Issue 28

Contents
Legal Outsourcing
Patent Portfolio of CSIR
Stem Cells
Generic Drug Industry
Dangers of TCE
Generic Zoloft
Symbicort

Legal Outsourcing
Massachusetts-based Forrester Research predicted in a recent study that by 2015, more than 40,000 U.S. legal jobs will be sent overseas, costing lawyers $4.3 billion in lost wages. It’s not surprising that companies are seduced by the idea of offshoring. The cost benefits alone are astounding.  Legal outsourcing vendors such as U.S.-based Lexadigm and India-based Atlas Legal Research charge $60 to $80 per hour per lawyer.  Paralegals and junior associates in the U.S. charge three or four times that amount for the same work. The Indian lawyers employed by these companies handle low-end legal services. Document review, online and legal research, patent applications, contract and other document drafting, litigation support and paralegal services typically fall under this category. While the cost factor seems to weigh heavily in favor of India, the deal seems equally profitable in the Indian context with an estimated $12 billion by 2016, according to an estimate.

Patent Portfolio of CSIR
Intellectual property was once considered the most boring subject in the world and a totally irrelevant subject in India.  However, things have changed today, as the world has changed.  The old industrial era has been supplanted by a new knowledge based economy in which ideas and innovation have become valuable. Many companies realize now that if they don't claim their stake in the future, they will wake up and discover one day that their competitors own all the patents to exclude them from the business.  Market giants like Microsoft started using their patents as competitive weapons.

Thus, once dreaded boring patent lawyers are attracting small crowds at party gatherings!  People are trying to patent every idea - silly to ground breaking.  Is a bird diaper patentable? Yes, of course, see US patent 2882858.  Is urinal for women while standing patentable? Yes, of course, see urinal for use by females (United States Patent 4,683,598).  However, it should be noted that the purpose of a patent is to protect one's inventions from being stolen by others. Nobody steals a worthless item or idea.  Obviously, you don't need to protect such worthless or useless inventions by an expensive US patent costing about $ 25000 to procure, which only prevents others from using, offering to sell, selling or manufacturing the patented invention in the US. Accordingly, it would be wise to spend money on patenting inventions after you determine the potential market value of your inventions.

Once you have an IP portfolio, it is important to perform IP due diligence, a legal exercise, wherein skilled IP counsel defines, examines and analyzes an IP portfolio of a target company to sell or out-license. Whether you are the target company or the buyer in a business transaction involving IP, the due diligence involves revealing the value of the intangible assets – patents, trade marks, copyrights and trade secrets – by examining the strength, scope and enforceability of the IP, the ownership rights surrounding the IP, and the future potential to be derived from the IP. The breadth and depth of these inquires usually are directly proportional to the importance of the IP and its corresponding impact on the value of the transaction.

India, the sleeping giant, is also waking up to this reality of the global knowledge-based economy. "To be noticed, you need a portfolio of patents," says in Nature Dr. Raghunath Mashelkar, head of India's largest funding body, the Council of Scientific and Industrial Research (CSIR), equivalent of NIH in the US.  "Patent or perish" is the slogan of Dr. Mashelkar.  Dr. R. K Gupta enunciates the policy of CSIR, "the approach of the CSIR has been to file a patent on any new finding that meets the criteria, whether or not the agency wants to commercialize it." However, the article entitled "Is India's 'patent factory' squandering funds?" in the journal Nature in July 2006, reports the above quotes and questions the Indian prudence in patenting strategy in view of a particular patent on an extract from cow's urine.

In all fairness, it should be noted that FDA approved horse urine extract, Premarin (http://www.premarin.com/), sold by Wyeth, has been prescribed for women in the US for hot flashes or night sweats.  Millions of American women have been using horse urine extract. Just because Indians developed something from cow's urine, there is nothing to laugh at. However, the difference between the Wyeth's American horse urine and CSIR's Indian cow's urine is in the economics.  Wyeth has been making money by selling horse urine to American women, while India's CSIR has not yet made a penny on the patented cow's urine.

In general, vast majority of companies are simply unaware of the often-enormous economic and competitive values that lie untapped within their patent portfolios.  When India's CSIR performs due diligence and sells or licenses out patents and when CSIR makes money from the patented Indian cow's urine, just like Wyeth makes money from horse urine, then Mr. Suresh Chandran, who reportedly had a laugh at it, would applaud and then Dr. Ramarao Alla (AV Ramarao), who reportedly said in Nature "A lot of money is going down the drain in the name of patents", might approve the process and the expenditure!

It's about time India patented and exploited her inventions. Hat's off to CSIR and hope it will continue the trend.  Welcome to the new global battlefield of Intellectual Property! The race is on!

Stem Cells
Stem cell research promises to help fill gaps where current medicine falls short. Many scientists believe the treatment of strokes, heart disease, cancer and birth defects could benefit from stem cell research, along with Parkinson's and Alzheimer's disease. Stem cells promises to be the biggest boon for humans against the risk of deadly diseases. http://edition.cnn.com/2006/TECH/science/04/14/fs.stemcellprofile/.

Hyderabad seems to be a center for stem-cell medicine in India.  The privately owned L. V. Prasad Eye Institute in Hyderabad pioneered techniques as early as 2001. Dorairajan Balasubramanian, Chairman of the National Task Force on Stem Cell Research and a member of the CNN Future Summit Nominating Committee, has been using stem cells to treat patients at the L.V. Prasad Eye Institute in Hyderabad to restore sight. The institute says it has used transplanted stem cells to treat more than 240 patients with damaged corneas. Two other private hospitals in Hyderabad are using stem-cell therapy to treat damaged heart muscle, and plans are in place in other hospitals and clinics in the city to use stem cells to regenerate the liver in cirrhosis sufferers and the pancreas in diabetics.

India’s biotech boom could even dwarf software in coming years if you trust the most optimistic projections. State governments like Karnataka, Tamil Nadu, and Andhra Pradesh are bending over backward to lure firms into their “genome valleys.”  Foreign firms and research institutes are rushing in. The Hyderabad-based Center for Cellular and Molecular Biology’s (CCMB) 85-million rupee research facility, the first of its kind in Asia, has been hunting for new genes and proteins that may help identify the genetic root of diseases like cancer. However, almost all the biotech products so far have been indigenous versions of existing products. It is beyond any Indian drug firm to even think of bringing out a novel product, let alone new drugs. Stem cell research might deliver what is missing - a new cure- from India. America's rejection of stem cells may be a boon for Indian scientists.

The use of embryonic stem cells has become a social issue in America. Many researchers in Europe and Asia are also constrained by government regulations, and some still face outright bans on the work.  Many Christian religious groups find the idea of using cells from human embryos - that would otherwise be wasted anyway- to help suffering patients morally unacceptable. They argue the human stem-cell experiments amount to murder, while wars, wars-on-terrorism and terrorism go unabated killing hundreds of human lives per day from Congo to Iraq to Kashmir. It is alright to do research on monkeys and dogs and even human volunteers, but it is not ok to do research on the embryonic cells frozen to thrown away later, they argue.

A week after George W. Bush cast his first veto, of a bill to permit federal funding of stem-cell research, the European Union decided that some of its public research budget could be used for the same end, albeit with some restrictions, as some central European members, supported by the Catholic Church, were against. The decision cleared the way for the adoption of the EU's 54-million-euro (65-billion-dollar) research budget for 2007-2013 aimed at catching up with research in the United States and boosting Europe's sluggish economy.

Europeans aren't the only ones trying to profit from the U.S. restrictions.  Big and small countries such as China, India, Singapore, Australia, Japan, South Korea etc. are all vying for a share of the large biotech demand in the world. (Stem cell centers in the world) 

Singapore in particular, is going all out to promote stem cell research in the country. http://www.lifenews.com/bio1453.html.  Singapore is looking to replace South Korea as the number one international destination for stem cell research and is luring top scientists from around the globe with modern, high-tech labs and large sums of government money. The country has invested billions of dollars in this field and plans to become the number one international stem-cell research destination in the world. But Singapore is spending so much it's standing out in the crowd. It has already put in $4 billion U.S. into biotechnology and has committed another $8 billion by 2010, according to an AP report. The nation has named its research Mecca Biopolis and has a sprawling facility 10 stories tall and connected by impressive skywalks. For Alan Colman, an English biochemist and a leader of the British team that created the first cloned mammal in 1997, steamy Singapore has become the destination.  The progress of Singapore in biotechnology is such that wealthy mothers from Thailand are depositing their newborn baby’s blood in Cord blood banking services available in Singapore. Some other governments have focused on importing talent. China, for instance, has recruited scientists from top universities in the U.S. to run research centers on the mainland. 

As far as India is concerned, in 2002, the the Indian Council of Medical Research (ICMR) in New Delhi, which belongs to the health ministry, announced a policy that permitted therapeutic cloning and encouraged stem-cell research. The Department of Biotechnology (DBT), which belongs to the science ministry, had also issued guidelines the previous year. Hopefully, as  Muthuswami said in Nature, "the planned guidelines will not stop research but will ensure that there are sufficient checks and controls on clinical practice."

Generic Drug Industry
Innovative drug developers are facing an unprecedented number of challenges in maintaining revenue growth. Fewer novel drugs are being approved, a large number of blockbusters are facing patent expiry, and public and private payers across the major drug markets are implementing cost-containment policies in response to sky-rocketing healthcare costs, which is affecting drug margins. This increasing focus on cost containment is boosting the sales growth of generics. In the US, payers are under increasing pressure to utilize cost-containment policies, such as tiered formularies, which provide incentives to use generics because they reduce patient co-pay for generic drugs. In Europe, factors such as generic substitution are also helping to drive uptake. The reward for generics companies who gain market share is significant: Datamonitor estimates that US$157 billion (around 40%) of 2005 brand sales will be exposed to generic competition by 2015.

Global sales of biologic products (by 56 of the leading pharmaceutical and biotechnology companies) are growing rapidly, and are forecast to almost double from US$56 billion in 2004 to $105 billion by 2010. Therefore, this market represents a significant target for generics companies, but there are higher barriers to entering the biosimilars market than the small-molecule generics market. Key factors set to affect the biosimilars market over the short- to medium-term include regulatory issues, marketing strategies and the class of rDNA protein being targeted. Over the longer term, the emergence of biosimilars from low-cost manufacturing sites plus the next generation of so-called 'super-biosimilars' is also set to drive market growth. For more visit: Nature Reviews Drug Discovery 5, 535-536 (July 2006).

Dangers of TCE
Trichloroethylene, TCE, which is widely used to remove grease from metal parts in airplanes and to clean fuel lines at missile sites. TCE is a colorless liquid that evaporates at room temperatures and has a somewhat sweet odor and taste. It is one of the most common pollutants found in the air, soil and water at U.S. military bases. Until the mid-1970s, it also was used as a surgical anesthetic. TCE also has been found at about 60 percent of the nation's worst contaminated sites in the Superfund cleanup program. TCE is known to cause cancer in some laboratory animals. Growing scientific evidence suggests the most widespread industrial contaminant in drinking water can cause cancer in people. In 2001, EPA issued a draft document saying the risks of TCE causing cancer in humans were higher than previously thought. But that pronouncement was dropped. EPA was blocked from elevating its assessment of the chemical's risks in people by the Defense Department, Energy Department and NASA, all of which have sites polluted with it.  A 379-page report from National Academy of Science recommends that EPA revise its assessment of TCE's risks using "currently available data" -- so no more time is wasted. EPA currently requires limiting TCE to no more than 5 parts per billion parts of drinking water. A stricter regulation could, in turn, force the government to require more thorough cleanups at military and other sites.

Generic Zoloft
The first generic version of Zoloft, the top-selling antidepressant in the United States, received federal approval July.

Symbicort
AstraZeneca PLC's Symbicort received approval for the long-term maintenance treatment of asthma in patients 12 and older, said Food and Drug Administration. Symbicort combines budesonide and formoterol fumarate dihydrate. It is inhaled as an aerosol. Budesonide is an inhaled corticosteroid and provides an anti-inflammatory effect, while formoterol is a rapid and long-lasting bronchodilator. This asthma inhaler has already been sold overseas.