Patents Act Versus Competition Act
Fact:The appellant, Mr. Swapan Dey, is a hospital CEO providing free dialysis services under the Pradhan Mantri National Dialysis Programme, who approached the Competition Commission of India alleging anti-competitive conduct by Vifor International AG concerning Ferric Carboxymaltose (FCM) injection used to treat iron deficiency anaemia common in dialysis patients and vulnerable populations, asserting that Vifor’s licensing and market practices made FCM inaccessible and unaffordable in India.
Vifor, a Swiss company, held an Indian patent on the FCM molecule granted on 25.06.2008, which expired on 21.10.2023, and the company had entered into licensing arrangements with Indian pharmaceutical companies including Emcure Pharmaceuticals (manufacturing) and Lupin Ltd. (import and distribution), with the appellant alleging limited production, control, and discriminatory pricing. The appellant claimed contraventions under Sections 3 and 4 of the Competition Act, 2002 on the basis that Vifor’s arrangements and conduct restricted supply, involved abuse of dominance, and discriminated on pricing between public procurement and private markets, thereby harming patients’ access to essential therapy.
Procedural Detail:The appellant filed information before the Competition Commission of India on 12.01.2022 in Case No. 05 of 2022 alleging violations under Sections 3 and 4 of the Competition Act by Vifor, which the CCI closed at the prima facie stage by order dated 25.10.2022 under Section 26(2) of the Act, concluding that there was no requirement to define a precise relevant market or assess dominance, and finding no prima facie contravention.
The CCI’s order reasoned that Vifor’s limited-term licences with Emcure and Lupin contained reasonable IP-protective conditions, did not foreclose competition, did not restrict inter se competition between licensees, and did not indicate long-term exclusionary effects; it also observed patent expiry in 2023 would open the market, and that price differentiation between public bulk procurement and private retail could be benign. Aggrieved, the appellant filed the present appeal under Section 53B of the Competition Act before the NCLAT, where CCI supported its jurisdiction and merits closure with reference to Delhi High Court’s Monsanto 2020 single judge decision, while Vifor challenged maintainability, asserted lack of CCI jurisdiction due to the Patents Act being a special code, and pointed out patent expiry and alleged forum shopping by the appellant.
Dispute:The core dispute was whether the Competition Commission of India had the power to inquire into and decide allegations of anti-competitive agreements and abuse of dominance relating to licensing and supply of a patented drug, when the conduct arose in the exercise of statutory rights under the Patents Act. The connected issue was whether, even if the CCI had jurisdiction, the impugned order closing the case at the prima facie stage for want of contravention required interference in appeal, in light of the licensing terms, market structure, alleged price discrimination, and patent expiry changing market dynamics. Finally, the tribunal had to consider the effect of the Delhi High Court Division Bench decision in Telefonaktiebolaget LM Ericsson PUBL v. CCI, 2023 SCC OnLine Del 4078, and the Supreme Court’s subsequent disposal of CCI’s SLP on 02.09.2025, on the jurisdictional relationship between the Competition Act and the Patents Act.
Detailed Reasoning:The tribunal began by recording that the CCI had examined the matter within its statutory confines and closed it at the threshold under Section 26(2), having found no prima facie contravention of Sections 3 and 4, particularly in view of licensing agreements’ nature, absence of long-term foreclosure, inter se competition, and impending patent expiry in 2023, as reflected in the CCI’s reasons at paragraphs 65 to 79 of its order. The CCI’s analysis highlighted that Vifor’s licences with Emcure and Lupin were time-bound, did not include unilateral anti-competitive restraints on pricing or competition between licensees, and did not block entry by other potential producers of soluble iron injectables, with the Commission observing that not all price differentiation is discriminatory, especially when justified by bulk procurement or public purpose considerations.
The tribunal noted the appellant’s criticism that the CCI failed to define a precise relevant market or assess dominance, and that it adopted an ex-ante lens instead of ex-post assessment under Section 3 and 4; however, the tribunal emphasized that the decisive issue in this appeal was jurisdictional primacy when alleged conduct arises from exercise of patent rights under the Patents Act. In this regard, the tribunal recorded CCI’s reference to the Delhi High Court’s decision in Monsanto Holdings Pvt. Ltd. v. CCI (W.P.(C) 1776/2016, decision dated 20.05.2020) to contend that Section 3(5) of the Competition Act does not oust CCI’s jurisdiction merely because IP is involved, but also noted that the Division Bench of the Delhi High Court in Telefonaktiebolaget LM Ericsson PUBL v. CCI, 2023 SCC OnLine Del 4078 (in LPA 247/2016 and connected matters) later reversed the Monsanto single judge view and held that, for issues concerning exercise of patent rights, the Patents Act is a special and subsequent code that prevails over the Competition Act.
Relying on Ericsson, the tribunal reproduced and adopted the Division Bench’s reasoning that the inquiry proposed by CCI in respect of licensing terms and alleged abuse by a patentee is nearly identical to the inquiry contemplated under Chapter XVI of the Patents Act concerning compulsory licences and related reliefs, and that unreasonable licensing conditions, abuse of patentee status, and the remedial framework are a complete code under the Patents Act. The Division Bench reasoned that, applying generalia specialibus non derogant and lex posterior derogat priori, the Patents Act as the special and later legislation must prevail over the general competition law where the subject matter is anti-competitive agreements or abuse by a patentee in the exercise of patent rights, with Section 3(5) of the Competition Act further indicating legislative intendment to preserve reasonable conditions for IP protection outside competition scrutiny.
The tribunal then recorded the subsequent development that the CCI had filed SLP No. 25026 of 2023 against the Delhi High Court’s Ericsson decision, which the Supreme Court disposed of on 02.09.2025, declining to interfere in the peculiar facts, noting that the original informants had nothing further to say, and expressly keeping questions of law open for appropriate cases. Although the Supreme Court’s order kept questions of law open, the tribunal treated the Delhi High Court’s operative conclusions as binding guidance for present purposes, reading Ericsson to mean that CCI lacks power to proceed where the alleged conduct is integrally bound to the exercise of patent rights and the Patents Act provides the special mechanism for regulating unreasonable licensing conditions and market abuses by patentees.
Within that framework, the tribunal emphasized that Section 3(5) of the Competition Act preserves the right of a patentee to restrain infringement and to impose reasonable conditions necessary to protect patent rights, while Sections 83, 84, 88, 89, and 90 of the Patents Act collectively embody a policy balance between innovation incentives, access, affordability, and public interest, including compulsory licensing to address unmet reasonable requirements of the public, non-working, or unaffordable pricing. Vifor’s submissions invoking Section 83 and the compulsory licensing regime were noted to support the view that patent-related market questions, including supply sufficiency and reasonable pricing, are primarily addressed by the Patents Act’s dedicated apparatus.
On facts, the tribunal recorded that Vifor’s patent expired on 21.10.2023, thus placing FCM into the public domain and making it available for free exploitation by interested parties across India, which materially diminished any continuing competition law concern premised on exclusive rights; it also noted that the CCI had already considered the limited-term nature of licences, absence of licensee foreclosure, and freedom to enter more licences. Further, the CCI had observed that pricing differences in public procurement versus private retail may be justified and that cross-country comparisons, such as Bangladesh prices, are an unreliable benchmark due to distinct tax, duty, and regulatory environments.
In this statutory and factual setting, the tribunal concluded that, guided by the Delhi High Court’s Division Bench in Ericsson and the Supreme Court’s disposal of CCI’s challenge, the CCI lacks power to examine the present allegations against Vifor because the controversy stemmed from the exercise of patent rights over FCM at the relevant time, for which the Patents Act is a complete and special code. The tribunal therefore found no merit to interfere with the CCI’s closure of the matter and held that the Patents Act prevails over the Competition Act in the facts of this case, while also noting Section 3(5) of the Competition Act protects reasonable IP-related conditions.
Judgment:The National Company Law Appellate Tribunal held that the Competition Commission of India lacks power to examine the allegations against Vifor International AG in this case because the subject matter concerns conduct by a patentee in the exercise of patent rights, an area governed by the Patents Act as a special and complete code, as clarified by the Delhi High Court Division Bench in Telefonaktiebolaget LM Ericsson PUBL v. CCI, 2023 SCC OnLine Del 4078. The tribunal noted the Supreme Court’s 02.09.2025 order disposing of the CCI’s SLP in Ericsson without interference and keeping questions of law open, but in the present facts applied the Delhi High Court’s guidance to hold that the Patents Act prevails and that CCI’s prima facie closure did not warrant interference, also taking into account the expiry of Vifor’s patent on 21.10.2023 and the CCI’s reasons that licensing terms did not show foreclosure or anti-competitive restraints and that price differentials in public procurement may be justified.
Case Title: Mr. Swapan Dey Vs Competition Commission of India
Order Date: 30.10.2025
Case Number: Competition Appeal (AT) No. 5 of 2023
Name of Court: National Company Law Appellate Tribunal
Name of Hon’ble Bench: Justice Yogesh Khanna and Mr. Ajai Das Mehrotra
Decision:The appeal was dismissed with no order as to costs, and pending applications were closed, thereby affirming the CCI’s order dated 25.10.2022 closing the information under Section 26(2) of the Competition Act.
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Written By: Advocate Ajay Amitabh Suman, IP Adjutor [Patent and Trademark Attorney], High Court of Delhi
