December 2010

In this issue:

Court of Appeal upholds escitalopram prohibition Orders »

Supreme Court of Canada news »

Health Canada news »

Patented Medicine Prices Review Board news »

Federal Court encourages early hearing dates in applications »

Recent Court decisions »

Eli Lilly denied Order of prohibition regarding Apotex and atomoxetine on the basis of
mootness »

Janssen denied Order of prohibition against Mylan for galantamine; subject-matter found to be an unpatentable method of medical treatment »

Not plain and obvious that "first person" does not include foreign corporations that exercise control »

CGPA's application seeking removal of AVAMYS from Register of Innovative Drugs struck »

Application for cancellation of Sepracor's trademark FXT 40 denied »

Federal Court of Appeal upholds striking of colour mark applied to ADVAIR DISKUS inhaler as non-distinctive »

New Court proceedings »

Court of Appeal upholds escitalopram prohibition Orders

On November 25, 2010, the Federal Court of Appeal dismissed three appeals from the decisions of Justice Harrington granting Lundbeck prohibition Orders relating to escitalopram (Lundbeck's CIPRALEX), an antidepressant: Apotex Inc. v. Lundbeck Canada Inc., 2010 FCA 320, aff'g 2009 FC 146.

Read more »

Supreme Court of Canada news

Hearings

Celgene's appeal regarding PMPRB's assertion of jurisdiction over U.S.-based sales. As reported in the May 2010 issue of Rx IP Update, the Supreme Court granted Celgene leave to appeal the Federal Court of Appeal reversal of a decision of the Federal Court that set aside a decision of the Patented Medicine Prices Review Board ("PMPRB"). The PMPRB had ruled that it had jurisdiction over Celgene's sales from the U.S. to Canadian customers of THALOMID (Celgene's thalidomide) pursuant to the Special Access Programme. The Court of Appeal held that "sold in any market in Canada" extended to such sales, despite the parties' agreement that common law commercial principles would establish New Jersey as the locus of the sales. Celgene's appeal was heard on November 10, 2010, and the decision was reserved.

Celgene Corporation v. Canada (Attorney General) (SCC Case No. 33579).
Court of Appeal decision – 2009 FCA 378.
Trial Judge's decision – 2009 FC 271.

Disclosure under the Access to Information Act. As reported in the February 2010 issue of Rx IP Update, the Supreme Court granted Merck leave to appeal two decisions of the Federal Court of Appeal allowing the Minister's appeals from two Federal Court decisions finding that (i) Merck was entitled to a declaratory Order about the illegality of the process followed by the Minister in handling the access request (the Minister disclosed certain pages relating to Merck's drug submissions for SINGULAIR without consulting Merck), (ii) the disclosure of documents by the Minister without consultation was contrary to section 20(1) the Access to Information Act, and (iii) certain portions of the documents should not be disclosed. Merck's appeal was heard on November 12, 2010, and the decision was reserved.

Supreme Court summaries – 33290 and 33320.
Court of Appeal decision – 2009 FCA 166.
Federal Court decisions – 2006 FC 1200, 2006 FC 1201.

Leave applications

The standard of disclosure for demonstrated utility. Teva Canada Limited ("Teva") has filed an application for leave to appeal the Federal Court of Appeal's dismissal of Teva's appeal from an Order of prohibition regarding sildenafil (Pfizer's VIAGRA). The Court of Appeal found no error in Justice Kelen's conclusion that the relevant patent contained sufficient disclosure. Further, the Court of Appeal held that there is no requirement for a patent to demonstrate utility in the patent disclosure so long as the trier of fact finds it to be proven upon a legal challenge.

Teva Canada Limited v. Pfizer Canada Inc., et al., November 23, 2010 (SCC Case No. 33951).
Court of Appeal decision – 2010 FCA 242.
Federal Court decision – 2009 FC 638.

The "Saccharin doctrine." Apotex Inc. ("Apotex") has filed an application for leave to appeal the Federal Court of Appeal's dismissal of Apotex's cross-appeal from a determination that Apotex had infringed Eli Lilly's patents by importing bulk cefaclor (Lilly's CECLOR), which had been produced outside Canada from an intermediate compound that Apotex's suppliers had made by a patented process. The Court of Appeal found no error in Justice Gauthier's conclusion that it is settled law that a process patent can be infringed by the importation, and use and sale in Canada of a product manufactured abroad by another person using the patented process (the "Saccharin doctrine"). Further, the Court of Appeal dismissed Apotex's argument that Justice Gauthier erred in applying the doctrine in circumstances where material changes were made to the article produced by the patented process prior to importation and agreed that the patented process need merely play an "important part" in the manufacture of the imported product in order to establish infringement.

Apotex Inc. v. Eli Lilly and Company, et al., November 22, 2010 (SCC Case No. 33946).
Court of Appeal decision – 2010 FCA 240.
Federal Court decision – 2009 FC 991.

Health Canada news

Health Canada makes administrative changes to the Guidance Document: Patented Medicines (Notice of Compliance) Regulations. On November 12, 2010, Health Canada published administrative changes to the Guidance Document Patented Medicines (Notice of Compliance) Regulations. The changes relate only to the contact e-mail address, and the content of the guidance document has not changed.
(Notice and Amended Guidance Document.)

Government proposes new Regulations titled Fees in Respect of Drugs and Medical Devices Regulations. The regulatory proposal sets out the updated fees for Health Canada's human drugs and medical devices programs, fee mitigation measures and provisions for the annual adjustment of fees. Fees are proposed to be updated to better reflect the costs to Health Canada in delivering its regulatory activities. The government has released the Regulatory Impact Analysis Statement, including a detailed cost-benefit statement and the proposed Regulations (RIAS and proposed Regulations). The regulatory proposal would also require consequential amendments to be made to the Food and Drug Regulations (proposed amendments) and Medical Devices Regulations (proposed amendments) related to the expiration and establishment of licenses.

2009 statistical report for Regulations and data protection released. The Therapeutic Products Directorate has released its 2009 statistical report relating to the administration of the Patented Medicines (Notice of Compliance) Regulations and data protection. The report provides statistics relating to the maintenance of the Patent Register (including the number of patent lists filed by first persons, the number of patent lists accepted and rejected, and related litigation) and statistics relating to the number of notices of allegation served, prohibition applications initiated, and outcomes of the applications. The report also provides statistics on products added to the Register of Innovative Drugs by product type. (Therapeutic Products Directorate Statistical Report 2009, Patented Medicines (Notice of Compliance) Regulations and Data Protection).

Patented Medicine Prices Review Board news

The PMPRB recently approved Voluntary Compliance Undertakings for Novartis's Tasigna (nilotinib) and
Miochol-E (acetylcholine chloride) (Notice).

New NEWSletter released. The PMPRB has released its October 2010 NEWSletter.

Federal Court encourages early hearing dates in applications

On November 18, 2010, the Federal Court released a Practice Direction regarding early hearing dates for applications. The notice states that the goal of the Court is to be "ready to hear applications as soon as litigants are ready," and that parties may seek a hearing date prior to filing application records, either on consent or by case management. In addition, if at the outset or during a proceeding parties agree to a schedule of the steps for perfecting the application, the parties can seek a hearing date at any time. The Practice Direction is not applicable to applications made pursuant to the Patented Medicines (Notice of Compliance) Regulations. (Practice Direction).

Recent Court decisions

Patented Medicines (Notice of Compliance) Regulations

Eli Lilly denied Order of prohibition regarding Apotex and atomoxetine on the basis of mootness. On October 29, 2010, Justice Barnes dismissed Eli Lilly's application for an Order of prohibition against Apotex regarding atomoxetine (Eli Lilly's STRATTERA) on the ground of mootness in view of his intervening in rem declaration of invalidity of the patent at issue in Novopharm Limited v. Eli Lilly Company, 2010 FC 915. In that case, Justice Barnes found that the patent claiming the use of atomoxetine to treat attention deficit hyperactivity disorder (ADHD) was invalid for inutility. In the application, however, Justice Barnes found that none of Apotex's allegations were justified on the record before him. He rejected Apotex's allegations of obviousness and anticipation and found that Apotex had failed to satisfy its initial evidentiary burden with respect to inutility because it did not challenge Eli Lilly's assertion of demonstrated utility. While he dismissed Eli Lilly's application for mootness, Justice Barnes noted that it remains open to Eli Lilly to defend any claim by Apotex for section 8 damages on the basis outlined by Justice Gauthier in Eli Lilly v. Apotex, 2010 FC 952, and on the strength of an argument that the expression in section 8 "dismissed by the court hearing the application" means a dismissal on the merits of the application. Apotex has appealed.

Eli Lilly v. Apotex, October 29, 2010.
Decision – 2010 FC 1065.

Janssen denied Order of prohibition against Mylan for galantamine; subject-matter found to be an unpatentable method of medical treatment. On November 10, 2010, Justice Barnes dismissed Janssen's application for an Order of prohibition against Mylan regarding galantamine (Janssen's REMINYL). He found that the relevant patent claims for a dosing regime of galantamine with a titration schedule to treat Alzheimer's disease cover a method of medical treatment that cannot be monopolized. The Court held that by attempting to monopolize an effective titration regime for galantamine, the patent interferes with the ability of physicians to exercise their judgment in the administration of the known drug for an established use absent a license from the patentee. Justice Barnes also considered whether the rationale of excluding methods of medical treatment from patentable subject matter should be revisited in light of the repeal of section 41 of the old Patent Act and the Federal Court decision in Amazon v. Canada (Attorney General) ("Amazon"), 2010 FC 1011 . The Court held that this exclusion remains good law in Canada because of public policy concerns ("for ethical and public health reasons, physicians should not be prevented or restricted from applying their best skill and judgment for fear of infringing a patent covering a pure form of medical treatment (as distinct from a vendible medical or pharmaceutical product")). Justice Barnes also found that Amazon does not present a helpful legal analogy because that case "does not raise the kinds of public policy concerns that apply to the provision of medical care to patients whose lives or wellbeing may be dependent upon it." Janssen has appealed.

Janssen v. Mylan, November 10, 2010.
Decision – 2010 FC 1123.

Not plain and obvious that "first person" does not include foreign corporations that exercise control. On November 30, 2010, Justice Simpson issued separate reasons dismissing related appeals from a Prothonotary's Order (1) refusing to dismiss section 8 claims made by Teva Canada Limited ("Teva") and Apotex Inc. ("Apotex") (regarding ramipril (ALTACE)) against foreign corporations allegedly exercising control over sanofi-aventis Canada, and (2) striking Teva's claim for permanent loss of market share.

Section 8 provides for liability by a "first person." Justice Simpson concluded that the question of whether a "first person" includes a foreign corporation that allegedly exercises control over a Canadian corporation that filed the new drug submission has not been conclusively decided, and refused to dismiss the claims on the basis that it was not plain and obvious that the interpretation of "first person" put forward by Apotex and Teva must fail.

Justice Simpson further concluded that it is settled law that a "second person" may only claim damages resulting from a loss of market share that were actually incurred within the period set out in section 8.

Apotex Inc. v. Sanofi-Aventis, Sanofi-Aventis Deutschland GmbH and Sanofi-Aventis Canada Inc., November 30, 2010.
Decision – 2010 FC 1209; Prothonotary's decision.
Sanofi-Aventis Canada Inc. and Sanofi-Aventis Deutschland GmbH v. Teva Canada Limited, November 30, 2010.
Decision – 2010 FC 1210; Prothonotary's decision – 2010 FC 150.

Other decisions

CGPA's application seeking removal of AVAMYS from Register of Innovative Drugs struck. The Canadian Generic Pharmaceutical Association ("CGPA"), an industry association representing generic drug manufacturers, had written to the Office of Medicines and Liaison requesting that AVAMYS be removed from the Register of Innovative Drugs: http://www.hc-sc.gc.ca/dhp-mps/prodpharma/applic-demande/regist/reg_innov_dr-eng.php (a listing of drugs granted data protection). The CGPA alleged that AVAMYS (fluticasone furoate) is an ester variation of a previously approved medicinal ingredient (fluticasone propionate) and therefore falls outside of the definition of "innovative drug." The Minister refused, advising that fluticasone furoate and fluticasone propionate are both esters of fluticasone; since fluticasone is not a medicinal ingredient previously approved in a drug by the Minister, fluticasone furoate is not a variation of a previously approved medicinal ingredient. The CGPA therefore sought a declaration in the Federal Court that the listing of AVAMYS on the Register has no legal effect.

On motion by GlaxoSmithKline, a prothonotary struck the application, finding that the CGPA lacks standing as it is neither a person directly affected by the decision (neither CGPA nor any of its members have filed a submission for fluticasone furoate or expressed an intention to manufacture the drug) nor a person entitled to make the application in the public interest (the preferred, reasonable and effective manner to bring the issue to the Court is by a generic manufacturer seeking to submit an abbreviated new drug submission for fluticasone furoate).

Canadian Generic Pharmaceutical Association v. The Minister of Health and GlaxoSmithKline, December 1, 2010.
Decision – 2010 FC 1211.

Trademark decisions

Application for cancellation of Sepracor's trademark FXT 40 denied. Afexa Life Sciences commenced a proceeding pursuant to section 45 of the Trademarks Act regarding the mark FXT 40, registered for use in association with pharmaceutical preparations, namely antidepressants. The Trademarks Office concluded that based on the evidence filed by Sepracor, the trademark was in use in Canada in association with the wares in the normal course of trade during the relevant period. Accordingly, the registration will be maintained.

Afexa Life Sciences Inc. v. Sepracor Pharmaceuticals, Inc., October 20, 2010.
Decision – 2010 TMOB 172.

Federal Court of Appeal upholds striking of colour mark applied to ADVAIR DISKUS inhaler as non-distinctive. As reported in the April 2010 issue of Rx IP Update, GlaxoSmithKline ("GSK") appealed a decision of the Federal Court striking GSK's registration consisting of dark and light purple applied to its ADVAIR DISKUS inhaler from the Register of Trademarks. The Federal Court found, among other things, that consumers did not associate the colour and shape of the GSK mark with a single source. On appeal, GSK argued that the Judge had not held the respondents to the proper burden of proof, had selected the incorrect test for distinctiveness and had improperly applied the test to the facts.

On November 19, 2010, the appeal was dismissed. The Federal Court of Appeal found that the Judge had turned his mind to the proper burden of proof, and in any event, the presumption of validity simply requires that an examination of all the evidence establish the trademark was not registrable at the relevant time. GSK did not suggest that the Judge did not examine all of the evidence. The Court of Appeal also found that the Judge applied the correct test for distinctiveness and that GSK had not established any palpable and overriding error in the Judge's application of the law to the facts in the case.

Glaxo Group Limited v. Apotex Inc., November 19, 2010.
Federal Court of Appeal decision – 2010 FCA 313.
Federal Court decision – 2010 FC 291.

New Court proceedings

Patented Medicines (Notice of Compliance) Regulations

Other proceedings

To check the status of Federal Court cases, please click here.

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