In a recent judgment, the Madras High Court dismissed a petition filed by Embio Ld. (“Embio”) challenging the validity of a patent granted to Malladi Drugs & Pharmaceuticals Ltd. (“Malladi”) for a method of preparing chiral beta-amino alcohols. The court upheld the patent’s validity, affirming its novelty and inventive step.
Background of the dispute
Malladi’s patent (No. 249376), titled “A method for the preparation of new chiral beta-amino alcohols from R(-)-phenyl acetyl carbinol”, was filed in 2007 and granted in 2011. It relates to a method and a process for preparing optically pure 1-phenyl-2-(N-alkyl/arylamino) propanol hydrochlorides, which serve as crucial intermediates in pharmaceutical products.
Embio, a major competitor in the industry focused on the bulk production of similar active pharmaceutical ingredients, contested the patent, claiming it lacked both novelty and an inventive step. According to Embio, the use of phenyl acetyl carbinol and noble metal catalysts was already disclosed in prior art, rendering Malladi’s invention a mere workshop improvement. They also claimed that Malladi’s patent failed to demonstrate any technical advancements or enhanced efficacy over existing methods.
In response, Malladi argued that its process achieved superior results, including higher yields and greater optical purity compared to previously known methods. They stated that the patent had already survived rigorous scrutiny during the patent examination process. Additionally, Malladi challenged Embio’s legal standing as an “interested person”, contending that merely claiming to be a major manufacturer of ephedrine was insufficient for challenging the patent.
Court’s Observations
The Madras High Court examined whether Embio qualified as a “person interested”, a critical requirement for challenging the validity of a patent. Drawing on legal precedents, the court determined that Embio qualified as a ‘person interested’ owing to its status as a competitor and bulk manufacturer of related pharmaceutical compounds. Citing Supreme Court’s ruling in Dr. Aloys Wobben vs. Yogesh Mehra & Ors., the court clarified that “person interested” is not a static concept, and evolve based on the person’s later activities. Even a party that does not initially meet the criteria for being a “person interested” at the time of the patent grant can assume that status later, depending on their subsequent activities in the relevant industry. The court referred to Section 2(t) and Section 64 of the Patents Act to reinforce the inclusive nature of this definition, stating that anyone engaged in or promoting research in the same field can challenge the validity of a patent, regardless of their current manufacturing status.
On the issue of patent validity, the court found that Malladi’s process demonstrated clear advancements over prior art. The court highlighted the simplified reaction conditions, improved yield (60-70%), and near-100% optical purity of the final product as indicators of Malladi’s inventive step. The court pointed out that Malladi had developed a more efficient synthetic route using platinum as a catalyst and organic solvents, resulting in significantly higher yields and purity than prior methods. Furthermore, the court found that Malladi’s inventors had provided ample comparative data to demonstrate the technical improvements achieved by their process. The Court emphasized that an invention has to be assessed as a whole and dissecting the invention into parts and finding individual parts to be obvious to hold that the invention itself is obvious, is not the right approach to be adopted. The court stated that the patent had been granted after rigorous examination by the Patent Controller, and that no substantive grounds were presented to justify revocation.
The court further reiterated that the burden of proof in patent invalidation cases lies with the petitioner, and that Embio had failed to present sufficient evidence to invalidate the patent. The court noted the significant time gap between the prior art cited by Embio and Malladi’s invention, reasoning that, if Malladi’s process were truly obvious, it would have been developed earlier by others in the field.
Consequently, the Madras High Court dismissed Embio’s petition, affirming the validity of Malladi’s patent.
Relevant paras of the Court’s Judgment that discuss novelty, inventive step and other principles read as follows:
“19. Let me examine the relevant case laws on the subject, before I proceed to apply the ratio laid down in the said cases, as applicable to the facts of the present case.
20. In Oilos Biotech’s case (referred herein supra), this Court held on the facts of the said case that no comparative data was provided and the complete specification lacked experimental data to support an inference of technical advancement.
21. In ITT, Madras’s case (referred herein supra), this Court held that in order to surmount the test of inventive step, the claimed invention must possess two main characteristics, viz., i) it should exhibit technical advancement as compared to the existing knowledge or have economic significance in the industry or both of the above; and ii) the purported technical advance must not be obvious to a person skilled in the art.
22. In Novartis’s case (referred herein supra), the Hon’ble Apex Court held that in the case of medicines, therapeutic efficacy should be shown and mere existence of advantages or beneficial properties would not be relevant. It further held that mere change of form with properties inherent to that form would not qualify as ‘enhancement of efficacy’ of a known substance.
23. The Division Bench of the Hon’ble Delhi High Court, in F. Hoffmann’s case (referred herein supra), held that any inventive step of an invention must not be obvious to a person skilled in the art. The Hon’ble Delhi High Court further held that a new form is neither the same substance nor the same product and if one does show enhancement in efficacy, he would be entitled to grant of a patent for the new form. The Division Bench also held that obviousness is a question of law based on facts and the burden to prove is on the party which alleges, however after the party which alleges makes out a prima facie case, the burden shifts on the inventor to disprove obviousness.
24. In Aloys Wobben’s case (referred herein supra), the Hon’ble Supreme Court dealt with ‘interested person’ and held that a person interested would include a person who has a direct, present and tangible interest with a patent and the grant of the patent would adversely affect his rights and would include a person who desires to make independent use of either the invention itself (which has been patented), or desires to exploit the process which has been patented, in his individual production activity.
25. In Agfa’s case (referred herein supra), the Hon’ble Delhi High Court held, referring to Terrell on Law of Patents, 16th Ed., proof of common knowledge is given by witnesses competent to speak upon the matter, who, to supplement their own recollections, may refer to standard works upon the subject which were published at that time and which were known to them, and regarding inventive step, the invention should be considered as a whole and it would not be sufficient to draw a conclusion that a claimed invention is obvious merely because individual parts of the claim taken separately are known or might be found to be obvious.
26. In Societe’s case (referred herein supra), the Hon’ble Delhi High Court held that when prior arts cited are more than 20 years older than the patent in question, having been available for a long time and an apparently minor development meeting a long felt want may be shown to be non-obvious because, although prior art has been available, the development was not hit upon by others.
27. In M/s. La Renon’s case (referred herein supra), the Division Bench of this Court held that when a patent has already been granted, the onus is on the person wishing to challenge its validity and that onus has to be discharged on a balance of probabilities and also held that the onus of establishing invalidity on any of the grounds cannot be shifted to the patentee.
28. Keeping in mind the above principles, first and foremost, it is to be examined whether the Petitioner is an interested person competent to challenge the grant in favour of the 1st Respondent. Section 2(t) of the Patents Act, 1970 defines a “person interested” to include a person engaged in, or in promoting, research in the same field as that to which the invention relates.
29. The specific case of the Petitioner is that the Petitioner is a manufacturer of Ephedrine and Pseudoephedrine salts and also having a bulk manufacturing facility. The 1st Respondent also manufactures API (Active Pharmaceutical Ingredients) including DL-Ephedrine HCl, DL-Methylephedrine HCl, Pseudoephedrine and salts. As held by the Hon’ble Apex Court in Aloy Wobben’s case (referred herein supra), the term ‘person interested’ is not static and even if he may not be a ‘person interested’ when the grant of the patent concerned was published and yet on account of his activities at a later point of time, he may assume the character or disposition of a ‘person interested’.
30. Section 64 of the Patents Act, 1970 deals with revocation of patents. The validity of a patent can be challenged or sought to be revoked by any person interested on the grounds mentioned in subsections 1(a) to 1(q). Even according to the 1st Respondent, the Petitioner is a competitor and therefore, it cannot be said that the Petitioner is not a ‘person interested’. The language employed in Section 2(t) does not require that the person interested should be only in manufacturing in the same field.
31. This Court also in M/s. La Renon’s case (referred herein supra), held that ‘person interested’ is an inclusive definition and merely because the Petitioner is not a manufacturer, he cannot be shut out from filing an application for revocation under Section 64(1). Therefore, in the facts and circumstances of the case discussed hereinabove, I have no hesitation to hold that the petition at the instance of the Petitioner is maintainable under Section 64 of the Act.
32. Moving on to the next two-fold objections that the 1st Respondent’s patent lacks novelty and inventive step, especially in the light of the prior art, I shall proceed to examine the facts of the present case and the rival contentions put forth, in the light of the settled legal position.
33. The EP 1 142 864 Al deals with a process where L-(R)-Phenylacetylcarbinol reacts with primary aralkylamine under catalytic reduction conditions using catalysts like platinum or palladium with the reactions being carried out using lower alcohols as solvents, achieving 82% optical purity with a yield of isolated pure L-erythro (iR,2S)-2-amino-1-phenylpropan-1-ol of 42.3%.
34. In the 1st Respondent’s patent, the yield is in the range of 60% – 70% with a purity of more than 99% and optical purity of close to 100%. Thus, the 1st Respondent has certainly shown technical advance over the prior art in the European patent.
35. In the US Patent, US2,509,309, the process disclosed is for preparation of ephedrine salts. The yield achieved is 42.5% or thereabouts using ethyl as a catalyst and using nickel predominantly. In the US Patent, US2004/0249212 Al, phenylacetylcarbinol is reacted with liquid methylamine or methylamine in THF, using liquid carbon dioxide as solvent. This prior art does not disclose any yield or purity and optical purity of the isolated product.
36. Comparing the 1st Respondent’s patent to even the above prior arts, it is clear that the process involved in the 1st Respondent’s patent is certainly different and also better than the teachings of all the three prior arts.
37. Regarding novelty also, the 1st Respondent has evolved a process whereby the reaction time is lesser and also produces better results, especially drastic higher yield as well as optical purity of the isolated product being far superior to what is achieved in the prior arts. The reaction conditions are also far simpler than the ones followed in the prior arts. Novelty is exhibited by the isolation of β-Amino alcohol as HCl salt in organic solvent leading to selective crystallisation of Erythro (iR, 2S) isomer.
38. In fact, from the claims, I notice that the primary object of the invention itself is to provide a new synthetic route and a new process for synthesis of optically pure hydrochlorides by a reduction using platinum as a catalyst and in the presence of organic solvents and also isolate optically pure phenyl propanol hydrochlorides in a higher yield as well as in optically pure form in the range of more than 99% and even able to reach 100%. Thus, both inventive step and novelty have been shown by the 1st Respondent over the prior arts cited and relied on by the Petitioner.
39. The 1st Respondent has also provided sufficient examples before the Patent Controller in order to illustrate the invention which is a process of preparation of new chiral β-amino alcohols which are useful intermediates in the synthesis of anticoagulant drugs. Therefore, I do not find any merit in the contention that the 1st Respondent has not provided sufficient data or comparison relevant to the patent.
40. As held in Agfa’s case (referred herein supra), the invention has to be considered as a whole and dissecting the invention into parts and finding individual parts to be obvious to hold that the invention itself is obvious, is not the right approach to be adopted. In doing so, it is evident from the foregoing discussions that the patent granted to the 1st Respondent is not hit by Section 3(d) of the Act.
41. Also, the EP Patent is of the year 1999 and the US Patent is also of the year 1950 and applying the ratio laid down in Societe’s case (referred herein supra), the prior arts being much earlier to the patent in question and when the 1st Respondent has shown some advancement over the earlier prior arts and the very fact that despite the prior arts being in existence, none has been able to come up with the invention of the 1st Respondent all these long years, by itself shows that there is non-obviousness in the claimed invention.
42. The further fact that the Controller has examined the patent application and raised various objections, including prior arts, all of which have been overcome by the 1st Respondent, before being granted the patent also shows that the Controller has applied his mind and only after a thorough examination of all the claims made by the 1st Respondent, that too after amending the claims twice, the patent has been granted. I do not find any illegality or perversity in the grant, in order to invalidate the same on the grounds raised by the Petitioner.”
Citation: Embio Ltd. v. Malladi Drugs & Pharmaceuticals Ltd., OP(PT) No. 45 of 2023 (H.C. Madras Oct. 4, 2024). Available at: http://indiankanoon.org/doc/184089444/, Visited on: 08/10/2024.
Authored by Dr. Neetha Mohan, Patents Team, BananaIP Counsels
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