India’s generic drugmakers hope to get a bigger piece of the US market and reap a windfall from the recent Supreme Court decision that requires more stringent proof of inventiveness for patents, The Red Herring writes.

The Court’s unanimous April 30 ruling makes it easier to invalidate patents and raises the threshold for obtaining new patents. Calling it a “very positive move” for the Indian pharma industry, Dilip G. Shah, secretary general of the Indian Pharmaceutical Alliance in Mumbai, says “the court decision will pose an enhanced threat to an existing patent should it be challenged.”

Indian drugmakers, which produce over 22 percent of the world’s generic drugs, according to the consulting firm KPMG, already spend enormous effort challenging patents in order to sell in the US market. FDA figures show about a dozen Indian companies - led by Aurobindo Pharma, Ranbaxy, Wockhardt, and Dr. Reddy’s Laboratories - account for 23 percent of generic approvals since December 2006.

The Supreme Court ruling means patent challenges could become an even more viable business strategy for generics producers. Dr Reddy’s, India’s second-largest drug company, says it has filed 33 patent challenges in US courts. Ranbaxy, Cipla, Sun, Glenmark, Cadila Healthcare, and others also have filed several challenges.

The Court ruling may make it easier to win those challenges, which, for regulatory reasons, are usually brought when the patent nears its expiration date. Even before the ruling, big pharma had been expecting losses from patent expiration in excess of $100 billion between 2007 and 2010.

Still, some analysts say it’s too early to say which side will gain more from the Court ruling - big pharma or generics - since generic drugmakers are also known to file for patents that could be deemed frivolous. “I think any ruling works both ways,” says Sanjiv Kaul, managing director of New Delhi-based PE fund ChrysCapital. “What’s good for the goose is good for the gander.”

Source: The Red Herring[tags]Generics, India, Patents[/tags]