Nancy Pei January 18 2023 2022 highlights in Canadian life sciences IP and regulatory law Smart & Biggar | Healthcare & Life Sciences - Canada Nancy Pei Healthcare & Life Sciences Patent decisions on the meritsPMNOC Regulations: fifth-year anniversary of major amendments, marketing requirementPMNOC Regulations: first amended section 8 cases scheduled for 2023 trialsDismissal of Apotex's olanzapine Statute of Monopolies case upheld on appealPatent Rules amendments in force 3 October 2022PMPRB updatesFinal report from pan-Canadian formulary advisory panel releasedHealth Canada's regulatory initiatives for 2022-2024Biosimilars updateFederal Court issues decision on application of data protection when submissions are co-pendingCompetition Bureau updatesSupreme Court of Canada affirms C$645 million patent infringement profits award in Dow v NovaPatent decisions on the meritsThe federal courts released the following patent decisions in 2022, all relating to section 6(1) actions under the Patented Medicines (Notice of Compliance) (PMNOC) Regulations.Federal Court decisions:Janssen v Pharmascience and Janssen v Apotex (paliperidone palmitate, Invega Sustenna) – following the first summary trials under the PMNOC Regulations, the Court concluded that Pharmascience and Apotex would induce infringement of claims for a dosing regimen (for further details, see "Federal Court holds summary trial appropriate, Apotex and Pharmascience will induce infringement of paliperidone palmitate patent"). Appeals by both are pending. Subsequent to the summary trial, Pharmascience's invalidity defence was unsuccessful at trial (for further details, see "Federal Court upholds validity of patent relating to paliperidone palmitate"). Pharmascience's appeal is pending;Allergan v Apotex (risedronate sodium, Actonel DR) – formulation claims "for use with or without food or beverage intake" were held to be valid (not anticipated, not obvious, useful, not insufficient, not overbroad), but not infringed (the product monograph stated that the product should be taken with food) (for further details, see "Federal Court finds formulation patent relating to Actonel DR valid but not infringed"). Allergan's appeal was dismissed on consent;Merck Sharp & Dohme Corp v Pharmascience (sitagliptin phosphate monohydrate, Januvia) – the claim to R-enantiomer of the dihydrogen phosphate salt of sitagliptin in crystalline monohydrate form was held to be valid (not obvious in view of Merck's prior genus application, which included sitagliptin and its hydrochloride salt, not insufficient) (for further details, see "Merck's Januvia crystalline monohydrate DHP salt patent found valid"). Pharmascience's appeal was discontinued; andJanssen v Sandoz and Janssen v Apotex (macitentan, Opsumit) – in the Sandoz case, claims to macitentan in combination with a phosphodiesterase type-5 inhibitor to treat diseases where vasoconstriction is involved, including pulmonary arterial hypertension, were held to be valid (not obvious, utility soundly predicted, not overbroad, not insufficient) (for further details, see "Federal Court finds Janssen's macitentan combination therapy patent valid"). In the Apotex case, validity was not challenged, and the Court held that Apotex would induce infringement (for further details, see "Janssen succeeds on infringement against Apotex in macitentan combination patent case"). Appeals by Sandoz and Apotex are pending.Federal Court of Appeal decisions:Pharmascience v Teva (glatiramer acetate, Copaxone, Glatect) – the Court upheld the finding that claims to the use of 40 milligrams of glatiramer acetate administered by subcutaneous injection three times weekly for the treatment of relapsing-remitting multiple sclerosis (the 802 patent) were valid (utility soundly predicted, not obvious) (for further details, see "Federal Court of Appeal upholds validity of glatiramer acetate patent"). The infringement finding was not challenged on appeal. Pharmascience's application for leave to appeal to the Supreme Court of Canada was dismissed;Pharmascience v Bristol-Myers Squibb (apixaban, Eliquis) – the Court upheld the finding that the two patents were valid (for further details, see "Federal Court of Appeal upholds validity of two patents relating to Eliquis"):the 202 patent, which claims apixaban, an anticoagulant, and the use of apixaban in the treatment of thromboembolic disorders (novel, not obvious in view of BMS's prior genus patent, no double patenting and sufficient); andthe 171 patent, which claims tablet formulations of apixaban (not obvious, not ambiguous/overbroad).Pharmascience's application for leave to appeal to the Supreme Court of Canada is pending;Biogen v Pharmascience, Taro (fampridine, Fampyra) – the Court upheld the finding that the patent relating to uses of fampridine sustained release compositions to treat multiple sclerosis was invalid as obvious (for further details, see "Federal Court of Appeal upholds invalidity of fampridine patent"); andJanssen v Apotex, Pharmascience, Dr. Reddy's (abiraterone acetate, Zytiga) – the Court upheld the finding that the patent relating to treatment of prostate cancer in humans by co-administration of abiraterone acetate and prednisone was invalid as obvious (for further details, see "Federal Court of Appeal upholds obviousness finding with regard to Janssen's abiraterone acetate and prednisone combination therapy patent").PMNOC Regulations: fifth-year anniversary of major amendments, marketing requirementSeptember 2022 marked the fifth anniversary of the significant amendments to the PMNOC Regulations (for further details, including statistics on actions commenced, pending, decided and appealed, see "Patented Medicines (Notice of Compliance) Regulations: five-year anniversary of major amendments"). In the fifth year following the amendments, Apotex was the most active patent challenger, followed by a tie for second between JAMP Pharma and Sandoz.As of 23 December 2022, of the approximately 234 actions started since the 2017 amendments came into force, only 26 actions have been pursued to a decision on the merits (a total of 15 decisions, as some of the actions were tried together and decided in a single set of reasons), though a number of actions remain pending. The innovator was successful in 12 actions. There have been five appeal decisions, all of which have affirmed the trial decisions, with six appeals pending.The Federal Court found the minister of health was reasonable in his interpretation of section 5(1) of the PMNOC Regulations as applying only to the drug identification number specific version of the innovator's drug. As a result, as some strengths of AbbVie's high-concentration Humira (adalimumab) were not marketed when JAMP filed its regulatory submission for those strengths, JAMP was not a "second person" under the PMNOC Regulations for its high-concentration product, Simlandi, a biosimilar of AbbVie's Humira (for further details, see "Federal Court finds minister of health reasonable in concluding JAMP not "second person" for Simlandi biosimilar"). AbbVie's appeal is pending. Patent trials were completed in December 2022.All section 6(1) trials will be presumptively held in person as of January 2023.PMNOC Regulations: first amended section 8 cases scheduled for 2023 trialsSection 8 damage cases brought by Dr. Reddy's and Apotex against Janssen regarding their abiraterone acetate products (Janssen's Zytiga) are scheduled for consecutive trials in June 2023. These would be the first trials under section 8, as amended in 2017. The trial relating to Pharmascience's section 8 claim has not yet been scheduled.Various pre-trial motion decisions illustrate some of the issues raised in these cases:Janssen's motion to have evidence in the three cases on common issues heard together was dismissed as a common hearing "would not achieve the most efficient resolution of the matters in issue in the section 8 actions" (for further details, see "Federal Court rejects trial of common issues and allows pleadings amendment concerning supply disruptions in abiraterone acetate amended section 8 actions"). The Court noted that each case requires the construction of separate "but-for worlds" with different parameters, and evidence may differ between the separate but-for worlds as to what third-party generic manufacturers would have done.The Court granted Janssen's motion to particularise its pleading that Apotex did not have the ability and/or capacity to supply the market by adding reference to supply disruptions in the US and Canadian markets experienced by Apotex in the real world (for further details, see "Federal Court rejects trial of common issues and allows pleadings amendment concerning supply disruptions in abiraterone acetate amended section 8 actions").The Court dismissed Dr. Reddy's motion for a pre-trial determination of the following question of law (for further details, see "Federal Court rejects pre-trial determination of a question of law about the nature of the section 8 but-for world"):Under the [PMNOC Regulations], when a patentee has exercised its right to a section 7 statutory stay against generic entry, and never resolved or renounced that right in relation to certain generics in the real world, does that same obstacle to entry by those generics prevail in the section 8 but-for world (other than the section 8 claimant)?Dismissal of Apotex's olanzapine Statute of Monopolies case upheld on appealIn 2021, the Ontario Superior Court of Justice dismissed Apotex's claims for damages against Eli Lilly under the Statute of Monopolies, the Trademarks Act and common law conspiracy relating to a patent for olanzapine (for further details, see "Ontario Superior Court dismisses Apotex's Statutes of Monopolies and Trademarks Act claims regarding olanzapine"). While Eli Lilly was successful in the PMNOC proceeding against Apotex (and therefore Apotex could not claim section 8 damages), the patent was later found to be invalid in a separate case against Novopharm. In August 2022, the Ontario Court of Appeal dismissed Apotex's appeal (for further details, see "Ontario Court of Appeal affirms dismissal of Apotex's Statutes of Monopolies and Trademarks Act claims regarding olanzapine"), based in part on its finding that the Patent Act and the PMNOC Regulations form a complete code. Apotex's application for leave to appeal to the Supreme Court of Canada is pending.Patent Rules amendments in force 3 October 2022Significant changes to Canadian patent practice and procedure came into effect on 3 October 2022, with the coming into force of amendments to the Patent Rules. A government fee of C$100 (C$50 for a small entity) is payable for each claim over 20 in applications in which examination was requested on or after 3 October 2022. Fees are calculated based on the greatest number of claims pending at any time from when the examination is requested to when the issue fee is paid. A request for continued examination and a government fee of C$816 (C$408 for a small entity) are required in order to reopen prosecution after a notice of allowance or conditional notice of allowance or to respond to a third examiner's report and every second subsequent examiner's report. For further details, see:"New rules: request examination of Canadian patent applications before 3 October 2022";"Canada's new patent claim fee rules: alternative embodiments within a single claim – part one";"Canada's new patent claim fee rules: alternative embodiments within single claim – part two"; and"Safe and cost-effective divisional application filing strategies under Canada's newest patent rules".PMPRB updatesAmendmentsIn February 2022, the Quebec Court of Appeal declared the confidential rebate reporting and new price regulatory factors of the amended Patented Medicines Regulations invalid (for further details, see "Court declares confidential rebate reporting and new price regulatory factors of amended Patented Medicines Regulations invalid"). The minister of health did not seek to appeal that decision and instead decided not to proceed with those amendments (for further details, see "Slam dunk! New basket of countries for PMPRB reporting remain, controversial amendments to Patented Medicines Regulations dropped"). The narrowed amended Patented Medicines Regulations, originally scheduled for 1 July 2020, came into force on 1 July 2022 (for further details, see "New PMPRB regulations in force"). The amendments:amended the basket of foreign reference countries for price benchmarking; andreduced reporting obligations for veterinary, over-the-counter (apart from non-prescription schedule D drugs such as vaccines and insulin) and generic medicines.The Federal Court of Appeal upheld the Federal Court decision which had rejected a validity challenge to the amended basket (for further details, see "Federal Court of Appeal dismisses appeal challenging amended basket of comparator countries in PMPRB Regulations"). In August 2022, the Patented Medicine Prices Review Board (PMPRB) announced an interim "status quo approach" to price reviews from 1 July 2022 until the publication of its revised guidelines (for further details, see "Patented medicines pricing – "status quo" during interim period"). The revised draft guidelines were released for comment in October (for further details, see "Draft revised PMPRB guidelines released for comment by 5 December 2022"); proposed changes include a waiver of filing requirements for vaccines and biosimilars. The release of the revised guidelines has been delayed (for further details, see "New PMPRB guidelines delayed").Soliris redetermination proceeding resolvedIn 2017, the PMPRB decided that Alexion's Soliris (eculizumab) was sold at an excessive price. In doing so, the PMPRB departed from the guidelines, in finding the appropriate benchmark was the lowest international price. The Federal Court of Appeal – criticising the PMPRB for its lack of transparency in departing from the guidelines and finding the PMPRB had misunderstood its mandate, which is directed at controlling patent abuse – remitted the matter to the PMPRB for redetermination (for further details, see "FCA remits pricing decision on ALEXION'S SOLIRIS to PMPRB"). In August 2022, the redetermination was discontinued following issuance of a consent order regarding payment by Alexion and setting the ex-factory list price until patent expiry (for further details, see "Soliris PMPRB redetermination proceeding resolved on consent").Procysbi found excessively pricedIn September 2022, a panel held that the price of Procysbi (cysteamine delayed release capsules), used to treat an ultra-rare genetic disorder, is excessive and required Horizon to pay excess revenues (for further details, see "PMPRB finds ultra-rare drug Procysbi is excessively priced"). The panel declined to depart from the guidelines as proposed by PMPRB staff, disagreed with Horizon that Procysbi satisfied breakthrough status and instead applied the moderate improvement test.Annual reportThe 2021 PMPRB Annual Report was released in November (for further details, see "Minister of health releases 2021 PMPRB Annual Report").Final report from pan-Canadian formulary advisory panel releasedIn June 2022, the advisory panel released its Final Report: Building Toward a Potential Pan-Canadian Formulary, together with summary highlights (for further details, see "Final report from advisory panel on potential pan-Canadian formulary is released").Health Canada's regulatory initiatives for 2022-2024In June 2022, Health Canada updated its Forward Regulatory Plan: 2022-2024 (for further details, see "Updates to Health Canada's regulatory initiatives for 2022-2024, and amendments to Food and Drug Regulations (Exports and Transhipments of Drugs)", which included:reference to an Advanced Therapeutic Products Pathway for Adaptive Machine Learning-enabled Medical Devices; andnotice that in Autumn 2022 (later updated to Spring 2023), final amendments may be made to the Food and Drug Regulations pre-published in 2019 (for further details, see "Proposed Amendments to Food and Drug Regulations: Generic drug equivalence, labeling, and related terminology"), which would permit a generic manufacturer to file an abbreviated new drug submission for a drug having a different salt form of the medicinal ingredient in the Canadian reference product.Health Canada released a new guidance document on clinical evidence requirements for medical devices in November 2022 (for further details, see "Health Canada releases new guidance document on clinical evidence requirements for medical devices").Biosimilars updateFor further details on biosimilars, including approvals, pending regulatory submissions, and litigation, regulatory and market access developments, see "Update on biosimilars in Canada – June 2022". In October 2022, Saskatchewan launched a biosimilars initiative (for further details, see "Saskatchewan launches biosimilars initiative") and in December 2022, Ontario announced a biosimilars transitions policy that will be fully effective on 29 December 2023 (for further details, see "Ontario is the latest jurisdiction to implement a biosimilars transition policy").Federal Court issues decision on application of data protection when submissions are co-pendingCatalyst received a notice of compliance (NOC) for Firdapse (amifampridine). Médunik later received an NOC for Ruzurgi (also containing amifampridine) based on a new drug submission filed about one month after Firdapse, referencing Firdapse data, and on the same day, Firdapse was found to be eligible for data protection. Data protection precludes the filing of a submission based on a direct or indirect comparison to Firdapse for six years after issuance of the NOC. In 2021, the Court quashed the Ruzurgi NOC (for further details, see "Federal Court quashes RUZURGI NOC and returns matter to the Minister of Health for redetermination") and returned the matter to the minister for redetermination. On redetermination, Health Canada issued a new NOC for Ruzurgi and in March 2022, the Court quashed the Ruzurgi NOC for a second time (for further details, see "Federal Court sets aside minister of health decision to issue Ruzurgi NOC for second time"), sending the matter back again for redetermination. The minister of health's appeal is pending.Competition Bureau updatesFor details of the Competition Bureau's continued interest in the health sector, see "Competition Bureau's interest in health sector continues"). In May 2022, the Competition Bureau announced it had closed two investigations into pharmaceutical patent litigation settlement agreements as evidence gathered in the two investigations suggested the agreements did not contravene the Competition Act (for further details, see "Competition Bureau closes two investigations into pharmaceutical patent litigation settlements"). In June 2022, the Competition Bureau announced it had completed a preliminary investigation into potential anti-competitive harm from "relabelled" biologic drugs (for further details, see "Update on biosimilars in Canada – June 2022").Supreme Court of Canada affirms C$645 million patent infringement profits award in Dow v NovaIn November 2022, the Supreme Court of Canada affirmed a C$645 million award granted to The Dow Chemical Company as a result of Nova's infringement of Dow's patent on novel polyethylene blends (for further details, see "Supreme Court of Canada affirms record-setting C$645m patent infringement award in Dow v Nova"). While the decision is outside the life sciences area, it is a good reminder of the availability of this discretionary remedy for patent infringement in Canada.For further information on this topic please contact Nancy Pei at Smart & Biggar by telephone (+1 416 593 5514) or email ([email protected]). The Smart & Biggar website can be accessed at www.smartbiggar.ca.