Pharmaceutical giant gives up medicine patent
By Jia Hepeng (China Business Weekly)
Updated: 2004-08-26 15:14

British pharmaceutical giant GlaxoSmithKline (GSK) has stepped down from a legal battle and released a patent for Rosiglitazone -- the major compound of the diabetes drug Avandia.

Many expected the company to embark on a legal wrangle over the drug.

But it announced last Wednesday it would give up the patent without a fight.

However, GSK still retains two patents on Avandia, covering Avandia's formula -- Rosiglitazone maleate -- and its manufacturing techniques. The conglomerate's decision will enable Chinese drugmakers to copy Rosiglitazone in other pharmaceutical salts -- but they cannot produce generic Avandia.

GSK did not give reasons for its decision.

Lilian Xiao, a spokeswoman for GSK China Investment Co Ltd, said that "after careful assessment of the situation, GSK is voluntarily abandoning the Rosiglitazone formulation patent and withdrawing from an invalidation hearing held by the State Intellectual Property Office (SIPO) on its patent."

Xu Guowen, president of Beijing Anboda Intellectual Property Right Co Ltd, was quoted by the Guangzhou-based Information Times as saying that GSK's withdrawal was because invalidation applicants have enough evidence.

Anboda is representing Chinese firms in the Rosiglitazone case.

GSK's Avandia was launched in China in 2001 for the treatment of type 2 diabetes. In China, patents covering the active ingredient of Avandia, or Rosiglitazone maleate, and its manufacturing process were granted to GSK in 2000 and 1998 respectively.

Starting in 1993, more than a dozen Chinese drugmakers began to copy Rosiglitazone in other forms of salts.

In July 2003, a patent covering formulations containing 2-8 milli-gram of Rosiglitazone or its pharmaceutically acceptable salts or solvates, was granted to GSK in China. That made all Chinese drugmakers unable to produce Rosiglitazone in other forms of salts, which means their initial investment -- estimated at more than 100 million yuan (US$12.1 million) -- would be wasted.

In early 2004, four domestic drugmakers -- including Shanghai-based Sunway Pharmaceutical Co Ltd, Chongqing-based Taiji Group and Zhejiang Wanma Pharmaceutical Co Ltd, and Chengdu Hengri Pharmaceutical Co Ltd -- filed an application to SIPO to invalidate GSK's the patent.

Guo Xiaodong, a drug patent expert with Beijing-based NTD Intellectual Property Agency, said GSK must have its own, unknown consideration in giving up the patent voluntarily.

"I guess GSK may worry about the possible failure to maintain its patent, which will put GSK in a disadvantageous position in marketing Avandia and other drugs," said Guo.

It might want to absorb the lessons of Pfizer's Viagra, Guo added.

SIPO declared the patent for Viagra's active ingredient Sildenafil as invalid in China because it does not conform with Article 26 of China's Patent Law which says the description of the patented product must enable a person skilled in relevant fields to understand its creativity.

Pfizer has tried in vain for two years to protect its Viagra's patent in China.

But the company said it will appeal to Chinese courts to topple the judgment.

Analysts say the process may take at least another two years.

They say Pfizer has used too much energy to maintain its Viagra patent, but use less energy to promote the drug, which some experts say may help cure one-tenth of Chinese males' erectile dysfunction.

Despite Viagra's huge market potential, the drug's sales remain lukewarm in China. Insiders estimate Viagra's annual sales do not surpass 10 million yuan (US$1.2 million), while the drug's global sales were more than US$500 million in 1998.

For GSK, keeping Avandia's market shares seems more important.

According to Chinese legal stipulation, domestic drugmakers will need at least one year to obtain production licences for drugs containing Rosiglitazone in other pharmaceutical salts.

It is estimated that sales volumes of clinical diabetes drugs were 1.46 billion yuan (US$176.3 million) in 2003, rising 9.3 per cent over the previous year.

Between 1999 and 2003, clinical diabetes drug sales grew 11.4 per cent annually in China.

Guo said that seeing Pfizer and GSK's lose their patents may stimulate more Chinese drugmakers to file lawsuits against foreign pharmaceutical giants' establishing patents in China.

"The patent of a compound covering all of its pharmaceutical salts is reasonable. After all, it is compound that takes huge capital and long time to develop, not its salts," said Guo.

On the other hand, producing generic medicines is the most popular way for Chinese drugmakers. At least 97 per cent of chemical medicine produced in China is generic.

Therefore, more domestic pharmaceutical firms may be lured to copy other pharmaceutical compounds by trying to find the loophole in their Chinese patents, Guo said.

Close