Novartis Caught In Controversy: 'Evergreening' Tactics Target Swiss Consumers

Swiss pharmaceutical companies are infamous for using patent litigation to block generic competitors and boost their profits. Their strategic use of complex patent thickets enables them to keep prices high for their blockbuster drugs. A prime example is Entresto: Novartis has initiated 25 lawsuits against 18 different pharmaceutical companies in the United States over this heart medication. This aggressive legal approach threatens access to affordable treatments, even in Switzerland. The Federal Council needs to address the misuse of intellectual property rights concerning medications. As a member of the European Patent Office, Switzerland should act to prevent the granting of frivolous patents.

Pharmaceutical companies often safeguard new drugs with a multitude of patents—sometimes exceeding 100. By strategically staggering these filings, they extend the market exclusivity of a drug well beyond the 20 years prescribed by the World Trade Organization’s TRIPS agreement. This practice, known as “evergreening,” is a cornerstone of Big Pharma's strategy. Switzerland, known for its high patent registration rates, proudly claims innovation leadership. However, in the pharmaceutical industry, many of these patents are unjustified. Rather than fostering genuine advancement, they lead to inflated monopoly prices, placing a growing burden on patients and public healthcare systems.

Pharmaceutical companies often engage in lengthy legal battles to delay the market entry of generic competitors, aiming to extend the exclusivity of their patented drugs. This tactic is prevalent in the United States, the largest pharmaceutical market, and is also observed in India due to its prominent generic industry. According to investigations by Public Eye, Novartis is notably active in this strategy. Between October 2019 and October 2022, the Swiss pharmaceutical giant launched 25 lawsuits against 18 companies in U.S. courts, claiming infringement of nine patents related to its Entresto drug. Novartis even took legal action against the Biden administration over a government-imposed price control on Entresto. The drug, which generated over $6 billion globally in 2023, including CHF 39 million in Switzerland, is the highest-grossing product for Novartis, having earned more than $20 billion over eight years.

In the U.S., India, and increasingly Switzerland, patients who depend on essential medications like Entresto and public health budgets are bearing the costs of pharmaceutical companies' strategies. In Switzerland, medications account for a quarter of the compulsory health insurance spending, with patented drugs making up 75% of that expenditure. While the U.S. government is pushing back against Big Pharma's tactics of extending patent exclusivity, Swiss authorities are working to further bolster the intellectual property rights of companies like Novartis. If these efforts fall short, Swiss policy may seek to limit the ability of low and middle-income countries, such as India, to address these practices, as evidenced by recent trade agreements. As a key player in the pharmaceutical sector and a member of the European Patent Convention, Switzerland should take responsibility by advocating for stricter patent rules and ensuring their effective enforcement.