarter saw most private economists cut growth estimates to less than 6%.
Policymakers do not have much in their arsenal to deal with the slump even as political uncertainty has emerged as a big drag on the economy in the last few days. As a result, big-ticket investments could be delayed further.
The Reserve Bank of India had cut repo rate in its March 19 policy review by 25 basis points, but said further monetary easing was not possible if inflation remained high. The high fiscal deficit has tied the government’s hands when it comes to boosting growth through traditional stimulus programmes.