The Federal Court has allowed Apotex to amend its statement of defence to include a new anticipation claim and a new defence of issue estoppel and abuse of process in part.
This is a ruling in a bifurcated infringement action scheduled to proceed to trial on November 27, 2017. This infringement action follows a prior PM(NOC) application between the parties.
Apotex moved to amend its statement of defence and counterclaim to add a new ground of invalidity by anticipation, a defence of ex turpi causa based on anti-competitive conduct, and two new defences based on the concepts of issue estoppel, abuse of process and the doctrine of election, arising from the prior prohibition proceedings commenced by Alcon in relation to the same patent and product.
The parties agreed the ex turpi causa defence relates solely to the quantification of damages, and thus it was adjourned to be addressed in the second half of the proceeding.
The new invalidity by anticipation defence alleges that the invention was disclosed to the public by Alcon during an annual conference, and in an abstract published at the conference. The Court held that the proposed amendments were sufficiently particularized and have a reasonable prospect of success.
The new allegations of issue estoppel, abuse of process and cause of action estoppel are based upon findings that were made in the prior PM(NOC) proceeding involving the same patent and parties. The delay in raising them was not found to be prejudicial, but the new defences would only be permitted to the extent that they raise an arguable defence.
The new allegation that Alcon is precluded from "contesting or making any allegation inconsistent with" Justice Kane's findings "that the patent is invalid on the basis of obviousness" was found to offend the Federal Court of Appeal's express ruling that cause of action estoppel in respect of the validity of a patent does not disclose a reasonable defence. Thus, this new pleading was not allowed.
The new defence of issue estoppel and abuse of process was allowed in part, with the Court striking the part stating that Alcon is precluded from "making any allegation inconsistent with" a prior finding of fact. That was held to preclude a party from leading evidence different from that led in the prior proceeding and cannot disclose an arguable defence.
The new defence of election was not allowed given the prior jurisprudence that both an application under the PM(NOC) Regulations and an infringement action can both be pursued. Furthermore, the jurisprudence provides that it is permissible to introduce in an action a better evidentiary record than on a prior prohibition proceeding between the same parties. Therefore, what prior art experts considered when considering obviousness was not held to be fixed by the prior PM(NOC) proceeding.
On October 27, the Supreme Court will announce the result of a leave application which asks, in determining whether to hear moot appeals, should appellate courts apply categorical rules for certain classes of cases that will eliminate any right of appeal for entire class, or are courts required to exercise discretion on a case by case basis in accordance with the decision in Borowski v. Canada. The following summary was provided by the Supreme Court.
Intellectual property – Patents – Medicines – Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 – Appeals – Mootness – Federal Court dismissing Amgen's motion for order of prohibition and Minister issuing notice of compliance to Apotex to market generic version of Amgen's drug – Apotex bringing action for section 8 damages – Amgen appealing after issuance of notice of compliance – Apotex's motion to dismiss appeal as moot granted – In determining whether to hear moot appeals, should appellate courts apply categorical rules for certain classes of cases that will eliminate any right of appeal for entire class, or are courts required to exercise discretion on a case by case basis in accordance with decision in Borowski v. Canada (Attorney General),  1 S.C.R. 342?
Amgen applied for an order under the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 ("Regulations") prohibiting the Minister of Health from issuing a notice of compliance to Apotex for its generic version of Amgen's filgrastim pharmaceutical drug. The Federal Court dismissed this application and Amgen appealed that decision. Before the appeal could be heard, however, the Minister issued a notice of compliance to Apotex for its generic version of filgrastim. Apotex moved to dismiss the appeal on the ground that the subject-matter of the appeal was moot as there was no longer anything to prohibit.
On November 8, the Supreme Court is scheduled to hear AstraZeneca's appeal in its application which asks the correct applicable standard for patent utility in Canada and whether a promised utility doctrine properly exists. The following summary was provided by the Supreme Court.
Intellectual property – Patents – Medicines – Utility – Validity of patent for drug used in treatment of gastric acid conditions challenged in infringement and impeachment action – Whether a promised utility doctrine properly exists – Whether lower courts erred in law in finding that the 653 patent invalid: (i) on the basis of a "promise of the patent" utility doctrine; and/or (ii) by applying an incorrect standard for patent utility.
The appellants, (collectively, "AstraZeneca") owned the Canadian '653 patent for the compound, esomeprazole, a proton pump inhibitor used in the reduction of gastric acid, reflux esophagitis and related conditions. It was sold under the name Nexium, and was a very successful drug for AstraZeneca. The respondents (collectively, "Apotex") applied to the Minister of Health to obtain a Notice of Compliance which would allow it to sell its generic version of the drug. In response, AstraZeneca brought a prohibition application under the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 to prevent Apotex from entering the market until after the expiry of the '653 patent. In 2010, that application was dismissed and Apotex received its Notice of Compliance and commenced sales of its generic esomeprazole. AstraZeneca brought an action against Apotex for patent infringement. Apotex counter-claimed to impeach the '653 patent on several grounds.