Eli Lilly Canada v Canada (Attorney General), 2014 FC 152

The Federal Court upheld the decision of the Minister of Health to exclude Eli Lilly’s Canadian Patent No. 2,379,329 (the “’329 Patent”) on the combination drug Trifexis from the register of patents for failing to claim a formulation of each of the medicinal ingredients as required by paragraph 4(2)(b) of the PM(NOC) Regulations. [86] The ‘329 Patent explicitly claimed a formulation with one of the medicinal ingredients, spinosad, but the only reference in the claims made to the second medicinal ingredient, milbemycin oxime, was in the specification’s definition of “formulation”, which listed the family of milbemycin molecules as a possible component. [7-9] The Court determined that as a matter of claim construction the ‘329 Patent could extend to a formulation of both medicinal ingredients, [80] but nevertheless did not satisfy the “perfect matching” requirement in paragraph 4(2)(b) of the Regulations between what is claimed and what is authorized.

Background

The Minister of Health denied the listing of the ‘329 Patent on the patent register because of her holding that the patent did not contain claims for a formulation combining both of the medicinal ingredients in Trifexis, namely spinosad and milbemycin oxime, contrary to the product specificity requirement in paragraph 4(2)(b) of the Regulations. [2] There was no reference to milbemycin oxime in any of the claims or in the description, except indirectly through more general reference to the family of milbemycin molecules in the definition of “formulation” in the specification. [12] Eli Lilly argued that the Minister conflated claim construction with its interpretation of paragraph 4(2)(b), [22] and that a formulation containing spinosad and milbemycin oxime was claimed by representative claims 1 and 5, which include the defined term “formulation”, which the specification defines as possibly containing milbemycins. [25]

Representative claims 1, 5, and the definition of “formulation” are provided:

1. A single-dose oral formulation for controlling an ectoparasite infestation on a dog or cat comprising an ectoparasiticidal amount of spinosad, or a physiologically acceptable N-demethyl derivative or salt thereof, and a physiologically acceptable carrier in a dosage form selected from tablet, capsule or liquid suitable for administration once every at least 7 days at a dose of 10 to 100mg of spinosad per kg of body weight. [emphasis added] [8]

5. A single-dose oral formulation for controlling an ectoparasite infestation on a dog or cat comprising an ectoparasiticidal amount of spinosad, or a physiologically acceptable N-demethyl derivative or salt thereof, and a physiologically acceptable carrier in a chewable treat oral dosage form suitable for administration once every at least 7 days at a dose of 10 to 100mg of spinosad per kg of body weight. [emphasis added] [8]

And,

“The formulations of this invention may further include, in combination with the spinosyn component, one or more other compounds that have activity against the specific ectoparasite or endoparasite to be controlled, such as, for example, synthetic pyrethroids, natural pyrethins, organophosphates, organochlorines, carbamates, foramidines, […].milbemycins, […]” [emphasis added] [9]

The Minister concluded that this reference did not amount to claiming a formulation containing spinosad with milbemycin oxime as a matter of claim construction. [70] Subsequently, the product specificity requirement in paragraph 4(2)(b) of the Regulations, which requires that the claimed formulation must include both medicinal ingredients, [72] was not met. [2]

Paragraph 4(2)(b) of the Regulations reads as follows:

(2) A patent on a patent list in relation to a new drug submission is eligible to be added to the register if the patent contains… (b) a claim for the formulation that contains the medicinal ingredient and the formulation has been approved through the issuance of a notice of compliance in respect of the submission.

Issues

The issues before the Federal Court were:

(1)  Did the Minister correctly construe the ‘329 Patent?

(2)  Did the Minister correctly interpret the requirements set out in paragraph 4(2)(b) of the Regulations?

(3)   Was the Minister’s decision to exclude the ‘329 Patent from the patent register reasonable? [20]

The Minister Erred in Construing the ‘329 Patent

The Federal Court reversed the Health Minister’s claim construction to find that the ‘329 Patent could extend to a formulation containing both spinosad and milbemycin oxime. [69, 80]

The Court relied on the principle in Purdue Pharma v Canada (Attorney General), 2011 FCA 132, that in the context of an eligibility assessment under the Regulations, a patent must be construed with the principles articulated in Whirlpool Corp v Camco Inc, 2000 SCC 67. [61] The person skilled in the art would have understood that milbemycin oxime is a compound that is included in the class of compounds described as milbemycins. [68]

The Minister Correctly Interpreted Paragraph 4(2)(b) of the Regulations

Despite her error in claim construction, the Court determined that the Minister interpreted paragraph 4(2)(b) of the Regulations correctly in holding that the product specificity requirement requires a perfect match between what has been claimed and what has been authorized. [73, 78]

To contrast the “perfect matching” requirement in the Regulations to the kind of “matching” that would occur in a patent infringement analysis, the court cited G.D. Searle & Co v Canada (Minister of Health), 2009 FCA 35 for the principle that determining whether the patent to be listed on the register could be infringed is not the same analysis that occurs when interpreting the Regulations. [76] The Court further cites Purdue as applying this principle to paragraph 4(2)(c) of theRegulations to bring out the matching requirement: “Absent precise and specific matching, the patent is not eligible for listing on the patent register under the Regulations.” [77]

The Minister Reasonably Excluded the ‘329 Patent from the Register

Despite her error in construing the claims to not extend to a formulation of spinosad and milbemycin oxime, and despite the fact that her decision to exclude the ‘329 Patent from the register was based directly on this construction, [79] the Court still found her decision to exclude the ‘329 Patent from the register to be reasonable. [86]

The Court was of the view that referring to the general family of milbemycins in the definition of oral formulation was not specific enough to conclude that the claims match the formulation contained in Trifexis. [85] The Court framed the issue to be, more specifically, whether “the fact that the claims can be read as covering a formulation that could, but that does not necessarily, comprise the specific ingredient, milbemycin oxime, is sufficient to meet the strict matching requirement with Trifexis’ NOC which clearly comprise this specific ingredient”. [81] The Court felt bound by Gilead Sciences Canada Inc v Canada (Ministry of Health), 2012 FCA 254, where the FCA endorsed FC’s exclusion a patent from the register in a similar situation [82] based on the principle that “it was insufficient for a patent to meet the product specificity requirement by referring to a class of compound rather than to a specific medicinal ingredient.” [84]

Commentary

It seems the Minister’s decision on claim construction was in error for taking a results-based approach by considering how claim construction would impact the paragraph 4(2)(b) analysis when it was in fact unnecessary for it do so. The Senior Patent Officer at the Office of the Patented Medicines and Liaison, a witness, even acknowledged that the patent, when read by itself, without applying the requirements of subsection 4(2) of the Regulations, could extend to a combination of spinosad and milbemycin oxime. [36] This case makes it clear that such a consideration is misguided, since a patent may be found to claim certain medicinal ingredients as a matter of claim construction without meeting the product specificity requirement. This decision clearly states that a higher level of specificity is required to adhere to the Regulations than is required for an element to be claimed as a matter of claim construction.

This case comes three months after an announcement from Industry Canada of its intention to change PM(NOC) Regulations regarding combination drugs such as Trifexis. Industry Canada intends to confirm Health Canada’s established practices with respect to listing patents on the register that claim only one medicinal ingredient even though the medicinal ingredient in the Notice of Compliance is the combination of medicinal ingredients. This case, however, sidesteps the concern raised in the announcement, since the ‘329 Patent was found to claim both of the medical ingredients in Trifexis’s Notice of Compliance.

The Industry Canada announcement is said to address what might have been an adverse trend in the case law after Gilead and other cases. The Federal Court in ViiV Healthcare ULC v Teva Canada Limited, 2014 FC 893 relied on Gilead for the proposition that “[a] patent claim for only one medicinal ingredient cannot support a listing under the NOC Regulations where the underlying NOC is for a combination (synergistic or otherwise) of two or more medicinal ingredients,” [89, ViiV] which would seem to run contrary to Health Canada’s established practice by enhancing the product specificity requirement. Notably, the Court in this case felt bound by Gilead, but did not read Gilead as having enhanced the product specificity requirement. [73]

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Following a pair of decisions in the Federal Court and Federal Court of Appeal, namely Gilead Sciences Canada v Minister of Health, 2012 FCA 254, and ViiV Healthcare ULC v Teva Canada Limited, 2014 FC 893, aff’d 2015 FCA 93, Industry Canada announced in December of 2014 that it would make amendments to the PM(NOC) Regulations to clarify the patent listing requirements as they relate to single medicinal ingredients found in combination drugs. On May 2, 2015, the proposed amendments were published in the Canada Gazette.

The amendments propose adding a new subsection to clarify the provisions that were at issue in Gilead and ViiV, particularly paragraphs 4(2)(a) and 4(2)(b) of the Regulations. The publication in the Canada Gazette states that these two decisions reinterpreted the PM(NOC) Regulations regarding the eligibility for listing on the patent register of patents claiming one or more medicinal ingredients “in a manner that conflicts with the intent of the Governor in Council in making the Regulations” and  is contrary to long-standing practices of Health Canada.

The problematic holding in Gilead, which was subsequently followed in ViiV, was that “[a] patent claim for only one medicinal ingredient cannot support a listing under the NOC Regulations where the underlying NOC is for a combination (synergistic or otherwise) of two or more medicinal ingredients.” [89, ViiV] In particular, in Gilead, “the relevant claims in the ‘475 Patent do not meet the requirements of paragraphs 4(2)(a) as they lack strict product specificity with regards to the three medicinal ingredients listed in the NDS.” [3, Gilead]

Paragraphs 4(2)(a) and 4(2)(b), which were interpreted in Gilead to include a strict product specificity requirement, read:

The proposed amendments seek to dispose of the strict product specificity requirement and reinforce Health Canada practices by adding subsection 4(2.1) immediately following subjection 4(2):

The amendments would also change the definition of “claim for the formulation” (relevant to paragraph 4(2)(b) to mean “a claim for a mixture that is composed of medicinal and non-medicinal ingredients, that is contained in a drug and that is administered to a patient in a particular dosage form”, and would specify that the claim for the formulation need not specify the non-medicinal ingredients contained in the drug.

The proposed changes also allow for any patent which was deleted from the register or refused listing on the register after October 18, 2014, on the basis of the decision in ViiV, to be resubmitted within 30 days of the proposed amendments coming into force. An example of a case which may fall into this category, and which revisits the issues discussed here in the context of paragraph 4(2)(b) of the Regulations, is Eli Lilly Canada v Canada (Attorney General), 2014 FC 152, summarized here.

For new proceedings commended under section 6 of the Regulations, the Court will be required to consider the provisions as amended.

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Gilead Sciences, Inc v Canada (Health), 2015 FC 610

In Patented Medicines (Notice of Compliance) (“PM(NOC)”) proceedings between Gilead Sciences Inc. (“Gilead”) and Apotex Inc. (“Apotex”), the Federal Court dismissed Gilead’s assertion that its Canadian Patent No. 2,298,059 (“the ‘059 patent”) is valid. Making that assertion would be relitigating old issues and an abuse of PM(NOC) proceedings.

Gilead had already conceded that claims 1, 2, 5, 6, and 7 of the ‘059 patent were invalid in earlier PM(NOC) proceedings with another generic, Teva Canada Ltd. (“Teva”) (2013 FC 1270). [4] Claims 3 and 4 were also found to be obvious in those proceedings. [4] Now, in proceedings with Apotex, Gilead sought to reassert the validity of the entire patent. [8] Gilead insisted that it would fill an evidentiary gap this time around, and that claims 1, 2, 5, 6, and 7 being at issue could support a different outcome, but each of those justifications were rejected. [6, 8]

Gilead conceded invalid claims

The Court reiterated that it is settled law that an attempt to relitigate the validity of a patent is an abuse of process. [9] Once the validity of a patent is put into play in PM(NOC) proceedings, the patentee must fully defend the assertion. [13] The patentee cannot concede some claims in one proceeding but later resile from that position in another. [14] The Court explained its reasoning:

“If it were otherwise, the patentee could effectively split its case and unilaterally compel subsequent generic challengers to litigate claims, the invalidity of which the patentee had effectively conceded. This would amount to a manipulation of the system and it would violate the principle that the patentee is required to put its strongest case forward in the first instance.” [14]

The Court concluded by suggesting that if Gilead is aggrieved by the earlier finding in the proceeding with Teva, then it could always bring an infringement action. [16]

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Hospira Healthcare Corporation v Canada (Health), 2015 FC 1205

Normally, when a drug company seeks approval to sell a generic drug in Canada, the applicant cannot rely on a comparison of the generic drug to an existing similar drug unless the existing drug has been approved for a certain length of time. Known as “data protection” provisions, these rules are meant to incentivize investment in the development of new drugs by slowing the entry of generics into the market. [73, 83] In this Federal Court case, a quirk in the rules was resolved that could make the entry of generics into the market even slower if the generic tries to make post-filing amendments to its application.

Facts

The traditionally generic company Hospira was developing an alternative to Oxaliplatin, the current standard of care treatment for colorectal cancer. [15] Dubbed OXALIPLATIN FOR INJECTION, Hospira sought regulatory approval to sell the drug in Canada through consultation with Health Canada from 2004 to 2006, and ultimately filed a New Drug Submission in October of 2006. [14] However, since Oxaliplatin was the current standard of care, Hospira could not ethically run clinical trials comparing OXALIPLATIN FOR INJECTION to Oxaliplatin. [15] Thus, Hospira decided to compare OXALIPLATIN FOR INJECTION to a newer drug, ELOXATIN, which at that time was currently being developed by the innovator company Sanofi, and had only been filed as recently as late November of 2006, one month after the Hospira application. [15] Hospira made a post-filing amendment to its application to make the comparison to Oxaliplatin.

Even though the Hospira application was filed first, it was blocked by Health Canada and the data protection provisions protecting Eloxatin. [40, 64]

Data Protection Provisions

According to C.08.0014.1(3) of the Food and Drug Regulations, an application comparing a proposed new drug to an existing drug cannot be filed until 6 years after the existing drug was approved, and the application cannot be approved until 8 years after the existing drug was approved. [12] The issue in this case was whether or not the data protection provisions apply to the applicant’s request for a NOC for OXALIPLATIN FOR INJECTION. [76]

Hospira argued that “[t]he applicant clearly did not ‘seek’ a NOC [approval] on the basis of a comparison with an innovative drug. Post-filing amendments do not fall within the scope of subsection C.08.004.1(3).” [65] And since Hospira filed its New Drug Submission before Eloxatin, it was clear of the 6-year filing bar, and argued that must also be free of the 8-year bar against having its application approved. [67]

The Minister of Health disagreed. The Minister argued that the 6-year filing bar and the 8-year approval bar are separate, and that Hospira was still caught by the 8-year approval bar. [69]

The Federal Court sided with the Minister, writing that “while I agree with the applicant that subsection C.08.004.1(3) is not sufficiently precise, I find that when its text is read by cross-reference to the other provisions found in section C.08.004, it is clear that post-filing amendments are subject to the data protection prohibition imposed on the Minister by paragraph (b) of subsection C.08.004.1(3),” [79] thus upholding the application of the 8-year approval bar.

The Federal Court thought this result to be consistent with the purpose behind the data protection provisions, which it agrees is to protect undisclosed data generated by an innovative manufacturer from unfair use, thus providing an incentive for the development of new drugs. [73, 83]

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Eli Lilly Canada Inc v Mylan Pharmaceuticals ULC, 2015 FC 125

This Federal Court (“FC”) decision dealt with an application to prohibit the issuance of a Notice of Compliance (“NOC”) until the expiry of an existing patent. The respondent successfully argued that the existing patent was invalid on the grounds of lack of utility for having made a promise of utility that could not be demonstrated nor soundly predicted, was anticipated by a previous patent of the applicant that claimed an overlapping dosage range, and was also therefore made obvious by the same previous patent. This decision is being appealed by the applicant.

Background

Mylan Pharmaceuticals (“Mylan”), one of the respondents, sought a NOC for a generic version of tadalafil, a drug used to treat erectile dysfunction (“ED”). Eli Lilly (“Lilly”), the applicant, applied for an order prohibiting the issuance of the NOC to Mylan until the expiry of Canadian Patent No. 2,371,684 (the “‘684 Patent”). The ‘684 Patent claims a dosage form of tadalafil and claims its use to treat ED.

Mylan argued that the ‘684 Patent was a selection patent, contending that it had never had its utility demonstrated or soundly predicted either at the filing date or presently. Alternatively, Mylan submitted that if the ‘684 Patent was not interpreted as a selection patent, then the claimed invention was anticipated by Canadian Patent No. 2,226,784 (the “’784 Patent”), and was clearly obvious.

The FC was required to construct the ‘684 Patent and then determine whether the following three allegations were justified:

1. Is the allegation that the ‘684 Patent is invalid for lack of utility justified?
2. Is the allegation that the claims are invalid for anticipation by the ‘784 Patent justified?
3. Is the allegation that the claims are invalid for obviousness justified? [82]

The FC dismissed the application for an order prohibiting the issuance of the NOC as the applicant failed to establish the validity of the ‘684 Patent on a balance of probabilities. The respondent was successful in alleging that the ‘684 Patent lacked utility, was anticipated and was obvious. Lilly has appealed.

‘684 Patent

This case is one of three prohibition applications by Lilly relating to its tadalafil patents. Tadalafil was claimed and disclosed in Canadian Patent No. 2,181,377 (the “’377 Patent”), which was published in 1995. [4] The use of tadalafil for the treatment of ED was claimed and disclosed in the ‘784 Patent, which was published in 1997. [4]

The ‘684 Patent came about as a result of research into the side effects of sildenafil, the main compound in Viagra, which is also used for the treatment of ED. Some of the side effects of sildenafil include, but are not limited to, high rates of flushing, blue-green vision, headaches, back pain, rhinitis and conjunctivitis. [6-7]

The ‘684 Patent claimed a dosage form of tadalafil of less than 20mg to treat ED, with separate claims to various specific dosage forms. It was filed in Canada on April 26, 2000 and has a priority date of April 30, 1999. [13] Lilly sold the drug under the brand name CIALIS, in a unit dosage form protected by the ‘684 Patent.

Selection Patent

Mylan attempted to argue that the patent is a selection patent. A selection patent refers to “a patent where a single element or segment is selected from a group, based on a particular feature of the element that provides an advantage not shared by the larger group.” [105] It is similar to other patents and is governed by the same legal principles.

The FC did not interpret the ‘684 Patent as a selection patent. There was nothing in the ‘684 Patent to suggest that the promised advantage of reduced side effects was peculiar to the claimed dosage range and to the exclusion of other doses.

Utility

Central to the utility analysis is the promise of a patent, which as stated by the Federal Court of Appeal in Sanofi-Aventis v Apotex, 2013 FCA 186, “is the standard against which the utility of the invention described in the patent is measured”. Lilly contended that the promise of the ‘684 Patent was that the claimed doses were effective and that they would have less side effects than sildenafil when used by patients for the treatment of ED. [86] Mylan argued that the ‘684 Patent’s promise went beyond Lilly’s construction, and that it promised that the claimed doses would provide an improvement over sildenafil by reducing three side effects – flushing, vision abnormalities, and the negative effects associated with co-administration with nitrates – to clinically insignificant levels. [86] Lilly attempted to read down the promise, but the FC disagree, finding that the promise of the ‘684 Patent was “not merely to lower the incidence of adverse side effects as compared to sildenafil, but to minimize them significantly or even to eliminate them.” [100]

The FC thus agreed with Mylan’s construction of the promise, holding that Lilly’s construction would go against the clear language of the patent. [92] There were explicit statements throughout the patent that promised more than a marginal improvement over sildenafil.

The FC found that as of the filing date, the promised utility had not been demonstrated. Furthermore, the FC found that the promised utility could not be predicted by a person skilled in the art. Lilly did not attempt to establish predicted utility and the FC held that it should not have even tried as there was no factual basis for such a prediction as there was no evidence to support a sound prediction. [116] The disclosure of the ‘684 Patent was not complete and the FC noted that the only study provided that compared one of the side effects between the compounds showed no difference, calling the study “very sketchy.” [139]

The FC also agreed with Mylan that at the time the application was being heard neither demonstrated nor predicted utility of the ‘684 Patent had been established.

Consequently, the FC found that the ‘684 Patent lacked utility, as the promise of the Patent was neither demonstrated, nor soundly predicted at the filing date and at present.

Anticipation

After finding that the ‘684 Patent was not a selection patent, the FC was required to consider whether the ‘684 Patent was anticipated by the ‘784 Patent. As set out by the Supreme Court in Apotex Inc v Sanofi-Synthelabo Canada Inc, 2008 SCC 61, a patent will be invalid for anticipation if the essential elements of the claimed invention have been disclosed and where the disclosure enables the claimed invention. [145]

The ‘784 Patent disclosed:

• unit dosage forms of tadalafil, such as tablets or capsules, in the dosage range from 0.2 to 400 mg;
• with the unit dosage form suitable for oral administration; and
• for use in treating male ED. [148]

The doses of tadalafil in the ‘684 Patent, ranging from 1 to 20 mg, are entirely within the dosage range disclosed in the ‘784 Patent. The FC therefore held that the ‘784 Patent disclosed all the essential elements of the ‘684 Patent and provided the skilled person with enough information to allow him or her to perform the invention claimed in the ‘684 Patent without undue burden. [149] Therefore, the ‘684 Patent was anticipated by the ‘784 Patent.

Obviousness

Mylan alleged that if the ‘684 Patent was not interpreted as a selection patent, then the claimed invention was clearly obvious because it was anticipated by the ‘784 Patent.

The FC used the four-part test for obviousness laid out by the Supreme Court in Sanofi-Synthelabo:

1. Identify the notional “person skilled in the art” and the relevant common general knowledge of that person;
2. Identify the inventive concept claimed in the patent;
3. Identify the differences between the common general knowledge and the inventive concept;
4. Do those differences require a degree of invention, or are they more or less self-evident?

The analysis focused mainly on whether it was more or less self-evident that the lower and narrower doses of tadalafil in the ‘684 Patent would be effective in treating ED and would result in reduced side effects. The FC found that it was more or less self-evident that a skilled person in the art would look for a minimal effective dose and a maximum tolerated dose. [172] The FC thus found that the ‘684 Patent was invalid for obviousness.

Commentary

Patentees should be wary to not overstate promises of utility in their patents. When a promise is not clearly and unequivocally expressed in the claims of a patent, a court will construe the promise within the context of the patent as a whole. Promises must be supported by articulate and reliable evidence to prevent the possibility of a patent being deemed invalid in the future.

This is not the first time that Lilly has been on the losing side of a battle regarding the manufacture and distribution of generic versions of drugs. In response to the courts invalidating two of its other pharmaceutical patents (Zyprexa and Strattera) for lack of utility, Lilly initiated legal proceedings against Canada, alleging violation of the North American Free Trade Agreement (“NAFTA”). Lilly contends that the courts, in invalidating the Zyprexa and Strattera patents, relied on the promise of utility doctrine, an allegedly elevated utility requirement that is not found in other jurisdictions and that Lilly argued is inconsistent with Canadian jurisprudence on utility. Lilly believes that the courts have imposed a heightened evidentiary burden for demonstrating utility, straying from prior jurisprudence. The issue to be determined is what the minimum basic intellectual property principles are regarding utility, which NAFTA countries must adhere to. The nine day hearing of Lilly’s NAFTA challenge is scheduled for May 30, 2016. The outcome of the challenge may affect the case discussed above and the way courts address utility in the future.

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Takeda Canada Inc v Canada (Minister of Health), 2015 FC 570

In this Federal Court (“FC”) decision the FC dismissed a prohibition application on the basis that the applicant failed to establish that the respondent’s allegations of obviousness were unjustified. The proceeding was brought under the Patented Medicines (Notice of Compliance) Regulations and required the FC to consider three existing patents. The FC favoured the respondent’s “blinded expert” evidence in which the experts provided their opinions before knowing what was claimed in the disputed patents.

Background

Takeda Canada Inc. and Takeda GmbH (“Takeda”), the applicants, created Omnaris, a nasal spray used in the treatments of conditions such as allergic rhinitis. Takeda sought an order prohibiting Apotex Inc. (“Apotex”), the respondent, from marketing a generic version of Omnaris.

The active ingredient in Omnaris was ciclesonide (CS). Takeda had four patents related to CS, the first of which expired in 2011. Of the other three patents, Canadian Patent No. 2,388,322 (the “’322 Patent”) related to a pharmaceutical composition for CS, Canadian Patent No. 2,388,325 (the “’325 Patent”) related to an aqueous pharmaceutical composition for CS and Canadian Patent No. 2,538,419 (the “’419”) (collectively, “the Patents”) related to the use of CS in the treatment of respiratory diseases in children. [3] Apotex alleged that the three patents were invalid on the grounds of anticipation, obviousness, double-patenting, lack of utility, sufficiency and overbreadth. [4]

The FC dismissed Takeda’s Application. The FC found that the Patents were invalid for obviousness as there was no difference between the relevant art and the inventive concept of the Patents.

Obviousness

The FC was tasked with comparing the state of the art and the common general knowledge of the skilled person with the inventive concept of the Patents’ claims to determine whether the claims were obvious.

The ‘322 Patent

The ‘322 Patent claims compositions of CS with varying osmotic pressures, ranging from 10 mOsm or less, to 290 mOsm or less. [10] The FC found that the inventive concept of the ‘322 Patent was clear from its description, that it was “an aqueous pharmaceutical composition for application to the mucosa, which contains CS, and a water-insoluble and/or water-low soluble substance, and which has an osmotic pressure of less than 290 mOsm.” [23]

Looking at the evidence, the FC found that the expert used by Takeda failed to canvass the entire state of the art and the common general knowledge of the skilled person at the relevant time. [34] Conversely, Apotex’s expert, before even being provided with the ‘322 Patent, came to the conclusion that the only difference between the inventive concept of the ‘322 Patent on the one hand, and prior art and common general knowledge on the other, was that there was no explicit disclosure of a CS formulation with low osmotic pressure in the prior art. [35]

After considering the evidence, the FC held that a skilled person, in applying his or her general knowledge, would have been led to the formulation set out in the ‘322 Patent by reviewing the readily-available pertinent publications. No inventive step was taken in regard to the ‘322 Patent. The FC thus held that the ‘322 Patent was invalid for obviousness.

The ‘325 Patent

The inventive concept of the ‘325 Patent involved a pharmaceutical composition containing CS and hydroxypropylmethylcellulose in an aqueous medium, which consequently avoids variations in CS concentration and decreases in CS recovery during production. [39]

The FC favoured Apotex’s evidence. The FC summarized Apotex’s expert’s finding to mean that based on the prior art and common general knowledge, a “skilled formulator, using only the prior art and his or her general knowledge, would have arrived at the putative invention set out in the ‘325 patent.” [46] The expert came to this conclusion before knowing what was claimed in the ‘325 Patent.

The FC thus concluded that that the ‘325 Patent was invalid for obviousness as a skilled person, in applying his or her general knowledge, would have been led to the formulation set out in the ‘325 Patent by reviewing the pertinent literature.

The ‘419 Patent

The FC found that the inventive concept of the ‘419 Patent involved “the use of CS in the treatment of children with chronic respiratory diseases with reduction or avoidance of common side-effects associated with use of other corticosteroids, including growth-suppression.” [53]

The FC found that the weight of evidence relating to the state of the art and common general knowledge indicated that a skilled person would have known that administering CS in the dosage range set out in the ‘419 Patent would not cause systemic side effects. Furthermore, the FC found that the CS compositions in the ‘419 Patent would have been obvious to try, as a routine clinical trial described in the ‘419 Patent would have confirmed what a skilled person already expected.

Commentary

One point of interest in this FC decision was that the FC preferred Apotex’s evidence that used blinded experts that provided their opinions before knowing what was claimed in the disputed patents. This approach, while not determinative of the issues, has also been favoured in other cases including AstraZeneca Canada Inc v Apotex Inc, 2014 FC 638 and Teva Canada Innovation v Apotex Inc, 2014 FC 1070.

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Eli Lilly Canada Inc v Apotex Inc, 2015 FC 875

Pharmaceutical patent-filers face more uncertainty as to the appropriate time to file patent applications, after this Federal Court (“FC”) decision. This FC decision dealt with an application to prohibit the issuance of a Notice of Compliance (“NOC”) until the expiry of an existing patent. The defendant was not successful in its allegations that the existing patent was invalid on the grounds of insufficiency, same-invention and obviousness double patenting. The FC granted the prohibition order, but noted in its analysis that the law is unsettled when it comes to determining the appropriate date for assessing obvious-type double patenting. This case has been appealed and is scheduled to be heard on May 5, 2016.

Background

Apotex Inc (“Apotex”), the respondent, sought a Notice of Compliance (“NOC”) in respect of Apo-Tadalafil, a generic version of tadalafil – a drug used to treat erectile dysfunction (“ED”), among other things. Eli Lilly Canada Inc (“Lilly”), the applicant, markets tadalafil under the brand name Cialis. Lilly sought an order under section 6 of the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 (“PMNOC”) to prohibit the issuance of the NOC until the expiry of Lilly’s Canadian Patent No. 2,226,784 (the “’784 Patent”), which is listed against Cialis on the Patent Register. [2] The relevant claims of the ‘784 Patent relied on tadalafil to treat erectile dysfunction (“ED”). Apotex alleged that the ‘784 Patent was invalid for double patenting of the invention claimed in Canadian Patent No. 2,181,377 (the “‘377 Patent’) and for insufficiency.

Only the validity of the ‘784 Patent was an issue in this case, not infringement, as Apotex did not contest that its Apo-Tadalafil product would infringe claims 1, 2, 4, 9, 12, 14, 15 and 18 of the ‘784 Patent. [5]

The FC allowed Lilly’s prohibition application, noting that the ‘784 Patent was not invalid for insufficiency, same invention-type or obviousness-type double patenting.

The ‘377 Patent

The ‘377 Patent claimed several novel compounds, including tadalafil, pharmaceutical compositions and the use of these compounds in the treatment of various disorders where the inhibition of PDE V was thought to be beneficial. [18] The 377 Patent did not discuss ED in any way. [81, 117]

The ‘784 Patent

The ‘784 Patent involved using of some of the compounds claimed in the ‘377 Patent in the treatment of ED. The FC agreed with Lilly that the promise of the ‘784 Patent was on the effectiveness of the compounds to treat ED, not the specific route of administration. Apotex alleged that the ‘784 Patent was invalid for double patenting over the ‘377 Patent and for insufficiency. [6]

Double Patenting

The doctrine of double patenting, “prevents a patent holder from ‘evergreening’ its patent by obtaining a second patent for the same invention for which a patent has already been granted.” [60]

Same Invention-type Double Patenting

The FC found that both the ‘784 Patent and the ‘377 Patent (collectively, the “Patents”) disclosed tadalafil and disclosed in vitro testing, but that, unlike the ‘784 Patent, the ‘377 Patent did not discuss ED in any way.  [118] After finding that the ‘377 Patent did not extend to the use of tadalafil to treat ED, the FC held that Apotex’ allegation of same invention-type double patenting was unsubstantiated. [120]

Obviousness-type Double Patenting

To assess obviousness-type double patenting, the FC compared the claims of the Patents to determine whether the claims of the ‘784 Patent were patentably distinct from the claims made in the ‘377 Patent. [136] This case was the second PMNOC case dealing with the Patents, the other case being Eli Lilly Canada v Mylan Pharmaceuticals, 2015 FC 17 (“Mylan Pharmaceuticals”) (appeal pending). The FC in the case at hand did not follow the FC’s determination in Mylan Pharmaceuticals of the appropriate date for assessing obviousness-type double patenting. [96] In Mylan Pharmaceuticals, the FC held that the relevant date was the priority date of the earlier patent. The FC in the case at hand considered the priority date of the second patent to be the relevant date, since the common general knowledge may have advanced in the interim.

In the end, however, the FC declined to come to any firm conclusion on this legal issue, noting that both relevant dates would yield the same result. The FC went on to hold that it was not obvious that the compounds claimed in the ‘377 Patent could be used to treat ED. Apotex’s allegation of obviousness-type double patenting was thus rejected.

Sufficiency

Several of the relevant claims in the ‘784 Patent extended to hydrates of tadalafil. [169] Apotex alleged that the ‘784 Patent was invalid for insufficiency because it failed to provide enough information to enable a person of ordinary skill in the art (“POSITA”) to produce a hydrate of tadalafil. [169] The FC found that the ‘784 Patent disclosed a general method for solvent formulation. [172] The FC preferred the evidence of Lilly’s expert and found that there was “adequate disclosure in the 784 Patent to enable the production of solvates of tadalafil and 3-methyl tadalafil and that, from there, the skilled person, relying on his or her common general knowledge, would be able to create and if necessary modify reaction conditions so as to favour hydrate formation.” [176] Apotex’s allegation of insufficiency was rejected.

Commentary

This was the second PMNOC case to favour Lilly in regard to allegations that Lilly’s ‘784 Patent was invalid due to double patenting of the invention in the earlier ‘377 Patent. The FC noted that the law remains unsettled in regard to the appropriate date for assessing obviousness-type double patenting. Both this case and Mylan Pharmaceuticals have been appealed.

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Apotex Inc v Alcon Canada Inc, 2016 FC 720

It appears that Courts look to reduce duplicative pharmaceutical litigation in PM(NOC) proceedings and related patent infringement actions by looking to foster possibilities of settlement when determining how to arrange proceedings that run in parallel.

In the context of a section 8 damages proceeding under the PM(NOC) Regulations and an ongoing related infringement action, the Federal Court (“FC”) bifurcated the issues of infringement and validity from any other section 8 issue in hopes that bifurcation would likely lead to a settlement of all the issues between the parties. [10] In this particular case, the FC found that bifurcation would likely lead to settlement because of similarities between the section 8 proceeding and the infringement action: the allegedly infringing product had a composition, manufacture, and use that would have been the same throughout the hypothetical period as in the real world. [11]

Background: Infringement and Section 8 Damages

This decision was made in the context of multiple proceedings between the parties. Apotex Canada Inc. (“Apotex”), wishing to enter the market selling a generic version of the Travoprost Z ophthalmic solution, served a Notice of Allegation under the PM(NOC) Regulations on Alcon Canada Inc. (“Alcon”), alleging the invalidity of Alcon’s two listed patents against Travoprost Z, Canadian Patent Nos. 2,129,287 (the ‘287 Patent) and 2,606,370 (the ‘370 Patent). [2] In response, Alcon launched proceedings to prevent Apotex’s entry into the market. Alcon’s prohibitions proceedings were dismissed with the finding that Apotex’s allegations in invalidity were justified, opening the door for Apotex into the market. [2]

Infringement of ‘370 Patent: Soon after Apotex’s entry onto the market, Alcon sued Apotex for infringement of the ‘370 patent (but not the ‘287 Patent), asking for an injunction against Apotex. Apotex’s defence was, again, that the ‘370 patent is invalid. [2] Importantly for the bifurcation issue, these ‘370 Patent infringement proceedings were proceeding swiftly. [4]

1. 8 Damages: Almost simultaneously, Apotex started proceedings under section 8 of the PM(NOC) Regulations for damages caused by Alcon’s prohibition proceedings which delayed the entry of Apotex’s generic onto the market. [3] In its defence, Alcon pointed to the infringement of the ‘287 and ‘370 Patents, as well as a third patent not listed on the Patent Register, the ‘172 Patent. Apotex again replied with allegations of invalidity of each of these patents. [3] In contrast to the infringement proceedings with respect to the ‘370 Patent, these section 8 proceedings were proceeding slowly. [5]

On this motion, Apotex requested that, within the section 8 proceedings, the issues of infringement and validity of the ‘287 and ‘172 Patents be bifurcated from any other section 8 issue. [6] The parties were already in agreement that issue of the infringement and validity of the ‘370 Patent is already bifurcated, as it would be fully determined in the ‘370 action, and binding on the section 8 proceedings. [6]

Alcon opposed bifurcation, citing fears that Apotex would use the bifurcation as a first step toward consolidating the liability phases of the trial of the infringement of the ‘287 and ‘172 patents with the trial of the ‘370 patent, thereby possibly delaying the already-speedy proceedings regarding the ‘370 patent, thereby possibly delaying its chance at obtaining an injunction against Apotex. [7]

Bifurcation: FC Allows Bifurcation as Most Likely to lead to Settlement

Despite Alcon’s fears that the ‘370 Patent infringement action may be delayed, the FC did not accept that bifurcation would necessarily entail consolidating the liability phase of the two simultaneous proceedings. [10]

The FC then looked to whether bifurcation would be more likely than not to lead to the just, expeditious and least expensive determination of the proceeding on its merits. [9] In doing so, in the context of this case, the FC took the determinative question to be whether, or to what degree, bifurcation might facilitate the settlement of the remaining issues or put an end to the ‘370 Patent infringement action. [10]

Given that Apotex’s concession that its product’s composition, manufacture and use would have been the same throughout the hypothetical period as in the real world, there FC thought that a finding of hypothetical infringement in the section 8 proceedings would very likely lead to a settlement, including possibly disposal of the ‘370 infringement action. [11] The FC also thought it more likely than not that if Alcon were successful in the ‘370 infringement action or on any of the hypothetical infringement defences, the remainder of the section 8 claim would settle. [12]

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Eli Lilly Canada Inc v Mylan Pharmaceuticals ULC, 2015 FCA 286

An attack on the Federal Court’s (“FC”) slight rewording of the obvious-to-try test has proven unsuccessful.

Background: FC Finds Invention Obvious-to-Try

Eli Lilly brought an application under the Patented Medicines (Notice of Compliance) Regulations, to prohibit Mylan Pharmaceuticals ULC from being issued a Notice of Compliance for a generic version of the drug tadalafil until after the expiration of Canadian Patent No. 2,379,948 (the “’984 Patent”). [1]

In response, Mylan claimed that it would not infringe the ‘948 Patent and that the ‘948 Patent was invalid on the basis that it was obvious. The FC agreed with Mylan and held that the allegations of non-infringement and invalidity were justified, employing the obvious-to-try test. Eli Lilly appealed the FC decision, alleging legal and factual errors on the part of the Judge. [2]

Minor Rephrasing of “Obvious-to-Try” Test Not Material

Eli Lilly alleged that the FC Judge erred in law in his obviousness analysis by asking the incorrect question at the first step in the obvious-to-try test. [4] Eli Lilly cited paragraph 150 of the FC reasons, where the Judge wrote that the “test, rather, is whether the skilled person had good reason to pursue predictable solutions or solutions that provide a ‘fair expectation of success.'” [4]

The proper test, as set out by the Supreme Court of Canada in Apotex v Sanofi-Synthelabo Canada Inc, (2008 SCC 61), differs slightly: “For a finding that an invention was ‘obvious to try’, there must be evidence to convince a judge on a balance of probabilities that it was more or less self-evident to try to obtain the invention. Mere possibility that something might turn up is not enough.” [66]

The FCA held that any conceivable error by the FC Judge in the way he initially articulated the test for assessing obviousness was not salient to the FC decision. [5] The FCA upheld the finding of invalidity and non-infringement and dismissed the appeal with costs.

Commentary

Despite its slight rephrasing of the obvious-to-try test, the FC Judge’s conclusion that the ‘948 Patent was obvious to try was in line with the test used in Sanofi. It is not surprising that the FC Judge was not held to the strict wording of the Sanofi decision, considering the Supreme Court’s own departure in Sanofi from the restrictive obviousness tests of the past, and its own characterization of the obvious-to-try test as a non-exhaustive set of factors to be taken into consideration in accordance with the evidence in each case (Sanofi at paras 60, 69).

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Apotex Inc v Sanofi-Aventis, 2014 FCA 68

Innovator pharmaceutical companies should be cautious and think twice about how aggressively they defend their patents as they could potentially face paying more than 100% of actual damages as an award under section 8 of the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations”). This can occur when multiple plaintiffs successfully sue a company and the calculation of each plaintiff’s market share is not coordinated to appropriately allocate 100% of the market share in a hypothetical world.

Courts must create a “hypothetical world” to attempt to assess what would have occurred if a generic company, who was successful in a Notice of Compliance (“NOC”) proceeding, entered the market at an earlier time. Such awards can provide generic companies with a windfall when damages are calculated in the face of multiple section 8 damage claims against an innovator pharmaceutical company. Such was the situation in this case where Sanofi-Aventis (“Sanofi”) was also facing a claim by another generic drugmaker, Teva.

Background: Two Generics Delayed Market Entry under PM(NOC) Regulations

Sanofi held the rights to a series of Canadian patents, including Canadian Patent No. 1,246,457 (the “’457 Patent”) for the brand name version of the drug ramipril used in the treatment of hypertension. [2] Apotex manufactured a generic version of ramipril, Apo-ramipril, and in April 2014, Apotex applied for an NOC to market it in Canada. Sanofi successfully applied for an order of prohibition with respect to its ‘457 Patent. As a result, a 24-month statutory stay was triggered that prevented Apotex from receiving an NOC until December 12, 2006. However, Apotex was subsequently successful alleging the invalidity of the ‘457 Patent. [78] Apotex then brought an action for damages under section 8 of the PM(NOC) Regulations for lost profits in respect of Apo-ramipril for delayed entry into the market.

In regard to Apotex’s market share during the relevant period, the Trial Judge awarded Apotex 100% of the generic market from April 26, 2004 to July 26, 2004 (when Apotex was determined to be alone in the market), 70% from July 26, 2004 to August 1, 2006 (when Apotex and the authorized generic were determined to be the only participants in the market), and 50% from August 1, 2006 to December 12, 2006 (when Apotex, Teva and the authorized generic were determined to be sharing the market).  [61]

Both parties appealed. The principal issues on appeal were whether the Trial Judge erred in determining (1) the liability period, (2) the attributes of the hypothetical market during that period, (3) how “double ramp-up” should be treated and (4) whether sales for unapproved indications should be included.

1.     Section 8 Liability Period Upheld

The FCA held that the Trial Judge made no error in concluding that the section 8 liability period ran from April 26, 2004 to December 12, 2006.

2.     Attributes of the Hypothetical Market During the Section 8 Liability Period

The FCA agreed with the Trial Judge’s reasons rejecting the “open season” methodology for determining the hypothetical market wherein each competitor is assumed to enter the market free of the constraints of the PM(NOC) Regulations. [159] FC held that steps taken in the real world should be assumed to be taken in the hypothetical world, unless there is evidence to reasonably conclude that different steps would have been taken. [157]

The Trial Judge held that in the hypothetical market, Sanofi’s authorized generic drug manufacturer, Ratiopharm Inc., could have launched a competing generic product on July 24, 2004. The FCA held that the trial judge’s conclusion was reasonable. [173] The FCA also found to be reasonable the Trial Judge’s conclusion that Riva, another competitor generic ramipril producer, would not have entered the hypothetical market until after the end of the section 8 liability period. [175]

However, in regard to Teva, yet another competitor generic ramipril producer, the FCA held that the Trial Judge erred in principle in concluding that Teva would have entered the hypothetical market on August 1, 2006. The FCA held that based on the record, Teva would not have entered the hypothetical market during the section 8 liability period. [188] The FCA thus allowed Apotex’s appeal in this respect and ordered the redetermination of the quantum of damages.

3.     Double Ramp-Up: Adjustment Rejected as Outside Liability Period

At trial, no adjustment was made for a double ramp-up. Ramp-up refers to the period of time that it takes a drug manufacturer after initial approval of its drug to reach its final level of sales. Apotex sought compensation in respect of its double ramp-up after it was issued its NOC in December. The Court of Appeal held that the trial judge did not err in rejecting the double ramp-up adjustment, as the ramp-up period was outside of the section 8 liability period to which section 8 damages are limited. [191]

4.     Sale for Unapproved Indications: Adjustment not Precluded

At trial, no adjustment was made for sales made in respect of an unapproved indication. Ramipril was originally approved for hypertension, but further testing of ramipril revealed additional benefits for heart-related health issues, which were referred to as HOPE indications. As a result, Sanofi filed two further patents for Ramipril related to the HOPE indications. Sanofi argued that Apotex’s compensation under section 8 could not extend to sales of Apo-ramipril for unapproved indications, namely HOPE indications. The FCA found no error with the Trial Judge’s findings and conclusions in not precluding Apotex from recovering losses associated with the HOPE indications.

Commentary

Sanofi’s appeal to the Supreme Court of Canada was dismissed with costs for substantially the same reasons of the majority of the Court of Appeal (Sanofi-Aventis v Apotex Inc, 2015 SCC 20).

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Mylan Pharmaceuticals ULC v. Eli Lilly Canada Inc., 2016 FCA 119

Patent owners applying for a new patent should be prepared to identify a degree of inventiveness from their previous patents, even those published within the last year, in order to avoid rejection on the grounds of obviousness-type double-patenting. In this case, the Federal Court of Appeal (“FCA”) dismissed the appeal, which alleged that Canadian Patent No. 2,226,784 (the “‘784 patent”) was invalid on the basis of obviousness-type double-patenting and for lack of utility due to no sound prediction. [1] As a result, the ‘784 patent was upheld.

Background of The ‘784 Patent

The ‘784 patent claims tadalafil and 3-methyl tadalafil for the treatment of erectile dysfunction (“ED”). [2] These compounds are PDE V inhibitors. As PDE V prevents erections, an inhibitor of PDE V will have the effect of stimulating erections. [4] Eli Lilly Canada Inc. (“Eli Lilly”) had previously acquired Canadian Patent No. 2,181,377 (the “’377 patent”) that claimed, among other compounds, tadalafil. These compounds were claimed as treatment for various disorders, but did not mention ED treatment specifically. [5]

After the priority date of the ‘377 patent, but before the priority date of the impugned ‘784 patent, Pfizer’s PCT patent application WO1994028902A1 (the “’902 patent application”) for sildenafil was published. [6] This application showed that a PDE inhibitor could treat ED. [6] However, there was evidence before the Federal Court (“FC”) judge that this was counterintuitive and initially met with skepticism. [6]

Eli Lilly had applied for an order under section 6 of the Patented Medicines (Notice of Compliance) Regulations (“PMNOC Regulations”) prohibiting Notice of Compliance being issued to Mylan Pharmaceuticals ULC (“Mylan”) for its generic version of tadalafil. [8] In response, Mylan filed a Notice of Allegation alleging that the ‘784 patent was invalid for lack of utility and obviousness-type double-patenting. [8] The FC rejected Mylan’s allegations. [10-13]

The Difference Between Prior Art and Common General Knowledge

Before delving into the analysis of this appeal, the FCA reviewed and restated a few relevant areas of patent law, the first being the difference between prior art and common general knowledge. Prior art is the publicly available collection of learning in the relevant field, regardless of it being obscure or not generally accepted. [23] In contrast, common general knowledge is what is generally known and accepted by persons skilled in the relevant art. [24]

The Difference Between Obviousness and Obviousness-Type Double-Patenting

The FCA noted that, although obviousness and obviousness-type double-patenting may seem like similar grounds for invalidity, each is aimed to achieve a different policy objective. Obviousness is directed at the question of whether an invention (in the legal sense) actually exists. Obviousness-type double-patenting, in contrast, is directed at preventing the evergreening of an existing patent, through what would otherwise be a valid patent, but is an extension of a patent that has already been granted. [28]

One major difference between these two tests is that any piece of prior art can be cited in an obviousness challenge, whereas only the earlier patent can be cited in an obviousness-type double-patenting challenge.  [29] A second major difference is that in an obviousness challenge, subsection 28.3(a) of the Patent Act provides that any information disclosed by the patentee within a year prior to the filing cannot be cited as prior art that renders the patent obvious. [30] This section does not apply to double-patenting, where an earlier patent can be cited even if it was published within a year of the filing date of the impugned patent. [30]

The Test for Obviousness-Type Double-Patenting

In determining the proper test for obviousness-type double- patenting, the FCA concluded that the relevant question is whether there is an inventive step from the first patent to the second. [35] To execute this test, the claims of the second patent must be considered against the claims of the first patent. [37] In construing the claims, the FCA noted that the rules of patent construction preclude reference to the specification when the claims are clear and unambiguous. [39] The ‘377 patent’s claims are unambiguous, and as such, the FCA felt that the FC judge erred by referring to the specification in their analysis. However, it was of little consequence as the judge still came to the correct conclusion. [40, 43]

After settling the methodology of the obviousness-type double-patenting test, the FCA turned to the question of at which date the inquiry was to be conducted. [44] There were three potential dates which were reviewed: (1) the priority of the first patent (the ‘377 patent), (2) the priority date of the second patent (the ‘784 patent}, and (3) the publication date of the second patent. The third date was deemed to be inappropriate, as using a date after the claim date would mean that the court assessing an obviousness-type double-patenting claim would consider prior art beyond what section 28.3 allows the court to consider in a classical obviousness analysis. [49-50]

The FCA, however, opted not to determine whether the first or second date was correct, as both dates result in a finding of no double-patenting. [52] The primary difference between these two dates, as mentioned above, is that the ‘902 patent application was published after the first date, but prior to the second date. As mentioned above, the FC judge accepted evidence that the ‘902 patent application, which showed that a PDE V inhibitor could treat ED, was counterintuitive and met with skepticism. This meant that the ‘902 patent application would not be part of the common general knowledge, as a skilled person wouldn’t have unhesitatingly accepted its teachings. [53] This rendered the two remaining dates having the same outcome, and the FCA found that the FC judge did not commit a palpable and overriding error in concluding that the ‘784 patent was distinct from the ‘377 patent. [53]

Utility and Sound Prediction: A Reasonable Inference of Success Existed

Mylan alleged that while the oral administration of tadalafil to treat ED may have been soundly predicted, the oral administration of 3-methyl tadalafil was not. [54] The FCA stated that the FC judge erred in their finding that only one compound in a Markush claim has utility, since all of the compounds must have utility. This error ultimately had no consequence, though, as it was found that, on the evidence, there was both a factual basis and sound line of reasoning sufficient to ground a sound prediction. [57]

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Eli Lilly Canada Inc v Apotex Inc, 2015 FC 1016

The Federal Court (“FC”) has discretion as to whether or not to stay a prohibition application under the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC)”) where it is found to be an abuse of process. In this decision, the FC permitted the applicant to proceed with its prohibition application, despite a previous decision finding that the patent in question was invalid. In deciding whether or not to exercise its discretion to dismiss the case for an abuse for process, the FC in this case considered which party would be more severely prejudiced by a negative determination. The previous decision was being appealed by the applicant. The FC held that although allowing the prohibition application to proceed could result in unnecessary litigation, if the appeal was dismissed, this would result in less prejudice than if the prohibition application was dismissed and the appeal was successful.

Background

Eli Lilly Canada Inc. (“Eli Lilly”) sells CIALIS for the treatment of erectile dysfunction, among other things, and ADCIRCA for the treatment of pulmonary arterial hypertension. Tadalafil is the active pharmaceutical ingredient in both CIALIS and ADCIRCA. The patent for tadalafil expired in 2015. Eli Lilly brought an application under the Patented Medicines (Notice of Compliance) Regulations, to prohibit Apotex Inc. (“Apotex”) from being issued a Notice of Compliance for the generic versions of CIALIS and ADCIRCA until after the expiration of Canadian Patent No. 2,379,948 (the “’948 patent”). The ’948 patent was a formulation patent for tadalafil that claimed formulations with a reduced particle size and certain excipients to address tadalafil’s poor water solubility. [3] At issue was whether Apotex’s products infringed the ‘948 Patent and whether the ‘948 Patent was invalid for obviousness or lack of utility.

PM(NOC) Prohibition Application Not an Abuse of Process

The ’948 patent was found to be invalid for obviousness in a previous proceeding, Eli Lilly Canada v Mylan Pharmaceuticals ULC, 2015 FC 178, which Eli Lilly has appealed. Apotex attempted, but was unsuccessful, in arguing that that Eli Lilly’s prohibition application was an abuse of process and should be dismissed. The decision on whether or not to dismiss an application as being abusive is discretionary. [19] The key issue for the FC in deciding whether to exercise its discretion was a determination of which party would be more severely prejudiced by a negative determination. The FC noted that although allowing Eli Lilly to proceed could result in unnecessary litigation – notably, in the event that Eli Lilly’s appeal in the Mylan litigation was dismissed – this would be preferable to the unfairness that would result to Eli Lilly if the dismissal request were granted. [28]

Non-infringement Allegation: Justified

The party bringing a prohibition application, in this case Eli Lilly, carries the burden of establishing that the Apotex products infringe the 948 Patent. The FC did not find that Eli Lilly has discharged this burden. [66] The FC found that the identity and amounts of excipients in Apotex’s formulations fell outside the claims of the ‘948 patent. [70]

Obviousness Allegation: Justified

Apotex alleged that the ‘948 patent was invalid for obviousness. The FC agreed and found that the formulations claimed in the ‘948 patent would have been obvious to try. The FC held that it would have been obvious for a person skilled in the art, that being a skilled pharmaceutical formulator, to use tadalafil in free drug form, reduce its particle size and formulate it with the excipients claimed in the ‘948 Patent in order to achieve a stable and more rapidly-dissolving formulation of tadalafil. [114]

Inutility Allegation: Not Justified

Eli Lilly relied only on demonstrated utility, not sound prediction, to uphold the ‘948 patent. The FC held that the testing done by Eli Lilly was sufficient to establish the promised utility – i.e. “the claimed utility of the rather self-evident promise that the formulations without an enteric coating would provide more rapid dissolution and enhanced bioavailability over the formulation of the Butler Patent, which contained an enteric coating.” [144] The FC noted that case law supports the proposition that “evidence of demonstrated utility need not be referenced in the patent for the patentee to rely on it.” [142] Data demonstrating utility was thus not required to be referenced in the ‘948 patent. The FC thus held that Apotex’ allegations of inutility were not justified.

The FC dismissed Eli Lilly’s prohibition application.

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Apotex Inc v Pfizer Ireland Pharmaceuticals, 2016 ONSC 7193

In this Ontario Superior Court (“ONSC”) decision, Nordheimer J heard pleadings by Apotex Inc. (“Apotex”) and Pfizer Ireland Pharmaceuticals (“Pfizer”) concerning Pfizer’s, now invalid, patent for Viagra. [5] Apotex had previously been prevented from manufacturing its own generic because of the Viagra patent, and now claimed damages for the delay in being able to market its own variant. [5]

Pfizer moved to strike Apotex’s claim, which sought a common law remedy for the delay, by taking the position that the Patent Act provides a “complete code” of remedies for matters pertaining to patent law, and that therefore Apotex’s claim for a common law remedy must be struck out. [6] For the reasons below, and for the reason that “[i]t is certain[ly] not ‘plain and obvious’ that the claims cannot succeed,” [11] the appeal was dismissed and Apotex’s claim was allowed to proceed unstruck. [12-13]

Rules of Civil Procedure: Common law claims vs. the “complete code” argument allowed to proceed

For a moving party to obtain leave to appeal on a pleadings motion, one of two tests set out in Rule 62.02(4) must be satisfied. [7] The first of these tests is that there must be a conflicting decision from Ontario by another judge on the matter involved in the proposed appeal, and that it is the opinion of the current judge that leave to appeal be granted. [7] The second test is that there appears to the judge hearing the motion to be good reason to doubt the correctness of the order in question and the proposed appeal involves matter of such importance that leave to appeal should be granted. [7]

With regards to the first test, the judge did not feel there was a pertinent enough conflicting decision from Ontario available for application to the current facts. [9]

Under the second test, Nordheimer J indicated that there was confusion and uncertainty in Pfizer’s argument that the patent regime provides a “complete code” of remedies barring Apotex from common law remedies. [11]

In conclusion, however, as this was a pleadings motion, no final determination on the merits of whether the Patent Act provides a “complete code” of remedies could be made here. [12] Thus, Nordheimer J concluded that the time of the court and the time and money of the parties should not be spent on endless arguments over a party’s pleadings. [12]

Commentary

The “complete code” argument, used to bar parties from bringing civil claims in patent cases, has recently seen more usage (For example: Low v Pfizer Canada Inc, 2015 BCCA 506). The decision at hand, although not fully articulated, dealt with the question of retroactivity. Also not discussed in this case is the parallel between a common law claim for damages, where a patent was retroactively invalidated, and a claim for Section 8 damages under the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC)”), which provides a remedy for a generic pharmaceutical manufacturer in the case where its product was delayed entry into the market by operation of the PM(NOC) Rules. In line with Nordheimer J’s conclusion, the absence of this discussion is likely explained by the fact that this case is simply dismissing an appeal of a pleadings motions.

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Gilead Sciences, Inc v Teva Canada Limited, 2016 FC 336

Patent holders may want to consider bringing actions for potential future patent infringement, , even where the future infringement is temporally distant, if sufficient facts are available to support a high likelihood of future harm. In this case, the Federal Court (“FC”) affirmed Prothonotary Tabib’s decision to strike some of Gilead Science Inc.’s (“Gilead”) pleadings and allow the action to continue on the basis of amended allegations of a likely future (quia timet) infringement. [1, 12]

Gilead is the owner of Canadian Patent No. 2,261,619 (“the ‘619 Patent”), for its tenofovir disoproxil product, which expires on July 25, 2017. [6] Teva Canada Limited (“Teva”) has developed a competing version of tenofovir disoproxil, which has been approved by the Minister, however it is currently on patent hold and has not been issued a Notice of Compliance (“NOC”). [6, 8] In the preceding decision, Prothonotary Tabib declined to strike out Gilead’s Statement of Claim in its entirety and allowed the action to continue on the basis of a likely future (quia timet) infringement. [1] The issue to be decided in this case was whether the prothonotary made a palpable and overriding error when applying the test for maintaining a quia timet proceeding. [1,4]

Future (Quia Timet) Infringement: No Palpable and Overriding Error Made

It was not disputed that the correct legal test for a quia timet proceeding was identified. Pursuant to Connaught Laboratories Limited v Smithkline Beecham Pharma Inc, the following criteria are required: (i) a deliberate expressed intention to engage in activity, the result of which would raise a strong possibility of infringement, (ii) the infringing activity must be imminent and the resulting damage to the plaintiff must be very substantial, if not irreparable, and (iii) the facts pleaded must be cogent, precise and material – it is not sufficient for them to be indefinite or amount to mere speculation. [2]

The FC found that Teva had declared a clear intention to come to market with its competing product as soon as it obtained a NOC. [6] Teva argued that there was no guarantee of a NOC being issued and, even if it was, a potential infringement a year or more away does not amount to an imminent infringement. [7] The FC found that as Teva’s product had been contingently approved by the Minister and Teva had made it clear it would enter the market upon receipt of a NOC, the prothonotary’s conclusion that a strong possibility of infringement was present could not be characterized as an error, let alone a palpable and overriding error. [9] The FC also found that the prothonotary did not err in her analysis of the temporal aspect of imminence. The prothonotary stated in her decision that the purpose of a quia timet action is to stop an event before it happens and that it is neither premature nor pointless to institute an action 22 months before the occurrence of the event to be avoided. [10] The FC further found that a potential event that is more distant in time may be less likely to occur, however temporal imminence appears to be a subordinate consideration when the likelihood of future harm is high. [12]

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Leo Pharma Inc v Teva Canada Limited, 2015 FC 1237

The Federal Court (“FC”) heard an application by Leo Pharma Inc. (“Leo”) to prohibit Teva Canada Inc. (“Teva”) from being issued a Notice of Compliance under the Patented Medicines (Notice of Compliance) Regulations. [1] The application was in relation to Leo’s patent, Canadian Patent No. 2,370,565 (“the ‘565 Patent”), [1] an ointment used in the treatment of psoriasis. [2] Teva alleged that the ‘565 Patent was invalid for obviousness, lack of utility and insufficiency, and would not be infringed by its own generic ointment. [4]

The FC found that Teva’s allegations of invalidity on the grounds of obviousness, lack of utility and insufficiency were not justified, [7] and granted the application in favour of Leo, preventing Teva from marketing and selling its generic version until the expiration of Leo’s patent. [7]

Background: The ‘565 Patent

The ‘565 Patent, entitled “Dermally Applicable Vitamin D-Containing Pharmaceutical Compositions,” is set to expire on January 27, 2020. [14] It described and claimed a combination of two preexisting psoriasis drugs: 1) at least one vitamin D or vitamin D analogue (“Component A”), and 2) at least one corticosteroid (“Component B”), with the addition of a solvent (“Solvent C”). [15] Teva sought to sell its own generic version of the patented 50 mcg/g calcipotriol and 0.5 mg/g betamethasone ointment, [1] where betamethasone is a corticosteroid and calcipotriol is a vitamin D analogue. [54] The addition of Solvent C solved the previous instability problems that resulted when the two drugs were mixed together, caused by their pH incompatibility. [127]

Non-Obviousness

Teva argued that the ‘565 Patent was obvious because it alleged that the simultaneous use of Components A and B for the treatment of psoriasis was common knowledge at the relevant date. [121] However, the FC found that the patented combination was not obvious to try. [154] The FC acknowledged that the use of the combination was known, but neither common nor obvious. [124] The FC held that there was motivation in the prior art to attempt to find a way to combine the two components, but that in light of the many other possible combinations that might also be tried, the claims in the ‘565 Patent were not obvious. [134]

Utility

Teva alleged that the ‘565 Patent failed to satisfy the doctrine of sound prediction on two grounds: 1) that it lacked drug-release or skin-penetration data so that a person of skill in the art (“POSITA”) could not soundly predict that all formulations would be effective; and 2) that it claimed millions of formulations, not all of which could be soundly predicted to be stable and effective. [167] The FC rejected the first allegation as Teva did not raise it in the Notice of Allegation. [168] The second allegation was rejected as the FC found that at least one of the claims was soundly predicted. [178]

Sufficiency

The FC rejected Teva’s argument that the ‘565 Patent lacked sufficiency because it was silent as to which Component, A or B, had to be dissolved in Solvent C. [188] The FC found that a POSITA would be able to make the claimed formulation and would not have to be explicitly told that the calcipotriol had to be dissolved in the solvent. [191]

In a subsequent costs decision, Teva was ordered to pay Leo’s costs in the amount of $419,729.92. [Leo Pharma Inc v Teva Canada Limited, 2016 FC 107]

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Apotex Inc v Astrazeneca Canada Inc, 2017 FCA 9

Patents that are subject to the old Patent Act may have provincial limitation periods applicable to them if all elements of the cause of action are within a province.

In this case, the Federal Court of Appeal (“FCA”) affirmed the Federal Court’s (“FC”) decision that AstraZeneca Canada Inc.’s (“AstraZeneca”) patent, Canadian Patent No. 1,292,693 (“the ‘693 Patent”), was valid and infringed, accepted Apotex Inc.’s (“Apotex”) appeal with respects to limitation periods, and rejected AstraZeneca’s cross-appeal regarding punitive damages. [6]

Background

The ‘693 Patent pertains to pharmaceutical preparations containing omeprazole, a drug that is used in the treatment of gastrointestinal diseases and was commercialized by AstraZeneca under the brand name LOSEC. [3, 13] Apotex thought it had succeeded in finding a way to work around the ‘693 Patent by using a different process than was covered in the claims and obtained a Notice of Compliance (“NOC”) allowing it to sell its own omeprazole product. [13, 16] The issues to be decided in this case were (1) whether the FC erred in construing the ‘693 Patent, and if so, then erred in finding infringement, (2) whether the FC erred in finding the ‘693 Patent was valid, (3) whether the FC erred in concluding that a six-year limitation period applied to all of the infringing activities, and (4) whether the FC erred in declining to award punitive damages to AstraZeneca. [25, 26]

FC Claims Construction Found to be Correct

Apotex alleged that the FC adopted a fettered, results-oriented construction. [31] The FCA noted that the issue of construction of the patent is to be reviewed on the correctness standard and therefore performed its own analysis. [41] The FCA then stated that it is trite law that a court will consider disclosure when it construes the claims, however, the disclosure cannot be use to enlarge or contract the scope of the claim as written and thus understood. [48] The FCA concluded that the FC was correct in its construction and therefore its finding of infringement should stand. [65]

Invalidity Allegations Rejected

The FCA rejected Apotex’s overlapping allegations of insufficiency of disclosure, overbreadth and ambiguity, all of which pertained to a preparation including a layer made in situ. [76, 79, 92] In regards to sufficiency, the FCA found that an inventor is only required to disclose one method or process for making the invention. [79] While the process disclosed in the ‘693 Patent does not involve a layer made in situ, it nonetheless enables a person skilled in the art to practice the invention as described. [78] The FCA also rejected Apotex’s allegations of inutility, finding that a formulation meeting the essential elements of the claims would be expected to provide good gastric acid resistance and long-term storage stability. [98]

Limitation Period

Apotex alleged that the FC was incorrect in applying a six-year limitation period to all acts of infringement. [105] The FCA found that the FC erred in precluding the possibility that provincial limitation periods might apply to specific acts of infringement where all elements of the cause of action occurred within that province. [114, 118] The FCA highlighted that as the six-year limitation period applicable to all acts of infringement has now been included in the Patent Act for over 20 years, the issue of provincial limitation periods only applies in cases involving patents subject to the old Patent Act. [123]

Cross-Appeal: Punitive Damages Not Awarded

AstraZeneca sought punitive damages or solicitor/client costs, or both, on the basis that Apotex had been deceptive in the context of the settlement obtained in earlier NOC proceedings involving the ‘693 Patent. [127] The FCA was not persuaded that the FC misconstrued the law or made a palpable and overriding error in assessing the facts, and therefore rejected AstraZeneca’s cross-appeal. [136]

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Apotex v Eli Lilly, 2017 ONSC 224

In this Ontario Superior Court (“ONSC”) decision, Apotex Inc. (“Apotex”), sought compensation from Eli Lilly and Company Limited (“Eli Lilly”) for damages suffered for delayed entry to the market for its generic version of olanzapine, Apo-olanzapine. [6]

Background: PM(NOC) Proceedings

Eli Lilly had successfully obtained an order prohibiting the Minister of Health (“the Minister”) from issuing an approval to Apotex for its generic until the expiry of the olanzapine patent. [4]

However, during the same time period, Eli Lilly was in Patented Medicines (Notice of Compliance) (“PM(NOC)”) proceedings with another generic manufacturer, Novopharm Limited (“Novopharm”), in which the validity of Eli Lilly’s patent was brought into question. Eli Lilly was unable to demonstrate that Novopharm’s allegation of invalidity was not justified. [5]

Analysis: Claims under Statutes of Monopolies and Trade-marks Act Allowed to Proceed

In light of Eli Lilly’s failure to defend its patent against the allegation of invalidity, Apotex claimed treble damages under the Ontario Statute of Monopolies and the English Statute of Monopolies, damages under section 8 of the PM(NOC) Regulations, damages under section 53.2 of the Trade-marks Act, and damages at law. [6]

Eli Lilly was scheduled to bring a motion to strike the entirety of Apotex’s claim, however, they abandoned the motion on the day of the hearing after their request for an adjournment was dismissed. [9]. Eli Lilly’s abandonment of its motion is curious, but appears to have been influenced by a recent decision (Apotex Inc v Eli Lilly and Company et al, 2015 ONSC 5396) which found that “it was not ‘plain and obvious’ that an action based on the Ontario Statute of Monopolies and the English Statute of Monopolies could not succeed,” [7] and another recent decision (Apotex Inc v Schering Corporation, 2016 ONSC 3407) which found that “ it was not plain and obvious that a claim under sections 7(d) and 53.2 of the Trade-marks Act  had no chance of success despite the argument that the right to compensation under section 8 of the Regulation creates a ‘complete code’ for compensation.” [7]

The ONSC undertook a brief analysis of the Rules of Civil Procedure, [10] offers to settle, [13] bills of costs [15-24] and other matters relevant to costs, [34-36] and ordered Eli Lilly to pay Apotex a total of $20,000.00. [37]

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Allergan Inc v Apotex Inc, 2016 FC 344

Not adequately distinguishing between mere goals and promises of utility in the claims of a patent could spell out disaster for patentees.

In this Federal Court (“FC”) decision, Allergan Inc. (“Allergan”) sought an order pursuant to the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations”) prohibiting the Minister of Health (“the Minister”) from issuing a Notice of Compliance to Apotex Inc. (“Apotex”) for it’s gatifloxacin ophthalmic product until after the expiry of Canadian Patent No. 2,307,632 (“the ‘632 Patent”). [1] Entitled “Aqueous Liquid Pharmaceutical Composition,” the ‘632 Patent claims eye drops, ear drops or nasal drops containing gatifloxacin and disodium edetate (“EDTA”). [2]

Apotex alleged in its Notice of Allegation (“NOA”) and submissions that the ‘632 Patent was invalid because it was obvious and lacked utility. [7] The FC found that the allegation was justified. [8]

The Claims and the Evidence

The main Claim at issue in this decision was Claim 10, as it read on Claims 1, 2, 3 and 9. [5] These Claims read as follows:

1. An aqueous liquid pharmaceutical composition which comprises Gatifloxacin or its salt and disodium edetate.
2. The aqueous liquid pharmaceutical composition according to claim 1, wherein pH of the composition is within the range of 5 to 8.
3. The aqueous liquid pharmaceutical composition according to claim 1 or 2, where the composition is in the form of eye drops.
4. The aqueous liquid composition according to any one of claims 1 to 5, wherein Gatifloxacin or its pharmaceutically acceptable salt is contained in an amount of 0.1 to 1.0 w/v% and disodium edetate is contained in an amount of 0.001 to 0.2 w/v%.
5. The aqueous liquid composition according to claim 9, wherein the amount of disodium edetate is 0.01 to 0.1 w/v%. [5]

In considering the evidence, the FC was satisfied that the evidence of one of Apotex’s expert witnesses was preferred and to be given more weight than other expert witnesses. [12] The FC was of this view because opinions of experts who had not seen the patent nor been exposed to the positions of the litigants ought to be given greater weight on issues going to obviousness and patent construction than experts who had full disclosure of the ‘632 Patent and knowledge of the positions of the parties. [13]

Obviousness

Allergan’s objection that Apotex’s experts took 49 references cited in the NOA without doing their own prior art search [20] was found to be without merit. [21] The FC agreed with Apotex’s expert that the 49 references accurately represented the common general knowledge of a person of skill in the art (“POSITA”). The FC held that the POSITA would have a fair and reasonable expectation that combining gatifloxacin with EDTA would produce an effective ophthalmic compound that would have the three advantages set out in the ‘632 Patent. [39]

Utility

The FC also agreed with the three advantages that Apotex’s expert described as promises, and which Allergan had submitted were merely goals:

The promised utility is clearly and unequivocally described in the 632 Patent.  The skilled person would understand that the patent explicitly states that the gatifloxacin and EDTA compositions of the invention are useful as follows:  to increased or raise corneal permeability of gatifloxacin compared to an aqueous solution that does not contain EDTA; to prevent precipitation of gatifloxacin crystals compared to an aqueous solution that does not contain EDTA; and to prevent colorization of gatifloxacin compared to an aqueous solution that does not contain EDTA. [46]

Furthermore, the FC found that the many compositions covered by Claim 10, coupled with the very limited testing performed by the inventors, Allergan’s expert had correctly conceded that the utility was neither demonstrated, [50] nor soundly predicted. [60]

Prohibition Order Dismissed

The FC found that Allergan failed to both establish the utility of ‘632 Patent [61] and to disprove the allegations of Apotex with respect to Claim 10 of the ‘632 Patent, specifically that it was obvious and lacked utility. [62]

The application was dismissed with costs. [62]

Commentary

This decision deals with what has come to be known as the so-called “promise doctrine.” The doctrine holds that if a patent promises a certain type of utility, but fails to deliver upon it, then that patent is void. This decision emphasizes  that a patentee should be careful to clearly distinguish objectives that are merely goals from promises of utility in a patent application, lest the patent is found void for lacking the utility it promised. It is unclear, however, what the distinguishing feature is between something that is a general objective and something that is a promise of utility, though one presumes it is a matter of context and purposive construction within a given fact situation. This means that Canadian patentees and patent practitioners alike will have to wait for the courts to provide guidance on this nuance.

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Shire Canada Inc v Apotex Inc, 2016 FC 382

When using expert witnesses in patent litigation, blinding them may be persuasive to a court, however the primary focus should be ensuring the substance and reasoning of their opinion is reliable.

In this case, the Federal Court (“FC”) concluded that Apotex Inc.’s (“Apotex”) allegations of non-infringement in respect of Shire Canada Inc.’s (“Shire”) Canadian Patent No. 2,348,090 (“the ‘090 Patent”) were justified and accordingly denied Shire’s requested prohibition order. [7]

Background: The ‘090 Patent

The ‘090 Patent, entitled “Oral Pulsed Dose Drug Delivery System,” describes a system for treating ADHD. [9] This system involves multiple pulsed doses of mixed amphetamine salts (“MAS”) being delivered by means of a single administration comprising a first, immediate pulse followed by a second, delayed pulse, which is intended to mimic the effect of taking two separate doses throughout the day. [14] Apotex’s product, in contrast, does not achieve extended-release characteristics by way of immediate and delayed release tablets, but rather uses an initial mechanism of diffusion of MAS followed later by a mechanism of diffusion and erosion once the tablets have reached the intestines. [24]

Shire filed an application under the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations”) for an order prohibiting the Minister of Health from issuing a Notice of Compliance to Apotex. [1] In response, Apotex alleged that (i) none of the claims in issue will be infringed by its product, (ii) in the event that the claims in issue are construed as Shire argues, they are invalid for overbreadth, ambiguity, insufficiency and lack of utility, and (iii) none of the claims in issue are relevant under the PM(NOC) Regulations because Shire’s product does not fall within the scope of said claims. [6]

Expert Blinding: Persuasive But Not Primary Interest

Apotex argued that its expert witnesses should be favoured over Shire’s because Apotex blinded its experts to certain facts and their legal position, whereas Shire did not. [42] The FC stated that while expert blinding may be persuasive, the primary interest is in the substance of the expert’s opinion and the reasoning that led to it. [45] Concern about whether an expert was blinded may arise in situations where the expert’s opinion seems tortured or less well-reasoned. [45] The FC also noted that blinding of witnesses is not a guarantee that expert evidence is reliable as it would be possible for a party to seek blind opinions from a number of experts and retain an outlier that provided the opinion that was sought after. [46]

Claims Construction and Infringement: Non-Infringement Allegations Justified

After completing a lengthy claims construction analysis on the essential elements of the claims at issue, the FC concluded that none of the ‘090 Patent’s claims were infringed by Apotex’s product. [181] As the FC concluded that Apotex’s non-infringement allegations were justified, it did not comment on the remaining allegations of invalidity and the claims not being relevant to the PM(NOC) Regulations. [182-183]

Commentary

The FC recently addressed the issue of expert blinding in two other cases, Bayer Inc v Apotex Inc, 2016 FC 1013 [Bayer] and Gilead Sciences, Inc v Canada (Health), 2016 FC 857 [Gilead], with similar conclusions that expert blinding is not determinative. In Bayer, the FC concluded that expert blinding may be persuasive and helpful in weighing the evidence where credibility concerns arise, but the principal concern remains the substance of the expert’s opinion and the reasoning that led to that opinion. In Gilead, the FC found that blinding of a witness is one of perhaps several factors that influences weight given, but it is not a matter that goes to admissibility. The FC further stated that blinding is a question of relevance, reliability and weight, and noted that the greater experience and knowledge of Gilead’s experts and two false statements made by Apotex’s witnesses were factors that affected weight given.

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Janssen Inc v Celltrion Healthcare Co, Ltd, 2016 FC 525

Applications brought under the Patented Medicines (Notice of Compliance) Regulations (“the PM(NOC) Regulations”) are likely to be dismissed if it is plain and obvious that the applicant cannot succeed in showing a patent will be infringed.

In this case, the Federal Court (“FC”) granted Celltrion Healthcare Co. Ltd.’s (“Celltrion”) motion to strike Janssen Inc.’s (“Janssen”) application pursuant to section 6(5)(b) of the PM(NOC) Regulations. [45]

Application Found to be Clearly Futile

In January 2014, Celltrion received a Notice of Compliance (“NOC”) for its drug called INFLECTRA (infliximab) for use in the treatment of rheumatoid arthritis, ankylosing spondylitis, psoriatic arthritis and plaque psoriasis (“RA Indications”). [2] In 2015, Celltrion filed a Supplementary New Drug Submission (“SNDS”) seeking approval for additional uses for INFLECTRA in the treatment of diseases related to various forms of inflammatory bowel disease (“IBD Indications”). [5] The patent at issue in this case is the ‘630 Patent, which is listed on the Patent Register in connection with Janssen’s drug REMICADE^® (infliximab). [4] Celltrion served Janssen with a Notice of Allegation (“NOA”) pursuant to the PM(NOC) Regulations alleging that none of the intended uses would infringe the ‘630 Patent. [6] Janssen responded by commencing an application for a prohibition order. [6]

Pursuant to section 6(5) of the PM(NOC) Regulations, the court may strike an application in whole or in part. [8] The FC noted that previous caselaw has described subsection 6(5)(b) as an extraordinary remedy that should only be granted when an application is clearly futile or it is plain and obvious that the application has no chance of success. [9] The FC further noted that the underlying premise of the PM(NOC) Regulations is to prevent infringement. [34] Upon reading the ‘630 Patent, the FC rejected Janssen’s argument that it required expert evidence in order to construe the claims. [37] The FC found that given a plain and ordinary construction, the claims relate only to RA Indications and do not in any way discuss IBD Indications. [37] Therefore, if Celltrion obtained an NOC for its SNDS, it could not infringe the claims of the ‘630 Patent. [37]

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