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B.B.A., LL.B (HONS.)
ACADEMIC YEAR: 2015-2016



Evergreening: A tussle between Private Monopoly and Innovation
Subject Name: Intellectual Proper Rights
Under the Supervision of: Asst. Prof. Anuradha Nayak
NAME: SHREYA SINGH (500022285)-ROLL NO.: R760212047





1.1 Facts of the case

1.2 Issues:
1.3 Arguments:
1.3.1 Contentions of the appellant
1.3.2 Contentions of the Respondent:
1.4 Judgment:
1.5 Held:




1. The impact of patent regime on controlled prices of drugs.
2. Whether Section 3(d) of the Patent Act, 1970 is in compliance to TRIPS
1. Whether the patent law is still fraught with a number of controversial provisions. How far the SC has
been successful in its approach to balancing public good with monopolistic pricing and innovation with
4. How apt was the SC approach in interpreting the word efficacy used in the section and its
application in the discussed case.




Evergreening1 is an off-the-cuff thought of patent law; best understood as a social plan accustomed
with the myriad ways during which pharmaceutical company owners use the law and connected
regulative processes to increase their high rent-earning intellectual property rights notably over
extremely profitable "blockbuster" medicine, either by getting rid of new patents, or by shopping for out
or frustrating competitors, for extended periods of your time than would unremarkably be permissible
underneath the law. Application for the cancer of the blood drug Gleevec by Novartis too was the same
commit to evergreen its patent.
Novartis Ag v. Union of India, became the primary major legal challenge to Indias fresh amended
jurisprudence of 2005.The judgment rendered by the Supreme Court has been applauded because it can
facilitate offer countless individuals round the world access to cheaper medicines and stop
pharmaceutical giants from evergreening their patents.

In The Supreme Court of India

Novartis Ag v. Union of India & Ors
Citation: (2013) 6 SCC 1














Hon'ble Judges:
Aftab Alam, RanjanaPrakash Desai,JJ.
For Appellant: GopalSubramaniam and T. R. Andhyarujina.
For Respondents: Paras Kuhad
Subject: Patents
Acts/Rules/Orders: section 3(d) of the Patents Act, 1970, section 2 (1)(d) read with section 133 of the
Act, section 24A of the Act, section 25(1) of the Act, rule 55 of the Patent Rules, 2003, Article 14 of the
Constitution of India, Article 27 and Article 64 of the TRIPS Agreement.
1.1 Facts of the case:
Novartis Ag made worldwide applications to patent active molecule imatinib in 1993. Novartis didn't
patent imatinib in India as a result of the 1970 Act didn't enable patenting of pharmaceutical product at
that point. Once India entered the World Trade Organisation in 1995, Novartis filed a mailbox
application within the Madras Patent and Trademark Office Database for imatinibmesylate, a beta
crystalline kind of the free base imatinib. In 2002, Novartis started its Gleevec donation program in
Asian country to produce Gleevec to patients WHO were unable to afford the drugs, however halted that
program when Indian drug makers began to supply a generic version of Gleevec. In2003, the Patent and
Trademark Office Database granted Novartis Exclusive selling Rights (EMR) in Asian country, that
allowed Novartis to enjoin generic Gleevec makers and lift the worth of Gleevec nearly ten-fold.
In Gregorian calendar month 2006, the Madras Patent and Trademark Office Database refused to
grant Novartis a patent for imatinibmesylate. the primary major ground for rejection was that as a result
of imatinibmesylate was a salt kind of the free base imatinib, and Novartis claimed all pharmaceutical
salt types of imatinib in its1993 patents, the Indian application thus lacked novelty and inventive- dry
land. ThesecondmajorgroundforrejectionwasbasedonSection3(d) of the 2005 change, that needed that
new types of a celebrated substance might solely be proprietary as a product if they incontestible
enhanced effectuality. though Novartis disclosed info that imatinibmesylate had a half-hour increase in
bioavailability (the share of the drug absorbed into the bloodstream) as compared with imatinib, the

Patent and Trademark Office Database found this skimpy to satisfy the enhanced efficacy demand of
Section 3(d).
Novartis filed 2 legal instrument petitions before the Madras court U/Art./ 226 of the
Constitution of India to declare that section 3(d) of thePatents Act, 1970 as substituted by the Patents
(Amendment)Act, 2005 is non-complaint with the TRIPSAgreement and / or is unconstitutional
being imprecise, capricious an infringement of art. 14 and consequentially to direct the Controller
General of Patents & Designstoallow the application in 2006. The respondents to the suit were the
Indian Government, the Patent and Trademark Office Database, many Indian drug makers ANd an
Indian public interest. The Indian drug makers were Natco drug company, Cipla, Hetro medicine,
Ranbaxy, Indian Pharmaceutical Alliance and SunPharmaceuticals. The Indian public interest was
Cancer Patient Aid Association. The case was divided between the Madras court and therefore the
property proceeding Board (IPAB). The challenges on journeys compliance and constitutionality of
Section 3(d) were detected by the Madras court2.
It declared that the need as per the section with regards to enhanced efficacy was imprecise and gave
away unrestricted power to the patent examiner, thereby resulting in capricious management of power
within the hands of the authority. In 2007 the court control that the article of the Section 3(d) was to
stop intellectual monopoly privileges, additionally referred to as evergreening by corporations and
additional control that Novartis had the correct to gift the case before a court of law over the proceeding
Subsequently in 2009, when the proceeding board rejected the application, Novartis made a direct and
final appeal before SC through a SLPU/Art. 136 of Constitution.
1.2 Issues:
Whether courts in India have jurisdiction to review if Section 3(d) of the 2005 change is compliant with
Article twenty seven of journeys, and as an alternative, whether or not courts in India will grant
declarative relief that Section 3(d) isn't compliant with journeys and thus offending of Article fourteen of
the Constitution of India.

2 Novartis AG v. Union of India, (2007) 4 MADRAS L.J. 1153


If the courts do have jurisdiction, whether or not Section3(d) complies with Article twenty seven

of journeys.

Whether Section 3(d) violates Article fourteen of the Constitution of India as a result of it's

obscure, whimsical and confers uncontrolled discretion to the Patent Controller.

Whether the product that the appellant claims patent qualify as a new product which comes by

through associate invention that features a feature that involves technical advance over the prevailing
information making the invention non obvious to an individual skilful within the art?

In case the appellants product satisfies the tests and therefore qualifies as invention at

intervals the that means of clauses (j) and (ja) of section 2(1), will its patentability still be questioned
and denied on the bottom that section 3(d) puts it out of the class of invention?

Whether the appellant is entitled to urge the patent for the beta crystalline sort of a matter

referred to as Imatinib Mesylate that may be a therapeutic drug for chronic granulocytic leukemia and
sure forms of tumours and is sold by the name of Glivec or Gleevec.3
1.3 Arguments:
1.3.1 Contentions of the appellant:
That the corporate had met the desired criteria of novelty and creative step because the compound in
question, the beta crystalline type is barely one organism of imatinib mesylate.

That the compound in its beta crystalline type had increased effectiveness over alternative

variants of identical compound like imatinib or imatinib mesylate and thereby all necessities of the
section 3(d) of the Indian Patents Act, 1970 stands consummated.

That ample analysis was dole out to by selection prepare the beta crystalline sort of imatinib

mesylate and it absolutely was warrant being granted patent rights.

3 Novartis Ag v. Union of India & Ors (2013) 6 SCC 1, available at http://supremecourtofindia.nic.in/outtoday/patent.pdf


1.3.2 Contentions of the Respondent:

That the beta crystalline sort of the compound is neither novel nor non-obvious as a result of

publications regarding it within the Cancer analysis and Nature in 1996, and varied alternative
disclosures in Zimmerman patents and by US FDA.

Further the need of effectiveness as declared in section 3(d) of the Act ought to be control to be

taken on lines of therapeutic effectiveness and not simply one among physical effectiveness.
1.4 Judgment:
Considering the contentions of the parties, the Supreme Court ruled that Novartis did not meet the need
of novelty. And additionally thereby failing to qualify as an invention as provided u/s 2(1)(j) and s. 2(1)
(ja) of the Act, as a results of the varied publications and disclosures already created regarding the beta
crystalline sort of the compound, Imatinib Mesylate. The court set to interpret effectiveness as
mentioned in section 3(d) of the Act as therapeutic effectiveness and not simply physical effectiveness.
It csaid that although physical effectiveness of imatinib mesylate in beta crystalline type is increased as
compared to alternative forms. however since there was no substantive associated conclusive material
and proof to prove that beta crystalline sort of imatinibmesylate can turn out an increased or superior
therapeutic effectiveness4, Novartis did not meet the necessities below Section 3(d) of the Act. The
Supreme Court went with the therapeutic effectiveness interpretation over physical effectiveness as a
result of the actual fact that the compound was of medicative price.
1.5 Held:
Thus the judgment given by a Bench of the Supreme Court, upheld the rejection of the application filed
by Novartis for Glivec in 1998 before the Indian government agency.


The judgment is first of its kind as it involves section 3(d) for the first time. It has established a
jurisprudence for the world to look forward to as the provision is unparallel.


PHARMACEUTICALS IN INDIA, (LexisNexis 2011) (2009).

However, the court creates confusion by asking the courts and patent officers to be guided on the anvil
of efficacy, but does not give any direction or definition that what constitutes therapeutic efficacy.
Moreover I believe that the SC through the judgment has set the standards of non-obviousness so high,
that it might categories certain innovations worth patenting as not efficacious. The SC might have
balanced monopolistic approach and innovation but by discouraging evergreening many pharma giants
may be discouraged in investing in India markets now.
Altogether it will promote indigenous R&D in the country and establish a stringent patent regime.
1. Impact of Patent Regime on controlled prices of drugs?
Today prescribed drugs firms area unit payment millons on analysis and development.
It is seen that of each thousand potential medication tested, solely 5-6 reach clinical trials and just one is
really approved for promoting. Pharmaceutical firms patent the medication that they develop and
therefore thereby acquire exclusive promoting rights; the prices of analysis and the profits attributable to
the shareholders area unit recovered through applicable evaluation mechanisms from the patients World
Health Organization receive the proprietary medication.
Universally, drug patents and therefore the choose showcasing rights connected thereupon area unit
recompensed for a time of twenty years; amid now, no alternative drug organization is allowable to form
or market identical drug. Once the patent terminates, completely different organizations area unit
allowed to form and market the drug; their brands area unit referred to as generic versions.
As Asian country wanted to boost its presence within the international market, it became clear that it
might now not defend domestic customers in its patent policy. Asian country may be a member of the
planet Trade Organization. Asian country thus needs a replacement law to fulfil its obligations below the
trade-related aspects of belongings rights (TRIPS). India became a member of the Paris convention and
signed the Patent cooperation pact with impact from Dec 7, 1998. Since then, amendments to the Patent
Act were enacted in April 1999 and will 2002. The third change became due. the mandatory bill to form
the Indian Patents Act TRIPS-compliant was alleged to are tabled throughout the 2004 winter session of
Parliament; instead, AN ordinance was passed on Dec twenty six, 2004, that came into impact on
January one, 2005. This ordinance changed the Indian Patents Act. This ordinance was itself changed

and therefore the Patents (Amendment) Bill was gone by the Lok Sabha and Rajya Sabha on March
twenty two and March twenty three, 2005, severally. The President signed the bill on April five, 2005,
creating it AN Act of Parliament.5
Present scenario in India:
1.India will respect patent of the product.

For the amount of twenty years product Patent are going to be revered from the time of

application and not from the grant of patent.


New applications or new entities are going to be accepted and processed once more and it'll be

for twenty years from the date of application. As per the Cooperation pact that Asian country has signed
which can more create it attainable for a replacement invention to be proprietary in additional amount.6
4.The agencies World Health Organization have an interest within the product are going to be given a
chance to oppose the grant of patent each pre-grant and post-grant opposition are going to be taken. With
the new Patents Act of 2005, pre-grant opposition has been strengthened: longer has been allowed and
therefore the person has been given the correct to be a celebration to the proceedings.

Despite the fact that the patent are going to be awarded with retrospective impact from the date

of application, the implementation of the patent can solely be with prospective impact.
Therefore the generic versions of a drug can have to be compelled to be withdrawn solely once a patent
is awarded and therefore the companys producing and promoting the generic medication won't be
retrospectively answerable for having factory-made and marketed the drug.The companies World Health
Organization area unit producing product proprietary between 1995 and 2005 are going to be allowed to
continue their work by paying an affordable royalty to the patent holder.

Companies depend on evergreening to increase the length of their patent with them. It refers to

the creating of minor modifications in an exceedingly drug structure or formulation. within the
ordinance gone by Indian government not not embrace evergreening. However, within the Patents Act of
2005, the definition of patentability was changed thus on stop evergreening.7

5 Indian Patent Law and TRIPS: Redrawing the Flexibility Framework in the Context of Public Policy
and Health V.K. Unni Presented in March 2011 at the University of the Pacific, McGeorge School of
Law Symposium on The Global Impact and Implementation of Human Rights Norms.
6 available at http://http//:www.patentoffice.nic.in/ipr/patent/mashelkar_committee_report.doc.


As once the older applications area unit cleared and therefore the new patents area unit awarded, freshly
introduced generics within the Indian market area unit to be taken back tadalafil have disappeared from
the shelves. And, newer major tranquilizer, medicinal drug, antiepileptic drug and alternative medication
are going to be allowable to be marketed solely by the patent holder.
As having the monopoly the price to the patent can rise.8
As being the only supplier and having the rights currently the drug that comes in international market
are going to be out there to Indian Patents kind the primary patent holder, and this may result in the
increase within the price.
2. If Section 3(d) of the Patent Act, 1970 is in compliance to TRIPS
Section 3(d) of the Indian Patent Act, 1970 has been underneath the gun ever since it was introduced to
the Act through amendment. Foreign pharmaceutical corporations have time and once more did not
establish that the letter of this provision violates the journeys, and have, recently, in Associate in Nursing
aggressive move, tried to attack its validity by stating that the spirit of the section isn't in compliance
with the journeys. This move, that may hamper Indias pharmaceutical business, was established by the
America Associate by difficult Section 3(d) within the World Trade Organization arena by revitalizing
the principle of Non-violation complaints that permits a rustic to question the policy of another
member country although there's no actual violation of an agreement.
The riddle revolving around section 3(d) of the Patents Act 1970 has one facet involving the flexibility
provided inside the visits Agreement. it completely was argued by Novartis that, India has overrun the
international commitment whereas victimisation the journeys flexibility in writing the section 3(d)
exception. This instance reflects one in each of the foremost necessary issues with flexibility provided

7 Thawani V, Gharpure K, Thawani M. Patent laws must be in the national interest. Indian J Pharmacol 2006;38:702http://www.startribune.com/562/story/1002905.html

8 Qaiser M, Chandran MP. Patent holder deserves monopolistic rights. Indian J Pharmacol 2006;38:73-5

inside the international legal instruments therefore on administer house to maneuver towards
safeguarding national interests.
In the light-weight of our case, varied remote pharmaceutical organizations have communicated their
worry regarding India's patent principles. As mere before in one in all our past net journal articles [A
Lowdown on the Indo-US Tensions attributable to India's Patent Regime], the Indian Patent
administration has caused strain on its association with totally different nations. With the developing
interest for medications, varied created Countries square measure starting to discover new and
unplumbed edges to strike down Section 3(d).
By and huge, a discussion emerges once one Country ruptures Associate in Nursing understanding or a
promise. A non-infringement dissension could be a cure that has existed following the start of UN
agency and licenses a world organization half to check another's strategy, not on the grounds that it
contradicted concurred commitments however rather on the premise that a plus rising underneath a
world organization understanding has been invalid or disabled by a usually WTO-steady live. This
implies however a basic perusing of Section 3(d) won't per say render it violative of the TRIPS, be that
as it may, its strict understanding will influence the IP privileges of pharmaceutical organizations in
outside nations, in this manner vanquishing the target of TRIPS assention. Along these lines, such a
measure can be addressed utilizing non-infringement objections.9
The non-violation complaint provision stands suspended even since it was included under the TRIPS
agreement. In the upcoming 10th WTO Ministerial Conference which is scheduled to take place in
December, US and Switzerland propose to recommend the termination of the suspension on nonviolation complaints. Whereas, India and Brazil submitted a joint proposal, co-sponsored by 17 other
countries, calling for continuing the suspension on non-violating complaints under the TRIPS
3. Whether the patent law is still fraught with a number of controversial provisions. How far the
SC has been successful in its approach to balancing public good with monopolistic pricing and
innovation with affordability?
In 2005, India purportedly made the final changes required to bring its intellectual property laws in
compliance with the Trade-Related Aspects of Intellectual Property Rights (TRIPS), the World Trade
9 Rishi Gupta, TRIPS Compliance: Dealing With the Consequences of Drug Patents in India, 26 HOUS.
J. INTL L. 599, 602 (2004).

Organizations (WTO) minimum standards for intellectual property protection, 10 but its patent law is still
fraught with a number of controversial provisions.11 The ability of pharmaceutical companies such as
Novartis to secure patent protection in India not only is important in creating incentives for
pharmaceutical research, but also greatly affects the Indian generic drug industry, and therefore the price
of medicine available to patients.
The Patents (Amendment) Act of 2005 (2005 Amendment) removed the prohibition of product patents
for pharmaceutical compounds, allowing any company to seek both product and process patents in
India.12 However, other provisions in the 2005 Amendment could potentially limit the reach of product
patent protection. One of the newly introduced provisions, Section 3(d), which is the subject of the
Novartis litigation, states that the following are not patentable inventions:
The mere discovery of a new form of a known substance which does not result in the
enhancement of the known efficacy of that substance or the mere discovery of any new property
or new use for a known substance or of the mere use of a known process, machine or apparatus
unless such known process results in a new product or employs at least one new reactant.
ExplanationFor the purposes of this clause, salts, esters, ethers, polymorphs, metabolites, pure form,
particle size isomers, mixtures of isomers, complexes, combinations and other derivatives of known
10 Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr. 15, 1994, Marrakesh
Agreement Establishing the World Trade Organization, Annex 1C, Legal InstrumentsResults of the
Uruguay Round, 33 I.L.M. 81 (1994)
UNION OF INDIA, available at http://re.indiaenvironmentportal.org.in/files/file/TRIALS%20AND
12 Many commentators contend that the 2005 Amendment illustrates a compromise between the
obligation to recognize pharmaceutical product patents and the desire to restrain overbroad IPRs. The
2005 Amendment began as the Patents (Amendment Bill) of 2003, but the Bill lapsed due to a change in
government. Legislators feared that India would not meet its 2005 TRIPS deadline and instead passed
the Bill as a temporary Presidential Ordinance in 2004. Due to intense public debate and pressure from
the Left (Communist) party (representing the interest of Indias poor), the final version of the Patents
(Amendment) Act of 2005 was significantly different from the 2004 Ordinance. See, e.g., Mueller, The
Tiger Awakens, supra note 21, at 529-531.

substance shall be considered to be the same substance, unless they differ significantly in properties with
regard to efficacy. This controversial amendment is aimed at preventing frivolous patents that are only
trivial modifications of existing inventions. Some commentators have alleged that the objective of
Section 3(d) is to prevent evergreening.13
Both the Chand Report of 1950 and the Ayyangar Report of 1959 called for the need to encourage
innovation and prevent foreign monopolization.14 By explicitly abolishing patents for pharmaceutical
products, the 1970 Act generated immediate and dramatic results. Within a decade, the number of
foreign-owned patent applications filed decreased sharply. Because pharmaceutical products patented
outside of India could be reverse engineered and manufactured, India developed a capable generic drug
manufacturing industry reputed for producing generic versions of branded drugs at low cost. Today,
India still has a thriving domestic generic drug industry that competes directly with brand-name drug
manufacturers from the U.S. and Europe. 15 Indeed, India and Japan are the only two countries where
generic drug manufacturers dominate over multinational corporations. The domestic industry is itself
divided between several large companies (such as Ranbaxy, Cipla, and Dr. Reddys Laboratories), which
engage in some original research and development in addition to generic drug production, and hundreds
of smaller companies, which exclusively reverse engineer and manufacture generics. Both segments rely
heavily on export markets. Meanwhile, a growing Indian middle class and an expanding health
insurance system have increased the demand for medicines within India. Annual sales have been
predicted to triple to $20 billion by 2015. The landscape of the multinational pharmaceutical industry in
India is also changing. Multinational companies traditionally manufactured drugs outside of India and
then exported them into India. Recently, multinationals are leveraging Indias low labor costs and skilled
workforce to conduct manufacturing, R&D, and clinical testing in India. Yet, India must compete with

13 Janice Mueller, The Tiger Awakens: The Tumultuous Transformation of Indias Patent System and
the Rise of Indian Pharmaceutical Innovation, 68 U. PITT. L. REV. 491, 495 [hereinafter Mueller, The
Tiger Awakens].
14 Id. at 510-12.
15 Aaron Smith, Report: Indian Drug Market to Reach $20B, CNNMONEY.COM, Aug. 22, 2007,
http://money.cnn.com/2007/08/22/news/companies/india_pharma/index. - htm (last visited Dec. 20,

countries such as Singapore or China for foreign investors who prefer more stringent patent rights. 16 The
fragmented Indian pharmaceutical industry has led to a wide disparity of interests with respect to patent
protection. Not only do multinational drug companies want enhanced patent protection, but some
domestic companiesprimarily those who have significant research and development operationsalso
want a stronger patent regime. Other domestic companies, however, fervently oppose patent law reform,
fearing that it would lead to patent-based monopolies and destroy their imitation-based business models.
4. How apt was the SC approach in interpreting the word efficacy used in the section and its
application in the discussed case.
Section 3(d) of the 2005 Amendment, which required that new forms of a known substance could be
patented as a product, only if they demonstrated enhanced efficacy; 17 its interpretation by SC is worth
appreciating. Although Novartis disclosed information that imatinib mesylate had a 30% increase in
bioavailability (the percentage of the drug absorbed into the bloodstream) as compared with imatinib,
the Patent Office found this insufficient to meet the enhanced efficacy requirement of Section 3(d).
The court interpretation regarding efficacy as therapeutic effectiveness has been used to oppose
several patents which were an attempt to evergreen. Some of those cases include Astra Aktiebolags
Application (Opposition by Torrent Pharmaceuticals Limited).18 However, the court creates confusion by
asking the courts and patent officers to be guided on the anvil of efficacy, but does not give any
direction or definition that what constitutes therapeutic efficacy.

16 See generally Hitesh Gajaria, Protecting IP for Prosperity, ECONOMIC TIMES (India) (Aug. 3,
http://economictimes.indiatimes.com/Guest_Writer/Protecting_IP_for_prospertity/articleshow/2251915.cms (expressing need for IP protections to compete
in the region)
17 In the Matter of an Application for Patent No. 1602/MAS/98 (Jan. 26, 2006), available at
http://www.scribd.com/doc/416824/Patent-office-Order-India-Glivec; See also Basheer, First Mailbox
Opposition (Gleevec) Decided in India, (discussing ruling).
18 Patent Application No. 1255/DEL/1995.

The New Patent Regime has many edges because it can result in Indian pharmaceutical sector into larger
efforts in analysis and development. Many of the pharmaceutical majors in India have already applied
for the patents for various medication and chemicals.
1. Laboratory outsourcing and alternative clinical trials in Indian can considerably increase, and it'll
facilitate the domestic method and approved promoting of a replacement drug. And additionally
outsourcing can more decrease the analysis price. All this will result in bulk drug manufacture could
also be outsourced to Asian country, which might more cut back the prices of the marketed product.
2. Now the Competition will eventually change from brand v. brand to drug v. drug
3. Little firms can now come up with good quality of drug.
4. Will restrict companies from evergreening their product patents with little modifications.
5. Will promote generic drug brands cut down prices.

Web Links referred1. Rahul Cherian, Novartis v. Union of India & Others, Supreme Court of India Civil Appeal No.
2706-2716 of 2013, available at http://www.lawinfowire.com/articleinfo/novartis-v-union-indiaothers-supreme-court-civil-appeal-no-27062716-2013
AG V. UNION OF INDIA, available at http://re.indiaenvironmentportal.org.in/files/file/TRIALS
3. Novartis
Books referred-






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