Indian patent office has rejected US pharmaceutical major Gilead’s claim of patent protection for its expensive Hepatitis-C drug Sofosbuvir (brand name Sovaldi), enabling Indian generic manufacturer to make a low cost version of the medicine.

The medicine is currently available in India only for emergency cases with a price tag of about Rs 60,000 ($ 900) for a three month period. Though Gilead tied up with seven Indian generic drug makers for local production, the manufacturing has not yet begun.

The patent office’s January 13 order would open up the gates for other drug manufacturers to come out with cheaper version. Incidentally, the medicine is sold in the US market at a whopping cost of $ 84,000 for the same three month treatment regimen.

At the end of a 35 page ruling with details of arguments from both sides, Hardev Karar, deputy controller of patents and designs at the Patent office in Delhi said, “I refuse to proceed for grant of patent on this application.” The decision can be challenged in the Intellectual Property Appellate Board and the Supreme Court.

Two NGOs–Initiative for Medicines, Access and Knowledge and the Delhi Network of Positive People–and drug manufacturer Natco Pharma challenged Gilead's patent claims in Delhi patent office. Another legal challenge against the same drug is pending at the Kolkata patent office.

Though Gilead had agreements with generic producers on local production, these agreements impose many restrictions, including limited export opportunity.

The US company has partnered with Cadila, Cipla, Hetero, Mylan, Ranbaxy, Sequent and Strides Arcolab, which will receive a complete technology transfer. But their export would be limited to 91 nations in the poor and middle income countries – identified by Gilead – and not the US market where the medicine is sold at a cost of $ 84,000. Activists claim that Gilead adopted “diversionary tactics” to prevent low-cost manufacturers from India to export their products to the USA.

With the patent being denied, other companies that have not signed the licence agreement with Gilead are now free to produce the life saving medicine and explore the export market.

Entry of additional generic manufacturers would increase the open competition, leading to further lowering of the prices especially in poor countries that have been excluded from Gilead's list of countries where the $ 900 version of the medicine can be sold.

“Indian manufacturers could produce this drug in the future for as little as $101 for the full three month treatment course. At the current prices, sofosbuvir is unaffordable for widespread use in most countries of the world,” said Andrew Hill, a senior researcher at Liverpool University who researched on the skewed pricing pattern of Hepatitis C drugs.