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Federal Court Adjourns Motion for Confidentiality Order

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Innovator Company v Canada (Attorney General), 2017 FC 548

A third party whose patent interests may be affected by an application is entitled to notice of the application.

In this Federal Court (“FC”) decision, an entity under the pseudonym [1] Innovator Company brought an application for judicial review [3] over Section 5 of the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations”). [2] Innovator Company asserted that the Minister of Health (“the Minister”) erred in its application of Section 5, which deemed Innovator Company to be a Second Person, as defined in the PM(NOC) Regulations. [2] The FC found for the Attorney General (“AG”) [8] who argued that as another innovator (“the Other Innovator”) also had patents listed on the Patent Register pertaining to products to which Innovator Company made comparisons, [2] the Other Innovator was a necessary respondent to the application. [7]

Background

Innovator Company had filed a New Drug Submission (“NDS”) with Health Canada in order to obtain approval to market a certain drug in Canada. [2] Along with its name, Innovator Company wanted to keep the identity of this drug confidential as well. [2]

Innovator Company alleged that its submission referenced certain clinical studies in which itself and the Other Innovator had propriety rights to use the resulting data relating to the product at issue. [3] It also submitted that the Minister erred in applying the PM(NOC) Regulations mechanically and failing to consider that Innovator Company was an innovator in its own right with a proprietary interest in the data generated by the studies and the right to use it, as opposed to merely a generic seeking to use an innovator’s confidential data. [3]

The Notice of Application sought an order declaring that Innovator Company’s NDS did not trigger the application of Section 5 of the PM(NOC) Regulations, an order quashing the Minister’s decision finding that the NDS triggers the application of Section 5 of the PM(NOC) Regulations, and an order directing the Minister to process the NDS without requiring the filing of the relevant forms. [4] Innovator Company brought the current motion seeking a confidentiality order in respect of its own identity, the identity of its drug product, the entire content of its NDS, and any information it provided to the Minister in support of its NDS. [5] While it was not specifically stated in the proposed order, the confidentiality order would protect the identity of the Other Innovator as well. [5]

Analysis

The FC found the circumstances of this case to be indistinguishable from Apotex Inc v Canada (Minister of Health), 2006 FC 846 [Apotex]. [9] In that decision, Apotex Inc. had submitted an application for judicial review to compel the Minister to process its Abbreviated New Drug Submission without regard for the PM(NOC) Regulations. [9] The FC had determined that it was “apparent that the proprietary interest of a third party may be directly affected by the application.” [9] The FC was not persuaded [11] by Innovator Company’s argument that another case, Novopharm v Canada (Health), 2010 FC 566, distinguished Apotex. [10] The decision in Forest Ethics Advocacy Association v Canada (National Energy Board), 2013 FCA 236 had also held that a party has a direct interest and standing to be named as a respondent in a judicial review proceeding when “it is prejudicially affected in some direct way.” [15]

Conclusion

The FC was satisfied that the Other Innovator was a person directly affected by the order being sought, that it should have been named as a respondent and that the motion for a confidentiality order could not be considered without giving the Other Innovator a chance to be heard. [16]

The motion was adjourned without the merits or the confidential affidavit being considered. [18]

Commentary

Section 5 of the PM(NOC) Regulations is an element stemming from basic administrative law principles, in that it allows for interested parties to receive notice of matters that may concern them. Rights related to notice are fundamental in ensuring procedural fairness. As administrative principles umbrella over all areas of the law, it would be a violation of them to allow a party to bring an application without the knowledge of another party that has a legitimate interest in the outcome of the decision. Innovator Company unsuccessfully attempted to persuade the FC to do exactly this – circumvent having to name the Other Innovator as a respondent. Without checks and balances like Section 5 in place, the practical implications would involve more diligence for patent owners and their agents in ensuring they follow developments related to their interests. The risk of missing or overlooking relevant applications would also be greater and may even result in more parties pursuing litigation to resolve matters that took place behind their backs.

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Federal Court Affirms Price Regulation Schemes are intra vires

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Alexion Pharmaceuticals Inc v Canada (Attorney General), 2016 FC 716

Pharmaceutical companies should be cognizant of the price control regime when setting prices, especially potentially excessive ones, for patented medicines.

In this Federal Court (“FC”) decision, the Attorney General of Canada (“the AG”) was successful in bringing a motion to strike Alexion Pharmaceuticals Inc.’s (“Alexion”) constitutional challenge to the patented medicines price regulation scheme in the Patent Act. [3] The AG brought the motion to strike on the ground that the application was bereft of any chance in light of a line of jurisprudence, the most recent of which being Canada (Attorney General) v Sandoz Canada Inc, 2015 FCA 249 [Sandoz], which had fully and finally determined that these sanctions are intra vires and constitutional. [4]

Alexion’s application sought declaratory relief declaring that ss. 80-86 of the Patent Act and the words “in any proceeding under section 83” in s. 87(1) (“the Impugned Provisions”) were ultra vires the Parliament of Canada because the price regulations scheme created by the Impugned Provisions exceeded the powers granted to Parliament under s. 91(22) and other federal power, of the Constitution Act, 1867.  [3] Alexion had further alleged that that Impugned Provisions violated provincial jurisdiction over property and civil rights under s. 92(13) of the Constitution Act, 1867. [3]

Background & Positions

On January 20, 2015, the Patented Medicines Prices Review Board (“the Board”) issued a Notice of Hearing, notifying Alexion that the Board would “determine whether, under section 83 and 85 of the Patent Act… [Alexion] is selling or has sold… SOLIRIS in any market in Canada at a price that, in the Board’s opinion, is or was excessive and if so, what order, if any, should be made.” [8] Alexion’s application stated that the “price of SOLIRIS in Canada has neither increased since it was first introduced in the Canadian market in 2009, or decreased in the countries where the product is sold outside of Canada. Further, it is noted that in 2010 and 2011, the Board explicitly acknowledged that the introductory price of SOLIRIS was not excessive based on international pricing of the product.” [9]

The AG’s argument was simply that the constitutionality of the Impugned Provisions had already been established in prior jurisprudence, leaving the application bereft of any chance of success. [5] Alexion rebutted that the application is not bereft of any chance of success because despite the constitutionality of the Impugned Provisions being adverted to in several cases, the discussion had been peripheral in nature and not focused on a pith and substance approach, leaving none of the jurisprudence dealing with the issue head on. [6]

Issues Under Appeal

The AG cited three cases in its argument, however the Federal Court of Appeal (“FCA”) case Sandoz engaged the Impugned Provisions directly. [28] In Sandoz, following the commencement of proceedings and seeking of information, [31] orders by the Board were made against Ratiopharm Inc. (“Ratiopharm”) and Sandoz Canada Inc. (“Sandoz”) to pay over $65 million to offset excess revenues, [32] and provide information relating to five drugs, [33] respectively. Both orders were judicially reviewed, [34] with it being found that neither Ratiopharm nor Sandoz were patentees within the meaning of the Patent Act, and thus beyond the jurisdiction of the Board. [35] Justice O’Reilly also found that the Impugned Provisions were constitutional. [35] The AG appealed both decisions, and in the FCA’s view, the FC and the Board had correctly held that the control of prices charged for patented medicines comes within the jurisdiction conferred on Parliament, when applied to a patent holder or owner. [38] In the decision at hand, this determination by the FCA was sufficient to show that the Impugned Provisions were constitutional, and enough to render the application bereft of any chance of success. [39]

Application Struck

The test to be applied on a motion to strike is whether the proceeding is bereft of any chance of success. The FC was of the view that this requirement had been met. [43] The FC was also of the view that the precedent set by Sandoz in the FCA was sufficient to dispose of this motion, and applied the doctrine of stare decisis. [44] The motion of the AG was granted and the application was struck with costs. [46]

Commentary

Decisions such as these may yet reappear in the foreseeable future, as the Sandoz decision is being appealed to the Supreme Court of Canada (“SCC”) even though no decision has been rendered yet by the SCC on the leave to appeal application. Sandoz’s argument is focused on whether a generic manufacturer can be captured by the definition of a “patentee” in the Patent Act, however if the SCC grants leave to appeal, then the matter of constitutionality of price control and the jurisdiction of the Board will also likely be considered by the SCC.

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Federal Court finds Insomnia-treating Drug Patent neither Invalid nor Infringed

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Meda AB v Canada (Health), 2016 FC 1362

In this Federal Court (“FC”) decision, the formulation patent for the insomnia-treating drug zolpidem tartrate (“zolpidem”), licensed by Meda AB, Meda Pharmaceuticals and Valeant Canada LP (collectively, “Meda”), [3] was found to be substantially valid but not infringed by Pharmascience Inc.’s (“Pharmascience”) generic version of zolpidem, PMS-Zolpidem. [18]

Background and Issues: The ‘988 Patent

Canadian Patent No. 2,629,988 (“the ‘988 Patent”), entitled “Pharmaceutical Composition for the Treatment of Acute Disorders,” is owned by Orexo AB and was issued in Canada in January 2014, dependent upon a PCT application from 1999. [4] Meda are “first persons” as defined in the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations”). [1] They filed New Drug Submissions with the Minister of Health (“the Minister”) for zolpidem sublingual orally dissolving tablets (“the SUBLINOX® Tablets”) for which Notices of Compliance (“NOC”) for Submissions were issued in 2011 and 2012. [2] In January 2014, the Minister granted Meda’s request to list the ‘988 Patent on the Patent Register with respect to the submissions and the SUBLINOX® Tablets. The Patent Register was updated in January 2015 to reflect Valeant, a sublicensee of the ‘988 Patent, as the current holder of the NOCs for the SUBLINOX® Tablets. [3] In May 2014, Pharmascience filed an Abbreviated New Drug Submission (“ANDS”) seeking a NOC for PMS-Zolpidem and compared its proposed tablets to the SUBLINOX® Tablets. [5]

The validity issues questioned whether Pharmascience’s allegations of anticipation, obviousness, inutility and overbreadth were justified. [18] The infringement issues questioned whether Pharmascience’s allegation of non-infringement was justified, and/or if the Gillette defense applied. [18]

Substantially Valid

The FC considered the expert evidence in relation to the sole reference relied upon for anticipation, European patent EP0324725 (“the ‘725 Patent”), entitled “A pharmaceutical composition.” It concluded that the ‘725 Patent neither disclosed nor enabled a person of skill in the art (“POSITA”) to “make, at the relevant date, a sublingually administered formulation of an ordered mixture.” [134] The allegation that the ‘988 Patent was anticipated failed. [134]

Similarly, the allegation of obviousness failed, as one of Pharmascience’s own experts commented that the ‘988 Patent was “an unusual approach” and “very different from all the formulations [he had] read… not like everything else [he] was looking at.” [151] The FC found on a balance of probabilities that the pharmaceutical composition of the SUBLINOX® Tablets was not obvious, and the allegation not justified. [154]

On the issue of inutility, the FC assessed whether the utility of the invention was either demonstrated or soundly predicted based on the information and expertise available by the filing date. [170] Meda argued that bio/mucoadhesion was discussed as a part of the means through which the promise of rapid release, absorption, and ultimately rapid relief from the acute disorder of insomnia occurs, but no particular strength or duration of bio/mucoadhesion, or any absolute prevention of swallowing are required. [175] The promised rapid release and absorption only required sufficient bio/mucoadhesion to take place. [176] The FC agree with Meda that the promise was both demonstrated and soundly predicted, [177] and that the inutility attack was not justified. [182]

On the issue of overbreadth, Pharmascience argued that because there was no explicit limitation on water in any of the claims, they would cover formulations both with water and excipients containing water, which was contrary to the specification. [163] Meda rebutted that there were indicators in the patent specification that would enable a POSITA to discern that water should be excluded from the process of making the formulation disclosed in the ‘988 Patent. [164] The FC found that a POSITA reading the specification would know that the formulation would have to be free from water to work, however, concluded that the claim in question was overbroad, since this limitation was an essential feature of the invention and necessary for it to work. [168]

Not Infringed

Meda argued that 20 claims of the ‘988 Patent were infringed by Pharmascience’s PMS-Zolpidem. Specifically, they asserted the PMS-Zolpidem was a pharmaceutical composition for treating insomnia by sublingual administration containing API zolpidem. [186] Pharmascience’s position was that the PMS-Zolpidem formulation had neither an ordered mixture nor a bio/mucoadhesive component, thereby putting it outside the scope of the ‘988 Patent. [187] While redacting some key pieces of information, the FC agreed with Pharmascience in that there was no information specifying those components in Pharmascience’s product, [192, 193] and found that Pharmascience’s allegation of non-infringement was justified. [195] In light of this conclusion, application of the Gillette defense was unnecessary. [196]

Commentary

The redaction of key statements by the FC in the infringement analysis of this case leaves a fair amount open to interpretation. The FC was clearer in its reasoning for finding the ‘988 Patent valid, but in assessing the infringement, specifically why it agreed with the position put forth by Pharmascience, it is difficult to ascertain how this conclusion was reached.

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Federal Court shoots down an attempted revival of the promise doctrine

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Pfizer Canada Inc v Apotex Inc, 2017 FC 774

In AstraZeneca Canada Inc v Apotex Inc, 2017 SCC 36 [AstraZeneca], the Supreme Court of Canada (“SCC”) set out to abolish the so-called “promise doctrine,” not simply rename it to “overpromising.”

In this decision, the Federal Court (“FC”) granted Pfizer Canada Inc. (“Pfizer”) an order [5] pursuant to Section 6 of the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations”) prohibiting the Minister of Health from issuing a Notice of Compliance to Apotex Inc. (“Apotex”), with respect to Canadian Patent No. 2,436,668 (“the ‘668 Patent”). [1] The FC found, on a balance of probabilities, that Apotex’s allegations of obviousness, inutility, non-infringement, overpromising, anticipation and double patenting were not justified. [5]

Background

Entitled, “Novel Succinate Salt of O-Desmethyl-Venlafaxine,” the ‘668 Patent covers the drug PRISTIQ, which is used to treat depression. [1] O-desmethyl-venlafaxine (“ODV”) is a serotonin and norepinephrine reuptake inhibitor which works by simultaneously inhibiting reuptake of these chemicals, both neurotransmitters believed to play a role in depression and anxiety. [7] The main active pharmaceutical ingredient in this proceeding was Form I ODV succinate, a particular crystal form of ODV succinate, which is a particular salt of ODV. [7]

The claims at issue in this decision were Claims 8, 9, 33, 43 and 44. [2] The FC accepted that Form I ODV succinate was a novel composition of matter and is the subject of Claims 8 and 9, on which Claims 33, 43 and 44 depend. [7]

Claims 8, 9, 33, 43 and 44 are as follows:

  1. A compound according to claim 6 which exhibits an X-ray powder diffraction pattern having characteristic peaks expressed in degrees 2.theta. (~ 0.2° 2.theta.) at 10.20, 14.91, 20.56, 22.13, 23.71, 24.60, and 25.79.
  2. A compound according to claim 6 having an endotherm at about 131° C.
  3. Use of an effective amount of O-desmethyl-venlafaxine succinate or a mixed salt thereof as claimed in any one of claims 1 to 20 for the treatment of depression.
  4. Use of a therapeutically effective amount of a sustained release oral dosage form comprising O-desmethyl-venlafaxine succinate or a mixed salt thereof as claimed in any one of claims 1 to 20 prepared in a dosage to induce a blood plasma level of no more than 225 ng/ml to lower the incidence of nausea, vomiting, diarrhea, abdominal pain, headache, vaso-vagal malaise, or trismus resulting from the oral administration of O-desmethyl-venlafaxine succinate.
  5. A sustained release formulation comprising O-desmethyl-venlafaxine succinate and a pharmaceutically acceptable carrier or excipient, wherein the sustained release formulation provides peak serum levels of up to 225 ng/ml.

While ODV and pharmaceutically acceptable salt forms of it were both known and claimed in claim 22 of US Patent No. 4,535,186 (“the ‘186 Patent”), issued in 1985, and in claim 21 of Canadian Patent No. 1,248,540 (“the ‘540 Patent”), issued in 1989, [11] there was nothing in either the two patents or elsewhere in the prior art which indicated that the salt of ODV succinate had even been known. [13]

Issues

The issues at the heart of this decision were whether Pfizer had demonstrated on a balance of probabilities that Apotex’s allegations of obviousness, inutility, non-infringement, overpromising in relation to subsection 27(3) of the Patent Act, anticipation and double patenting were not justified. [145]

Analysis

The FC dealt with each of the six issues in turn.

Allegation of Obviousness Not Justified

The FC first considered whether or not the invention in the ‘668 Patent was obvious. In identifying the notional person of skill in the art (“POSITA”), the FC preferred Pfizer’s position, [225] which stated that the POSITA should be skilled in solid-state chemistry, pharmaceutical formulation and development, pharmacology, and pharmacokinetics, but not necessarily be a medical doctor, as Apotex had put forth. [226] With regards to the general knowledge possessed by the POSITA, it was found that the POSITA would not have known, anticipated or predicted the properties of either ODV succinate generally or Form I ODV succinate, or whether those properties would be amenable to formulation as a sustained release drug. [235] In identifying the inventive concept the FC found that the most basic inventive concept was the novel crystal, Form I ODV succinate. [251] The FC also repeatedly disagreed with Apotex’s argument that the ODV succinate was the single inventive concept of the claims. [250-261] The invention in the ‘668 Patent was then found to be separate from what the state of the art would have been at the time of invention. [265, 269, 275] Thus, the view of the FC regarding obviousness generally was that the POSITA would not have come directly and without difficulty to the solution taught by the ‘668 Patent. [279]

Moving on to the obvious to try analysis, the FC assessed whether it was more or less self-evident to the POSITA that what was being tried ought to work, and whether there existed a finite number of identified predictable solutions known to the POSITA. The FC found considerations such as the state of the art in the early 2000s to point against a finding of obvious to try under this initial element. [304] It was similarly found that the extent, nature and amount of effort required to achieve the invention, and level of routineness in the trials also pointed away from a finding of obvious to try. [309] There was no motive found in the prior art for finding the solution the ‘668 Patent addressed and so this this aspect of the test also favoured Pfizer. [315] Pfizer was also favoured with regard to the course of conduct followed that culminated in the making of the invention. [323] Overall, the FC concluded that Form I ODV succinate was not obvious to try. [329]

The FC found that Pfizer had established on a balance of probabilities that Apotex’s allegations of obviousness and obvious to try were not justified. [330]

Allegations of Inutility Not Justified

In an inutility analysis, the first step is to identify the subject matter of the invention as claimed in the patent, after which the court must ask whether that subject matter is useful or, in other words, capable of a practical purpose. [336] Utility must be either demonstrated or soundly predicted. [336] Following a claim-by-claim analysis, the FC agreed with Pfizer that the utility of Claims 8 and 9 is the usefulness as a stable, solid-state form of ODV succinate. [340] The FC was also satisfied that the subject matter of Claims 8 and 9 was a subject matter that was useful and capable of a practical purpose in that it allowed the compound to be used as a pharmaceutical drug. [342] The FC also agreed with Pfizer’s argument that the practical usefulness of the drug as a stable solid form was by itself sufficient utility under the SCC decision in AstraZeneca, [344] and thus Claims 8 and 9 had demonstrated utility. [345] In terms of Claim 33, it was found that the inventors had demonstrated and soundly predicted that the ODV compound was capable of a practical purpose in the form of a treatment for depression, thus demonstrating its utility as well. [349] Similarly, Claims 43 and 44 were found to provide the practical result of a sustained release formulation, intended to release the drug more slowly so as to reduce blood concentrations and side effects. [353]

The FC was satisfied that on a balance of probabilities Apotex’s allegations of inutility were not justified. [354]

Allegation of Non-Infringement Not Justified

Pfizer asserted that both of Apotex’s products infringed Claim 8 of the ‘668 Patent, while Apotex only alleged that Claim 8 was invalid and therefore could not be infringed. [184] The FC found on a balance of probabilities that Apotex’s allegations relating to the invalidity of Claim 8 were not justified and, therefore, neither were Apotex’s allegations of non-infringement of Claim 8. [185] Pfizer asserted that both of Apotex’s products infringed Claim 9, with Apotex’s defence again being that the Claim was invalid and incapable of being infringed, as well as that Apotex’s products did not fall within the scope of Claim 9. [186] The FC rejected this argument as well, its reasoning turning on the way Claim 9 was construed, [187] especially the word “about,” wherein a margin of error of ±2°C in the melting point of the product [188] would put both of Apotex’s products within the scope of Claim 9. [190] With regards to Claim 33, Pfizer again asserted that both of Apotex’s products infringed it, while Apotex argued that the claim was invalid and could not be infringed. [191] As the allegations of invalidity could not be justified, the FC found that Apotex’s allegation of non-infringement was also not justified. [192] Claims 43 and 44 were assessed together, where Pfizer asserted that only one of Apotex’s products infringed them, and Apotex used the same invalidity argument for non-infringement that it had previously advanced. [193] The FC therefore found that on a balance of probabilities, Apotex’s allegation of non-infringement was justified for one of Apotex’s products, [195] but not the other. [194]

The FC concluded that on a balance of probabilities Pfizer had established that Apotex’s allegation of non-infringement was not justified. [197]

Allegation of Overpromising in relation to subsection 27(3) of Patent Act Not Justified

The FC noted that Apotex’s allegations of overpromising resembled the previously advanced promise of the patent arguments. [360] Apotex had argued that the ‘668 Patent should be invalidated as its overpromises violated subsection 27(3) of the Patent Act, based on the SCC decision in AstraZeneca. [356] Under subsection 27(3), the invention must be described correctly and fully by the inventor, something Apotex did not consider to be the case in the ‘668 Patent. [356] The FC did not agree with this, particularly because it thought the SCC would not likely have abolished the promise doctrine, which it did in the AstraZeneca decision, only to see it reinstated with a new name. [363]

In essence, the FC did not agree with Apotex’s allegations of overpromising and thus did not find them on a balance of probabilities to be justified. [366]

Allegation of Anticipation Not Justified

Apotex had raised the issue of anticipation in its NOA [370] and provided affidavit evidence from two of its witnesses to give its allegation an air of reality. [372] The FC refused to accept this evidence as neither of the witnesses were instructed on the law of anticipation, nor were either of them instructed on disclosure or enablement. [373] Furthermore, the evidence from both witnesses was provided with regard to the issues of obviousness and obvious to try, not anticipation. [374]

The FC did not find on a balance of probabilities that Apotex’s allegation of anticipation was justified. [390]

Allegation of Double Patenting Not Justified

A second patent for an invention will fail for double patenting if its claims are either coterminous with the claims of the first patent, or if its claims lack ingenuity over the claims of the first patent. [391] With regards to coterminity, the claims of the ‘668 Patent were not found to be coterminous with the claims of the ‘540 Patent. [397] It was also found that the ‘668 Patent did not lack ingenuity, in that the POSITA would not be able to arrive at the claims of ‘668 Patent without exercising some ingenuity of their own. [398]

The FC was therefore satisfied on a balance of probabilities that Apotex’s allegation of double patenting was not justified. [405]

Conclusion

On a balance of probabilities, Apotex’s allegations of obviousness, inutility, non-infringement, anticipation, overpromising and double patenting were found not to be justified. [406] Pfizer was granted its requested order, [406] and costs were payable by Apotex to Pfizer. [407]

Commentary

A matter of great interest in this decision is the FC’s reasoning surrounding overpromising. With the recent SCC ruling in AstraZeneca (PCK Reporter summary available Here), which abolished the so-called “promise doctrine” in Canada, the current decision appears to involve what may be considered by some as a revival. In AstraZeneca, the SCC stated:

Supporters of the doctrine assert that the consequences of the Promise Doctrine play a key role in ensuring patentees do not “overpromise” in their patent applications. That is, a patentee will be dissuaded from stating the invention can be used for things that are not sufficiently established at the time of filing if doing so would risk invalidating the entire patent. The utility requirement should not be interpreted, however, as the Federal Courts have done, to address such concerns. Nonetheless, overpromising is a mischief. [AstraZeneca, 45]

In the current decision, the FC exercised the above guidance from the SCC in that while overpromising may certainly be a mischief, using the utility requirement to remedy that problem may not be the correct response. In considering subsection 27(3), it may be possible that a different tool, such as insufficiency of disclosure, would be more fitting.

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Federal Court Upholds Pfizer’s Polymorph Patent for the Depression Drug PRISTIQ as Inventive and Useful

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Pfizer Canada Inc v Teva Canada Limited, 2017 FC 777

Innovator pharmaceutical companies have been criticized for seeking questionable patents on purportedly new or improved versions of drugs that are already on the market to effectively lengthen the market exclusivity period for the original drug. Polymorph patenting may be an example of such a practice. A polymorph is a crystalline form of a drug that may have improved qualities such as more stability and reduced side effects.

This case is concerned with the Canadian Patent No. 2,436,668 (“the ‘668 Patent”), which covers the depression drug PRISTIQ marketed by Pfizer Canada Inc. (“Pfizer”). [1] Pfizer applied to the Federal Court (“FC”) and was granted an Order of prohibition to prevent Teva Canada Limited (“Teva”) from being issued a Notice of Compliance under the Patented Medicines (Notice of Compliance) Regulations. [6] This Order prevents Teva from marketing or selling its generic version of PRISTIQ until the expiration of Pfizer’s ‘668 Patent.

The FC rejected Teva’s allegations that Claims 8, 9, 33, 43 and 44 of the ‘668 Patent are obvious and lack utility. Following a heavily fact-dependent obviousness analysis, the FC found that the Skilled Person at the time would not have been able to predict the novel crystalline form taught by the ‘668 Patent, but rather would have envisioned a large research program to come to the claimed invention. [246-249] The FC also found the subject-matter of the invention claimed in the patent as useful. [347]

The Polymorph Patent – From I ODV Succinate

The ‘668 Patent, entitled “Novel Succinate Salt of O-Desmethyl-Venlafaxine” (ODV), was issued in Canada in May 2009 and describes Form I ODV succinate – a particular crystalline form of a particular salt of ODV. [15] Form I ODV succinate is the specific active pharmaceutical ingredient in Pfizer’s PRISTIQ and acts to inhibit serotonin and norepinephrine reuptake for the treatment of depression. [15]

The prior art includes EFFEXOR and the extended release version EFFEXOR XR, also marketed by Pfizer for the treatment depression. [22] Importantly, EFFEXOR and EFFEXOR XR contain venlafaxine and, upon administration, require the body to convert it to the pharmacologically active ODV. [16-17] The problem with venlafaxine at the time was that no solid-state form of ODV itself was stable enough to be safely stored. [28] As such, research was conducted to solve this problem which culminated in the development of the crystalline solid described in the ‘668 Patent. [33-34]

Teva challenged the validity of the ‘668 Patent on the grounds of obviousness and lack of utility in regard to Claims 8, 9, 33, 43 and 44. [2] Claims 8 and 9 describe the novel composition matter, Form I ODV succinate (the “Composition of Matter Claims”). Claims 33, 43 and 44 depend on Claims 8 and 9, and relate to the use of Form I ODV succinate for treatment of depression and sustained release formulations (the “Use Claims”). [160]

Use Claims and Composition of Matter Claims are Not Obvious

The FC held that Teva’s allegation of obviousness is not justified because the inventive concepts of the Composition of Matter Claims and the Use Claims were not obvious and were not obvious to try. [162] The FC focused on whether the new composition of matter could have been predicted, and what the nature was of the research efforts involved.

The FC determined the gap between the state of the art and the inventive concepts of the Composition of Matter Claims to be the new composition of matter, Form I ODV succinate. [229] Further, since the prior art taught that every new solid form had its own set of unknown and unpredictable properties, [231] the FC considered the gap between state of the art and the inventive concept of Claim 33 to be the use for the treatment of depression [234], and that of Claims 43 and 44 to be sustained release formulations with reduced side effects. [237]

The FC considered expert evidence and found that the Skilled Person would not have been able to arrive directly and without difficulty at the inventive concept. [246] The Skilled Person was considered to not have been able to predict whether a compound is capable of polymorphism, the different polymorphs that may exist, or the characteristics of such hypothetical polymorphs. [196] The FC accepted expert evidence that such predictions would have required an extremely large number of potential experiments. [196] Essentially, the Skilled Person would have envisioned a research program as opposed to research that is routine in nature. [249]

The ‘obvious to try’ test was warranted for further analysis given that pharmaceutical experimentation was involved in this case. [251-252] The FC found that it was not more or less self-evident to the Skilled Person that what is being tried – to arrive at the solution of Form I ODV succinate – ought to work. [304-305] The FC rejected Teva’s expert evidence proposing the idea that a routine salt screen could have identified a salt form such as ODV succinate, because the expert statement was contradicted on cross-examination. [260-261] The FC did not consider there to be a finite number of predictable solutions, [264] and the amount of effort required to achieve the invention was considerable, including pro-drug experimentation, salt screening, polymorph screening, in vitro and in vivo testing. [276, 279] The FC considered the course of conduct in this case to entail a research program that is more than routine experimentation. [301] Further, the FC found no evidence of motivation in the prior art that points in the direction of the ‘668 Patent. [282] For all these reasons, the FC concluded that the inventive concept was not obvious to try. [303-304]

The Utility Requirement was Satisfied

After the FC heard this case, a new test for utility was released in the decision AstraZeneca Canada Inc v Apotex Inc, 2017 SCC 36. The new test provides that in considering whether that subject matter is useful, a single useful use is sufficient to meet the utility requirement, even if multiple uses are disclosed. In contrast, the utility analysis would have previously involved discussion of the Promise Doctrine, on which Teva’s allegations of inutility were entirely based. [335]

The FC determined the subject matter of Claims 8, 9, 33, 43 and 44 to be Form I ODV succinate, [327, 336] and that all these claims met the utility threshold. [346] Claims 8 and 9 were considered useful in offering solid-form stability, [328-330] and Claim 33 in providing a treatment for depression. [340] The FC also found Claims 43 and 44 to be useful because the sustained release formulations led to reduced side effects, when compared with previous immediate release formulations. [342]

Commentary

The FC ruled that Teva’s allegations of obviousness and inutility were not justified. Perhaps the most significant take-away from this case is its unfortunate timing for Teva. The Promise Doctrine was struck down by the Supreme Court of Canada between this case having been heard and the judgment having been rendered, leaving the generic drug-maker with only the obviousness argument to advance. The analysis for obviousness turned on the opposing opinions offered by pharmaceutical experts. The judge was more persuaded by Pfizer’s expert, while Teva’s expert made concessions at the hearing that weakened its position. [261] It should be noted that this judgment was released as part of a pair of decisions that resulted in the FC issuing two Orders of prohibition against the generic makers, Teva and also Apotex (see Pfizer Canada Inc v Apotex Inc, 2017 FC 774, PCK Reporter summary available Here). Both Teva and Apotex appealed.

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Federal Court Rejects Apotex’s Judicial Review Application for Apo-Omeprazole Magnesium Tablets

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Apotex Inc v Canada (Health), 2017 FC 857

The Federal Court (“FC”) upheld the Minister of Health’s decision to cancel reconsideration for Apo-Omeprazole Magnesium Tablets manufactured by Apotex Inc. (“Apotex”). [8] This is the second time Apotex sought an application for judicial review that was dismissed by the FC, amounting to yet another failed attempt to obtain approval for the magnesium tablet form of its anti-ulcer drug (see also 2012 FCA 322; PCK Reporter summary available Here).

The decision to cancel reconsideration resulted from the inability of the parties to agree on an eligible question to be posed to the Reconsideration Panel. [6] The FC held that Apotex did not have a legitimate expectation to have its preferred question appear before the Panel, and the Minister did not fetter her discretion to focus the question on the regulatory requirement of bioequivalence. [8]

Background and Context

To market a drug in Canada, a manufacturer must obtain a Notice of Compliance from Health Canada. While innovators must file a lengthy New Drug Submission, a “fast-track” option is available for generic manufacturers via the Abbreviated New Drug Submission (“ANDS”). [10-12] The Food and Drug Regulations allow a generic product to be approved by demonstrating that it is bioequivalent to the “innovative drug,” referred to as the Canadian reference product (“CRP”), [15-16] meaning that their product can be expected to have the same effects as the CRP when administered to patients under specified conditions. [3] Apo-Omeprazole is a Proton Pump Inhibitor (“PPI”) that functions to lower gastric acid production in the treatment of ulcers. [42] The CRP is LOSEC, marketed by AstraZeneca, which can be taken without any meal restriction. [42] Apotex’s ANDS ultimately failed because it did not demonstrate bioequivalence under high fat meal conditions. [22]

Apotex’s first ANDS was filed in 2003 and was placed on patent hold, with an expectation to be approved upon expiration of the AstraZeneca patent. [4] However, as a result of greater experience with PPIs, Health Canada realized the necessity to additionally require study results under fed conditions, including high fat meals, which was not part of Apotex’s 2003 ANDS. [20] Health Canada indicated that all generic PPIs approved have met the requirement to account for the different conditions that affect the release of PPIs. [72, 74]

Apotex submitted a second ANDS in 2013 to include a study conducted in 1998 with high fat meals, but Health Canada considered the study unsatisfactory, citing a poor design and inadequate results. [87] Apotex sought reconsideration, a process that involves posing an appropriate question to an external expert panel, but Apotex and Health Canada were incapable of reaching an agreement on an eligible question. [30-36] Health Canada wanted to focus on “bioequivalence” whereas Apotex insisted on “safe and effective.” [43-58] The Minister eventually cancelled the reconsideration process in 2015, which was the decision Apotex challenged in this case. [59]

Legitimate Expectations Were Met and There was no Fettering of Discretion

The FC explained that the function of the Reconsideration Panel is technical in nature. [39] In this case, the Panel’s role would have been to respond to the reconsideration question and to make a recommendation to the Minister of Health as to whether the results of the 1998 fat fed study provided evidence on Apotex’s product being “bioequivalent” to the CRP, a regulatory requirement for ANDS approval. [95] As such, a question that instead focused on “safety and effectiveness” would have been not useful. [99]

Apotex argued that it had legitimate expectations to have the issues it wanted raised to go before the Reconsideration Panel. [65] The FC disagreed, stating that the reconsideration process is not to be treated like an appeal where each party is free to frame its issues before a court. [85] In this case, the FC considered the legitimate expectation to be concerned with Apotex having been given a fair opportunity to draft an eligible question and found that Apotex was indeed given a better than fair opportunity. [90]

Contrary to Apotex’s submissions, the FC also found that the Minister did not have the discretion to not consider bioequivalence, and the Minister did not restrict how bioequivalence should be assessed. [94-104] Fettering of discretion occurs when the decision-maker confines the exercise of discretion by refusing to consider factors that are legally relevant. [92] The Minister could not have fettered a discretion that she did not have, as in this case. [104] The FC further explained that the underlying rationale for this bioequivalence regulatory pre-condition is to allow a generic product to “piggy-back” on the CRP, which has already gone through the rigour of presenting “detailed reports of tests” and “substantial evidence” to demonstrate safety and effectiveness. [103] Fundamentally, the FC viewed Apotex’s application as an attempt to circumvent regulatory requirements that would not otherwise have been met with its 1998 fat fed study. [95]

Commentary

This is a case where Apotex did not want to be confronted with the task of demonstrating bioequivalence because that would entail conducting further studies, presumably a time-consuming and resource-intensive undertaking. Instead, Apotex chose to bring its case, twice, before the Federal Courts, both times unsuccessfully. Justice Roy went as far as describing this case as an “episode” [28] in “what is in the process of becoming a veritable saga” [1] and essentially a “last-ditch effort” to salvage something that should not succeed. [124] Nonetheless, Apotex has appealed. Perhaps Apotex’s frustration stems from the Minister’s initial “approval” of the ANDS in 2003, only to later revoke it with an additional request for further experimental results, at a time when the patent hold was over and Apotex was anticipating to have its product enter the market.

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Non-Infringing Alternative Defence Denied in Omeprazole Infringement Profit Case

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Apotex Inc v AstraZeneca Canada Inc, 2017 FC 726

The Federal Court (“FC”) revisits the non-infringing alternative (“NIA”) defence in its decision concerning the remedy sought by AstraZeneca Canada Inc., Aktiebolaget Hässle and AstraZeneca AB (collectively, “AstraZeneca”) for Apotex Inc.’s (“Apotex”) infringement of the omeprazole formulation patent.

The FC held that Apotex did not satisfy the factual burden required to establish a hypothetically viable non-infringing substitute during the period of infringement, which could reduce the infringement profits owed to AstraZeneca. [254] In addition, Apotex’s recovery from a previous judgment based on Section 8 of the PM(NOC) Regulations (the “Section 8 Judgment”) was held at nil when reconciled with the infringement judgment. [254] The FC also held that the profits-on-profits allowance should be calculated at prime rate, compounded annually, and that Apotex owed AstraZeneca its profits from its export sales minus the damages already paid for in a foreign jurisdiction. [254]

Background

Canadian Patent No. 1,292,693 (“the ‘693 Patent”), entitled “Pharmaceutical Preparation Containing Omeprazole,” is a formulation patent marketed under the brand LOSEC (2015 FC 322, affirmed in 2017 FCA 9). After a finding in favour of AstraZeneca in the liability phase of the infringement actions concerning the ‘693 Patent, AstraZeneca had elected an accounting of profits instead of damages for the infringement period of 2003-2008. [1] In the US, Apotex had previously paid damages to AstraZeneca to account for its export sales for the infringement of the corresponding United States Patent No. 4,786,505 (“the ‘505 Patent”). [234]

Interestingly, Apotex succeeded in a Notice of Compliance (“NOC”) proceeding against AstraZeneca regarding the related Canadian Patent No. 2,133,762 (“the ‘762 Patent”), also covering LOSEC (2012 FC 559). [2] The Section 8 Judgment accordingly entitled Apotex to damages for being held out of the Canadian market for its generic formulation of omeprazole between 2002-2003. [2]

Issues

In this case, four issues were before the FC, as follows:

  1. Did Apotex have an available NIA during the infringement period of the ‘693 Patent;
  2. How should the Section 8 Judgment in favour of Apotex be reconciled with the infringement judgment in favour of AstraZeneca;
  3. What allowance should be made for profits-on-profits; and
  4. With respect to the infringement of the ‘693 Patent, what allowance is required having regard to the United States District Court award for the infringement of the US ‘505 Patent and Apotex’s satisfaction of that award. [5]

No Viable NIA Established

The underlying rationale of the NIA defence is that the inventor should only be entitled to the portion of the profits attributable to the invention. Therefore, if a non-infringing substitute is available during the period of infringement, then the profit owed would be reduced.

The FC clarified that the infringer’s failure to produce a viable NIA formulation in the real world is not a threshold bar to the use of the NIA defence. [18] Rather, the question should be “Could the infringer have made the product had it attempted to do so at the relevant time and would the infringer have sold the product on some reasonable financial basis in substitution for the infringing product?” [18] To establish a NIA defence, Apotex therefore had to prove on a balance of probabilities that it could and would have sold a NIA during the infringement period between 2003-2008. [11] Apotex argued that it had various viable formulations designed in-house, and in the alternative, NIAs were available from third-party foreign suppliers. [195] Both arguments were rejected by the FC. [196]

Although Justice Barnes found that the asserted in-house NIAs would not have infringed on the ‘693 Patent, [47-53] Apotex failed to establish that it would have sold a commercially viable NIA because its case to suffered serious problems of proof. [20] The FC disagreed with Apotex’s contention that the development of the asserted NIAs would have been simple, cost-effective and speedy [32] because of the fact that it took many years for Apotex to develop the infringing product in the first place. [33] Apotex failed to show that any of the NIA formulations would have been stable enough to be commercially viable. [100-143] The FC was of the view that Apotex started its stability testing long after it knew or ought to have known that its omeprazole product was infringing, [28] and was unsatisfied with the approach of using expert opinion evidence to predict stability in lieu of experiment data. [29] Justice Barnes also found there to be insufficient data to establish bioequivalence, [91] and rejected Apotex’s argument that it would have been a routine and simple exercise to obtain regulatory approval by piggy-backing its NIAs on the approval of its omeprazole, the infringing product. [144-152] The FC also commented that “where an infringer brazenly infringes a valid patent, or substantially courts the risk of doing so, an inference may arise that no viable substitute was available.” [31]

As for third-party NIAs, the FC identified two foreign sources, Kudco and Estevé, potentially available to Apotex, but found both to be unconvincing. [154] While there was no issue of infringement, [158, 172] it would have been unlikely for Mylan to have waived its exclusive rights in favour of a generic competitor, [167] and it was also inconceivable that Kudco, as a leader in the generic market for omeprazole, would have arranged with Apotex to further divide the United States market. [193] In addition, the FC found it unlikely that Apotex could have been able to obtain a third-party NIA during the infringement period by noting that, at best, Apotex would have pursued a third-party option after it had tried and failed to produce and commercialize its own formulation, which would have been well into the infringing period while further Canadian regulatory approval would be required. [153]

Apotex Disentitled to Recover Under Section 8

Before the infringement decision was issued, Apotex had succeeded in an NOC proceeding against AstraZeneca, invalidating the ‘762 Patent, which resulted in a claim for a Section 8 remedy. To reconcile the Section 8 Judgment with the infringement decision concerning the same drug, Justice Barnes exercised his discretion to hold Apotex’s Section 8 recovery at nil as Apotex suffered no loss from being barred from selling omeprazole between 2002-2003. [214-219] The reason was that had Apotex entered the market with its generic omeprazole during the Section 8 liability period, it would have necessarily infringed the ‘693 Patent and had to disgorge its profits to AstraZeneca. [217] It is rare for Section 8 recovery to be denied under the PM(NOC) Regulations, but this case stands as an example of it.

Profits-on-Profits and Foreign Damages Deduction

The FC decided for AstraZeneca’s entitlement to profits-on-profits to be calculated at prime rate and compounded annually, consistent with similar cases; [229] the FC rejected Apotex’s proposition to calculate the allowance at bank rate with simple interest. [220]

Lastly, Apotex had previously paid AstraZeneca damages in accordance with the United States District Court judgment for the infringement of the US omeprazole formulation patent. [234] With respect to Apotex’s export sales to the US, Apotex submitted that AstraZeneca is not entitled to any export profits, whereas AstraZeneca argued that the US export profits are owed, though the portion already paid for as a result of the US judgment should be subtracted from it. [234] The FC agreed with AstraZeneca’s approach that there was no concern for double recovery, and accordingly rejected Apotex’s arguments of estoppel and abuse of process. [251] The FC explained that patent infringement actions in multiple jurisdictions is warranted to ensure complete recovery across jurisdictions. [252]

Commentary

The NIA defence can be used to reduce the amount that an infringer must disgorge in patent infringement claims. Having become increasingly accepted where an accounting of profits is selected (reported Here), and having recently gained traction at the Federal Court of Appeal in the damages context (reported Here), the NIA defence is now an actively developing area in Canadian patent litigation.

In this case, the FC clarified that the lack of a viable non-infringing substitute in the real world is not a threshold bar to a NIA defence. However, a successful defendant would have to overcome a significant factual hurdle to establish the hypothetical availability of an after-the-fact NIA. Nonetheless, one can expect the NIA defence to continue to be raised in the future.

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Federal Court Dismisses Motion for Early Dismissal of Action Brought Under the New PM(NOC) Regulations

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Genentech, Inc v Amgen Canada Inc, 2018 FC 694

This case establishes the threshold required to bring a motion for early dismissal under the new Patented Medicines (Notice of Compliance) Regulations (“Regulations”). The Federal Court (“FC”) confirms that such a motion will only be granted “in the clearest of cases”, where the claim is “so clearly futile that it has not the slightest chance of success”. [42-43]

The FC dismissed Amgen Canada Inc’s (“Amgen”) motion to dismiss Hoffmann-La Roche’s (“Roche”) and Genentech Inc’s (“Genentech”) action, stating that the action raises some arguable cases, and that it is not “plain and obvious” that their claims have no chance of success. [57, 62]

Background

HERCEPTIN (trastuzumab) is a drug that was approved in Canada in or around 1999 and is marketed for the treatment of early breast cancer, metastatic breast cancer (“MBC”) and gastric cancer. Roche has listed six patents on the Patent Register related to HERCEPTIN, which are owned by Genentech. [2-3] HERCEPTIN’s product monograph includes a reference to the standard of care (which was based on the CLEOPATRA clinical trial): “HERCEPTIN can be used in combination with PERJETA® (pertuzumab) and docetaxel for the treatment of patients with HER2-positive metastatic breast cancer who have not received prior anti-HER2 therapy or chemotherapy for metastatic disease”. [9-10]

Amgen filed a new drug submission to obtain a notice of compliance for a product, KANJINTI, a biosimilar of trastuzumab. In its notice of allegation, Amgen seeks to market KANJINTI for the same indications as HERCEPTIN. [26-27] The Plaintiffs brought an action in December 2017 pursuant to section 6 of the Regulations seeking an order prohibiting the Minister from issuing a notice of compliance to Amgen for KANJINTI until after the expiry of the Canadian Patent Nos. 2,376,596 (“596 Patent”) and 2,407,556 (“556 Patent”) to avoid an inducement infringement. [30, 46]

In the context of that action, Amgen brought a motion to the FC, seeking an order pursuant to section 6.08 of the Regulations to dismiss the action. Amgen contends that there is insufficient evidence to support the Plaintiffs’ claims, that they “are so clearly futile that they have not the slightest chance of success.” [1]

Extraordinary Remedy; High Threshold

This was the first motion brought under section 6.08 of the new Regulations. Prothonotary Aylen explains that the language under section 6.08 is very similar to the language of section 6(5)(b) of the earlier version of the Regulations, and therefore the case law established under section 6(5)(b) should apply to a section 6.08 motion. [37-39] The FC notes that the consequences of granting a motion under section 6.08 are more significant than under the previous section 6(5)(b): if the claim is struck under section 6.08, section 6.01 of the Regulations precludes the plaintiff from commencing an action against the defendant. [41-42] To strike the action under section 6.08, Amgen has the onus of demonstrating that the claim is “so clearly futile that is has not the slightest chance of success” or in other words, that it is “plain and obvious” that the claim has no chance of success. [43]

The FC states that there are three elements to meet for the inducement test: 1) the act of infringement was or will be completed by the direct infringer; 2) the completion of the acts of infringement were or will be influenced by the acts of the alleged inducer to the point that, without influence, direct infringement would not take place; and 3) the inducer knows that this influence will result in the completion of the act of infringement. [48] The FC notes that the Plaintiffs did not provide evidence suggesting direct infringement by Amgen of the 596 and 556 Patents. [54, 58]

The Plaintiffs Have an Arguable Case

Amgen argued that it is plain and obvious that the claim of inducement in relation to the 596 Patent and the claim regarding the 556 Patent have no chance of success. Amgen contends it did not do “something more” than simply applying to make KANJINTI available on the market, and there is no evidence to satisfy the other prongs of the inducement test. Any physician who would prescribe KANJINTI in combination with PERJETA would be doing so under the current standard of care, and not under Amgen’s draft product monograph, as it specifically leaves out any reference of PERJETA. [55] Amgen adds that the Plaintiffs would have to demonstrate that Amgen told third parties to test patients twice using the specific testing methodologies in the 556 Patent to be found liable. [59]

The Plaintiffs argue that Amgen did “something more” which a trial judge could consider an influence leading to direct infringement by physicians and patients. The Plaintiffs submit that Amgen’s argument that if doctor prescribe KANJINTI in combination with PERJETA they will only be following the current standard of care is without merit, citing Abbott Laboratories Limited v Canada (Ministry of National Health and Welfare)2006 FC 1411. The global marketing documents for KANJINTI demonstrate that Amgen plans on answering questions about whether KANJINTI can be used in combination with pertuzumab to treat MBC in a manner that will promote the use of KANJINTI with pertuzumab. Amgen’s failure to expressly prohibit the combination of KANJINTI with PERJETA grounds an inference that Amgen intends to induce third parties to combine KANJINTI with pertuzumab. [56] As for the 556 Patent, the Plaintiffs assert that Amgen has effectively admitted on the motion that direct infringement by third parties will occur. “There is clear evidence put forward by the Plaintiffs that the KANJINTI draft product monograph is directed to medical oncologists and clear evidence as to how medical oncologists would interpret the product monograph.” [60]

The FC could not conclude that it is plain and obvious that the Plaintiffs’ claims of inducement have no chance of succeeding, and that the Plaintiffs have risen an arguable case in relation to each prong of the test for inducement such that it is not plain and obvious that their claim will fail. [61-62]

Commentary

In this decision, Prothonotary Aylen confirms that a motion for early dismissal under the new Regulations must meet a high threshold. In such a motion, the FC’s role is not to weigh in on the merits of the case, nor to determine if there has been an infringement or inducement. The FC will determine “whether the plaintiff raises an arguable case such that it is not plain and obvious that the action will fail”. [46] In this case, the FC found that “it is at least arguable that Amgen has done “something more” within the meaning of the case law that a trial judge could ultimately consider to be the requisite influence leading to direct infringement by physicians and patients”. [57] Since the Plaintiffs have raised an arguable case of inducement against Amgen, the FC dismissed Amgen’s motion to strike the action.

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Actions Under Old PM(NOC) Regime Not Automatically Applicable To The New

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PMNOC

Amgen Inc v Pfizer Canada Inc, 2018 FC 1078

The Federal Court (“FC”) confirms in this case that jurisprudence determined under the former Patented Medicines (Notice of Compliance) Regulations (the “Regulations”) is not automatically applicable to the revised Regulations. The FC dismissed Pfizer Canada Inc.’s (“Pfizer”) motion, as it was not plain and obvious that the within action was scandalous, frivolous, vexatious or otherwise an abuse of the Court’s process. [28]

Background

Pfizer filed a new drug submission (“NDS”) to market NIVESTYM, a biosimilar of Amgen Inc and Amgen Canada Inc’s (collectively “Amgen”) NEUPOGEN (filgrastim) which is listed against Amgen’s Canadian Patent No. 1,341,537 (the “537 Patent”). Amgen then commenced an action against Pfizer under the new Regulations to prevent Pfizer from obtaining a Notice of Compliance (“NOC”) for NIVESTYM. [2]

Within the context of this action, Pfizer filed for a motion to dismiss the action on the ground that it is redundant, scandalous, frivolous or vexatious or is otherwise an abuse of process, claiming that Amgen lost its right to further assert the 537 Patent under the Regulations. [1,3]

Previous Proceedings Involving the 537 Patent

In a previous proceeding, Amgen asserted the 537 Patent against Apotex Inc (“Apotex”) because Apotex was seeking an NOC for GRASTROFIL, a biosimilar of NEUPOGEN. Justice Hughes of the FC found in his decision dated November 10, 2015, that Apotex’s allegations of invalidity of the 537 Patent on the grounds of obviousness were justified. He dismissed Amgen’s application and thereafter, Apotex received its NOC for GRASTROFIL. [4] Before Justice Hughes rendered his decision, Amgen had started another application asserting the 537 Patent against Apotex’s GRASTROFIL in a different dosage strength. This application was also dismissed. [6] After Apotex entered the Canadian market with its GRASTOFIL products, Amgen commenced an action under the Patent Act, alleging infringement of its 537 Patent. The action was discontinued and the GRASTOFIL products remain on the market. [8]

Amgen also commenced an application asserting its 537 Patent against BGP Pharma ULC dba Mylan (“Mylan”) who was seeking an NOC for FULPHILA (a biosimilar of NEULASTA which is also listed against the 537 Patent), but Amgen discontinued this application. [9]

Motion Is Not Clearly Abusive Of The Court’s Process

Upon review of the previous proceedings concerning the 537 Patent, the FC dismissed Pfizer’s motion. [3, 29] The FC agreed with Pfizer that the new Regulations’ s. 6.08 have essentially the same wording as the previous Regulations’ wording of s. 6(5)(b) (under which Amgen’s application was dismissed by Justice Hughes). [15] However, the FC indicated that:

Hughes J.’s findings in the first Apotex GRASTOFIL application cannot simply be grafted on to the within action. Regard must be had to the operation of the entire NOC regime under the old and revised Regulations and what exactly was in issue and decided by Hughes J. under the old regime and to what extent it applies, if at all, to the current action. [17]

Under the old Regulations, decisions regarding applications were not binding on actions for patent infringement or to declare a patent invalid. The 537 Patent remains valid, as no final disposition invalidated it. [19-21] Under the new Regulations, if the FC finds in favour of Pfizer, this would be a final determination subject only to a full right of appeal: “The within action is effectively its first and only chance.” [22-23]

The FC was not satisfied that it is plain and obvious that the within action is scandalous, frivolous, vexatious or is otherwise an abuse of the Court’s process, and therefore dismissed the motion. [28-29]

Commentary

In this decision, the FC recognizes the limits of decisions under the former Regulations. The FC explains:

Actions commenced under the revised Regulations determine different issues than in applications commenced under the old Regulations. This is not to say, however, that some decisions made under section 6(5)(b) of the old Regulations could not have some application in motions brought pursuant to section 6.08 of the revised Regulations, but the present motion is not such as a case. [28]

Having determined that it was not clearly abusive for Amgen to assert its patent under the new Regulations, the FC dismissed Pfizer’s motion. Therefore, patentees who have lost their patent applications under the previous Regulations but have not had their patents declared invalid and still have their patents on the Patent Register may be able commence an action under the new Regulations to have a final determination on the validity of their patents.

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Teva Blocks Competitor With Patent for 40 mg/mL Dose of Copaxone®

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Photo of a pharmacist holding out a yellow pill in one hand and a white pill in another hand. A patient reaches for the yellow pill.Pharmascience Inc. v. Teva Canada Innovation, 2022 FCA 2

In this appeal, the Federal Court of Appeal (“FCA”) affirmed a decision of the Federal Court (the “FC”) and upheld the validity of Teva Innovation and Teva Canada Limited’s (collectively, “Teva”) patent claiming a specific dosing regimen of the drug glatiramer acetate, which is marketed by Teva as Copaxone® and used for the treatment of multiple sclerosis (“MS”). As in many pharmaceutical cases, the proceedings were brought by Teva as an application under the Patented Medicines (Notice of Compliance) Regulations to prevent competitor, Pharmascience Inc. (“Pharmascience”), from obtaining a Notice of Compliance (“NOC”) for a generic version of Copaxone®.

Background

When a new drug is approved for distribution in Canada, an NOC is issued to the drug manufacturer signifying compliance with Health Canada’s regulatory requirements. Copaxone® was initially approved for distribution in Canada in the mid 1990s as a 20 mg/mL daily dose, and later in 2016 as a 40 mg/mL dose injected three-times weekly. In 2017, Pharmascience obtained an NOC to market its own 20 mg/mL strength generic version of glatiramer acetate, called Glatect®.

This infringement action was triggered when Pharmascience sought marketing authorization for Glatect® 40 mg/mL. Teva alleged that Glatect® 40 mg/mL would infringe two of its Copaxone® products: Canadian Patents Nos. 2,702,437 (the “‘437 Patent”) and 2,760,802 (the “‘802 Patent”). The ‘437 Patent claims the early use of glatiramer acetate for the purpose of delaying the development of MS, while the ‘802 Patent claims the dosing regimen of 40mg/mL. In response to these allegations, Pharmascience questioned the validity of Teva’s patents. Following a thirteen-day trial, the FC concluded that the ‘437 Patent was invalid and the ‘802 Patent was valid and hypothetically infringed if Pharmascience were to enter the market with Glatect® 40 mg/mL.

Analysis

In the present appeal, Pharmascience took issue with several parts of the FC’s validity analysis and maintained that the ‘802 Patent was invalid for either lack of utility or obviousness.

Lack of Utility

In Canada, applicants must have demonstrated the utility of their inventions at the time they filed their patent applications. Sound prediction is an exception to this general rule, as it allows inventors to apply for a patent even if utility was only predicted at the time of filing. The doctrine is meant to balance the public interest of having early disclosure of new and useful inventions with the risk of granting patent rights based on speculative information. When an invention is soundly predicted, courts have held that the factual basis for the prediction needs to be included in the patent specification itself.

Pharmascience argued that the trial judge failed to properly consider the enhanced disclosure requirement, notwithstanding that the ‘802 Patent was based on sound prediction. Justice Locke, writing for the FCA, disagreed and pointed to the trial judge’s consideration of the common general knowledge and logic disclosed in the specification as evidence that sound prediction was established [21-22].

Obviousness

This in turn, led to Pharmascience’s alternate argument. Patent lawyers acting for Pharmascience argued that if the common general knowledge was sufficient to support a sound prediction of utility of the invention of the ‘802 Patent, then the same common general knowledge would make the invention obvious to try [6]. This form of argument is a common tactic used in patent litigation by patent lawyers to place the patentee in a ‘squeeze’. The patentee’s arguments for overcoming the prior art will be used either to show inconsistency, or to show that the patent is not infringed for the same reasons as the patent was found to be novel over the prior art.

Locke JA rejected Pharmascience’s attempt to indicate inconsistency and reasoned that just because an idea is sufficiently described in the patent disclosure and the common general knowledge to support a prediction that it will be useful, this does not mean that the idea is so known in the prior art so as to lead the person skilled in the art directly and without difficulty to the solution taught in the patent [38]. It was within the trial judge’s discretion to find enough in the common general knowledge to support a sound prediction of utility of the invention, but not enough to find the invention obvious.

Ultimately, the FCA dismissed the appeal, and Teva’s dosage regime patent was upheld.

Commentary

Since its emergence in the 1990s, Copaxone® has been the leading therapy for MS and has generated substantial revenue for Teva. However, following the expiry of the brand’s initial patents, generic versions of the drug began to enter the market. In other jurisdictions, Teva’s Copaxone® 40mg/mL dosing patents have been invalidated for obviousness, making way for even further market dilution by generic competitors.

The FCA’s decision to uphold the validity of the ‘802 Patent demonstrates the strength of Teva’s Canadian intellectual property rights and ability to maintain market exclusivity. The decision should serve as a reminder to patent applicants to thoroughly search the prior art, including all recent developments and publications that could later be used in litigation to prove that the idea was obvious.

For more information on obtaining patent protection for a dosage regimen, please contact a professional at PCK Intellectual Property.


PCK IP is one of North America’s leading full-service intellectual property firms with offices in Canada and the United States. The firm represents large multinational companies, scaling mid-size companies, and funded innovative start-up entities. PCK IP professionals include seasoned patent and trademark agents, engineers, scientists, biochemists and IP lawyers having experience across a broad range of industries and technologies. Contact us today.

The contents of this article are provided for general information purposes only and do not constitute legal or other professional advice of any kind.

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