News in brief from around the world… UK politicians have called for patent reforms to combat antimicrobial resistance, while a court in India has banned online drug sales and Mexico’s Supreme Court has ruled to legalise marijuana for personal use in the past week.

Regulation

⇒ A group of UK MPs have suggested reforms to patent law to combat antimicrobial resistance (AMR).

In a report published by the Commons Health and Social Care Select Committee, MPs also stated that investment into scientific research and pharmaceutical companies, and changes to the way pharmaceuticals are reimbursed for new antimicrobial medicines, are needed to tackle this “grave threat to health.”

Scientists say AMR is a growing concern as many bacterial diseases are evolving resistances to existing medicines used to treat diseases like TB, to make childbirth safer and to protect cancer patients undergoing chemotherapy.

The report cites pharmaceutical market failure as “one of the most serious issues in the fight against AMR,” hence the need for changes to patent law.

Current UK medicines have a patent of 20 years, which allows medicines to generate high profits and investment due to exclusivity rights, but also often results in “sparing” prescriptions to “preserve their effectiveness for as long as possible.”

As a potential solution to this market tension, Professor Dame Sally Davies suggested the introduction of a transferable patent voucher, currently being considered in the US, which would “grant a patent extension to the successful developer of specified antimicrobials.”

A commentary on the report, produced by lawyers from Pinsent Masons, states that the patent voucher scheme is “highly controversial” due to concerns that major pharmaceutical companies might use the vouchers to prolong their key patents and so keep drug prices higher for longer.

“No system is perfect, however,” said Asawari Churi at Pinsent. “And desperate times call for desperate measures. Another solution may lie in orphan drug designations,” which are a way of classifying certain medicines to incentivise their development.

Courts and cases

⇒ The Madras High Court has granted an interim restraining order on the online sale of medicines.

The injunction obliges the Indian government and the Ministry of Health to cease online drug sales until a proper legal framework is established.

The order was granted by Justice R Mahadevan following a petition from the Tamil Nadu Chemists and Druggists Association (TNCDA), a body of approximately 30,000 pharmaceutical companies.

The petition claimed that some online pharmaceutical companies had breached India’s Drugs and Cosmetics Rules, 1945 and were operating without proper licences.

Specifically, rule 65, on the condition of licences to sell drugs, and rule 97, on the labelling and packaging of drugs, were allegedly violated by several websites selling medicines listed under the law.

As these regulations were written prior to the arrival of computers, India has no legal provision for online pharmaceuticals. Despite various amendments having been made to them, they still do not encompass information technology in the sale of medicines, the TNCDA said.

The selling of drugs online “cannot be allowed,” the judge reportedly told the court. “Thousands of innocent people may purchase the drugs online just because they were sold at cheaper prices and end up getting harmful products.”

The injunction is set to last until another hearing takes place on 9 November , the Financial Express reports.

⇒ The Supreme Court of Mexico overturned the country’s ban on recreational use of marijuana on 31 October, finding it violated citizens’ “fundamental right to the free development of the personality”.

An announcement by drug regulation body Transform said the court issued judgments on two cases, following three similar rulings from 2015, all of which held that “prohibition of adult cannabis possession, use, and private cultivation was unconstitutional on human rights grounds”.

Transform’s translation of the Supreme Court’s reasoning said it had reached its decision on the basis that people of legal age should be allowed to decide what recreational activities they want to take part in without state interference. The court, however, clarified that certain drugs would continue to be prohibited in Mexico and that the judgment only applied to personal possession and use, not commercial production.

Mexico’s Congress will now have 90 days to repeal and replace rules prohibiting use of marijuana, Transform said.

⇒ On 5 November, the US District Court for the Central District of California ruled that Australian hearing device company Cochlear had infringed two inner-ear implant technology patents, doubling its original fine to US$268 million.

The Alfred E Mann Foundation for Scientific Research (AMF) and Advanced Bionics (AB) asked judge Fernando Olguin to pass a judgment for US$131.2 million against Cochlear, based on a verdict from the lawsuit’s original jury trial in 2014.

This plaintiffs’ request was granted, with the judge adding a US$2.8 million fine for a post-verdict infringement, as well as increasing the damages from the jury’s verdict of wilful infringement, totalling a US$268 million judgemnt against Cochlear.

AMF and AB’s original lawsuit alleged that Cochlear infringed their Multichannel Implantable Cochlear Stimulator and Physician’s Testing System and Method for Testing Implantable Cochlear Stimulator patents.

Despite the jury returning a verdict that the infringement was wilful and awarding damages, a judge in the District Court ruled in 2015 that three of the four patent claims were invalid and that the remaining claim was in fact not wilful.

As such, the court ordered a new trial to be held regarding damages after a ruling from the Federal Circuit Court of Appeals.

In 2016, the Court of Appeals affirmed the infringement judgment and the invalidity of one patent, in addition to reversing the invalidity of another patent, before handing the case back to the District Court to rule on damages and the wilfulness of infringement.

“We are surprised by the decision and do not agree with the reasons given by the judge,” said Dig Howitt, Cochlear’s CEO. “We will continue to defend this case and the next step in the litigation process is our appeal to the US Court of Appeals.”

To stay the execution of the judgment while it awaits the appeal, Cochlear will need to lodge a US$ 335 million insurance bond with the court within 14 days of the judgment’s entry.

A decision on the appeal is expected in approximately two years.

Companies

⇒ White & Case has guided private equity firm EQT in its bid to purchase all shares of Sweden’s Karo Pharma.

EQT announced its public cash offer to Karo’s shareholders on 29 October, whereby it would buy the pharmaceutical company at 36.90 Swedish kronor per share, totalling 5.973 billion kronor (US$654 million).

 “We are impressed by Karo Pharma’s development and successful strategic transformation from an early stage research and development company into a leading specialty pharmaceutical company with a strong product portfolio and European reach,” said Per Franzén, partner at EQT and head of its Nordic Equity business, said in a press release.

Karo Pharma, founded in 1987, became a “specialty pharma company marketing pharmaceuticals” in 2015, following the implementation of a new business strategy. It manufactures medical products such as painkillers, medicine storage devices and ergonomic goods.

The White & Case team in Stockholm that is advising EQT is led by partner Jan Jensen and includes partners Rikard Stenberg, Johan Thiman and Oscar Liljeson, as well as counsel Peter Svanqvist and associates.

The acceptance period of the EQT/Karo deal will last from 13 November to 10 December, with a settlement date due for 18 December.