Kerala High Court Rules Centre Can Use Section 100 of Patents Act to Make Exorbitantly Priced Patented Drugs

The Kerala High Court (搜索)搜索该词条 on Monday, September 28, held that Section 100 of the Patents Act can be invoked by the Central government to use a patent to manufacture the medicine covered by it and sell it to a person, including a needy patient, on a non-commercial basis. Justice Harisankar V. Menon delivered the verdict in a suo motu plea on exorbitant pricing of patented life-saving drugs, cited as 2026 LiveLaw (Ker) 528. A detailed order is awaited.

"I dispose of the petition with the following findings. (i) Notice under Section 100 of the Act would also include entitlement of the government to use the patent or invention for manufacturing the medicine covered by the patent and sell the same to a person, including a needy patient on a non-commercial basis. (ii) Section 100 is required to be invoked in circumstances where the government is required to intervene such as an instance where the medicine manufactured on the basis of a patent is being sold at an exorbitant price. (iii) Government requires to collate the required data and arrive at a decision as to whether a particular medicine is affordable or not and on that basis, proceed under Section 100 of the Act if found necessary," the Court pronounced in open court.

Section 100 empowers the Central government to use compulsory licences in circumstances such as national emergency, extreme emergency or public, non-commercial use, enabling others to manufacture a patented product without the patent holder's permission.

Origin of the Proceedings

The plea was originally filed in June 2022 by a breast cancer (搜索)搜索该疾病 patient who was being treated with patented ribociclib查看药品详情 and sought intervention by the Central government under the Patents Act. She sought to make the drug, priced at around Rs 75,000 per month, more affordable, and contended that the medicine remained expensive and inaccessible for many patients because patent protection prevented other manufacturers from producing or selling it at a lower price without the consent of the patent holders. The drug currently costs about Rs 78,468.75 per month.

The petitioner died in September 2022. On September 16, 2022, the Court decided to continue considering the matter as a suo motu case under the title "In Re Exorbitant Pricing of Life Saving Patented Medicines." Advocate Maitreyi Sachidananda Hegde served as amicus curiae.

The case centred on ribociclib查看药品详情, a patented breast cancer (搜索)搜索该疾病 drug manufactured by Novartis查看公司主页, and palbociclib查看药品详情, another breast cancer drug whose patent expired and which is available from several manufacturers at a significantly lower price. The question before the Court eventually turned on whether palbociclib could be used as an alternative drug to treat the cancer. The Court had earlier observed that if palbociclib could be used for the same treatment, then prima facie there may be no need for the Central Government to invoke compulsory licensing provisions under Sections 92 or 100 of the Patents Act.

Amicus Arguments on Substitutability and Cost

The amicus curiae submitted that palbociclib查看药品详情 is not a substitute for patented ribociclib查看药品详情 and abemaciclib查看药品详情 because of varying toxicity profiles. She stated that ribociclib, and not palbociclib, is the medicine prescribed in early stage disease, while the latter may be used in metastatic stages. Since early intervention reduces the chances of death, the unaffordability of the patented medicine blocks the right to health of patients in early stages, it was argued.

The amicus also submitted that the medicine accounts for only 36% of total treatment costs, which include chemotherapy and surgery, and that in most cases prices are met through borrowing or pledging. She pointed out that there is no systemic or scientific study on the number of diagnoses and deaths reported in each type of cancer. She raised an aspect of gender discrimination, stating that women's health takes a backseat in India as women are expected to make sacrifices. In the case of a newly impleaded patient, the amicus noted that she can afford the medicine only through insurance, that her insurance was rejected three times before being accepted, and that it is uncertain whether the insurance will be renewed.

Referring to "government purposes" under Section 100, the amicus submitted that the provision is for non-commercial sale, and that taking the whole purpose of the Act and the public health aspect, the Central government is duty bound to intervene. She also pointed out that two local companies have obtained CDSCO approval to manufacture the drugs but have not applied for compulsory licensing under the Act.

Patent Holders Contest Section 100 Route

Novartis查看公司主页 manufactures patented ribociclib查看药品详情 and Eli Lilly查看公司主页 Pvt. Ltd. manufactures patented abemaciclib查看药品详情. Novartis argued that Section 100 cannot be invoked without first adverting to compulsory licensing under Sections 84 and 92. It pointed out that ribociclib is already made available under a capped price, with 30% of the trade margin capped. Novartis contended that invoking Section 100 would leave the patent holder high and dry since it invests billions into R&D to create the drug, and that such a move, based on the arguments of two or three persons that the medicine is unaffordable, would not warrant interference by the Court. Novartis also argued that the grant of a patent is itself in the public interest, because at the end of the patent period the process would be revealed; if patents are not granted, businesses would have no incentive to disclose and would keep the process as a trade secret.

Eli Lilly查看公司主页 Pvt. Ltd. contended that there is no national emergency where the three medicines, which are substitutable, are unavailable. It pointed out that the company provides schemes under which patients are given the medicine free in certain situations, and that cancer centres also give the medicines at affordable prices. It argued that only the government can take a decision in this matter, and that the drug discovery process, which takes over 10 years and an investment of billions of dollars, is overlooked. Counsel told the Court that although the patent was applied for in 2008, it was granted only in 2018, cutting 50% of the period the legislature intended for a patent holder. It contended that there is a public interest in enforcing the Patents Act and the integrity of patents, and that the Act is self-contained legislation that adequately balances the right to property and the right to health.

Union Position and Other Submissions

On behalf of the Union, it was argued that a system is working in the field of manufacture and that there is a mandate to ensure benefits and profits to the patent holder even under compulsory licensing. Considering the wide scope of the suo motu petition on exorbitant pricing of life-saving drugs, all companies manufacturing such drugs would have to be heard, it was contended. The Union further contended that medicines have to be made affordable to both the patient and the manufacturer, and that there is no single research or data showing what price would be affordable or that a medicine would become affordable when manufactured under compulsory licensing. Only competitive manufacturing would bring down prices, which would require invocation of Section 92 or 100, and the same is not warranted in the present circumstances, it was argued.

The Department of Pharmaceuticals pointed to financial repercussions such as setting up factories and procuring machinery, raw materials and expertise to manufacture the medicine, as the same is not being done in India. It also noted central government schemes that give a financial incentive of Rs 15 lakhs or procure free medicine if applied for by patients.

Counsel appearing for the husband of the original petitioner and the newly impleaded cancer patient pointed out the actual costs of the medicines, which come to Rs 7 lakhs to 10.8 lakhs per annum, and argued that in the face of no affordable alternatives the government has a duty to invoke the provisions of the Patents Act.

Rahul Bajaj, the intervenor appearing in person, suggested that the Ministry of Health and Family Welfare may be asked to develop a mechanism to monitor and evaluate how many cases exist where people do not have access to life-saving patented medicines. He pointed out that the language employed in Section 100 regarding "government use" indicates public, non-commercial use as well, and that the patent holder would be adequately compensated in the case of compulsory manufacture or in procurement for non-commercial use. He submitted that although a patent holder has a right to property, in a clash with the right to health the balance should be made giving weightage to the latter.