Brandon Heard December 14 2022 Federal Court rejects trial of common issues and allows pleadings amendment concerning supply disruptions in abiraterone acetate amended section 8 actions Smart & Biggar | Healthcare & Life Sciences - Canada Brandon Heard Healthcare & Life Sciences IntroductionDecisionIntroductionIn January 2021, the Federal Court found Janssen's Canadian Patent No. 2,661,422 (the 422 patent) – which relates to treatment of prostate cancer in humans by co-administration of abiraterone acetate (marketed by Janssen as Zytiga) and prednisone – invalid in actions under the Patented Medicines (Notice of Compliance) Regulations against Apotex, Dr. Reddy's and Pharmascience (for further details, see "Janssen's abiraterone acetate and prednisone combination therapy patent found invalid"). The Federal Court of Appeal upheld the invalidity of the 422 patent on appeal (for further details, see "Federal Court of Appeal upholds obviousness finding with regard to Janssen's abiraterone acetate and prednisone combination therapy patent").In three separate actions, Apotex, Dr. Reddy's and Pharmascience seek damages from Janssen pursuant to amended section 8 of the Regulations for their lost sales of abiraterone acetate. Dr. Reddy's and Apotex's actions are scheduled to be tried consecutively in June 2023, which would be the first trial in actions under amended section 8 of the Regulations. The Pharmascience trial has not yet been scheduled. On 27 October 2022, Justice Southcott decided three motions addressing procedural issues in these proceedings.DecisionMotion for common issues to be heard togetherThe Court dismissed Janssen's motion that evidence on issues common to the three actions should be heard together.(1)The Court disagreed with Janssen that the level of commonality between issues was sufficient. Each case requires the construction of a separate "but-for world" with different parameters (eg, relevant time period and product dosages, as Dr. Reddy's sells only the 250 milligram product whereas Apotex and Pharmascience sell both 250 milligram and 500 milligram products). Additionally, evidence may differ between the separate but-for worlds as to what third-party generic manufacturers would have done in the abiraterone acetate market.Next, the Court weighed the prejudice asserted by each party. Janssen asserted that, absent a common hearing, it would:need to call evidence from five non-parties across multiple actions;face different burdens to prove the plaintiffs' activities in each trial;incur expenses for the testimony of Janssen's witnesses three separate times; andface the risk of inconsistent factual findings.Justice Southcott found that the following categories of prejudice asserted by the plaintiffs "militate strongly" against a common hearing, and "outweigh the prejudice advanced by Janssen":Adverse witnesses may be cross-examined by all plaintiffs, each with their own unique interests, with the potential for an adverse impact on an individual plaintiff's approach to the litigation.Testimony regarding three different but-for worlds in one hearing would be "potentially confusing for both witnesses and the Court".Pharmascience would be required to participate and be bound by a common issues trial 17 months earlier than the potential trial date (not yet scheduled) being discussed in that case.Considering the foregoing factors and rule 105(a) of the Federal Courts Rules, Justice Southcott found that a common hearing "would not achieve the most efficient resolution of the matters in issue in the section 8 actions".Motion to amend statement of defence regarding Apotex's capacity to supply marketIn the Apotex action, the Court granted Janssen's motion for leave to amend its statement of defence.(2) Janssen sought 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.The Court found that the proposed amendments particularise real questions in controversy in Janssen's existing pleading "surrounding alleged real-world events that have the potential to affect Apotex's damages in the but-for world". Though Janssen sought to plead real-world events that occurred after Apotex received approval, these events potentially affect the damages calculation as Apotex seeks damages beyond this approval date. While Apotex asserted that information produced on discovery dispels the proposed pleadings, Justice Southcott determined that the Court should not assess on a pleadings motion whether the amendment is consistent with this other evidence. Accordingly, Janssen's proposed amendments have a reasonable prospect of success; establishing these facts and their relevance are issues for trial.The Court found that the interests of justice support allowing the amendments. While the motion was heard less than nine months before trial, there was no basis to conclude that the trial date would be lost, or that Janssen had deliberately and strategically delayed pursuit of the amendments.Appeal of refusals motion decisionIn a third motion, the Court also allowed Janssen's appeal from an order of Associate Judge Milczynski that did not compel Apotex to answer certain discovery questions. Justice Southcott ordered Apotex to answer questions relating to Apotex's US activities that were also the subject of Janssen's motion to amend.(3)For further information on this topic please contact Brandon Heard at Smart & Biggar by telephone (+1 416 593 5514) or email ([email protected]). The Smart & Biggar website can be accessed at www.smartbiggar.ca.Endnotes(1) Apotex Inc v Janssen Inc, 2022 FC 1473.(2) Apotex Inc v Janssen Inc, 2022 FC 1477.(3) Apotex Inc v Janssen Inc, 2022 FC 1476.