Bayer Corporation v. Union of India (2014 – Compulsory Licensing, Natco Sorafenib Case)

A defining judgment affirming India’s power to grant compulsory licences for life-saving medicines.

Summary :

This case revolves around India’s first major compulsory licence granted to Natco Pharma for Bayer’s patented cancer drug Sorafenib Tosylate (Nexavar). Bayer argued that the licence violated its patent rights, while Natco contended that the drug was unaffordable and inadequately supplied in India. The IPAB and later the courts upheld the compulsory licence, emphasizing public interest and access to essential medicines.

Facts of the Case :

Nexavar, priced extremely high, was inaccessible to most Indian patients. Natco applied for a compulsory licence stating that Bayer failed to meet reasonable public requirements, charged exorbitant prices, and did not manufacture the drug locally. Evidence showed that only a small fraction of eligible patients had access to the medicine due to cost barriers. Natco proposed selling the generic version at a dramatically reduced price.

Court Findings / Reasoning :

Authorities found that Bayer did not ensure adequate availability or affordability of the drug, which violated Section 84 of the Patents Act. The court highlighted that patent rights are not absolute; they exist alongside public health obligations. The decision noted that when a lifesaving medicine is priced beyond the reach of the public, compulsory licensing is justified.

Suggestions / Practical Lessons :

Patent holders must meet public-requirement standards, ensure availability, and price essential medicines reasonably. The case established India as a model for using compulsory licensing to balance patent protection with public health needs.

Judgment :

The compulsory licence granted to Natco Pharma was upheld, allowing it to produce and sell affordable sorafenib.