Why the Delhi HC’s Take on Biosimilars May Set a Dangerous Precedent – SpicyIP
In the past two months, Zydus Lifesciences has faced two legal setbacks in litigations for its biosimilar medicines. In April, the U.S. District Court of Delaware rejected Zydus’s challenge against the validity of Astellas’s patent on Myrbetriq, dealing a blow to Zydus’s plan to launch a generic version of the drug in U.S. On 18th July, the Delhi HC dealt another blow– it restrained Zydus from manufacturing, selling, offering for sale, importing, exporting, advertising or dealing in any bio-similar of Nivolumab.
The Judge, in this case, has made some interesting (or problematic) observations, particularly on Bolar Exemption and may have inadvertently opened the backdoor to Patent Linkage in India. This post explores the implications of the order will have on these concepts going forward. From what I have heard, the order has been appealed.
Patent IN 340060
First, for those interested, a brief on what this
The invention claims a monoclonal antibody (‘MAB’) called Nivolumab which is used to treat various forms of cancer. T-cells, in the human body, are responsible for attacking abnormal or foreign cells, forming the core of our immune system.
Cancer cells, however, evade the immune system by expressing “PD-L1 ligands” which bind with the body’s own PD-1. As a result, T-cells are unable to recognize and attack the cancerous cell. The suit patent prevents PD-1 from attaching with the ligands of a cancerous cell. This allows the T-cell to identify and attack the infected cell. Nivolumab works by specifically attaching to PD-1 and physically preventing it to attach to PD-L1. This binding affinity to PD-1 is achieved by tweaking the CDRs in the amino acid sequence of the MAB, resulting in Nivolumab.
Factual Matrix
In March 2022, the Plaintiff was made aware that Zydus had applied for clinical trial approval of a drug called ZRC-3276. This drug, by Defendant’s own admission, was a Biosi version of Nivolumab.
A biosimilar drug is a highly similar, but not identical, version of a biological drug- a drug obtained through natural processes from a living organisms. (here) Nivolumab, for instance, was made from cells obtained from a genetically modified mouse.
In this case, the Defendant had submitted Nivolumab as the reference biologic for clinical trials. Under the 2016 Similar Biologics Guidelinesa reference biologic is used to decide whether the submitted drug is similar in terms of quality, safety and efficacy. If found similar, the CDSCO approves it as a similar biologic a.k.a biosimilar product.
Since Nivolumab was used as a reference biologic, the Plaintiff feared infringement and sent a cease-and-desist letter to the Defendant in 2022. In 2024, the Plaintiff received the following mail (this is excerpted from the judgement):
Based on this mail, and several others, the Plaintiff filed a because it is afraid action to seek an injunction against the Defendant from making, selling, importing, or exporting Nivolumab. (Para 15.2)
Basis for that fears?
To me, there was no basis for a quia timet injunction in this case. Quia timet interim injunction application is filed when a Patentee believes there is an imminent threat of infringemet. In Teva Pharmaceuticals (DHC 2014) and Novartis v. Zydus(DHC 2022), the DHC laid down the test to decide maintainability of quia timet actions-
- Deliberate expressed intention which raises a strong possibility of infringement
- The infringing activity is imminent
- Claim of Plaintiff is not merely speculative
In the order, apart from the above excerpted mail, import of Nivolumab drug, and seeking market approval for ZRC-3276, there was no other basis for filing the quia timet action.There is a brief mention that there were other inquiries received by Plaintiff on mail regarding Defendant’s launch. However, there is no indication who sent this mail and what sources did the sender rely upon to speculate a market launch. Even if Zydus had secured a market approval in July 2024, it does not indicate an imminent launch of the drug. As explained herethe launch of a generic drug is driven by a “a multitude of business and market factors.”
Further, in this case, the DHC had imposed an injunction on Zydus from placing its product in the market without Court’s permission. On 19th March, 2025, the Defendant, again reiterated that that it will not launch the product in the market without the Court’s permission.
In these circumstances, there was no credible reason to believe that Zydus would have launched the drug before expiry of patent term. If there were any oral reasons given, they have not been recorded as relevant reasons in the order.
Leaving the possibility of infringement aside, which I discuss later, relying on anonymous mails (without credible sources) to grant a quia timet injunction sets a wrong precedent. As Tejaswini writesquia timet injunctions lack established standards in India, making the process subjective and speculative. The order is a case in point.
Biosimilar = Patent Infringement?
This case is not first of its kind. F Hoffman Roche v. Zydus Lifesciences (DHC 2024) had a similar set of facts. The Defendant had applied for clinical trial approval of a biosimilar drug. The Plaintiff, apprehending infringement, filed an application for quia timet interim injunction against the Defendant. Similar to the present case, the biosimilar drug was yet to be launched in the market.
In that case, the Judge refused to give a finding on infringement. Since the biosimilar product was not launched, it was impossible to map the claims of the suit patent against the biosimilar product. As a result, the Court could not First facie decide if the biosimilar product ‘utilized or embodied’ any aspect patented by the reference biologic. Thus, it ordered the Plaintiff to do claim-mapping and present the results to the Court. It had also mooted the possibility of constituting a confidentiality club so that the process and composition of the similar biologic could be ascertained.
No such confidentiality club was sought to be constituted in this case.
In a later order of the same case, the Court noted- “this Court is unable to pass any order in favour of the plaintiffs merely because the composition comprising Pertuzumab is same or they are biosimilar.” Therefore, until claim-mapping was done, the Court refused to provide any finding on infringement.
In the present case, the Defendant had raised the same point- there can be no finding of infringement without claim-mapping.
The Judge, however, decides infringement without requiring claim-mapping. Noting that it is a quia timet application and Defendant’s product is yet to be launched, it felt claim-mapping could be dispensed with. Could the Court have constituted a confidentiality club to decide the issue? The Defendant, anyway, could not have launched the product owing to an earlier injunction order. Couldn’t the Court have waited for Plaintiff to provide claim-mapping and then decide the issue?
Rather, the Court took a problematic approach to decide prima-facie infringement. Stating that the Defendant’s product was biosimilar to Nivolumab, the Plaintiff mapped the suit patent with Nivolumab’s INN assigned by WHO. Upon mapping, Nivolumab’s INN was equivalent to Claim 1 & 3 of Plaintiff’s patent. Thus, it held there was prima facie case of infringement.
Let’s take a step back- what does it mean for a drug to be biosimilar? The guidelines define it as- “a product…which is similar in terms of quality, safety and efficacy to an approved Reference Biological product based on comparability.” How does similarity in quality attributes of both drugs demonstrate infringement? Similar biologic only needs to be of comparable quality to the reference biologic in terms of identity, purity and potency. The CDSCO, when approving a drug as a biosimilar, is not mapping the product against the claims of the reference biologic to decide quality. How, then, is the DHC using biosimilarity as a basis to decide infringement?
The order mentions doctrine of equivalence as a basis to say that claim-mapping is not required every time. However, even the doctrine of equivalence is inapplicable- it, too, requires mapping of essential elements of the claims. (Para 128 of SNPC) The comparison of the product has to be done against the claims of the patent. The Court, in saying that biosimilarity pre-decides infringement, sets a dangerous precedent which strikes at the root of infringement jurisprudence.
Patent Linkage
In Bayer v. Uoithe DHC had held that there is no concept of ‘patent linkage’ in India. As explained here and herepatent linkage refers to a system where market approval of a (generic) drug is linked to the patent status of the originator’s drug. Thus, the CDSCO, while granting marketing approval for a generic drug, is unconcerned (rightly so) whether the generic version violates another patent. As held in Bayerthe Patent Act and DSC operate in a “distinct and separate sphere.” For the Court to say that biosimilarity indicates infringement of a patent provides a backdoor entry to patent linkages in India. Infringement analysis has to be strictly confined to sec. 48 of the Patent Act. Nothing else. The Judgement, as a result, is in the face of established jurisprudence.
Bolar Exemption
The most problematic observation of the judgement is in Para 164- “manufacture of infringing goods and stockpiling them during the said period, so as to release it/flood the market, would also amount to infringement.”
Late Prof. Basheer, in this postwrote that sec. 107A (Bolar Exemption provision) is aimed at ensuring “that generic drugs are introduced into the market as soon as the patent expires or is invalidated.” This allows the early entry of drugs at an affordable price for the consumer. To achieve that, it allows a generic manufacturer to experiment with a patented drug to generate data to submit to the DGCI.
In Bayer v. UOI (2019)the Court held that “sale, use, construction of patented products…within the country or outside….is authorised and legal provided the seller ensures that the end use and purpose of sale/export is reasonably related to research and development of information.” This is a division bench judgement which was binding on the Judge in the present case.
The judgement, in fact, excerpts Bayer in Para 156. However, it says that the judgement does not apply in the present case since Zydus was stockpiling for commercial sale. As already stated, merely seeking market approval for a drug does not mean that the generic manufacturer wants to flood the market before expiry of patent term. In this case, more so, since the Defendant had already given an undertaking that it will not launch the product without Court’s permission.
“Sweetheart Deals” moving forward?
Keeping aside my criticism of this specific order, does it pave the way for “pay-for-delay” a.k.a. “sweetheart deals” in India? (See Dr Amitavo Mitra’s Comment here too). This has been seen in US frequently. What happens is that to delay the launch of generic versions after expiry of a patent term, a patentee pays the generic manufacturer to delay their manufacturing and selling of the generic drug. For the patentee, this prevents price erosion for their drug and ensures profits beyond the patent term. For the generic this brings in profit while preventing litigation expenses For consumers, they are forced to pay higher prices for essential drug.
If this judgement is to become good law, this is a possibility. Owing to the order, a generic company might not able to immediately launch a generic drug after expiry of patent term. However, a patentee can still pay off the generic company to delay their launch even further despite being able to manufacture and stockpile the drug. This enables the patentee to maintain a monopoly on prices for an extended period beyond the patent term.
(Thanks to an anonymous person for their inputs)