Companies & Sectors
Economy & Nation Exclusive
Cipla breached patent rights alleges Bayer

While the German pharma company is accusing Cipla for breaching its patents rights by slashing price, in March, the Indian government stripped Bayer it its exclusive rights to sell Nexavar used in treatment of kidney and liver cancer

German pharmaceutical company Bayer said Indian generic drug maker Cipla had breached its patent rights by slashing the price of a generic version of its patent-protected cancer drug Nexavar last week.

Bayer Pharma has not given its consent to Cipla to launch its generic Sorafenib (sold under the brand name Nexavar) and the latter's decision to cut the price of the life-extending kidney and liver cancer drug "is a clear patent infringement," a Bayer spokesperson told PTI.

Bayer holds the patent for Nexavar till 2020 and it will "vigorously defend its patent within the available legal framework," the spokesperson said.

Last week Cipla slashed prices of its generic drugs used in treating cancers of brain, lung and kidney by up to 76%. The price of 'Soranib' used for treating kidney cancer was cut by 76% to Rs1,710 "for a month's therapy", from Rs6,990, Cipla had said in a statement.

In March, India stripped Bayer of its exclusive rights to sell Nexavar, a treatment for kidney and liver cancer, granting Natco Pharma a license to sell the generic drug at Rs8,880 ($170) for a monthly dose. Bayer sells the branded Nexavar at Rs2.84 lakh a month.

The Delhi High Court is already dealing with a patent infringement suit filed by Bayer against the Indian company on 15 March 2010, in response to a decision of the Drug Controller General of India (DCGI) to grant Cipla marketing authorisation for a generic version of Nexavar.

The next hearing to decide the course of the proceedings is scheduled for 14 August 2012, the spokesperson said.

Bayer Pharma also confirmed that it has launched a legal challenge to the compulsory licence issued by India in March this year to domestic drugmaker Natco Pharma to manufacture and sell a low-cost generic copy of Nexavar.

An appeal against the decision of the Controller General of Patents, Designs and Trademarks to grant a compulsory licence for Nexavar was filed with the Intellectual Property Appellate Board (IPAB) on 4th May, it said in a press statement.

The order of the Indian patents office "damages the international patent system and endangers pharmaceutical research," the statement said.

"We will vigorously continue to defend our intellectual property rights, which are a prerequisite for bringing innovative medicines to patients."

The challenges faced by India's healthcare system have little or nothing to do with patents on pharmaceutical products as all products on India's essential drugs list are not patented, Bayer said.

Last week Cipla cut prices of its various generics used in the cancel treatment. Following the reduction, its brain cancer drug 'Temoside' in 250 mg strength is now available at Rs5,000 against Rs20,250 earlier. While lung cancer drug 'Gefticip 250 mg' in packs of 30 tablets is priced at Rs4,250 against Rs10,200.

Cipla's brain cancer drug 'Temoside' in the strengths of 20 mg, 100 mg, and 250 mg is now be available at Rs480, Rs2,400, and Rs5,000, respectively, for a pack of five capsules. The earlier prices of these drugs were Rs1,875, Rs8,900 and Rs20,250, respectively.

Cipla is one of the biggest players in Indian formulations market with about 5.7% market share. Key therapies for the company in the domestic space include respiratory, anti-infectives, cardiac, gynaecology and GI. It enjoys 70% market share in inhaler segment and its key brands in this segment are Seroflo, Foracort, Budecort and Aerocort.

In the export space, Cipla has been working on a low-risk, low margin partnership model, which restricts any margin-upside in the US and EU market. However, the company is consciously changing its policy towards a more profitable model for the same. It is now focusing on the inhaler opportunity, which is expected to yield significant profitability, going ahead.

Cipla closed 0.91% higher at Rs325.55 on the Bombay Stock Exchange, while the benchmark Sensex settled marginally down at 16,420.


Public Interest Exclusive
President Pratibha Patil’s luxurious home continues to be built

The 2,42,000 sq ft of land in Pune returned by President Patil is to be ‘suitably’ used for an alternative purpose. Communication from the ministry of defence is awaited, said Southern Command officials

Although President Pratibha Patil has returned the 2,42,000 sq ft of land in Pune on which she was building her palatial post-retirement home, construction continues on the site.

Senior officials at the Southern Command headquarters said since the construction is half done, it is being allowed to be completed. Assuring that it would be used 'suitably' as per the stringent norms of A1 defence land, they also clarified that A1 land 'can' be used for residential accommodation of jawans. However, they failed to answer how the same construction meant for a palatial personalised home could be converted for accommodation of jawans, which would obviously comprise a series of small tenements.

So far, Rs5 crore have been spent by the Southern Command. The construction work comes directly under the Army Commander with MES having given the contract to private contractors (allegedly not registered with the MES). However, senior officials of the Southern Command said they are waiting for orders from the ministry of defence (MoD), for the nature of the re-use of the sprawling construction site.

When asked as to how, in the first place, the Southern Command gave permission for a civilian home on A1 land, Maj Gen SK Yadav stated that they were merely following the orders of the ministry of defence. When told that the MoD had questioned 'precedence' of such an allocation, the Defence Estate Office was mum in its reply, the officers stated that they had "raised objections" but refused to spell out anything further.

In an unprecedented and curious move, the Southern Command, after coming under storm for bending backwards to construct President Patil's palatial post-retirement home on 2,42,000 sq ft of A1 defence land, decided to hold a press conference on Tuesday to "put the records straight" on land issues including official accommodation for serving officers and jawans not only in the Pune station but the entire command comprising 10 states and three Union Territories.
Pune is an important military station but officers are made to wait for between six months and one year to get an official accommodation and there is a woeful lack of homes for jawans in particular. It is against this background that President Patil's retirement home came under sharp criticism, as besides the legal aspect, the question of the propriety and precedence was questioned.

Maj Gen C P Singh, in charge of logistics and operations, stated that, "to make up the overall deficiency of married accommodation with an outlay of Rs56 crore-84 officers, 27 junior commissioned officers (JCOs) and 250 other ranks (OR) houses were constructed in 2011 and with an approximate projection of Rs.95 crore, 188 officers, 60 JCOs and 300 ORs houses are in various stages of completion in Married Accommodation Project Phase II. Satisfactory levels of accommodation will increase to above 90% for all ranks on completion of second phase."

Compilation and digitalisation of land records in Southern Command is underway but they had no answer to the number of encroachments on defence land and what specific action they have taken on the 2009 Pune Defence Estate Office report of such encroachments.



mike rana

5 years ago

no one should think that they can stop what the government is bent on doing ... thank god they are doing only this. Read history


5 years ago

The house may be alloted to the kin of the President ! In India any thing can happen.

Ashok Malkani

5 years ago

It is really heartbreaking to read of the loot that is taking place in every government organisation, be it Civil or Military.
The order of the day is " Take what you can and the Devil take the hindmost "

The incompetence and inability to govern displayed by the UPA , has created a lawless state of the nation.
The time has come to vote the UPA/Congress out, at every level.

Ravi Saraogi

5 years ago

Maj Gen SK Yadav is certainly hiding the facts and continuation of construction of the house is only raising suspicion in mind. GOC-In-C and MOD both should let people know the facts.

J Sharotri

5 years ago

South comd specially GOC-In-C can't get away by saying "we were following MOD Ordrs" He is not L/NK Bhup Singh to say like dat, he is an Army Cdr- in my openion unfit to hold dat rank n appntmnt wd suchc conduct and statemnent. He is spending govt(Army) money on construction of dat house. He must reveal tod public every proof of wt were his reaction/observation/orders when he received "ordrs of MOD to first give thastlasnd and subsequently construct dat house for dat women-head of Indn State, which puts my head to shame :-((((

P V Nair

5 years ago

There is a stench in the air. Clearly some foul work is afoot. It ill behoves the army to waste the taxpayers' money on building a luxurious mansion without knowing to what perpose it would be put. Vinita Deshmukh and her band of tenacious watchdogs need to be doubly vigilant to thwart any misconceived plot to use
defencse land for any purpose other than to house defence personnel.

Gaurav Garg

5 years ago

Really Shame On Our Indian Leaders :(

Rajnish Raj

5 years ago

Yeh Hamara India hai ! Yahan Koi Kitney Badi post per kuy na ho parntu Sarkari Suvidha ka beza istemal karney me nahi peechey rahta hai. Niyam kanoon to Janta- Janardan ke Liyey hotey hai maha mahim - manniyo ke liyey nahi. UP ke Ex CM apney sarkari Banglow me without permission Construction karati hai .Aur Vikas Pradhikaran Set back area me Construction ke liyey Public ko notice deta hai? Hai na India Gzab ka !


5 years ago

Looking at the picture of the building, I am sure Mrs. Pratibha Patil Sekhawat may end up occupying the palatial house along with her entrie khandaan of children, grand-children & niece & nephews as well.

The point here is that how can the President of a country run up a bill of Rs.65 crore and above for foreign trips as well as grap land meant for the Defence. She & her family should be impeached and put behind bars for embezzlement and using her position for personal gain.

God save the nation from any future Presidents who might turn out to be like her!

Dr. A.P.J Abdul Kalam is the best President we ever have in the last few decades. Not only is he perfect for the post, he is down-to-earth as well as not corrupted like Mr.s Patil.

Come on Mrs. S Gandhi, act fast before the entire country will blame you for every ills in the nation.

Ratanlal Purohit

5 years ago

I agree with previous comments supporting the author.
The RIT route takes long.
Mr Antony should clarify.
A multi story tower should take care of all pending list. The palace can be used for the mess and market for the resdency. More than 1000 accomdation can be create in this hub which may be named after the Supreme Commander to live after for ever.


5 years ago

I do not think this is the end of this story. I am prepared to bet that Ms Pratibha Patil will find a way to occuppy the palatial residence once it is completed, on some pretext or the other. Utmost vigil is required from all of us to ensure that she does not outsmart us!!

Shibaji Dash

5 years ago

Defence Minister Mr. Antony whose integrity and probity is taken as unimpeachable ought to make a statement on the issue in public interest.The President's name getting embroiled in controversy certainly does not augur well for the country.

R Srinivasan

5 years ago

What a shame that we have people at the very top flouting all norms of decency and spending public money for personal good. Rs.5 crores spent so far for a partially-built palace. Don't people have a conscience that should dictate dharmic behaviour

Economy & Nation Exclusive
Kingfisher Airlines no more a subsidiary: UB Holding

In February, Kingfisher allotted shares to banks and financial institutions against optionally convertible debentures, thus reducing stake of UB Holding. The question is who are these smart bankers who put money into the carrier which has been reporting losses since its inception

Vijay Mallya-led United Breweries (Holdings) (UBH), the majority shareholder in troubled Kingfisher Airlines said that the carrier ceased to be its subsidiary in February itself after the airlines allotted shares against optionally convertible debentures to certain entities. However, UBH said it had a significant exposure of over Rs12,000 crore to the debt-ridden airline.

In a regulatory filing, the UB Group unit said, "The company has significant exposure on various counts to Kingfisher Airlines as on March 2012. These include investment in equity/preference capital at Rs2,118.48 crore, corporate guarantees to banks and aircraft lessors at Rs6732.55 crore and Rs2,193.31 crore, respectively.". As on 10th May, UBH has a market cap of Rs416 crore.

According to a September 2011 report by Canadian research firm, Veritas, the finances of Kingfisher were so bad that they would drag down its parent United Breweries (UB) too. It had said, "UB, which has marketable assets of Rs4,713.40 crore ($1,037 million), compared to guarantees provided on behalf of Kingfisher of Rs16,853 crore ($3,638 million), is also staring into a black hole. We believe that the ill-conceived foray into the airline business has already cost UB shareholders dearly, and that their ownership of India's premier liquor and beer assets has been sacrificed at the altar of egoistic ambitions."

Kingfisher Airlines has pledged its brand as collateral with its lender consortium for Rs4,100 crore ($817.95 million). The brand valuation was done by Grant Thorton in 2010. Reportedly the brand has been valued and loans raised worth three times the carrier's market value.

On 6 July 2011, pursuant to requirements prescribed under the debt recast package, Kingfisher's founder companies, UBH and Kingfisher Finvest, pledged their entire stake in the airline with certain of its lenders.

Announcing its financial results for the fourth quarter ended March 2012, which saw its net profit plunging sharply by over 83% to Rs2.10 crore, UB Holdings, said that Kingfisher ceased to be a subsidiary as on 18th February, after the carrier allotted shares against optionally convertible debentures to certain entities.

Noting that it has given significant guarantees on behalf of its subsidiaries and associate companies, UB Holdings said its exposure to Kingfisher Airlines totalled Rs12,215.18 crore as on March 2012. The company's exposure relating to Kingfisher Airlines is under various accounts including corporate guarantees to banks. Total exposure include "advances at Rs1,029.75 crore and other receivables Rs141.09 crore", it added.

"Certain corporate guarantees have been invoked and Kingfisher Airlines is under negotiation in this regard with the beneficiaries," UBH said in the filing.

"In our view, the debt restructuring touted by Kingfisher is nothing to write home about. We believe that non-performing loans have been rechristened/repackaged into subordinated debt, and that Kingfisher has defaulted on its obligations is unquestionable. We do not believe that KAIR's antics would have found any takers in a responsible credit market and that the airline would have been liquidated by now," Veritas had said.

As on 31 December 2011, UBH had 40.1% stake in the carrier, but it declined to 34.55% on 18th February after an increase in the airline's equity base pursuant to issue of shares to some entities in lieu of certain convertible bonds.

As per the latest shareholding pattern available with the BSE, UB Holdings' stake in Kingfisher has declined further to 29.39% as on 24th April. The entire holding of UB Holdings in Kingfisher is as such pledged, BSE data shows.

UB Holdings further said that its investment in subsidiaries have been considered as long term strategic investments and diminution in their market value, though significant is considered temporary in nature.

The company said guarantee commission has been accrued based on contractual obligation, although the recovery could take a longer period of time than what was anticipated.

UB Holdings has been giving significant guarantees on behalf of subsidiaries and other associated companies and advances to subsidiaries. No amount has so far devolved on the company, the filing said.



Shanti Patel

5 years ago

The AUDITORs of the Banks must question the rationale behind going for conversion. Whether the price at debentures are converted is in the interest of the shareholders of the Bank, that also should be investigated by the auditors.


5 years ago

Why is a case not being filed against the owner who is hiding under the "Corporate veil", to block all his assets (whereto money has been diverted into) worldwide for this corporate fraud ?
Alongwith the Mallya family, Grant Thorton and the lending banks should be investigated for this huge fraud/scam.


5 years ago

I don’t know how many would have read the book ‘Face Value- Creation and destruction of shareholder value in India’, written by Mr.Debashis Basu close to a decade ago. I read it couple of years ago in Eloor lending library.

There have been so much value destruction by di-worsfying and going for expansions for the sake of it in last 10 years; Mr.Basu may consider writing a sequence to the above.


nagesh kini

In Reply to Muthu 5 years ago

Yes, Muthu I too eagerly look forward to the post-Kingfisher and DLF updated edition from Mr. D.Basu.
I'd like to know at what value were the debentures converted, surely not the inflated values applied for restructured loans!


In Reply to nagesh kini 5 years ago

Not only Kingfisher or DLF… ADAG group of companies… very many real estate and infra companies.. the list would be very long. The way in which minority shareholders are treated by many companies, financial institutions turning blind eye on the same despite holding huge chunk of shares… we can look forward for a very good book.

nagesh kini

In Reply to Muthu 5 years ago

None of the so-called Independent Directors on their Board dare open their mouths. What were the distinguished directors doing in Satyam and also their Independent Auditors?
Credit must be given to the statutory auditor of Kingfisher for reporting facts in so many words, who remembers him?

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