Introduction
On May 27, 2025, in Zeria Pharmaceutical Co. Ltd. v. Deputy Controller of Patents and Designs1, the Delhi High Court upheld the refusal of divisional patent, affirming that minor structural modifications of known pharmaceutical compounds—especially intermediates—must still demonstrate enhanced therapeutic efficacy to be patentable under Section 3(d) of the Indian Patents Act, 1970. The Court further upheld the refusal on grounds of lack of inventive step under Section 2(1)(ja), emphasizing the need for genuine innovation rather than speculative derivatives.
Facts of the Case
Zeria Pharmaceutical Co. Ltd. filed a divisional patent Application No. 3630/DELNP/2011 titled “A COMPOUND REPRESENTED BY FORMULA (5a)”, on 13.05.2011 out of Indian Patent Application number 1090/DELNP/2007. The Controller refused the subject application vide the impugned order on the grounds that the subject application does not fulfill the criteria envisaged under Section 2(1)(ja) of the Act, since the invention therein lacked inventive step based on prior art documents D1: EP 0994108 A1 and D2: US 5981557 A and fall under the purview of Section 3(d) of the Act.
Zeria appealed the refusal to the Delhi High Court.
Appellant’s (Zeria) Arguments
The Appellant argued that the Controller has failed to evaluate the merits of the invention by erroneously relying upon the prior art document D1 and ignoring the fact that the same has been cited as “A” category in the International Search Report (ISR) indicating its irrelevance in determining the inventive step. Further, the prior art document D1 “teaches away” from the claimed invention since it teaches a reaction wherein a compound of formula (5a) is avoided and therefore cannot help a person skilled to arrive at the compound of formula (5a) as claimed in subject application. The Appellant further highlighted that D2 does not clearly disclose the claimed methyl ester compound having the methoxycarbonyl group and that obtaining it would involve selections from multiple lists, thus making it non-obvious over D1 and D2.
Furthermore, the Appellant submitted that the Controller did not take into account the affidavit as submitted in favor of inventive step under Section 2(1)(ja) and erred in concluding that there was no enhanced efficacy under Section 3(d), despite the submission of experimental data to support this.
Contentions of the Respondent
The Respondent contended that the patent application is correctly refused under Section 2(1)(ja) and 3(d) of the Patents Act since the claimed compounds are an obvious derivative of compounds as disclosed in documents D1 and D2. The Respondent indicated that the only difference between Example 6 of D2 with the claimed compound of the subject application is the presence of “ethoxycarbonyl” instead of “methoxycarbonyl”. Further, D1 and D2 are from the same applicant and both disclose comparable intermediates in the same technical field. Therefore, it appears to be an attempt by the Appellant for mere extension of protection for known process intermediates, which is not permissible.
The Respondent further argued that the claimed compound in question had no enhanced efficacy as required under Section 3(d), and the data provided are related to a hydrochloride salt of a compound of formula (7) rather than the compound of formula (7) whereas the subject application mainly relates to a process for preparation of the compound of formula (7) or 7(a), and not to the hydrochloride form of formula (7) or 7(a). Thus, the data submitted is not applicable to the claimed invention of base compound. Therefore, the invention is not patentable under Section 3(d) as being a derivative of known compound without inventiveness and enhanced therapeutic efficacy.
Issues Before the Court
- Whether the claimed intermediate compounds are barred from patentability under Section 3(d) for lacking enhanced therapeutic efficacy.
- Whether the claimed compounds are “inventive” under Section 2(1)(ja) in view of cited prior art.
Court’s Rationale
Issue 1 – Patentability under Section 3(d)
The Court held that the claimed compound of the subject application is a derivative of the compounds disclosed in Example 6 of D2 as the claimed compound of the subject application share the same core structure, with only a minor difference in the ester group i.e. ethoxycarbonyl group in D2 and a methoxycarbonyl group in the claimed compound of the subject application. Further, under Section 3(d) of the Act, such minor modifications between derivatives require demonstration of enhanced therapeutic efficacy. However, the Appellant failed to show such enhanced therapeutic efficacy of the claimed compound. The comparative data provided by the Appellant did not discuss the enhancement of the “therapeutic efficacy” of the claimed compounds, therefore, it would still not be an invention under Section 3(d) of the Act. This view aligns with the Supreme Court’s stance in Novartis AG v. Union of India2, where it was held that Efficacy means “the ability to produce a desired or intended result”. Further, in the case of a medicine that claims to cure a disease, the test of efficacy can only be “therapeutic efficacy”.
As the Appellant itself stated that since the claimed compound is an intermediate, it is not possible to determine the “therapeutic efficacy” of the claimed compound, the Appellant failed to demonstrate therapeutic efficacy of the claimed compounds over the prior art documents D1 and D2, and the rejection under Section 3(d) remains valid.
Issue 2 – Inventiveness
The Court further upheld the Controller’s decision to reject the subject application, finding that the substitution of “ethoxy” with “methoxy” was an obvious modification for a person skilled in the art in light of prior art documents D1 and D2. Both documents disclose structurally similar compounds. Notably, Example 6 of D2 identifies “ethoxy” as the “D” group, while formula (II) includes “methoxy” as a representative lower alkoxy group. This clearly demonstrates that “methoxy” was explicitly referenced as a lower alkoxy substituent for “D” in compounds of formula (II), thereby confirming its presence in the prior art.
The Court agreed with the Controller’s reasoning, citing Agriboard International LLC v. Deputy Controller of Patents and Designs3, which outlines the factors relevant in determining the inventive step. The Court noted that the Controller had thoroughly analyzed both the subject invention and the prior art and also identified Example 6 of D2 as the closest prior art. Therefore, the objection under Section 2(1)(ja) relating to lack of inventive step was therefore well-reasoned.
Further, the Court held that Controller rightly noted that document D1 disclosed an intermediate compound of formula III, which is used in the synthesis of 2-hydroxybenzoylaminothiazole derivatives. Given the disclosures in D1 and D2, the Court held that a PSITA would find it routine to arrive at the claimed compound based on these teachings. The Appellant’s argument that D1 “teaches away” from the invention was rejected. The Court clarified that the absence of a direct teaching does not equate to a “teaching away,” by relying on Astrazeneca AB & Anr. v. Torrent Pharmaceuticals Ltd.4
The Court concluded that the prior art, particularly compound 38 of D2, would motivate a PSITA to consider structural modifications and reach to the compounds of the claimed invention. As both the prior art and the claimed invention belong to the same technical field, the claimed compounds lacked an inventive step under Section 2(1)(ja) of the Act. Thus, the appeal stands dismissed.
Our Analysis and Conclusion
The decision in Zeria Pharmaceutical Co. Ltd. v. Deputy Controller of Patents and Designs underscores the strict standards for patentability of the pharmaceutical inventions in India. It also emphasizes that minor structural changes or speculative innovations will not suffice for patent protection unless they are accompanied by clear evidence of inventive step and enhanced therapeutic efficacy. This decision makes it clear that, under Section 3(d) of the Act, Intermediates must exhibit improved therapeutic efficacy over the closest prior art compounds to qualify for patent protection. Merely demonstrating improved yield or purity of the final compound through the use of such Intermediates is not sufficient to establish their therapeutic efficacy.
This judgement reinforces Section 3(d) as a safeguard against evergreening and the patenting of trivial modifications. Further, it conveys that seeking patents for Intermediates as a means to bypass Section 3(d) rejections may not be permitted without enhanced efficacy as it indirectly restrict access to the preparation of the main compound.
In contrast to jurisdictions such as the United States or the European Union, where novelty and utility may suffice for patentability of Intermediates, Indian Patent law demands enhanced therapeutic efficacy. This judgment also aligns with the precedent set in Novartis AG v. Union of India (2013), particularly the strict interpretation of “efficacy” under Section 3(d). Ultimately, the ruling reiterates that the Indian patent system will continue to rigorously evaluate pharmaceutical inventions to ensure that patent rights are granted only for genuine innovations that serve the larger public interest.