Challenge and Opportunity ; Ranbaxy's Legal Battle with Pfizer Indicates How Tough and Profitable the Global Pharma Is

Summary

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Ranbaxy's challenge to Pfizer's patents on Lipitor in the UK has attracted attention both from the media and analysts. The UK court's ruling against Ranbaxy is only one step in the protracted legal battle, the outcome of which has huge implication for Indian drugmakers' global generic dream and the availability of critical drugs at reduced prices. What is the case all about? And how does it affect the Indian pharmaceutical industry?

Lipitor is Pfizer's brand name of a cholesterol reducer medicine, atorvastatin. Lipitor's worldwide sales of over $10 billion (about Rs 43,000 crore) in 2004 is more than the total sales, including exports, of all pharmaceutical companies in India. Lipitor, an original research product of Warner-Lambert Co, came to Pfizer with the acquisition of the company. Its basic patent (legal monopoly which protects production) is valid up to 2010. However, Pfizer has at least four patents for trivial changes which could be valid for varying periods up to 2011, 2013, 2015 and 2017. This practice of keeping the patent alive beyond a 20-year period is known as "evergreening", whereby the patent holder seeks to maintain legal monopoly beyond the 20-year protection provided under the Trade Related Intellectual Property Rights Agreement. The changes are mostly in the physical properties of the molecule, without altering the safety and efficacy of the drug.

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Extract

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Challenge and Opportunity ; Ranbaxy's Legal Battle with Pfizer Indicates How Tough and Profitable the Global Pharma Is

The Indian Patent Law seeks to block this abuse by not allowing patents for trivial changes. This is done with a view to promote competition...

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