Vifor International Ltd. & Anr. v. Biological E Limited & Anr.

15. Issue summons.

16. The learned counsel for the defendants accepts summons. The written statement shall be filed by the defendants within thirty days from today. Along with the written statement, the defendants shall also file an affidavit of admission/ denial of the documents of the plaintiffs, without which the written statement shall not be taken on record.

17. Liberty is given to the plaintiffs to file a replication within fifteen days of the receipt of the written statement. Along with the replication, if any, filed by the plaintiffs, an affidavit of admission/ denial of documents of the defendants, be filed by the plaintiffs, without which the replication shall not be taken on record. If any of the parties wish to seek inspection of any documents, the same shall be sought and given within the timelines.

18. List before the Joint Registrar for marking of exhibits on 22.11.2023. It is made clear that any party unjustifiably denying documents would be liable to be burdened with costs.

19. List before the Court for framing of issues on 16.12.2023. IA No. 11567/2023 (Application under Order XXXIX Rules 1 & 2)

20. Issue notice. Learned counsel appearing on behalf of the defendants accepts notice.

21. The present application has been filed by the plaintiffs i.e. Vifor (International) Ltd. and Emcure Pharmaceuticals Ltd. (hereinafter collectively referred to as the 'plaintiffs') under Order XXXIX Rules 1 and 2 CPC against the defendants seeking interim relief in terms of the prayer clause.

22. The plaintiff no. 1 i.e.Vifor (International) Ltd. also known as Vifor (International) A.G. is a company based in Switzerland and is the patentee in respect of patent bearing number IN 221536 (hereinafter referred to as the 'Suit Patent'). Whereas, the plaintiff no. 2 is a company incorporated under the laws of India and is the exclusive sub-licensee of the plaintiff no.1. As the sublicencee of the plaintiff No. 1, the plaintiff no. 2 has the right to commercially exploit the suit patent of the plaintiff no. 1 and the same is done under the brand name Encicarb (now sold under the brand names Ferium and Orofer FCM) in India.

23. The plaintiff no.1 claims to be a global leader in treatments for iron deficiency and iron deficiency anaemia, nephrology and cardio-renal therapies and the suit patent bearing number 221536 is titled as "WATER SOLUBLE IRON CARBOHYDRATE COMPLES AND A PROCESS FOR PRODUCING WATER SOLUBLE IRON CARBOYYDRATE COMOPLEX". The plaintiff NO. 1's invention i.e. FERRIC CARBOXYMALTOSE (hereinafter referred to as "FCM") is an intravenous iron deficiency therapy product. Thus, the suit patent relates to water soluble iron carbohydrate complexes with an average molecular weight of 80-400 kDA which are complexes of iron (ferric cation) and oxidized maltodextrins as ligand. Claim 1 of the suit patent covers FCM per se.

24. At this stage, it is relevant to note that the suit patent was filed in October 2003 and was granted in June 2008; the product was granted marketing approval in India in 2011, and the tenure of the suit patent expires in October 2023.

25. It is stated that FCM is used for the intravenous treatment of iron deficiency and iron deficiency anemia, when oral iron preparations are ineffective or cannot be used. Prior to the invention of FCM, there existed a need for an intravenous iron therapy which was non-toxic, easily administrable in a variety of clinical conditions, capable of being quickly sterilized-known parenterally applicable iron preparations based on sucrose and dextran were stable at temperatures up to 100ºC only, which made sterilization difficult and thus it was necessary to develop such an iron-preparation which was free of the earlier adverse effects noticed in other treatments in the prior art, such as dextran-based complexes, that were capable of inducing dangerous anaphylactic shocks.

26. It is further stated that the World Health Organization (hereinafter referred to as ‘WHO’) has assigned the International Nonproprietary Name (hereinafter referred to as ‘INN’) FERRIC CARBOXYMALTOSE to the plaintiff No.1’s invention claimed in Claim 1 of the suit patent.

27. The defendants are an Indian group companies, with the defendant No.1 being the parent company of the defendant no. 2. It is further stated by the plaintiffs that on 07.06.2023, the defendants addressed a notice to the plaintiff no. 1 seeking an acknowledgment that they are not infringing the suit patent as the defendants are using a process different from the process disclosed and claimed in the suit patent.

28. The plaintiffs case is that based on the disclosure provided in paragraph 4 of the notice, it manifests that the defendants' product is an iron (III) oxidized maltodextrin complex i.e. a FERRIC CARBOXYMALTOSE complex. It is stated by the plaintiffs that the defendants at the time of filing of the present suit had not launched their product in the market and the plaintiffs have reasonable apprehension that the defendants intend to launch their product and therefore the present suit has been filed.

SUBMISSIONS ON BEHALF OF THE PLAINTIFFS (I) 'PRODCUT' AND 'PROCESS PATENT' AND NOT 'PRODUCTBY PROCESS' PATENT

29. Mr. Darpan Wadhwa, learned senior counsel for the plaintiffs at the outset has drawn the attention of the Court to the ‘complete specification’ pertaining to the plaintiff no. 1’s suit patent (annexed as Document 3 to the plaint) to contend that Claim 1, 7-9 of the suit patent are product claim per se; whereas other claims being Claims 2-6 are process claims delineating the ‘process for preparing the product’ as claimed in Claim 1. In essence, Mr. Wadhwa argued that the plaintiff no. 1 while filing the patent sought to protect its product as well as the process which is used to manufacture the said product. Further, it was argued on behalf of the plaintiffs that even if the defendants prepare the product of the plaintiffs albeit using a different process, the same shall also infringe the suit patent of the plaintiff no. 1.

30. In this regard, the attention of the Court was drawn to the patent certificate issued to the plaintiff no. 1 which certifies that the patent has been granted for the invention entitled as "WATER SOLUBLE CARBOHYDRATE COMPLES AND A PROCESS FOR PRODUCING WATER SOLUBLE IRON CARBOYYDRATE COMOPLEX" (annexed as Document 2 to the plaint). It is contended that the very title of the patent manifests that the plaintiff no. 1 owns the patent for the product as well as the process for producing water soluble iron carbohydrate complex.

31. Referring to Section 2(1)(j) of the Patents Act, 1970, the learned senior counsel contends that the statutory regime recognizes only two types of patents i.e. product patents and process patents. It is also argued that the language employed by the legislature while defining the term 'invention' in Section 2(1)(j) of the Act has used the expression "means" and thus, the definition is exhaustive and not inclusive.

32. Elaborating further, Mr. Wadhwa submits that "Product-by-Process" is a term commonly used in claim drafting and statutorily there is no third type of patent under the Patents Act, 1970.

33. It was also urged that the suit patent has been granted an INN name by the WHO and such INN names are only granted to new and unique products and not to processes. Similarly, the product of the plaintiff has been granted marketing approvals and the same are only granted to products and not processes in view of the Rules 122B and 122DA of the Drugs and Cosmetics Rules, 1945.

ADMITTED CASE OF THE DEFENDANTS THAT THEY ARE

MANUFACTURING FCM I.E. THE SUIT PATENT.

34. In respect to the product of the defendants, the attention of the Court was drawn to para 4 and 5 of the defendants notice dated 07.06.2023 (annexed as Document 40 to the plaint) to contend that it is the admitted case of the defendants that they are manufacturing FCM albeit the same is prepared using allegedly a different process than that of the suit patent. Mr. Wadhwa submits that by merely manufacturing the product of the plaintiff no.1 using a different process would not absolve the defendants of all liability as the plaintiff no.1 has the product as well as the process patent for FCM.

35. He submits that even if the defendant manufactures the product by using a different process, they are still guilty of infringing at least claim 1 of the suit patent as the plaintiff no.1 owns the product as well as the process patent for the suit patent. It is also submitted that defendants have also failed to distinguish their process of manufacturing the product as they have not made disclosures regarding the molecular weight.

THE STRENGTH OF THE SUIT PATENT.

36. It is submitted that the patents corresponding to the suit patent have been granted in favor of the plaintiff no. 1 in 57 jurisdictions across the world, including major patent jurisdictions such as the US and EU.

37. Mr. Wadhwa further argued that the plaintiff no. 1 has continuously been protecting its patent against actions of third parties and has obtained interim injunctions in its favor. He referred to the orders of the cases where the plaintiff no. 1 has obtained interim injunctions (annexed as Document 31 to the plaint).

38. Mr. Wadhwa further submits that the defendants have failed to "clear the way" as no steps have been taken by the defendants to oppose the grant of or invalidate the suit patent.

THE DEFENDANTS HAVE NOT ENTERED THE MARKET

39. Mr. Wadhwa submits that the plaintiffs have reasons to believe that the defendants have neither entered the market nor offered its products for sale to the general public. To buttress his contention, he relies upon the affidavit of the investigator of the plaintiffs which has been annexed as document 43 to the plaint.

40. It is also the contention of Mr. Wadhwa that the balance of convenience lies in the favor of the plaintiffs and against the defendants at the interim stage, especially when the product has not been launched to the general public by the defendants.

41. In such a case, it is argued that in case the defendants are permitted to enter the market and offer its infringing product to the public at large, then it would irreversibly alter the market and cause irreparable harm to the plaintiffs. It is stated that in such a scenario, where the defendants are allowed to offer its product for sale, various other manufacturers of generic drugs would enter the market resulting in incalculable destruction of the plaintiffs' business built over several years after investing billions of dollars. It is thus urged that the balance of convenience lies in favor of the plaintiffs and against the defendants.

SUBMISSIONS ON BEHALF OF THE DEFENDANTS

(I) THE SUIT PATENT IS A 'PRODUCT BY PROCESS' PATENT AND

NOT 'PRODUCT' AND 'PROCESS PATENT'.

42. At the outset, Mr. Adarsh Ramanujan, the learned counsel appearing on behalf of the defendants submits that the suit patent is a 'product-by-process' patent. Elaborating further, he submits that the process steps in claim 1 are enforceable limitations and a party making the same product through a different process is not infringing the suit patent. He also relied upon the observations of this Court in Vifor (International) Ltd. & Anr. v. Mr. Pankaj Ramanbhai Patel & Anr.1, to contend that if the defendant uses a different process to manufacture the suit patent, the same would not lead to an inference that the defendant is infringing the suit patent. The relevant part of the decision reads thus:

43. Mr. Adarsh Ramanujan further submits that it has been the consistent stand of the plaintiffs that their product is a 'product-by-process' and not a 'product' and 'process' patent as claimed by the plaintiffs. For this purpose, the CS(OS) 1206/2015, Order dated 16.09.2015 defendant relied upon the observations of this Court in Vifor (International) Ltd & Anr vs. Dharmendra Vora & Anr[2], wherein the following statement has been made by the counsel appearing for the plaintiff:

44. He submits that similar submissions have been made by the plaintiff NO. 1 in yet another suit filed by it viz., Vifor (International) Ltd & Anr. vs. Maxycon Health Care Private Limited and Ors,[3] which read as under:- "i. The suit patent relates to a “product-by-process” invention which is a novel water-soluble iron carbohydrate complex which is a complex of iron (ferric) and oxidation product of one or more maltodextrins and a process for making the same;"

45. He contends that even an issue on this aspect has been framed by this Court in one of the suits filed by the plaintiff no. 1 titled as in Vifor (International) Ltd. vs. Venkat Jasti,[4] which reads as under:-

CS(COMM) 4083/2014 CS(COMM) 712/2018 CS(COMM) 1680/2016; Order dated 19.11.2018

46. Mr. Ramanujan thus, re-emphasized that though the defendants admit that they are manufacturing and marketing FCM, but there is no infringement of the suit patent since the process to obtain the product i.e. FCM being followed by the defendants is different from that of the plaintiffs. He invited the attention of the Court to the legal notice dated 07.06.2023 given to the plaintiffs wherein the defendants have sought to distinguish its process from that of the plaintiffs.

THE DEFENDANTS HAVE OFFERED THEIR PRODUCT FOR

SALE IN THE MARKET ON 31.05.2023.

47. Mr. Ramanujan further submits that the defendants have already launched their product and have entered the market under the trademark INRONX on 31.05.2023. For this purpose, an affidavit dated 13.06.2023 of Mr. N Eswara Reddy, authorized signatory of the Defendant companies, as well tax invoices, evidencing the sale of the drug INRONX, were handed over in Court and filed subsequently along with the written submissions. The contents of the affidavit read as under:-

5. I am advised to say that the process being employed by the Defendants is outside the scope of the claims of the patent IN 536 and is thus non-infringing."

48. Mr. Ramanujan further argued that the product is out in the distribution channels and out of the control of the manufacturer/defendants. For this purpose the defendants seek to rely upon the purchase order dated 07.06.2023 issued by Rainbow Children's Medicare Limited as well as the tax invoices dated 31.05.2023 (annexed as Annexure G & H to the written submissions, respectively).

49. He has also drawn the attention of the Court to various orders passed by Co-ordinate Benches of this Court, whereby Co-ordinate Benches have declined to pass interim injunctions in favor of the plaintiffs and against the respective defendants’, especially when the defendants’ had launched their product in the market. He further submits that in such cases the respective defendants’ have been directed to maintain accounts of their sales. The orders referred are enumerated as under:a. Vifor (International) Ltd. v. Eris Lifesciences, CS(COMM) 505/2022.[5] b. Vifor (International) Ltd. v. Macleods Pharmaceuticals Ltd, CS(COMM) 194/2023.[6] c. Vifor (International) Ltd. v. Biokindle Lifesciences Private Limited, CS(COMM) 198/2023.[7]

NO PRESUMPTION IN FAVOUR OF THE PLAINTIFFS AS

THERE WAS NO PRE-GRANT OR POST-GRANT OPPOSITION.

50. Mr. Ramanujan has emphasized that no presumption in favor of the suit patent can arise merely because there was no pre-grant or post-grant Order dated 03.08.2022 Order dated 18.04.2023 Order dated 11.04.2023 opposition. He submits that this position has been affirmed by this Court in F. Hoffmann-LA Roche Ltd. and Ors. v. Cipla Ltd.,[8] the relevant paragraph of the judgment which was sought to be relied upon reads as under:-

NON COMPLIANCE OF SECTION 105 OF THE PATENTS ACT

51. He further contends that the present suit has been filed by the plaintiffs without providing an opportunity to the defendants to respond to the reply of the plaintiffs. Elaborating on his submission, he submits that the defendants addressed a notice under Section 105 of the Act, seeking an acknowledgment from the plaintiffs vide its letter dated 07.06.2023 and sought the said acknowledgement within a period of 7 days. However, the plaintiffs replied to the said letter on 09.06.2023 stating inter alia that the information provided by the defendants to the plaintiffs was incomplete, 2009 SCC OnLine Del 1074 but intriguingly, without providing an opportunity to the defendants to provide the said information, the present suit has been filed by the plaintiffs on 12.06.2023.

SUBMISSIONS OF THE PLAINTIFF IN REJOINDER

52. In rejoinder, the learned senior counsel for the plaintiffs submits that the term "product by process" is merely a term used for the art for a drafting practice/style/format and it is not statutorily defined under the Patents Act or the Rules framed there under.

53. In respect of the defendants’ contention that they have entered the market, Mr. Wadhwa, the learned senior counsel for the plaintiff, has attacked the very foundation and authenticity of the alleged purchase order and tax invoices. He submits that in case the alleged purchase order and tax invoices are taken to be true and correct, the plaintiffs have entered the market only on 31.05.2023 and the said invoices show the movement of the defendants products only to its stockists, dealers and distributors etc. and not the general public.

54. He urges that the sales of the defendants are only miniscule as compared to the total sales of plaintiffs’ product. He contends that even if the defendants have entered the market, this Court is within its jurisdiction to restrain the defendants from infringing the patent of the plaintiff no. 1. ANALYSIS

55. The learned senior counsel for the plaintiffs as well as the learned counsel for the defendants have addressed the arguments at length and have also filed their detailed written submissions.

56. In so far as the controversy whether the suit patent is a 'product' and 'process' patent or a 'product-by-process patent', is concerned, it may be noticed that a Co-ordinate Bench of this Court in another suit filed by the plaintiffs viz., Vifor International Ltd. & Anr. v. MSN Laboratories Private Limited & Anr.9, concerning the same patent i.e., FCM, held that 'product-byprocess' patents are not unknown to Indian Jurisprudence and a patent secured by 'product-by-process' is limited by the process by which the product is obtained and any third party manufacturing the same product albeit using a different process shall not be infringing the suit patent. The relevant paragraphs of the said decision reads as under:- "CONCLUSION

109. Going by the binding dictum of the Supreme Court in Novartis AG (supra) and the observations of the Ayyangar Committee Report, grant ofpatent is restricted to the disclosure in the complete specification. Once Claim 1 has been limited by a particular process, Vifor cannot assert a right to prevent a third party which uses a process / set of processes different and distinct from the claimed process of Vifor and claim infringement qua IN’536. In order to succeed in establishing its claim for infringement even at the prima facie stage, Vifor is required to show that the rival processes to manufacture FCM are identical, which burden Vifor has failed to discharge. Balance of convenience is in favour of the Defendants and against the Plaintiffs. Irreparable injury shall be caused to the Defendants and it would also be prejudicial to public interest, if the undertakings given by the Defendants not to market or launch FCM are continued in favour of Vifor in CS(COMM) Nos.261/2021 and 265/2021or if an injunction is granted at this stage in CS(COMM) No.448/2022, in favour of Vifor.

KEY POINTS EMANATING FROM THE ABOVE DISCUSSION:

110. Securing patent protection in subject matter using product-byprocess claim(s) is not unknown to Indian jurisdiction. Indian Patent CS(COMM) 261/2021, Order dated 24.07.2023 Office has also recognized such claims in the “Guidelines for Examination of Patent Applications in the Field of Pharmaceuticals”.

111. Patent protection secured by product-by-process claim(s) is limited by the process by which the product is obtained. Therefore, monopoly cannot be claimed on the product as a whole which is the subject matter of product-by-process claim(s). In any case, the scope of protection of claim(s) cannot be wider for infringement analysis than for patentability."

57. The said judgment of the learned Single Judge has been challenged in FAO(OS) (COMM) 159/2023 titled as Vifor International Ltd. & Anr. v. MSN Laboratories Private Limited & Anr. The Division Bench of this Court vide order dated 10.08.2023 observed that it was unable to sustain the conclusions that have ultimately come to be recorded by the learned Single Judge in the order, wherein it has been concluded that suit patent is a product by process claim alone. Accordingly, the operation and the effect on the impugned directions contained in operative part of the judgment were stayed.

58. Evidently, the controversy that whether or not the suit patent is a 'product-by-process‟ patent, is now sub-judice before the Division Bench.

59. For now even if is assumed that the plaintiffs have a prima facie case in their favour, yet, the settled principle of law is that even where prima facie case is in favour of the plaintiff, the Court will refuse grant of a temporary injunction if the injury suffered by the plaintiff on account of refusal of temporary injunction was not irreparable.10

60. The plaintiffs have alleged that they shall suffer irreparable loss in case the defendants are not restrained from offering their product to the general public. On the other hand, the defendants’ case is that they have launched their product on 31.05.2023 i.e. prior to the filing of the present suit.

61. From a perusal of the affidavit of the authorized representative, and tax invoices, of the defendants it prima facie appears that the product of the defendants was out in the distribution channels on 31.05.2023 i.e. prior to the filing of the present suit. In so far as the challenge laid to the authenticity of invoices/ purchase orders by the plaintiffs is concerned, the same is a matter of evidence which will be decided at an appropriate stage.

62. As the defendants have already entered into the market, irreparable loss will rather be caused to the defendants if an interim injunction is granted in favor of the plaintiffs. On the other hand, the interest of the plaintiffs can be secured by giving a direction to the defendants to furnish accounts of manufacture and sales of FCM for the relevant period. Further, it is plaintiffs’ own case that the tenure of the suit patent is set to expire soon in October,

2023. The balance of convenience thus, also lies in favor of the defendants and against the plaintiffs.

63. It is also not in dispute that in various suits instituted by the plaintiffs in respect of the same suit patent, where the defendants had entered into the market, Co-ordinate Benches of this Court have refrained from granting interim injunction and instead directed the defendants to maintain the accounts from the date of launch of product. Reference may be had to the orders of the Co-ordinate Bench in (a) Vifor (International) Ltd. v. Eris Lifesciences, CS(COMM) 505/2022.11, (b) Vifor (International) Ltd. v. Macleods Pharmaceuticals Ltd, CS(COMM) 194/2023.12 And (c) Vifor (International) Ltd. v. Biokindle Lifesciences Private Limited, CS(COMM) 198/2023.13 There is no reason for me to take a different view, all the more when the tenure of the suit patent is set to expire soon. Order dated 03.08.2022 Order dated 18.04.2023 Order dated 11.04.2023

64. Reference in this regard may also be had to the decision of the Supreme Court in Wander Ltd. v. Antox14, wherein it was observed that relevant considerations for restraining a defendant will be somewhat different when he is already in the market than where the defendant has yet to commence his enterprise. The relevant observations reads as under:-

1990 Supp SCC 727 that apply to a case where the defendant is yet to commence his enterprise, are attracted. (emphasis supplied)

65. In view of the above discussion and regard being had to the fact that the tenure of the suit patent is set to expire soon in October, 2023, in the interim, it is directed that the defendants shall maintain accounts of manufacture and sales of FCM till the expiry of the tenure of the suit patent and the same shall be filed on affidavit within four weeks from the expiry of such tenure. Further, the defendants shall not use a process of manufacture which has been claimed by the plaintiff no. 1 in the suit patent.

66. List the present application before the Court on 19.10.2023.

VIKAS MAHAJAN, J SEPTEMBER 19, 2023