In the pharmaceutical industry, major companies usually spend thousands of dollars developing a drug, only to be copied by generic brands and undersold. Usually patents protect these market giants (at least for some time), but sometimes, generic companies use the claim of "obviousness" to invalidate a patent. It is up the judges at this point to determine if they think the drug is actually obvious to someone skilled in the field.
This is naturally a very controversial issue. Patents are supposed to protectors of innovation and competition, but in this case, those two goals have come into conflict. Ruling in favor of the generics may discourage companies from investing millions into research and development, which is antithetical to the purpose of intellectual property rights. However, ruling in favor of the pharmaceutical corporation protects these oligopolistic giants that control the market and charge outrageous prices for medicine, by conspiring with insurance companies to exploit the common man.
Source: http://online.wsj.com/news/articles/SB10001424052702304157204579474060730302816
This is exemplified by a recent ruling in a federal court, where a judge ruled in favor of pharmaceutical company Eli Lilly, determining that the defense gave insufficient proof that Lilly's drug was "obvious to a person skilled in oncology or nutrition." This specific patent "covers the method of administering Alimta[, the drug in question,] with folic acid and vitamin B12, which have been shown to reduce the incidence of side effects of Alimta, such as low counts of white blood cells." The argument made by Eli Lilly that ultimately persuaded the judge was the discovery that this drug should be combined with vitamins in this specific way was pivotal to the continuation of this drug on the market, since previously, it was plagued with side effects.
As a result of this court ruling, Eli Lilly now has a valid patent over this mechanism of administering Alimta until 2022, instead of 2017 if they had lost. Ultimately, generics will still end up copying the drug, though this extra 5 years will give Lilly a great deal of additional profits.
This is naturally a very controversial issue. Patents are supposed to protectors of innovation and competition, but in this case, those two goals have come into conflict. Ruling in favor of the generics may discourage companies from investing millions into research and development, which is antithetical to the purpose of intellectual property rights. However, ruling in favor of the pharmaceutical corporation protects these oligopolistic giants that control the market and charge outrageous prices for medicine, by conspiring with insurance companies to exploit the common man.
Source: http://online.wsj.com/news/articles/SB10001424052702304157204579474060730302816
Hi Akshay! You should read my blog post on evergreening of pharmaceutical drugs! This is when a company makes a minor change to the novel mechanism and patents it again in order to extend the life of the patents and thus have their market share for longer. Here, I agree with the judge’s ruling in favor the Eli Lily. The mechanism of administering Alimta (by combining it with folic acid and vitamin B12) was pretty novel and useful (in that it helped reduce the side effects, which is a HUGE deal in the pharmaceutical industry). I understand that this is a very controversial issue.
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