Parties' obligations


The text of CETA was released on September 26 2014 (for further details please see "Text of CETA released"). Chapter 22 in particular, includes provisions specifically affecting pharmaceuticals and biologics in three areas:

This update provides more details on the patent term restoration provision, Article 9.2, entitled "Sui Generis [Latin for 'unique'] Protection for Pharmaceuticals". This form of protection effectively extends the patent term to account for marketing delays resulting from the time required to obtain regulatory approval. While the European Union has had patent term restoration – granted by way of supplementary protection certificates (SPCs) – for a number of years, once enacted in Canada this form of protection will be entirely new.

Parties' obligations

Nature of product or patent (Section 1)
Protection will apply to a product defined as "the active ingredient or combination of active ingredients of a pharmaceutical product" – defined in Article 1.2 as:

"a product including a chemical drug, biologic drug, vaccine or radiopharmaceutical, which is manufactured, sold or represented for use in:

  1. making a medical diagnosis, treating, mitigating or preventing disease, disorder, or abnormal physical state, or its symptoms, or
  2. restoring, correcting or modifying physiological functions" –

that is protected by a basic patent, defined as "a patent which protects a product as such, a process to obtain a product or an application of a product in force".

Application or conditions of approval (Sections 2 and 3)
The protection will be granted upon request by the "holder of the patent or his successor in title", provided that:

  • marketing approval for the product has been granted;
  • the product has not already been the subject of protection; and
  • the marketing approval is the first such approval as a pharmaceutical product.

The protection will apply only if the first regulatory submission for marketing approval is submitted within a reasonable prescribed timeframe.

Further, the parties may prescribe a timeframe for submitting the application for protection. This may be no less than 60 days from marketing approval or, if the patent is not granted by that date, at least 60 days from patent grant.

One term per product (Section 4)
There may be only one term of protection per product, and if the product is protected by more than one patent, the single applicable patent will be selected:

  • by the person requesting the protection, where all the patents are owned by the same person; or
  • by agreement between the 'patent holders', where the patents are not owned by the same person and this gives rise to conflicting requests.

Term (Section 4)
The period of protection will commence at the end of the lawful term of the relevant patent.

The term will be for "a period equal to the period which elapsed between the date on which the application for a patent was filed and the date of the first authorisation to place the product on the market of that Party as a pharmaceutical product reduced by a period of five years", which "may not exceed a period of two to five years, to be established by each Party".

However, the two to five-year cap will be without prejudice to a possible extension to incentivise or reward research in certain target populations, such as children.

The period of protection may lapse if surrendered or if prescribed administrative fees are not paid.

The period of protection may be reduced "commensurate with any unjustified delays resulting from the inactions of the applicant after applying for the market authorisation".

Nature of protection (Section 5)
The protection will extend only to the pharmaceutical product covered by the marketing approval and any use of that product as a pharmaceutical product approved before the expiry of the protection. The protection will confer the same rights as conferred by the patent and will be subject to the same limitations and obligations.

Exceptions for export (Section 5)
Exceptions may be provided for making, using, offering for sale, selling or importing products for the purpose of export.

Lapse or revocation (Section 6)
The protection may be revoked if the patent is invalidated, the claims of the patent no longer cover the product, marketing approval is withdrawn or the protection had been granted contrary to the Section 2 requirements.

Once the terms are enacted into domestic legislation, Canada's agreement to implement patent term restoration will address a long-standing deficiency in Canada's regime relative to not only that of the European Union but also those of Canada's other major trading partners, including the United States and Japan.

For further information on this topic please contact Daphne Lainson at Smart & Biggar/Fetherstonhaugh's Ottawa office by telephone (+1 613 232 2486), fax (+1 613 232 8440) or email ([email protected]). Alternatively, contact Nancy P Pei at Smart & Biggar/Fetherstonhaugh's Toronto office by telephone (+1 416 593 5514) or by fax (+1 416 591 1690) or by email ([email protected]). The Smart & Biggar/Fetherstonhaugh website can be accessed at