On July 9, 2024, a single-judge bench of the Delhi High Court (DHC), presided over by Justice Sanjeev Narula, issued a 6-page order in the matter of F-Hoffmann-La Roche AG & Anr. v. Zydus Lifesciences Limited (pdf), granting an interim injunction to Roche until the next date of hearing. The case is intriguing because the DHC may have misgauged the need for such an injunction by focusing solely on Zydus’s conduct without first making a prima facie finding on the existence of a triable issue regarding the infringement. This approach seems inconsistent with the usual grounds for granting quia timet injunctions as established in older precedents. This order, hence, presents an intriguing opportunity to analyse quia timet injunctions. But before delving into that, a brief overview of the background of the present case is warranted.
Quia Timet Injunction to Roche’s Rescue!
In the present case, F-Hoffmann-La Roche AG (Plaintiff) sought quia timet interim relief to prevent the sale and distribution of “Sigrima,” a biosimilar version of the Plaintiff’s “Perjeta,” which contains “Pertuzumab” and is used to treat metastatic breast cancer. The Plaintiff claimed that “Sigrima” infringed upon their patents numbered IN 268632 and IN 464646. Additionally, Zydus Lifesciences Limited (Defendant) entered into a commercial licensing arrangement with Dr. Reddy’s Laboratories, a third party, to co-market their “Sigrima” product in India.
Roche alleged that Zydus launched its biosimilar drugs in the market without informing the Court or the Plaintiff while the dispute was still pending before the DHC. Roche argued that Zydus’s failure to disclose complete and accurate timelines for the subsequent launch of the product amounted to “overreaching the court process,” to which the DHC conceded. Moreover, the DHC commented that the Defendant also went back on their words regarding the final approval of their drug. Previously they had assured the Court that the regulatory authority would take at least three months for a final decision, but now the Defendant claims that they never specified a timeframe and requested more time to respond to the present application. Furthermore, the Defendant had received approval (although conditional) from the Central Drug Standard Control Organisation (CDSCO) on April 04, 2024, and had not disclosed this significant development to the DHC in the two subsequent hearings (April 24, 2024, and May 13, 2024, respectively).
The DHC observed that the Defendant’s lack of transparency regarding significant regulatory developments during the Court’s deliberations raised serious fairness concerns since such nondisclosure deprived the Plaintiff and the Court of important information pertaining to the launch of the impugned product, thus hampering equitable treatment. Defendant’s undisclosed approval and subsequent commercial launch of the product “Sigrima” in partnership with Dr. Reddy’s Laboratories was seen to be exemplifying a potential unfair advantage and made the DHC inclined to restrain the Defendant from marketing “Sigrima” while deciding on the interlocutory application.
The DHC held that the balance of convenience favours the Plaintiffs, as allowing the Defendant to continue sales could alter the market and disadvantage the Plaintiffs, especially if an infringement is later established. Thus, the DHC found compelling reasons to issue an injunction to restrain the defendants from marketing or selling “Sigrima” until the next hearing (which is on July 18th).
Back to the Basics of Quia Timet Injunctions
Sadly for Zydus, this case is not the only time that it has ended up facing the brunt of quia timet actions. On December 12, 2022, another single-judge bench of the DHC in the matter of Novartis Ag & Anr. v. Zydus Healthcare Limited & Anr had dismissed an application to reject the plaint, ruling that Novartis’s claims about Zydus’s actions—specifically, their application for a similar patent (Valsartan and Sacubitril combination) could infringe Novartis’ patent IN 2655MUM2015 and IN 201621044625. There have been several other instances where these injunctions have captured attention over the past decade, such as the successful grant to Novartis against several generic makers over Galvus in 2014 (discussed here and here) or its rejection by the MHC and DHC to Matrix Laboratories and Bristol Myers Squibb respectively due to the lack of jurisdiction (discussed here).
Most Indian cases, including the Novartis v. Zydus case mentioned above, as well as Teva Pharmaceutical Industries v. Natco Pharma Limited, derive their conceptual basis for the grant of a quia timet injunction from Connaught Laboratories Limited v. Smithkline Beecham Pharma Inc., where the Ontario Court held that for the grant of such an injunction:
- The statement of claim must allege a deliberate intention to engage in infringing activity that is imminent and could cause substantial or irreparable damage.
- The facts pleaded must be cogent, precise, and material, not indefinite, speculative, or based on mere intention.
However, on the whole, there are no established standards for granting interim injunctions in India. Aparajita, in her paper (access here), argues that this lack of standards makes the process subjective and speculative. She also notes that the recent increase in such actions in Indian patent cases is concerning given India’s non-presumption of patent validity, lack of ‘clearing the way’ principle, and the questionable quality of patents from the overburdened IPO can have quia timet actions harm innovation and public interest.
Did the DHC Get it Right with the Quia Timet Injunction Grant?
The issue that lies at the very heart of this order is understanding how the rationale of shielding critical information ended up becoming a reasonable basis for the grant of a quia timet injunction at all? If this ‘overreach’ constitutes an abuse of the court process, why grant an injunction instead of imposing costs? The rationale for the injunction in the present case diverges significantly from the tests for granting such relief in earlier precedents as seen above.
Firstly, given interim injunctions generally seek to establish a prima facie finding on infringement, there is no mention of it in any of the earlier orders. In the order dated 23 February 2024 (pdf), the plaintiffs claimed imminent harm from potential infringement of their patents by the defendant’s biosimilar product to obtain a quia timet action to prevent irreparable damage, which was countered by the defendants by reasoning that there is no urgency justifying an ex-parte injunction without hearing their side. The court refrained from granting the relief due to a lack of claim mapping for the biosimilars’ production process and invocation of Section 104A of the Patents Act to determine the allegations of process infringement. It gave out a list of several other directions and kept the rest of the discussion for the future. Unfortunately, none of the later orders discuss in detail whether these conditions were deemed fulfilled subsequently, though the 13th May order (pdf) mentions the defendants did present more arguments against patent infringement.
Secondly, to delve more into the aspect of ‘public interest’ raised in the above part, this aspect commonly becomes critical in cases involving medicinal patents. Should the court grant an injunction solely because the defendant’s launch was not disclosed – especially without any clear order or prima facie finding on infringement? Perzutumab, being an anti-cancer drug, is notably expensive. As of July 16, 2024, Roche’s “Perjeta” was priced at ₹2,20,450 per box! Interim injunctions (see here) can detrimentally impact the pharmaceutical industry by significantly harming generic competitors and, critically, by burdening patients with monopolistic pricing until the patent expires. Moreover, they may deter research efforts and delay the availability of affordable medications.
Fortunately, the injunction is effective until the next hearing date, but this reasoning by the DHC could establish a precedent where courts might begin granting quia timet injunctions after placing a significant burden on defendants to ensure they are informed about every aspect of allegedly infringing products. The next hearing is scheduled within 9 days (i.e., 18 July), which helps avoid any long-term harmful effects of the injunction on the defendants.
Another interesting aspect about quia timet actions is the positive recent development in Patil Automation v. Rakheja Engineers (discussed in an incisive post by Aparajita here), where the Supreme Court had ruled that mediation is mandatory before filing a lawsuit, except when ‘urgent interim relief’ is needed. Though the court failed to define ‘urgent interim relief,’ suits praying for patent injunctions based on apprehension of infringement do not qualify for the criteria, leaving quia timet suits beyond the scope of a pre-mediation remedy now. But if this is truly the case, then how are quia timet actions still being filed that casually? Nevertheless, the legitimacy and future of quia timet injunctions are still debated and evolving; it can only be hoped it evolves in everyone’s favour!