On December 19, 2014, the Federal Court set aside a decision of the Minister of Health granting a Notice of Compliance (NOC) to Teva authorizing the sale of its product that referred to Pfizer’s Aromasin®. In a separate decision of the same date, the Court declared that the Minister had no entitlement to grant NOCs to Cobalt and Sandoz authorizing sale of products that referred to Actelion’s Tracleer®.1
Justice Gleason found the Minister’s amendments to its Guidance Document that permitted issuing NOCs to generics submitting an administrative ANDS without having served a Notice of Allegation (NOA) on the holder of the listed patent contravened the Patent Medicines (Notice of Compliance) Regulations, SOR/93-133 (the Regulations).
She also upheld the purpose of Regulations as that of balancing the interests of patentees entitled to protection for legitimately patented innovations while allowing generic companies to early work patented medicines.
Pfizer markets Aromasin, a drug for the treatment of breast cancer and owns Canadian Patent 2,409,059 that is listed on the Patent Register in relation to Aromasin. The Minister issued NOCs to two separate companies seeking to manufacture generic versions that both referenced Pfizer’s Aromasin. A first NOC was issued to Generic Medical Partners Inc. (GMP), following Pfizer’s decision not to initiate proceedings under the Regulations in response GMP’s NOA because GMP does not sell products in Canada. A second NOC issued to Teva. This NOC followed from an administrative ANDS Teva filed based on a licensing agreement it had with GMP and for which Health Canada determined referred to Pfizer’s Aromasin product.2
Since Teva had not served Pfizer with an NOA, Pfizer sought judicial review of the Minister’s decision to issue an NOC to Teva.
Actelion markets Tracleer, a hypertension drug, and owned Canadian Patent 2,071,193 that was listed on the Patent Register in relation to Tracleer. After settlement of a proceeding with Pharmascience under the Regulations, Pharmascience received a NOC. Shortly thereafter, without having addressed the Regulations, NOCs were issued by the Minister to Cobalt and Sandoz, both of whom had been licensed by Pharmascience.
Since neither Cobalt nor Sandoz had served an NOA, Actelion sought judicial review of the Minister’s decision.
FEDERAL COURT DECISIONS
In both cases, it was submitted that second persons seeking a NOC with reference to an innovator’s product are obliged by subsection 5(1) of the Regulations to serve an NOA in respect of listed patents and that the Minister contravened section 7(1) by issuing NOCs.3
The Minister defended its decisions claiming they were made in accordance with amendments made in 2012 to its Guidance Document, Patented Medicines (Notice of Compliance) Regulations. These amendments allowed the Minister to issue NOCs to generic companies seeking to market drugs referencing patents on the Patent Register without first having served an NOA, so long as the generic company had been licensed to sell the drug by another company that had complied with section 5.4
The Minister claimed these amendments were based on its interpretation of the Regulations, submitting such an interpretation should be afforded deference by the Court for two reasons. First, the interpretation of the Regulations is within the significant expertise of the Minister and officials at the Office of Patent Medicine and Liaison. Second, the change in practice set out in the amendments represented valid policy choices of the Minister.5
Moreover, the Minister also submitted its interpretation of the Regulations in its Guidance Document was correct. It claimed Teva’s administrative ANDS did not amount to a “submission for a NOC” within subsection 5(1) because the purpose of the Regulations is limited to preventing infringement by generics who take advantage of the early working exception to develop a generic version of a patented medicine. For example, according to the Minister, GMP and not Teva, took advantage of the early working exception, and GMP had conformed with theRegulations by filing an ANDS for the NOC and serving Pfizer with an NOA.6
In thorough reasons, Justice Gleason set aside the Minister’s decisions, disagreeing with the Minister’s submissions.
First, Justice Gleason determined the Court did not owe deference to the Minister’s decision to issue a NOC because she found no statutory or regulatory support in the Regulations granting the Minister a policy making role to determine when a NOC may be issued. Nor did she consider it within the expertise of the Minister or departmental officials to make such determinations. Rather, she found the mandatory criteria in section 7 prevent the Minister from issuing NOC until those criteria are met and leave the ultimate determinations of whether NOC should be issued to the Court.7
Moreover, disagreeing with the Minister’s interpretation of subsection 5(1), she concluded the Minister’s amendments to its Guidance Document that permitted it to issue NOCs following administrative ANDS submissions such as Teva’s, Cobalt’s and Sandoz’s contravened theRegulations.8
Instead she found the purpose of the Regulations is to balance the interests of patentees entitled to protection for legitimately patented innovations with allowing generic companies to early work patented medicines. Relying on the Supreme Court decision in Biolyse, and the 2006 regulatory impact analysis statement accompanying the Regulations, she found that generic companies making comparisons to innovator drugs must comply with the obligation in subsection 5(1) to serve an NOA, irrespective of whether the generic had, in fact, early worked the invention.9
Further, Justice Gleason found that the generic manufacturers were required to address the listed patents prior to the Minister’s issuance of the NOC. Applying prior interpretations of subsection 5(1) by the Federal Court of Appeal in Nu-Pharm 1 and Nu-Pharm 2, that all generics who obtain rights through a license are required to address innovator’s listed patents, she found these submissions for NOCs amounted to one that made a direct or indirect comparison to Aromasin or Tracleer within the meaning of subsection 5(1). As a result, each of Teva, on the one hand, and Cobalt and Sandoz, on the other hand, was obliged to serve an NOA.10
As such, Justice Gleason found the Minister was not entitled to issue the respective NOCs without requiring compliance with subsection 5(1) as this contravened subsection 7(1) of theRegulations.11