Exclusive use of a trademark derived from a generic drug name is not permitted
The Division Bench of the Delhi High Court (“Supreme Court“) in the case of Sun Pharmaceutical Laboratories Ltd. vs. Hetero Healthcare Ltd. & Anr., ruled that a trademark derived from a generic drug name cannot be granted exclusive use. The High Court dismissed the appeal of Sun Pharmaceuticals Laboratories Ltd. (“Sun Pharma”) on the grounds that there can be no monopoly of Sun Pharma since their trademark ‘LETROZ’ is derived from ‘LETROZOLE’ which is an international nonproprietary name (“HOSTEL”) of a salt.
Sun Pharma has a registration of the mark “LETROZ” in Class 5 of the Trade Marks Act 1999 (“Trademark Law”), which is a drug used for the treatment of advanced breast cancer. It contains an active ingredient ‘LETROZOLE’. Sun Pharma sued Hetero Healthcare Ltd for trademark infringement and passing off. (“Hetero”) for the use of the trademark ‘LETERO’. The Single Judge, while rejecting Sun Pharma’s request for an interim injunction, found that both marks were derived from a generic name. Therefore, no case is established for the grant of an injunction.
Injured by the order of April 29, 2022, dismissing the application for interim measures (“Order contested”), Sun Pharma appealed to the High Court against the challenged Order. The appeal was heard by the divisional bench of Judge Vibhu Bhakru and Judge Amit Mahajan.
Sun Pharma claims:
- It is one of the largest generic drug manufacturing pharmaceutical companies in the world. The LETROZ product has been produced since 2001. Due to the trademark registration, it has a statutory right to the exclusive use of LETROZ and is therefore entitled to an injunction. Hetero has been using LETERO since 2017, in order to pass off its products as those of Sun Pharma and tries to take advantage of the goodwill and reputation acquired by Sun Pharma.
- Sun Pharma relied on judgments in Automatic Electric Limited v. RK Dhawan and Ajanta Pharma Limited v. Sunways (India) Pvt. ltd. declare that generic marks can also be protected by injunction.
- Hetero argued that the Sun Pharma and Hetero trademarks were derived from “LETROZOLE”, which is an INN of a salt and that Sun Pharma has no exclusive right to it and cannot claim a monopoly. Further, Sun Pharma was aware of Hetero’s use of the mark. Under Section 33 of the Trademark Act, he consented.
- LETERO is a registered trademark of Hetero and is invented by combining the first two letters of LETROZOLE salt with the last four letters of Hetero. It has various marks in which it combined the last 4 letters of Hetero.
- Hetero relied on the list of INNs published by the Office of the Comptroller General of Patents, Designs and Trademarks, Ministry of Commerce and Industry, Government of India (“Controller”) which indicates that LETROZOLE is an INN and cannot be registered. Section 13 of the TM Act states that no word declared by the World Health Organization (“WHO”) and notified in a manner prescribed by the Registrar of Trademarks as an INN may be registered as a mark.
High Court Decision and Findings
- The High Court referred to and relied on Schering Corporation v. Alkem Laboratories Ltd.(“Schering”). In Schering, the Single Judge had refused to grant an injunction for the trademark “TEMODAL” and “TEMODOR” against the defendant’s trademarks “TEMOKEM” and “TEMOGET” because they were derived from the drug – TEMOZOLOMIDE. In the present case, the High Court held that the ratio in Schering is applicable to current facts.
- Pursuant to Section 13(b) of the Trademarks Act, any name deceptively similar to an INN on the list published by WHO cannot be registered as a trademark. Therefore, Sun Pharma cannot be allowed to monopolize INN – LETROZOLE.
- The trademarks “LETROZ” and “LETERO” are not similar because both have adopted the initial letters of LETROZOLE. Both Sun Pharma and Hetero brands are derived from the INN – LETROZOLE, which describes the active ingredient of the drug – LETROZOLE.
- The High Court also relied on Panacea Biotec Ltd. vs. Recon Ltd., state that where a name is derived or invented from the name of the main ingredient used in the manufacture of the drug, the manufacturer cannot claim any distinctiveness or exclusivity.
This is a significant judgment on non-exclusivity on trademarks that are derived from the names of drugs themselves. The High Court clarifies the provision of Section 13 of the Trade Marks Act and implies that the trade mark derived or adopted from the DCI does not confer on the owner exclusive power to monopolize the DCI or seek injunctive relief against others.
This will have a significant impact on businesses, especially pharmaceutical/healthcare companies who normally create and register trademarks, based on the main ingredient or drug used in their product. This will encourage companies to invent new words (rather than coining a name from the ingredient itself) for their products to ensure they have exclusivity on the brand and can ask for its protection.