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					                         Global Pharmaceutical Industry1
                  - Intellectual Wealth and Asset Protection
                                 PRABUDDHA GANGULI
   103 B Seante, Lokhandwala Township, Akurli Road. Kandivli
                             East, Mumbai 40010, India
                            email: ramugang@vsnl.com


                                           Abstract
This is a commentary on the recent trends in the protection of intellectual assets
in the Global Pharmaceutical Industry. Patenting inventions, enforcing acquird
rights, evolving newer ways of sharing knowledge for effective cooperative
working through diverse licensing arrangements between organizations are the
key to success in this fiercely competitive industry.
                                   Biographical Notes
Starting as a research scientist, Prabiuddha Ganguli moved to various management
positions in Hindustan Lever. A patent attorney and an expert in IPR and information
managfement, he has authored numerous articles in IPR, chemical physics, material
science, chemical processes. His books titled “ Gearing up for Patents … The Indian
Scenario” was published by the Universities Press (India) Ltd in 1998 and “Intellectual
Property Rights… Unleashing the Knowledge Economy “ was published by Tata
McGraw Hill (India) in 2001. He is on the advisory committees of several Institutions in
India and is a member of the editorial board of the journal World Patent Information. He
is currently Advisor, at VISION-IPR his firm consulting in IPR, Knowledge Management
and Information Security. E is also Adjunct Professor at the Indian Institute of
Technology, Bombay and a visiting Professor at the National Law University, Jodhpur.

Substantial portions of this paper have been incorporated in the author’s book “
Intellectual Property Rights.. Unleashing the Knowledge Economy, Tata McGraw
Hill (New Delhi) (2001) ISBN 0-07-463860-2

Int. J. Technology Management Vol. 25, Nos ¾, 284-313 (2003)


                                                                                       1
Pharmaceuticals is one of the most intense “Knowledge Driven” industries, which
is continually in a state of dynamic transition. Human, animal and environmental
health are priority concerns of society. Diversities in life forms and diseases
pose stiff challenge to the design of specific and targeted solutions. The process
of “drug discovery/invention” is elaborate requiring on an average 8-10 years at a
cost of US$ 300 million to reach a new drug to the market. The long gestation
period between “learning“, “knowledge generation“ and its transformation to
“value added knowledge“ necessitates the creation of
“Proprietary Knowledge“ which is of paramount importance in establishing and
sustaining a global competitive posture. Patents build fortresses around
inventions, Trademarks establish and identify brands, Copyrights provide
protection to accompanying literature, and Designs Registrations cover novelties
in shapes, forms and ornamentation which visually impact consumers. Globally,
these tools of Intellectual Property Rights (IPR) are key components of strategy
formulation and implementation by Pharmaceutical Corporations. Protected
intellectual assets preserve exclusive markets, maintain profit margins, provide
market access and give freedom to operate. IPR portfolio has now become an
effective platform for benchmarking of intellectual assets and innovative
capabilities of corporations, business entrepreneurs and researchers. This is
extensively being used in today’s world of mergers, acquisitions, strategic
alliances, and collaborations, licensing arrangements and Venture Capital
Funding in Pharmaceutical and Allied Industries. Of the top 50 pharmaceutical
companies, 18 are with their head offices in the USA, 21 in Europe, and the
other 11 in Japan. Worlds patenting activities are also most intense in these
regions.

Pharma - Knowledge Chain
Nucleation and growth of modern pharmacology can be traced to the “knowledge
base” of ethnomedical practices. Empirical relationships between identified plant
& animal derived products (processed or in natural state) and their physiological
effects formed the basis for treatment of diseases or enhancement of health.
Through generations within indigenous cultures such “know-how” has been
transmitted as package of practices which formed the major component of their
“in training on the job”. This was largely unstructured and most often incomplete
in documentation.

Natural product chemists, phytologists and ethnobotanists initiated the process
of structuring this “Community Knowledge base “ to construct generic
frameworks in terms of classification of species, their pharmacological, medicinal
or cosmoceutical applications, isolating and testing bio-active components,
investigating their structural types and attempting their synthesis. Subsequent
phases in the conventional “drug discovery/invention” process have been
conceptualization of structures to mimic bioactive compounds, establish


                                                                                 2
synthetic pathways, subject them to in-vitro screening followed by tests on
appropriate animal models. Selected actives move to clinical trials and only few
reach the market after “adequate screening” and statutory clearance by
designated national authorities. In the market place product differentiation and
consumer acceptance are determined by the targeted and enhanced effective
drug delivery with minimized adverse drug reactions and drug toxicity.

Recent trends in this industry have been to compress the elaborate and time
consuming “drug discovery/invention/process” through functional genomics, bio-
informatics, DNA sequencing, combinatorial chemistry, combinatorial
biosynthesis, high-throughput screening techniques coupled with knowledge
management processes.

These modern developments intertwined with traditional approaches, the
growing phase lag between development of satisfactory legal frameworks in IPR
and rapid advances in bio-technology are making the process of acquiring,
enforcing and sustaining intellectual property rights at multiple points in the
“Pharma-Knowledge-Chain” a very complex process. This continual process of
learning, creating “new Knowledge” and further transforming it into “value-added
Knowledge” with appropriate “proprietary protection” & “fair distribution of its
benefits” is fundamental to the progress of Pharmaceutical Industry. The various
facets under the “Intellectual Canopy” pivoted on knowledge are strongly cross-
correlated and are significantly impacted by all the branches of Intellectual
Property Rights (Fig.1). Additionally, socio-political issues involving bio-diversity,
ethics and ownership of community knowledge are figuring in the agenda of
several international debates.



                                                                                tra
                         ss
                                                 Knowledge




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                                                 IPR
                              Fig.1. The Intellectual Canopy

Trade Related Intellectual Property Rights (TRIPs) under the umbrella of The
General Agreement on Tariff and Trade (GATT), provide guidelines for
harmonization of IPR laws in the World Trade Organization (WTO). These are
intended to reduce distortions and impediments to international trade by taking
into account the need to promote adequate & effective protection of IP and
ensuring measures including procedures to enforce IPR. The National Laws are
expected to comply with the basic requirements of TRIPs. It should be



                                                                                        3
appreciated that though the treaties on IPR are international in character, their
enforcement is national or at best in some cases regional. Proper understanding
and exploitation of the IPR laws in various countries would help in global
positioning of pharmaceutical businesses.

Post TRIPs ---- IPR Harmonization Drive

The pre-TRIPs era saw the world divided into groups of nations: a) allowing
patenting in all fields of technologies (products and processes) and
b) having restrictive patent laws providing for process patents in most fields of
technologies and non-grant of product patents in selected fields such as foods,
agrochemicals, drugs & pharmaceuticals, chemical entities, etc. Other issues
such as the term of patents, conditions for compulsory licensing, whether
importation should be considered as working of patents, etc., were variably
addressed in existing National Laws. TRIPs attempted to harmonize the IPR
laws by bringing the disparities into focus and providing guidelines for them. No
agreements are monolithic and these will undergo changes to accommodate the
needs of moving times.

Since the formation of the World Trade Organization (WTO) on January 1, 1995
several nations have made significant changes in their National Laws governing
IPR which have a direct bearing on the pharmaceutical industry.

On July 8, 1998 the European Parliament approved the biotechnology directive,
which set the guidelines for legal protection to biotechnology products and
processes within the European Union. This would markedly influence the
pharmaceutical industry in Europe. Since June 1995 USA changed the term of
patents from 17 to 20 years. The practice of “ first of invent “ as opposed to “ first
to file “ has been extended to all members of WTO. All patents in force on
8.06.1995, will have a term of 20 years from the date of issue, which ever is
longer. As per this provision several existing patents received extension of their
term. This as had significant effect on the pharmaceutical industry. The
Japanese Patent Law was amended on December 14, 1994 with the
amendments falling into two groups, one effective from July 1, 1995 and the
other from January 1996. With effect from July 1, 1995 the term of patents was
made 20 years from the date of filing in Japan. In this group there were other
features dealing with provisions for restoration of lapsed patents, priority based
on filing in WTO countries, etc. The other category effective from January 1,
1996 was replacement of pre-grant opposition proceedings to post-grant
opposition and procedures for accelerated patents processing. On March 10,
1999 the Indian Parliament passed a Patent Amendment Bill which regularized
the transitory “ mail-box provision “ (with effect from 1, January 1995) to file
product patents for inventions relating to Drugs, Pharmaceuticals, Agrochemicals
and to grant “exclusive marketing rights“ in these selected fields only. Other
changes in the Patent Act 1970 have been introduced to meet the immediate
obligations of TRIPs. India also joined the Paris Convention and the Patents



                                                                                     4
Cooperation Treaty w.f. December 7, 1998. In Spain the patent law was
amended in January 1998, removing the requirement that pharmaceutical
companies must make the patented product in Spain before an injunction would
be granted against an accused infringer. Now it is getting easier to obtain interim
injunctions from Spanish courts. In Argentina the 1995 Patent Law brought
provisions in line with TRIPs the term of patents to 20 years from the date of
filing, rather than 15 years from the date of grant. The problems of where the old
patent law ends and the 1995 legislation starts have not been satisfactorily
resolved. The Australia Patent Act was changed on August 10,1998 to give
pharmaceutical patents an effective term of 20 years to bring it in line with the
laws in USA, Japan and Europe. New Zealand joined many countries in
relaxing rules on parallel imports to legitimate distributors and this will affect the
pharmaceutical industry. Estonia's patent law has been amended with effect
from 16 June 1998 to cover substances derived by nucleus splitting and to
define that making a product via a patented method constitutes infringement.
The 1994 Mexican law allows patentability to practically all types of inventions,
including those related to biotechnology. It however introduced the utility factor in
the examination of patent applications. In order to comply with the utility
requirements a certain degree of safety must be demonstrated, as a food
product or a drug cannot be considered to have a practical application
(usefulness) unless it is safe. The New Brazilian Patent Law passed in April
1996 includes a shortened year transition period before WTO intellectual
property rules come into effect, and protection for pharmaceuticals in the
regulatory pipeline. In Kuwait, patents are granted to new industrial products,
innovated industrial methods or means or new application of known industrial
means or methods. The term 'industry' is intended in its wide meaning, so as to
include agricultural, chemical and pharmaceutical materials, plant species,
microorganism processes and their products. In contrast South Africa had a
patent law until December 12, 1997, which provided for product patents in drugs
and pharmaceuticals. Interestingly, a new law “ The Amended Medicines and
Related Substances Act “ was brought in force that has serious implications on
drugs and pharmaceutical business. Article 15C of this act states that the
Ministry of Health may, "notwithstanding anything to the contrary contained in
the Patents Act, 1978 (Act No 57 of 1978), determine that the rights with regard
to any medicine under a patent granted in the Republic shall not extend to acts
in respect of such medicine which has been put onto the market by the owner of
the medicine, or with his or her consent." Additionally, the new law, at section
15C(b), allows for parallel importation.

Features in laws pertaining to the generic drug industry are treated in the section
on “ exploding off-patent scene “


KNOWLEDGE ASSETS - CASE STUDY

Some of the leading Pharmaceutical Companies in the order of their 1997


                                                                                    5
Worldwide sales are Merck & Co. ( $11.3 bn ), Glaxo Wellcome ( $10.9 bn),
Novartis ( $10.5 bn ), Bristol-Myer Squibb ( $9.0 bn ), Johnson & Johnson
( $8.6 bn ), Pfizer ( $8.3 bn ), American Home Products ( $8.1 bn ), Smithklein
Beecham ( $7.2 bn ), Hoechst ( $6.4 bn ), and Eli Lilly ( $6.4 bn ).

Derwent databases were searched for a few companies and their patents were
ranked in the top 8 areas in terms of the International Patent Classification. Their
Patent Profiles in recent years are presented in tables 1 - 5.


Tables 1-5



                                                                 Patenting Profile of Novartis
    YEAR        TOTAL                 A61K     A61K A61K031            A61K A61K037               A61K         A01N          A01H C12P 021              C07D         C07C          C12N         C07D         C12N
                                      031/44   031/445 /70             000/00  /02                038/00       00/000        005/00  02                 000/00       000/00        005/10       401/12       015/09




    1998          611                   -       36          36           81             -            -            61           38             -           91           66             -           40           -




    1997          713                   -       -           42           91            41            -            60            -             -          110           79            45           42           -




    1996          489                   -       -            -           62            38            -            38            -             -           89           59            33           42          37



    1995          387                   -       -            -           49            43           30             -           30             -           68           38            35            -          34



    1994          274                  23       -            -           37            46           24             -            -            22           56             -           23           25           -



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                                                                                                f
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                                                                                                                                                                                                                      6
                                                                                YEAR




                                          1994
                                                 1995
                                                        1996
                                                               1997
                                                                      1998
                                                                                                                                                                                                                         YEAR




                                                                                                                                                                                   1994
                                                                                                                                                                                          1995
                                                                                                                                                                                                 1996
                                                                                                                                                                                                        1997
                                                                                                                                                                                                               1998
       he
                                                                                                                                               N
      7M teroc                                                                                                                                     as
                                                                                                                                                        he




                                                 20
         rin ycl




                                          179
                                                        214
                                                               173
                                                                      191
                                                                                                                                                           te




                                                                                TOTAL
            g s i cs
                                                                                                                                                                                                                         TOTAL

                     w                                                                                                                                       ro




                                                                                                                                                                                   401
                                                                                                                                                                                          390
                                                                                                                                                                                                 367
                                                                                                                                                                                                        416
                                                                                                                                                                                                               356
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                                          -
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                                                        23
          id i
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                                                                                                                                                            ne




                                                                             A61K
               ne




                                                                             031/55
                                                                                                                                                                                                                      031/395




                                                                                                                                                                                   37
                                                                                                                                                                                          31
                                                                                                                                                                                                 30
                                                                                                                                                                                                        34
                    de
                         riv
                                                                                                                                                                 de
                                                                                                                                                                    riv                                        31
           cy                 ati                                                                                                                                       a
                                                                                                                                                                        tiv
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                                     s.




                                          35
                                                 39
                                                        35
                                                               35
                                                                      34
            he cs w                                                                                                                               de rbo




                                                                              A61K
                                                                                                                                                                                                                      A61K




                te




                                                                                                                                                                                   -
                                                                                                                                                                                          -
                                                                                                                                                                                                        -
                                                                                                                                                                                                               -




                                                                             031/445
                           ith                                                                                                                        riv hyd




                                                                                                                                                                                                 28
                   ro
                                                                                                                                                                                                                       031/44




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                                          52
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                                                               40
                                                                      32
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                                                                              A61K
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                                                                             031/395
                                                                                                                                            m




                                                                                                                                                                                   44
                                                                                                                                                                                          43
                                                                                                                                                                                                 31
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                                          34
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                                                                                                                                                                                                                      C12N




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7
                         Patenting Profile of Johnson & Johnson
                         A61F         A61L         B29D      A61B        A61L       A61M       A61F      A61L     A61B         A61F        A61B        C12Q       G02C      G02C     G01N      A61F
     YEAR     TOTAL     013/15       015/00       011/00     017/04     027/00      025/00    013/46    017/00    000/00      013/20       017/06      001/08     007/02    007/02   033/53   000/00




     1998     524        59            -            51         -          35          28       27        25         -           -             -           -           -       27        -      31



     1997     628        58            -            73         -          37              -    29        32         -          33             -           -        107           -      -       -



     1996     610        60            -            58        29           -              -     -        38         -          33             -           -           90         -     30      29



     1995     512        74            -            45        26           -              -     -         -        28          33           28            -           61         -      -      29


     1994     453        63           22            -          -           -              -     -         -        20          21           20            21          35      20        -       -
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                                                  Patenting Profile of Merck & Co.


                             A61K          A61K           A61K        A61K         A61K        A61K      A61K        A61K            A61K            A61         C09K      C07D      C07D      G025
       YEAR     TOTAL       031/55         031/47        031/445      031/44      031/435     031/495    031/40     031/415         031/535         031/02      019/30     401/12    000/00   001/13




      1998      1024             -            -          128          115             -        82          77           69           67               -           -          -       125       71


      1997      1245          83            81           153          151             -       121          40           97             -              -           -          -       154        -


      1996      1189             -            -          152          154           93        124         117           93           89               -           -          -       148        -


      1995      1195             -          94           126          150           94        114         123           -              -              -           -          -       120      113

      1994      1190             -            -          103          148           89           -        119           -              -             83          87         85         -      114
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The Patent portfolios (presented in tables 1- 5) of these companies clearly map
on to their technology expertise, innovation thrusts and business. The distribution


                                                                                                                                                                                                       8
of the topics in which patents have been granted to these companies has not
changed substantially in recent years. The generic strengths are listed below:

Company                    Expertise profile

Johnson & Johnson          Tampons, absorbent Pads, sanitary towels,
                           supporting & fasteners, holders or package for
                           needless and sutures, materials for Prosthesis,
                           Catheters, materials containing layers of different
                           absorbing characteristics, materials for surgical
                           sutures     or   for   ligaturing     blood   vessels,
                           Diagnosis/Surgery Identifical analytical biological
                           materials, various needles, filters, imptantable filters
                           in blood vessels, prostheses, orthopedics, nursing,
                           contraceptive devices, lense systems & contact
                           lenses.
Merck & Co.                Medicinal preparations & Chemistry of N-
                           Heterocyclics liquid crystalline materials containing
                           saturated or unsaturated non-aromatic rings.
Novartis                   Medicinal Preparations and Chemistry of N-based
                           hetrocyclics, carbohydrates, proteins, peptides, and
                           diverse condensed ring systems. Fermentation and
                           enzyme based processes for preparation of organic
                           compounds, Tissue culture,. Minor presence in
                           recombinanat DNA technology.
American                   Pharmaceuticcal preparations using diverse organic
Home Products              compounds, Nitrogen based heterocyclic chemistry ,
                           condensed ring systems of O/N.


Bristol-Myers & Squibbs    Chemistry of heterocyclics specially involving
                           Nitrogen, Carbohydrate chemistry, fermentation and
                           enzyme based processes for preparation of organic
                           compounds, medicinal preparations using diverse
                           organic compounds. Some presence in techniques
                           involving undifferentiated plant and human cells.

These companies appear to have strong proprietary knowledge base and
expertise in traditional organic / biochemistry specially involving heterocyclics,
methodologies for clinical trials, fermentation techniques, surgical implements,
packaging etc. There is a distinct gap in their knowledge profile with respect to
biotechnology, genetic engineering, combinatorial chemistry, genomics etc. As a
part of their long-term strategy these companies have initiated several
collaborations with key biotechnology-led companies and expert research
groups.




                                                                                 9
In contrast a company such as Genentech has significant knowledge armory in
methods of modern biology and biochemistry as seen from their recent patent
profile in the last few years. (Figure 2).


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Key to the figure 2 : PHARMAPRE – Pharmaceutical Preparations, PROSE ---
Proteins having fully defines aminoacids, CELLMOD ---- Undifferentiated cells,
tissues modified by introduction of foreign materials,       FERPRPREP ---
Preparation of proteins by fermentation or enzyme-using processes, Antbod ---
Pharm preparations involving antibodies, GENENCOD --- Mutation or genetic
enginnering genes encoding animal proteins, MONANTB --- Fermentation or
enzyme processes for synthesis od proteins or peptides using monoclonal
antibodies, RECOMDNA --- recombinant DNA technologies, FORGENINT ---
modifying microorganisms by introducing foreign genetic material, DNSSEQFUP
--- DNA sequence coding , Mutation --- mutation or genetic engineering DNA or
RNA , vectors etc., USEMICROG – nucleic acid sequence encoding,
NUCLEICAC --- use of compounds containing two or more mononucleotide
units , HOSEUKARY --- Mutation or genetic engineering using eukaryotes as
hosts for animal cells, IMMUNOGLOB --- Mutation or genetic engg, vectors,
isolation etc. use of hosts involving immunogloblobulins.

Technology strengths of Genentech based on its patents profile are chemistry of
heterocyclics, proteins, peptides sequencing, manipulation of micro organisms
Using genetic Eng. techniques, human, animal & plant cell lines, tissue culture,
recombinant DNA technology, genes encoding animation processes, DNA


                                                                              10
sequences coding for human proteins, fermentation techniques for targeted
Synthesis, monoclonal antibodies, pharmaceutical preparations etc.

Most biotechnology companies such as Genentech would have developed wide
& diverse profile with expertise in several niche areas of modern biology,
biophysics, bioengineering including the building up of rich proprietary libraries of
gene sequences,etc. They have been trading with their knowledgebase through
active licensing of their technologies / database banks or are increasingly getting
involved in joint research projects involving drug discovery or setting up strategic
alliances with several companies for marketing of their developments. Many
such groups / organizations have become targets for acquisition by large
companies.

EXPLODING “ OFF- PATENT” SCENE

During the period 1999 to 2013 several best selling drugs of leading companies
valued at over 60 billion dollars (1997 sale value, tables 6 & 7) are due to go
“off patent “. The patent portfolio of some of the traditional pharmaceutical
companies discussed in the earlier section indicate that their in-house technical
competence is inadequate to meet the threat from global generic drug
manufacturers who have fiercely targeted the bag of off-patent drugs.

A “generic” drug is a formulation containing the same active compound as an
earlier approved drug.
In most countries the active compound has been subject of patents :
 if it is a novel chemical compound
 or even if known has not been used in medicine,
 or a newly proposed use
 or dosage of a known drug
 or a drug which although recognized as safe and effective has not been used
   to a material extent
 or for a material time.

Generic products are expected to be bioequivalent to the original branded and
patented drug.




                                                                                   11
                        TABLE 6

   VALUE OF PATENT EXPIRING DRUGS FROM 1999 - 2013 *
   [Source : Med. Ad. News 17, 94 ( 1998)]



YEAR OF   NUMBER of      WORLDWIDE SALES IN
 EXPIRY     DRUGS        1997 OF BEST SELLING
           Going off-      DRUGS $ (BILLION)
            patent

 1999          4                   1.76
 2000          9                   8.67
 2001          9                  11.56
 2002          7                   5.68
 2003          4                   2.90
 2004          8                   6.57
 2005         10                  11.83
 2006          4                   2.75
 2007          6                   4.96
 2008          4                   2.03
 2009          4                   2.30
 2010          2                   1.24
 2011          1                   0.73
 2012          1                   1.73
 2013          3                   2.80




                                                       12
                             TABLE 7

     PATENT EXPIRY OF BEST SELLING DRUGS 1999 - 2013
     [data source: Med. Ad. News 17, 94 (1998)]


                                                                1997
                    PATENT       BRAND      INDICATION        WORLD
     COMPANY        EXPIRY       NAME          FOR              WIDE
                     YEAR                                      SALE $
                                                              (Million)


I) GLAXO WELCOME      1999    Beclovent   Asthma                 542.8
   INC                1999    Fortaz      Infections             426.4
                      2000    Ceflin      Infections             649.4
                      2003    Flovent     Asthma                 516.6
                      2005    Zofram      Nausea          &      616.9
                                          Vomiting
                      2005    Retrovir    HIV Infection          470.7
                      2006    Imitrex     Migraine              1085.7
                      2008    Serevent    Asthma                 665.8
                      2009    Epivir      HIV Infection          677.3


ii) HOFFMAN-a-        1999    Versed      Depression             431.3
    LA ROCHE          2000    Rocephin    Infections            1011.4
                      2001    Accutane    Acne                   451.3


iii) MERCK & CO       2000    Vasotec     Hypertension          2510.0
                              Pepcid      Ulcers                1180.0
                      2001    Mevacor     Chloesterol           1100.0
                                          reduction
                      2001    Prinivil    Hypertension           585.0
                      2005    Zocor       Chlolestrol           3575.0
                                          reduction
                      2006    Proscar     Benign Prostatic      400.00
                                          Hypertropphy
                      2007    Fosamax     Osteoporosis           532.0
                      2009    Cozaar      Hypertension           681.0
                              Primaxin    Infections             530.0
                      2013    Crixivan    HIV Infection          582.2


                                                                    13
iv) JOHNSON &       1999   Nizoral       Fungal Infection    364.0
    JOHNSON         2000   Sporanox      Fungal Infection    537.0
                    2004   Ortho-Novum   Contraception       658.0
                    2004   Procrit       Red Blood Cell     1109.9
                    2006   Risperdai     Psychosis           848.0
                    2007   Propulsid     Nocturnal          1045.0
                                         Heatburn

 v) BRISTOL-MYERS   2000   Glucophage    Diabetes            579.0
    SQUIBB CO.      2000   Buspar        Anxiety             443.0
                    2004   Taxol         Ovarian Cancer      941.0
                    2004   Paraplatin    Ovarian Cancer      437.0
                    2005   Pravachol     Cholestrol         1437.0
                                         Reduction
                    2007   Zerit         HIV Infection      398.00


vi) PFIZER INC.     2000   Procardia XL Hypertension         822.0
                    2003   Cardura      Benign prostatic     626.0
                                        hypertrophy

                    2004   Diflucan      Fungal Infection    881.0
                    2005   Zoloft        Depression         1507.0
                    2005   Zithromax     Infections          821.0
                    2007   Norvasc       Hypertension       2217.0


vii) ASTRA AB       2001   Losec         Ulcers             2815.8
                    2002   Pulmicort     Asthma              643.9
                           Turbuhaler
                    2009   Trprol-XL     Hypertension        413.6


viii) ASTRA-MERCK   2001   Prilosec      Ulcers             2240.0
      INC


ix) SMITHKLINE      2002   Augmentin     Infections         1517.0
    BEECHAM         2002   Relafen       Arthritis           489.0
                    2004   Engerix-B     Hepatitis B         584.0
                    2005   Paxil         Depression         1474.0
                    2007   Kytril        Nausea &            366.0
                                         Vomiting
                    2010   Havrix        Hepatitis A         370.6



                                                               14
 x) ELI LILLY & CO.    2000   Humulin     Diabetes            936.0
                       2001   Profac      Depression         2559.0
                       2002   Axid        Ulcers              526.5
                       2011   Zyprexa     Schizophrenia       730.0


xi) ZENECA             2001   Zestril     Hypertension       1035.0
                       2002   Nolvadex    Breast Cancer       501.0
                       2005   Zoladex     Breast Cancer       569.9


xii) WARNER LAMBERT    2001   Accupril    Hypertension        378.0
   CO.                 2008   Rezulin     Non-insulin-        420.0
                                          dependent
                                          diabetes
                              Lipitor
                       2010               Cholestrol          865.0
                                          reduction


xiii) ABBOT            2003   Biaxin      Infections         1300.0
      LABORATORIES     2008   Depakote    Epilepsy            520.0


xiv)NOVARTIS           2003   Flovent     Asthma              516.6
                       2005   Lamisil     Fungal Infection    628.4
                       2008   Lescol      Cholestrol          425.8
                                          Reduction


xv) AMGEN INC.         2013   Epogen      Red Blood Cell     1160.7
                                          Enhancement
                              Neupogen    Neutropenia        1055.7
                                          reduction


xvi) SCHERING          2002   Intron-A    Cancer & Viral      598.0
     PLOUGH & CO.                         Infections
                       2012   Claritin    Allergies          1726.0


xvii) SANKYO COMPANY   2002   Mevalotin   Cholestrol         1406.7
      LTD.                                reduction


xix) AMERICAN HOME     2006   Prempro     Menopausal          413.0


                                                                15
    PRODUCTS                                          Symptoms
                                       Effexor        Depression              403.2


xx) G D SEARLE & CO.         2001      Ambien         Insomia                 396.0


xxi) RHONE-POULENC           2004      Lovenox        Deep vein               462.0
     RORER INC.                                       Thrombosis


xxii)TAP                     2005      Prevacid       Ulcers                  628.0
     PHARMACEUTICALS
     INC.


There is no harmonized global approach to the duration patent rights in the
patent system especially for drugs & pharmaceuticals to compensate them for
the time they lose in the market when their product is in the national statutory
approval process. Some countries consider making and submission of the
generic form of the drug an infringement of the drug during the term of on-patent
original drug. Other countries do not consider such an act as infringement but
have provisions to extend the effective term of the patent to compensate the
inventor of the original drug. On these uncertainties the relationship between the
brandname and generic industries have been confrontational by prompting
several complex litigations. The delay between patent expiration and generic
competition in several cases is less than three months. The issues are set into a
strategic mosaic of economic, financial, technological, geographic, regulatory,
and other factors. As more major branded drugs go off-patent, the innovator-
generic conflicts will also escalate.

In the USA, generics enter the market through an “ abbreviated new drug
application (ANDA) approval process of the FDA after the patent expiration of
the original brandname product. In 1984, the “Waxman-Hatch Act”, or “Drug
Price Competition” and “Patent Term Restoration Act” was introduced in the US.
This act hoped to strike at a balance between the terms of patent extensions
provided to for patented drugs and for generic companies to use patented
materials (without being considered as infringement before the patent expired )
for preparing their Abbreviated New Drug Applications (ANDAs) to FDA.

To compensate for the exemption from infringing activity the US Congress
brought in the concept of “ patent term extension “ to compensate companies for
the time they lose in the market during the regulatory process for their “ new drug
application (NDA). Under the amended patent law in USA, the term of the patent
for applications filed after 08-06-1995 is 20 years from the effective date of the
US filing. This term can be extended up to 5 years to compensate for delays



                                                                                 16
resulting from interferences, serecy orders or appeals and also to take into
account of problems securing product clearance for drugs and pharmaceuticals.

For patents filed before 08-06-1995 the term of the patent became 17 years from
grant or 20 years from the effective date of the USA filing. Pharmaceutical term
extension upto 5 years for patents filed before 08-06-1995 would be applicable
for existing patents only to the old term of 17 years from grant and not the new
20-year term.

The case of Mevacor from Merck: clearly illustrate the implications of these
patent term extension.

   Patent life Mevacor was extended from November 7, 1997 to June 15, 1999
    under the terms of GATT when USA changed its patent laws.
   The same patent had already been extended to November 4, 1999 by the
    Waxman-Hatch Act, so GATT does not extend the date upon which generic
    competition can begin.

 In June 1995 the U.S. Patent Office (PTO) stated that it would not make the
GATT patent extensions additive to the Waxman-Hatch patent extensions.
Based on the FDA position and the PTO decision, it appeared that the additional
patent life of pharmaceutical products would be the longer of GATT or Waxman-
Hatch patent extensions. Consideration of patents for which Waxman-Hatch
patent extensions exist shows that the Waxman-Hatch patent expiration date
exceeds the GATT patent extension date. This disparity has already been the
subject of debate between the branded drug and generic drug manufacturers in
the USA.

In an effort to create a reasonably transparent system in USA, the generic drug
manufacturer has to make the following information explicit statements with the
ANDA:

   Such patent information has not been filed
   Such patent has expired
   Such patent will expire on a particular date
   Such patent is invalid or will not be infringed by manufacture, use or sale of
    the drug for which the approval is being sought.

The patent holder of the original drug is notified of such an ANDA application.

If the patent holder of the original drug files an infringement suit within 45 days
on receiving the ANDA notification, then the FDA puts the approval of the ANDA
on hold for 30 months or till the court gives a ruling on the same. The ANDA
applicant who files all the relevant details as required receives a marketing
exclusivity for a period of 180 days after the applicant receives FDA approval.
The six-month window makes the first drug to market highly profitable and gives


                                                                                  17
the company a substantial lead in establishing its product in the market.

The system of Supplementary Protection Certificates were introduced throughout
the European Community in 1993. An SPC prolongs certain pharmaceutical
patents, which otherwise would have expired in or after 1993, for a further five
years beyond their original 20-year term, or 15 years from first marketing
authorization in Europe, whichever is the shorter. [Cunningham R, Managing
Intellectual Property, (82),16, September 1998 ]. There is a functioning system in
several countries within Europe which enforce a 10-year protection on regulatory
data filed by the first applicant for marketing authorization. At a later date if
another company applies for authorization of a bio-equivalent drug, then it can
avoid repeating the toxicology, clinical studies or pharmacology. However it is
bound by the 10-year protection period. If the company wants to get an
authorization before the protected period og 10 years, it is expected to do the
complete range of tests required by the regulatory body. Generic drug
manufacturers have to take such regulations into consideration to plan their entry
strategy.

Generic companies who wish to introduce generic drugs into the UK market can
experiment with patented drugs without fear of infringement allowing them to be
ready to release their drug on to the market as soon as the patent expires. In few
European countries, such as Germany and the Netherlands, submitting samples
prior to the patent expiry is considered an infringement.

From July 1 1999, extensions of up to five years will be available in Australia for
substance and process patents produced by recombinant DNA technology. The
effective patent life from marketing approval in Australia will then be 15 years.
In 1996 the average term of patent protection in Japan was less than 10 years,
and 2-year restoration limit was allowed under Japanese Patent Law. The
Japanese Intellectual Property Association (JIPA) wants an end to the rule where
patentees cannot have a patent extended if they apply less than six months
before the patent officially expires, and the abolition of the five-year upper limit
on patent restoration.

Canada's Patent Act amendments, Bill C-91, which provide specific exemptions
from patent infringement, allowing a generic drug manufacturer to research and
develop a product and conduct required tests for approval prior to the expiration
of the patent term. The provisions also allow manufacturers to stockpile for up to
six months, so that the generic drugs are ready to be shipped as soon as the
patent expires.

The recently approved Israeli patent law allows Israeli pharmaceutical
companies to start trial production of generic drugs before the patent on the
originator drug has expired in the source country. The policy permits Israeli
manufacturers to export patented drug substances to the United States and
Canada.


                                                                                  18
On August 10, 1998 the Australian Parliament passed the Intellectual Property
Laws Amendment Bill 1998, which states that extensions of up to five years may
now be granted for 20-year patents for pharmaceutical substances. Also,
manufacturers of generic drugs will be able to undertake activities to achieve
pre-marketing regulatory approval without violating the patent.

Landmark judgement by the Tokyo High Court on Otsuka vs. Towa was that
Towa's tests for application approval did not violate Otsuka's patent for test
research under article 69, section 1, of the Patent Law. In a similar judgement
the Tokyo Higher Court issued September 24,1998 a ruling dismissing an appeal
filed by The Wellcome Foundation Ltd. (U.K.) against the previous decision of
the Tokyo District Court that rejected Wellcome's claim that Kobayashi's
experimental study on a generic version (liquefaction) of Wellcome's aciclovir
antivirus agent had infringed its patents. The Higher Court judgment also
dismissed appeals by Wellcome charging patent infringements by Sawai
Pharmaceuticals, Taiyo Pharmaceutical Industry Co., Fuji Chemical Industries,
Ltd. and Mect Corp.

The general trend is to allow companies to use patented materials without being
considered as infringement but only for submitting data for statutory approval
processes and for non-commercial purposes only. The other trend is to
simultaneously compensate the original innovator company with provisions for
appropriate patent term extension to make up for the time lost in getting the
statutory clearances.

In the post GATT period several Indian Drug companies have shown positive
sign of a transition from being generic drug manufacturers to innovators. Notable
among these are Dr. Reddy’s Laboraories which has recently licensed its new
molecules ( for treatment of diabetes ) to Novo Nordisk and Ranbaxy which has
filed an Investigational New Drug Application for its product BPH for treatment of
benign prostate hyperplsia. Other companies as Lupin Laboratories, Wochardt,
Nicholas, Sun Pharmaceuticals have also enhanced their focus to basic research
in search for new molecules.

Intellectual cooperation in Pharmaceutical Industry

Evolving Strategies

Corporate houses are restructuring their businesses and focusing in core areas
and acquiring technical expertise through collaborations, mergers or acquisitions.
Globally in 1997 there were 426 corporate transactions in the pharmaceutical
sector with an average value of $ 253 million. In 1996 there were 285
transactions with an average value of $ 433 million per transaction.

To offset the negative influences of drugs going “off-patent” and to “manage the
life-cycle” of products the major drug manufacturers are gearing up to meet


                                                                                19
generic competition by adopting four strategies.

They are:

1. Develop brandline extensions and seek extended protection through
    “ Controlled release formulations “ and apply for new indications.
2. Enhance investment in R&D in core areas and support initiatives in search of
   new bioactive molecules and new chemical entities (NCE). Also lead
   sponsored collaborations with key academic groups in areas of modern
   biotechnology, combinatorial chemistry, genomics etc., with clearly defined
   arrangements on ownership of intellectual property. Corporate mergers and
   acquisitions have also been completed to enhance cross – fertilization of
   expertise, and cost effective strategic utilization of mutual intellectual assets.
   Evolve and execute productive ways of group working with various
   companies (also with competitors if necessary) through appropriate licensing
   arrangements and benefits sharing.
3. Switch brands to over the counter (OTC) sales, reorganize manufacture,
   grant licenses to generic manufacturers just before the patents expire to keep
   competition at bay. Alternatively the traditional drug companies have chosen
   to selectively litigate against drug manufacturers to delay their drug clearance
   by FDA on grounds of possible patent infringement. In retaliation generic drug
   manufacturers are fighting back claiming unfair blockage of their generic
   drugs from entering the market.

The market for enantiopure drugs was approx $40 billion in 1997. US FDA
considers enantiomers as two separate chemical entities. Thus technologies for “
single isomer pharmaceuticals “ via asymmetric synthesis & chiral resolution are
growing opportunities in areas of traditional chemistry.

Companies such as SEPRACOR Inc have outlined a distinct futuristic strategy.
They have been busy working on “ improved chemical entity compounds
(ICE) “ by researching on differences between single isomers of racemates or
active metabolites derived from parent drugs. They are on the path to improving
pharmaceuticals by enhancing receptor potency, initiating faster onset action,
limiting duration of activity and reducing side effects.    To compete against
generics they have to significantly differentiate their ICE compounds from
generic in terms of safety and efficacy. They have been able to procure
 “ use patents “ for their ICEs.

With SEPACOR’s lifecycle management strategy” it patents its ICEs then
licenses them to drug companies before their “ composition of matter “ patents
on the parent blockbuster drug are due to expire. This arrangement helps the
drug companies to extend a product’s lifecycle by the term of the ICE patents.
The first such deal was struck with Hoechst Marion Roussel on Fexofenadine in
1993. Hoechst will pay Sepacor an upfront fee plus royalties of 4-7% of sales
beginning in 2001.



                                                                                   20
Sepracor plans to bring 19 ICE drugs to the market by 2009. They have struck
several licensing deals with leading drug manufacturers. Schering-Plough’s
“composition of matter “ patent on Loratadine (antihistamine ) is due to expire on
2004. By partnering with Sepracor on its ICE it is able to extend the life cycle of
its anti-histamine franchise till 4014 when Sepracor’s ICE patent expires.
Schering Plough will pay Sepacor an upfront fee of $5 million & 4-7% royalties in
future sales. Similar deals have been made with Eli Lily, Janssen
Pharmaceuticals Johnson & Johnson, Pfizer, American Home Products, TAP
Pharmaceuticals Novartis and others. [RS Rogers CENAR 76, (48) 1998]
Contract research is has gained considerable ground in the last few years to
reach a value of $ 3.9 billion growing at a rate of 20 to 30% per annum most of
which is contributed by the pharmaceutical industry [R&D Directions 3, (5), 22
(1997).

Working with high-tech companies also involves developing complex licensing
agreements.
For example several small companies with niche technologies have partnered
with very large companies to internationally market their products. The big
company on behalf of the small company has managed IPR protection in various
countries.

 To ensure success in cooperative working one has to clearly understand the
IPR issues related to:

   filing of patents globally in the relevant markets,
   getting the patent claims tested by a set of experts for their validity,
    appropriate legal arrangements on transmission of Intellectual property rights
    in various geographical regions and countries,
    information and material not covered by the technology license,
    IPR ownership & distribution of benefits on further improvement of the
    licensed technology, etc.

A few recent collaborations and licensing arrangements in the pharmaceutical
industry illustrate how synergies are being exploited between diverse
organizations.

In a deal signed at the end of 1998 Novartis Agricultural Discovery Institute will
give $25 million to University of Berkeley’s College of Natural Resources over the
next 5 years and also give access to the company’s plant DNA database &
proprietary technology. In return Novartis will get first crack at developing 30 - 40
% of the discoveries that come from the university. A similar deal was signed
between Scripps Research Institute and Sandoz in 1993. in which Scripps
received $100 million over 5 years. In return Sandoz had first patent rights to all
Scripps discoveries. [ E.Wilson CENAR 76 , (50) 1998 ].



                                                                                   21
Illustrated cooperative arrangements and sharing of benefits between some
organizations have been collated from diverse sources cited in the Business &
Industry and Business & Management Practices Databases are presented to
highlight the approaches followed in recent times.




Licenses and Collaborations by select Pharmaceutical Companies.
[ collated from Business & Industry database ]

COMPANY       COLLABORATION/LICENSE ARRANGEMENT
Glaxo         1. GW and the Department of Biochemistry of Rush-
Wellcome Plc.     Presbyterian, Saint Luke's Medical Center, Chicago, Illinois,
(GW)              signed a three-year agreement to collaborate on
                  osteoarthritis research aimed at identifying new disease-
                  modifying therapies. GW will make annual payments to
                  Rush, and Rush will grant GW exclusive first rights for
                  worldwide license of patented discoveries resulting from the
                  research collaboration. Rush will receive royalties on any
                  therapeutic and diagnostic products that are marketed.
               2. GW signed an agreement with Hoechst Marion Roussel
                  (HMR) to evaluate a family of quinoxaline compounds that
                   may be useful in HIV non-nucleoside reverse transcriptase
                   inhibitors (NNRTIs) for treatment of HIV-infection. These
                   compounds were the outcome of a collaborative work
                   between Bayer and HMR.               U.S patent 5,723,461
                   concerning quinoxalines and synthetic methods has been
                   received by HMR. The European patent application
                   EP0728481 concerning use of quinoxalines in combination
                   with HIV protease inhibitors has been assigned to Bayer
                   and EP0657166 concerning use quinoxalines in
                   combination with nucleosides is assigned to HMR. The
                   agreement between HMR and GW gives Glaxo Wellcome
                   the worldwide rights to develop and market any drugs
                   demonstrating antiviral activity that arise from this
                   collaboration
               3. Synaptic Pharmaceutical granted GW of the UK a non-
                   exclusive license to certain of its alpha-adrenergic receptor
                   patents and an option to obtain a non-exclusive license
                   under Synaptic's functional-use patents for the treatment
                   of benign prostatic hyperplasia. GW paid an upfront fee of
                   $2 million to Synaptic.

Pfizer Inc.     1. Pfizer LTD, a subsidiary of Pfizer Inc. UK and Fuisz


                                                                                22
                  International LTD, Dublin, signed a development agreement
                  to conduct research using Fuisz's Ceform Taste Isolation
                  microsphere technology. This technology is used to produce
                  microspheres that incorporates a Pfizer new chemical entity.
                  The resultant microspheres will be combined with Fuisz's
                  patented Shearform technology to produce an orally
                  administered, rapidly dissolving flash-dose tablet.
             2.   Phytopharm (UK) and Pfizer agreed to jointly develop and
                  commercialize the P57 appetite suppressant extract, which
                  comes from an unidentified (patent pending) plant in South
                  Africa. Phytopharm licensed an extract from the Council of
                  Scientific & Industrial Research (South Africa). Pfizer will
                  pay $32 mil in license fees and milestone payments to
                  Phytopharm; Pfizer will also provide at least $7 mil for an
                  early development program.
             3.   With Warner Lambert’s (W L) Lipitor on patent until 2010,
                  WL has a licensing and development deal with Pfizer to
                  develop compounds for congestive heart failure. Pfizer paid
                  $87 million upfront for the rights to comarket lipitor, will pay
                  an additional $100 million as new filing and approval
                  milestones are reached, and will share in the cost of new
                  clinical trials. Warner-Lambert gets its choice of one of three
                  late-stage-development Pfizer drugs to comarket. Pfizer in
                  turn gets 50% of incremental sales over regularly ncreasing
                  baselines agreed upon by the two companies
             4.   Synaptic Pharmaceutical has granted GW a non-exclusive
                  license to certain of its alpha-adrenergic receptor patents
                  and an option to obtain a non-exclusive license under
                  Synaptic's functional-use patents for the treatment of benign
                  prostatic hyperplasia. GW paid an upfront fee of $2 million
                  to Synaptic.
Merck Inc.   1.     Merck extended its 1993 agreement with Synaptic
                  Pharmaceutical Corp. for the discovery of compounds that
                  may be useful in the treatment of benign prosthetic
                  hyperplasia. The joint research programme is focused on
                  compounds that selectively block the human alpha-1a
                  adrenergic receptor. Synaptic has two patents that cover the
                  use of selective alpha-1a antagofirsts for the treatment of
                  benign prostatic hyperplasia. Exclusive worldwide rights for
                  these products have been licensed to Merck.
             2.      Aurora Biosciences Corp. completed the design and
                  delivery of three screening subsystems to Merck & Company
                  Inc. Under the terms of an agreement that was signed in
                  1997, Merck committed more than $33 million in research
                  funding, license fees, and delivery payments. These
                  subsystems have been designed and integrated by Aurora



                                                                               23
              to improve high-throughput analysis of screens developed
              using Aurora's patented fluorescent membrane-potential
              sensors for ion channel targets.
           3. Merck’s arrangement with Cellomics Inc. involves the
              development and delivery of the ArrayScan 2.0 system, a
              functional high- content screening system. ArrayScan is
              designed to improve the efficiency of the drug discovery
              process.
           4. Merck formalised a collaboration with Isis Pharmaceuticals
              Inc. to discover drug candidates for treatment of patients
              infected with hepatitis C. Scientists of these companies will
              jointly design, synthesize, and evaluate novel small
              molecules. Merck will screen them to identify hepatitisC virus
              replication inhibitors. Merck retains the right to
              commercialize drugs arising from the collaboration and Isis
              retains the right to use the technology developed in the
              collaboration in its antisense program.
           5. Merck expanded its June 1996 agreement with Cubist
              Pharmaceuticals Inc., for the discovery and development of
              novel anti-infective compounds. Merck will license Cubist
              compounds and data for inclusion in their collaborative
              research program in exchange for research funding and
              milestone and royalty payments to Cubist

           6. Merck licensed proprietary, non-exclusive rights to methods
              for screening small-molecule compounds from Genzyme
              Molecular Oncology. Merck is screening these small
              molecules to determine their action against a cancer- related
              protein called MDM2. Genzyme received an upfront
              payment and could receive about $8 million in milestone
              payments and royalties on sales if Merck successfully
              develops a product through the use of these assay methods.
           7. Merck signed a collaborative research, development and
              license agreement with Biogen Inc. The arrangement relates
              to the clinical development of a new class of compounds for
              the treatment of inflammatory diseases. The two companies
              agreed to will develop an aerosolized anti-VLA4 small-
              molecule drug as a treatment for asthma and oral VLA4
              inhibitors. Merck has worldwide marketing rights for the
              asthma indications; Biogen retained marketing rights for the
              multiple sclerosis indication. Merck paid Biogen a $15 million
              fee. Milestone payments could total $130 million.
Bristol-   1. BMS arranged a $50 million license and research pact with
Myer          Cytoclonal Pharmaceutics Inc.. The deal calls for the
Squibbs       development of two technologies related to production of
Co.           paclitaxel, the active ingredient in BMS's anticancer product



                                                                          24
(BMS)       Taxol. The agreement focuses on microbial fermentation to
            produce paclitaxel and/or other taxanes and on the use of
            specific genes to enhance production. In addition, other
            microbial strains could be screened to identify new products
            for oncology.
        2. BMS and Medarex Inc. signed a $20million collaboration
            agreement involving Medarex's HuMAb-Mouse technology.
            This technology creates high-affinity, fully human antibodies.
            BMS is using the technology to create human antibodies to
            multiple antigens for use in its drug discovery programme.
        3. BMS and Irori, formed a two-year strategic alliance to
            develop an advanced, ultra high-throughput combinatorial
            chemistry system using Irori's proprietary NanoReactor
            technology. This allows BMS to synthesize thousands of
            compounds of known structure per week, thus speeding the
            drug discovery process. The deal is valued at about $14.5
            million.
        4. As part of its continuing effort to develop improved production
            processes for paclitaxel (the active ingredient in BMS's
            anticancer drug Taxol) , BMS signed an agreement with
            Phyton Inc for the commercialization of Phyton's proprietary
            plant cell fermentation technology, which Phyton had
            licensed to BMS in 1995. Phyton's plant cell fermentation
            technology represents a new method of producing paclitaxel,
            and related substances of potential interest, that does not
            require harvesting cultivated plants.
        5. BMS and Neose Technologies Inc. signed an agreement
            whereby Neose will develop and manufacture complex
            carbohydrates for two oncologic vaccines being developed
            by BMS. Neose is developing these products using its
            patented Multi-Transferase Reaction technology, which
            employs the natural power of enzymes to produce complex
            carbohydratesefficiently and in quantities sufficient for
            commercialization.
        6. BMS licensed its monoclonal antibody-based cancer
            targeting programme to Seattle Genetics. Among the
            tumour-targeting compounds is an immunotoxin that has
            advanced into clinical trials .
        7. BMS and Chiroscience Group plc. Signed licence
            agreements in the area of matrix metalloproteinase
            inhibitors for the treatment of cancer. BMS has licensed
            rights to Chiroscience's matrix metalloproteinase inhibitors
            programme, including the worldwide rights to two lead
            compounds designated D2163 and D1927. Both companies
            have agreed to a three-year oncology research collaboration
            to discover new selective matrix metalloproteinase inhibitors.



                                                                        25
                 8. BMS and Unilever have entered into a research and
                    development agreement under which BMS will obtain rights
                    to hair follicle research and patents developed by Unilever.
                    Unilever will receive milestone payments as BMS develops
                    prescription compounds for preventing hair loss. This is the
                    first time that Unilever has licensed its research technology
                    to a drug company for the expressed purpose of developing
                    a prescription product.

Genentech Inc    1. Protein Design Labs Inc (PDL) and Genentech Inc., agreed
                    to cross-license rights to certain intellectual property for
                    monoclonal antibodies. Genentech will pay a $6 million, up-
                    front, non-creditable, nonrefundable fee to PDL. Protein
                    Genentech will receive from Design Labs $1 million up-front,
                    non-creditable, nonrefundable fee, for rights to license
                    particular antibodies under specified patents and patent
                    applications held by Genentech.
                 2. PDL granted a nonexclusive license under its antibody
                    imumanization patents to Genentech Inc. for antibodies to
                    the antigen HER2, including Herceptin (trastuzumab),
                    Genentech's humanized monoclonal antibody for the
                    treatment of breast cancer.          Under the agreement,
                    Genentech paid PDL a $6 million fee for the right to license
                    antibodies for up to six antigens under certain of PDL's
                    patents and patent applications upon payment of additional
                    fees. Under the recent license agreement, Genentech will
                    pay PDL a license fee of $1 million and will pay royalties
                    under the PDL patents based on product sales. This is the
                    first license issued under the Genentech-PDL agreement.
                 3. Abgenix Inc. signed a research license and option agreement
                    with Genentech Inc. allowing Genentech to use Abgenix's
                    XenoMouse technology to generate fully human antibodies
                    for an antigen target in growth factor modulation.
                 4. Genentech grants patent rights to DAKO to develop
                    diagnostic kit to detect over expression of HER2, a growth
                    factor receptor that has been linked to especially aggressive
                    breast cancer . Under the terms of the agreement,
                    Genentech grants to DAKO a license to Genentech’s patent
                    and know-how for development of an immunohistochemical
                    (IHC). In exchange, DAKO pays Genentech a royalty on the
                    worldwide sales of DAKO's IHC detection kits.
Eli Lilly & Co   1. Eli Lilly and Co. and Sepracor Inc. entered into a license
                     agreement that enables Eli Lilly to exclusively develop and
                     globally commercialize R-fluoxetine , (a modified form of an
                     active ingredient found in Prozac) , a new chemical entity
                     patented by Sepracor. R- fluoxetine, is currently in Phase 1


                                                                               26
                     clinical development.
                  2. Pharmaceutical Product Development Inc. and Eli Lilly and
                     Co.,entered into development collaboration in the
                     genitourinary field. Under terms of this agreement, a
                     subsidiary of Pharmaceutical Product Development will
                     receive worldwide licenses to Lilly compounds that target
                     medical conditions, including bladder dysfunction and sexual
                     dysfunction. Lilly will receive license fees and royalties from
                     products that enter the market. Lilly also will receive a first
                     option to relicense compounds in the future.
                  3. Eli Lilly licensed the rights to use Emisphere's oral delivery
                     technology in the development of oral formulations of two of
                     Lilly's therapeutic proteins, one in the field of osteoporosis
                     and the second in the area of endocrinology. Two milestone
                     payments were made to Emisphere as part of their alliance.
                  4. Eli Lilly Canada and Toronto-based pharmaceutical
                     company Allelix announced an expansion of their research
                     programs with and investment of over $30 million from Lilly.
                     The agreement covers two projects: i) to discover new drugs
                     for central nervous system diseases ii) drugs targeting
                     eating disorders. The partnership has generated more than
                     60 patent applications worldwide covering 13 separate
                     inventions.

Litigations in Pharmaceutical Sector

The highly competitive atmosphere has fueled several litigations in the
Pharmaceutical Industry. Patent Oppositions, suits for revocations of patents,
infringements actions, challenges involving non-disclosure of relevant and
appropriate prior-art, hair-splitting on claims with respect to closely linked
inventions and prior art, questioning the best mode of practice disclosed,
claiming damages, etc. have been common. Illustrative cases such as Glaxo vs
Novopharma on Ranatadine, Genentech vs Eli Lilly, Novo Nordisk & Biogen
human growth harmone patent, Baxter International Inc vs McGaw on Safeline
needles highlight the complex issues. Wars between the Generic--Branded Drug
Manufacturers have also taken aggressive positions. A few examples are
included as illustration of the issues involved.
Council of Scientific and Industrial Research (India) vs University of
Mississippi ( USA)
The case of the “Haldi (Turmeric) Patent” revocation illustrates the significance of
documentation of traditional knowledge. US Patent No. 54015404 was granted to
two researchers of the University of Mississippi by the US Patent and Trademark
Office (USPTO) for the use of turmeric powder (haldi) as a wound healing agent
on March 28, 1995. On October 20 1996, the patent was opposed by the Council
of Scientific and Industrial Research (CSIR), India. The basis was that it did not
satisfy the essential criteria of patentability in terms of novelty because the use of


                                                                                   27
turmeric powder as a wound-healing agent has been well known in India over
several centuries. Thirty-two references including the wealth of India, citations
from Journal of Indian Medical Association and ancient treatise on home remedies
were submitted to the US patent office in support of this opposition. The USPTO
unequivocally rejected all the six claims of this patent on August 13, 1997.
Astra AB vs Han Mi Pharmaceutical Co, Ltd (Han Mi)
This is a recent landmark judgement in Korea.

The dispute centred on competing products for omeprazole oral formulations
marketed by both companies. At the time of Astra's patent application for its
Korean patent, Korea had not yet adopted the product patent system
(subsequently adopted on July 1 1987).

   Astra applied in Korea for a patent for its omeprazole formulation
    manufacturing process, which included the three steps of: 1) mixing the
    omeprazole with an alkaline reacting compound; 2) coating the thus-formed
    core with an inner layer; and 3) covering the core and inner layer with an
    enteric coating.
   This was opposed by the Korean Company Han Mi.
   Astra's patent was granted on October 1 1992 by the Korean Industrial
    Property Office (KIPO) on the basis of novelty and inventiveness of Astra's
    processes and that of the organic combination of the above three
    constitutional elements .
   Han Mi had also filed a patent application for its omeprazole manufacturing
    process claiming that its manufacturing process differed from Astra's patent
    as claiming that a stabilizing agent was added to the omeprazole core.
   On April 25, 1995 Astra brought in a patent invalidation action against Han
    Mi's .
   KIPO trial board issued a decision invalidating Han Mi's patent on September
    30 1997. It ruled Han Mi's manufacturing process patent was invalid on the
    grounds that the use of a basic amino acid (L-arginine) as a stabilizing agent
    for the omeprazole core was an obvious choice from prior art. The trial board
    also concluded that no evidence of an unexpected benefit was obtained from
    the use of L-arginine.
   On June 11 1998 the court passed a judgement in favour of Astra, finding
    that Han Mi's manufacturing process infringed Astra's patent.
   Reliefs granted to Astra are : 1) barring of Han Mi's infringing manufacturing,
    marketing and sales activities; 2) the destruction of all finished and half-
    finished infringing products in Han Mi's possession; and 3) the provisional
    enforcement of the above relief.

CellPro vs Baxter Healthcare Corp
After losing the litigation involving disposable kits for its Ceprate SC stem cell
concentration system CellPro also agreed to appoint Baxter Healthcare Corp as
its exclusive worldwide distributor of a limited number of the product. It also
agreed to settle all issues remaining outstanding in its ongoing patent litigation


                                                                                 28
with Baxter, Johns Hopkins University and Becton Dickinson & Co for payments
of $15.6 mln. In addition CellPro will discontinue all operations other than the
manufacturing & service functions necessary to support a limited quantity of
Ceprate SC kits. Its European operations have already been discontinued.
Eli Lilly and Co vs Barr
U.S. District Court dismissed two motions by generic drug maker Barr
Laboratories Inc., which was challenging the Lilly’s Prozac patent. Lilly holds two
patents on Prozac. The patent on the compound expires in February of 2001,
and the one on how Prozac works in the body expires in December 2003. The
court ruled in favor of Lilly on the doctrines of double patenting (obtaining two
separate patents for identical invention) and best mode disclosed.
Hoechst Marion Roussel vs Andrx Corporation
Hoechst Marion Roussel (HMR) filed a patent infringement suit against Andrx
Corp. related to the ANDA submitted by Andrx on diltiazem, the active ingredient
in Cardizem. This was a ploy to delay introduction of the generic drug into the
market. Until the litigation is resolved, Andrx officials have agreed not to market
their product. From July 1998 until resolution, Hoechst Marion Roussel will make
nonrefundable quarterly payments of $10 million to Andrx. In the meanwhile
Aetna U.S. Healthcare has sued HMR alleging that such a deal between Andrx
and HMR is unfair and has illegally prevented the introduction of a generic
version of Cardizem CD to the market.
Novo Nordisk A/S
In October 1997, Novo Nordisk filed a patent infringement suit in a U.S. District
Court against Genentech Inc., Eli Lilly and Co., Pharmacia & Upjohn Inc., and
Serene Laboratories Inc., who manufacture / market biosynthetic human growth
hormone products that compete with Novo Nordisk's Norditropin in USA. It
charges these companies of infringing a Novo Nordisk patent covering
biosynthetic human growth hormone.

In June 1998 Novo Nordisk and Genentech Inc. reached an out-of-court
settlement on patents relating to human growth hormone & insulin. They
mutually agreed to “cross-license worldwide “ certain patents relating to human
growth hormone and to the manufacture and production of growth hormone
products Norditropin, Nutropin, and Nutropin AQ. In addition, Novo Nordisk
would receive a worldwide license under Genentech patents relating to insulin
and Genentech will receive some other patents of Novo Nordisk.

In May 1998 Novo Nordisk and Serono Laboratories Inc reached an out- of-court
settlement related to the manufacture and marketing of Saizen, Serono's
biosynthetic human growth hormone product. The settlement also covered
Serostim human growth hormone approved in the United States for the
treatment of AIDS.
Amgen Inc. vs Transkaryotic In April 1997, Amgen filed a suit against
Transkaryotic Therapies Inc. and Hoechst Marion Roussel Inc. to stop the two
companies from developing gene-activated erythropoietin on the basis of patent
infringement. A ruling in April 1998 stated that Hoechst and Transkaryotic



                                                                                 29
Therapies activities are protected under the Waxman-Hatch Act. Amgen hopes
to stop Transkaryotic from coming to market with a gene-activated erythropoietin
through a preliminary injunction, until the patent issues are resolved.
SmithKline Beecham Corp. Vs Chiron Corp.
SmithKline Beecham Corp. (SKB) and Chiron Corp. settled their patent litigation
over the use of certain glyceraldehyde-3-phosphate dehydrogenase (GAPDH)
promoters (claimed by Chiron), used for expression of recombinant antigens.
Under the settlement SKB received a nonexclusive worldwide license from
Chiron to use the promoters for production of human vaccines, including
Engerix-B, SKB's recombinant yeast-expressed hepatitis B surface antigen-
based vaccine. In exchange, Chiron will receive a license issuance fee and
royalties on sales of vaccines using the promoters.
Hoechst Marion Roussel vs Alliance Pharmaceutical
Hoechst Marion Roussel has initiated a $16.8 million arbitration action against
Alliance Pharmaceutical involving a license dispute for the development of
LiquVent (perflubron), a compound used to treat respiratory disease. HMR
terminated its licensing agreement with Alliance and the development of
LiquiVent in December 1997.
Nycomed Amersham vs Mallinckrodt Medical BV and Mallinckrodt Medical
GmbH, Molecular Biosystems
Nycomed Amersham filed patent infringement suits in Holland and Germany
against Mallinckrodt Medical BV and Mallinckrodt Medical GmbH, and their
licensor Molecular Biosystems. Nycomed claims that MBI's Optison ultrasound
contrast agent licensed throughout Europe to Mallinckrodt and currently before
the European Medicines Evaluation Agency for marketing approval, infringes
Nycomed's European Patent 0 576 521 B1 granted in September 1997.
Nycomed is also pursuing patent infringement claims against MBI's Optison in
the USA under its analogous US patent.
Abbott Laboratories vs. Zenith Laboratories & Geneva Pharmaceuticals
Zenith Laboratories had sued Abbott claiming that Abbott interfered with Zenith's
ability to win government approval for and sell a generic version of Abbott's
Hytrin. In an agreement between Abbott Laboratories and Zenith Laboratories
Inc., & Geneva Pharmaceuticals Inc. regarding patents on Hytrin terazosin
hydrochloride, Abbott pays Ivax (parent of Zenith) $6 million per quarter
beginning July 15, 1998, until Abbott’s patent on Hytrin expires on February 17,
2000. Hytrin is an alphablocker indicated for hypertension and benign prostatic
hyperplasia. After the patent expires or a generic version of terazosin
hydrochloride is introduced in the market by any other party , Ivax may market
their generic brand free from claims of patent infringement by Abbott. Geneva
acknowledged the validity of Abbott's patents and agreed not to market its FDA
approved generic terazosin hydrochloride capsules until pending litigation
between parties is resolved.
LifeCell Corp vs Integra LifeSciences Corp.
LifeCell makes a tissue transplant product used for wound-healing, burns and
plastic surgery. Integra produces a product called Integra Artificial Skin.
LifeCell Corp., and its competitor, Integra LifeSciences Corp., mutually settled


                                                                               30
their infringement suits in which Integra had alleged that two patents related to its
product AlloDerm was being infringed by LifeCell Corp. LifeCell had sued Integra
for anti-competitive acts. Integra had licensed the technologies from the
Massachusetts Institute of Technology.

In the settlement both the companies agreed to dismiss the suits and Integra
agreed to buy $500,000 of LifeCell's common stock over the next three months.
LifeCell gets a royalty-bearing license from Integra to use its technology to
develop any products covered by the two patents.
Bayer Corp vs Physician Sales & Service Inc
Bayer Corp has filed a patent infringement suit seeking against Physician Sales
&Service Inc. alleging that infringement on four of its Multistix patents on urine
test strips. Bayer is seeking an injunction to prevent distribution of the Physician
Sales products until the issues have been resolved.


Conclusion

The pharmaceutical industry will always remain a growing industry due to
demands of a globally enlarging and aging population with diverse & changing
life styles. In the new millenium consumers will demand newer methods of
treatment, healthcare and services. Innovation will continually drive this industry.

The deciding factors for profitable growth and survival of this industry will be

   efficient use of Knowledge engineering techniques,
   structured management of innovation,
   authentic documentation
   accessing & creating new knowledge, ensuring its protection using
    appropriate IPR,
   setting up systems to enforce the acquired rights and
   at the same time evolving creative process of cooperative working and
    sharing of benefits.

The “ Small “ and the “ Big “ will co-exist through mutually beneficial licensing
arrangements. Ethical issues on Information & knowledge ownership by
Corporations with fair sharing of their benefits (Profits) of innovations based on
community knowledge will also have to be sorted.

Acknowledgements

The author is grateful to Mr. Jaideep Verma of Martix Information Services for
the searches he made for this article in various Derwent Databases. Several
articles figuring in the “Business & Industry and “ Business & Management
Practices “ databases from Dialog ONDISC have been referred to and quoted
and collated in the article. The author collectively acknowledges all these


                                                                                     31
sources.




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