NEW DELHI - India's Supreme Court is set to rule Monday on a patent challenge by Swiss drug giant Novartis that activists say threatens access to cheap generic versions of life-saving drugs in developing nations.
The landmark case - watched closely by global drug firms and patient groups - involves an updated version of Novartis' blockbuster cancer drug Glivec, for which the company has fought a seven-year legal battle to win patent protection.
India's patent office has so far refused to grant protection, asserting that the amended form of Glivec was not vastly different from the earlier version.
The challenge strikes at the heart of India's patent law, which restricts pharmaceutical companies from seeking fresh patents for making only small modifications to existing drugs - an industry practice known as "evergreening".
The case is the most high-profile of several patent battles being waged in India and could have far-reaching implications in defining the extent of patent protection for multinational drug firms operating in the lucrative market.
The Swiss firm has threatened to halt supplies of new medicines to India if the court does not rule in its favour, London's Financial Times reported on Sunday.
"If the situation stays as now, all improvements on an original compound are not protectable and such drugs would probably not be rolled out in India," said executive Paul Herrling, who is leading the company's handling of the case.
"Why would we?" he was quoted as saying by the newspaper.
But Leena Menghaney, a lawyer with medical charity Medecins Sans Frontieres (MSF), says a legal victory for Novartis could "set a dangerous precedent, severely weakening India's legal norms against evergreening".
It would "be dire for people in the developing world who depend on generic drugs made in this country. It could seriously curb access".
Generic drug firms in India - long known as the "pharmacy to the developing world" - have been a major supplier of copycat medicines to treat diseases such as cancer, TB and AIDS for those who cannot afford expensive branded versions.
The cost difference between generic and branded drugs is crucial for poor people around the world, MSF says.
It points out that Glivec - often hailed as a "silver bullet" for its breakthrough in treating a deadly form of leukaemia - costs US$4,000 (S$5,000) a month in its branded form while its generic version is available in India for around US$73.
But Novartis and other global drugmakers say India's generics industry inhibits pharmaceutical innovation and reduces commercial incentives to produce cutting-edge medicines.
The verdict is keenly awaited by many global drug firms hoping to sell branded medicines in the nation of 1.2 billion people where the pharmaceutical market is set to touch US$74 billion in sales by 2020 from US$11 billion in 2011.
India's copycat drugs industry, which supplies one-fifth of the world's generics, grew into a powerhouse because the country did not issue drug patents until 2005 when it began complying with World Trade Organisation rules.
India currently allows patents only for new drugs or for an updated version of a drug that displays "enhanced" therapeutic efficiency.