Wockhardt Ltd v Hetero Drugs Ltd (2005)

Summary

“Wockhardt Limited, a pharmaceutical company, appellant herein, is the holder of Process Patent, EMR” (“Exclusive Marketing Right”) “and Drug Licence for the manufacture of pharmaceutical preparation, namely, Nadifloxacin 1% Cream.” (para 1) “Hetero Drugs Limited, first respondent herein, infringing the Patent and EMR granted to the appellant, started manufacturing the same product and selling in the market.” (para 2) “A learned single Judge, after hearing the counsel for the parties, by an order dated 08.09.2005, vacated the interim injunction and dismissed the O.A.Nos.544 to 546 of 2005.” (para 4) The Bench framed the points “Whether the order of the learned single Judge would suffer from any infirmity; and” “Whether the appellant is entitled to the grant of interim injunction, pending the suit ?” (para 14)

The Bench held that “the learned single Judge has found, prima facie, that the appellant has fulfilled all the conditions to use the EMR” (para 20), that “the Drugs Controller, exercising power under the Drugs and Cosmetics Act, is only concerned with the product safety for human consumption and not about EMR, patent rights or such other intellectual properties or other civil rights of the parties” (para 24), and that “the first respondent cannot be allowed to manufacture the cream, as long as the EMR granted in favour of the appellant is valid and subsisting” (para 38). It found “that the balance of convenience is also in favour of the appellant” (para 44). “Under those circumstances, the learned single Judge’s order is set aside. The appellant/plaintiff would be entitled to injunction in the applications, filed in the suit. Appeals are allowed. No costs.” (para 48)

What the court decided

1. The three tests. “While exercising the said discretion, the Court applies the following tests :” “(a) Whether the plaintiff has a prima facie case ;” “(b) Whether the balance of convenience is in favour of the plaintiff; and” “(c) Whether the plaintiff would suffer an irreparable injury, if his prayer for interlocutory injunction is disallowed.” (para 16)
2. Object of interlocutory relief. “Relief by way of interlocutory injunction is granted to mitigate the risk of injustice to the plaintiff during the period before that uncertainty could be resolved. The object of the interlocutory injunction is to protect the plaintiff against injury by violation of his right for which he could not be adequately compensated in damages recoverable in the action if the uncertainty were resolved in his favour at the trial.” (para 17)
3. The prima facie finding below. “The above observation would clearly indicate that the learned single Judge has found, prima facie, that the appellant has fulfilled all the conditions to use the EMR” (“Exclusive Marketing Right”) “and, thereby, he is entitled to manufacture and market Nadifloxacin 1% Cream.” (para 20)
4. The writ against the drug licence. “we fail to understand as to how the mere fact that the appellant/plaintiff, as a writ petitioner before the Delhi High Court, failed to obtain the interim order in the writ petition seeking for cancellation of licence granted in favour of the first respondent would be a ground to reject the claim of the appellant in the suit” (para 22); “The scope of the present suit is completely different from that of the writ petition pending before the Delhi High Court.” (paras 22–23)
5. The Drugs Controller’s domain. “It cannot be debated that the Drugs Controller, exercising power under the Drugs and Cosmetics Act, is only concerned with the product safety for human consumption and not about EMR, patent rights or such other intellectual properties or other civil rights of the parties.” “the pendency of the writ petition or the appellant’s inability to obtain a stay order from the Delhi High Court over the issue of Drug Licence would neither prevent the Civil Court to go into the civil rights nor disentitle the appellant from seeking the relief of protection, on the basis of the civil rights conferred on him, as the holder of Process Patent and EMR.” (para 24)
6. The Bombay challenge to the grant. “even though the issue relating to Drug Licence and EMR is pending before the other High Courts, they were not inclined to pass any interim orders affecting the rights of the parties and, therefore, the learned single Judge should have appreciated the sanctity, attached to the Exclusive Marketing Right and Process Patent, granted to the appellant.” (para 29)
7. What the grant confers. “It cannot be denied that this EMR Certificate confers an exclusive right on the appellant to sell and distribute in India the pharmaceutical composition” (para 32); “It cannot also be debated that unless they are cancelled by the authority concerned or appropriate forum, the appellant would not be disentitled to exercise its right for a period of five years. In other words, no other party is entitled to use the said formulation during the tenure of the said EMR.” (paras 32–33)
8. A short tenure. “Patent and EMR rights are for a limited period of five years and, unless the same are exercised in the said period, it will be rendered useless. When this period of short tenure is sought to be disturbed over the rights by any other party, which has no prima facie right by virtue of Process Patent and EMR granted to the appellant, then, this Court has to necessarily prevent the other party, by affording appropriate relief in favour of the appellant/plaintiff, by granting the injunction sought for.” (para 34)
9. The Otsuka patents. The conclusion below was “wrong for two reasons, namely, (i) there is no material to show that the manufacturing and marketing the product impugned under licence is only by adopting US Patent and Japan Patent, and (ii) the patent documents, containing 10 preparation examples, would not show the cream product.” (para 35) “Thus, on a plain examination, for the purpose of prima facie case, the Otsuka’s patents could manufacture only an ointment, film coated tablets or injectable preparations and not a cream.” (paras 35, 38)
10. Royalty under section 11A(7). “We are unable to accept the contention of the learned Senior Counsel for the first respondent, especially when we feel that the short period, namely, five years, in which the appellant is allowed to exercise its right over the product impugned, is not to be disturbed, in the light of the fact that mere royalty, in our view, would not suffice to make good the loss.” (para 43)
11. Balance of convenience and irreparable injury. Having set out para 17 of Novartis v Adarsh Pharma (2004) among the principles it referred to (para 15), the Bench held: “When the statute protects such rights and when the parties in opposition do not have a legal ground over the exclusive marketing rights in their favour at this stage, the balance of convenience lies in favour of the appellant.” “if the prayer for interlocutory injunction is disallowed in the instant case, the appellant would necessarily suffer an irreparable injury, considering the fact that the five year period would soon elapse and the loss likely to be experienced by the appellant would not be compensated in terms of damages or royalty” (para 45)
12. Procedure. Interference on appeal. “only if the discretion is not exercised applying the tests on the point, fairly or honestly or according to the rules or reason and justice, then alone, the order can be reversed by the appellate Court.” (para 46) “the vital factual details have been ignored and overlooked by the learned single Judge. This would necessarily constrain us to interfere with his order.” (paras 46–47)
13. Disposition. “Under those circumstances, the learned single Judge’s order is set aside. The appellant/plaintiff would be entitled to injunction in the applications, filed in the suit. Appeals are allowed. No costs.” (para 48)

What the court did not decide

“Similarly, we are of the view that the contention urged by the learned counsel for the third respondent need not be decided at this stage.” (para 43) “any observation or opinion expressed in this order is only for the purpose of disposal of these appeals, relating to temporary injunction, and, it shall, in no way, influence the trial Court, while deciding the issues involved in the suit.” (para 49)

Subsequent treatment

• Followed — In Bajaj Auto v TVS Motor Company (2008) the Madras High Court held that “The three imminent factors which are necessary for consideration while dealing with the issue of interim injunction during pendency of legal proceedings are stated by the Division Bench of this Court in Wockhardt Ltd. v. Hetero Drugs Ltd. and Ors. 2006 (32) PTC 65 (Madras)”, reproduced paras 16 and 17, and applied them (para 48).

No further appeal verified as of 17 October 2026.