- For years, India did not recognise patents on drugs, which allowed India's generics drugs industry to flourish
- In a statement issued following the ruling, Novartis called the decision "a setback for patients"
- Novartis has threatened that if it lost the case, it would not introduce its newest generation of medicines to India
India's Supreme Court has rejected a plea from Novartis, the Swiss pharmaceuticals group, to patent its cancer drug Glivec, in a landmark ruling that health activists say will allow India's generics industry to keep making cheaper versions of newer medicines.
The judgment will infuriate multinational pharmaceuticals companies, already frustrated at the way India's 2005 patent law -- which New Delhi had to adopt in order to join the World Trade Organisation -- has been repeatedly interpreted to permit Indian generics companies to override their patents.
The Glivec case has been closely watched by both the global pharmaceuticals industry and activists for access to affordable drugs, who say it will set a precedent.
For years, India did not recognise patents on drugs, which allowed India's generics drugs industry to flourish -- and become the prime supplier of affordable generic drugs to many developing countries. India's generics drug industry is valued at about $26bn.
In a statement issued following the ruling, Novartis called the decision "a setback for patients that will hinder medical progress for diseases without effective treatment options".
India's 2005 patent law recognises patents on innovative drugs, but sets a higher-than-usual threshold for granting them, especially for updated versions of existing drugs.
The Indian law states that if a drug company wants a patent on a modified version of an existing patented drug, it must show improved efficacy of the compound.
Novartis, which had sought a patent on Glivec, had argued that the original compound it patented was too unstable for human use, and thus it should be granted a patent for the newer form of the drug. However, India's patent office ruled that it was not eligible for a patent as it was not a new drug, a decision upheld by the Supreme Court.
Novartis has threatened that if it lost the case, it would not introduce its newest generation of medicines to India.
The Swiss company sells Glivec for about Rs120,000 ($2,200) per patient per month. Indian companies sell generic versions of the cancer drug at a 15th of that cost, at Rs8,000 per patient per month.
The company said that few Indian cancer patients have been purchasing Glivec, and most of the medicine used in the country has been provided by the company through a donation programme. But in a previous hearing, India's Supreme Court judges have described the donation programme as "a complicated scheme", and suggested the company should reduce the prices.