Summary

On May 30, 2011, the Federal Court dismissed AstraZeneca's (“AZ”) motion for an interlocutory injunction preventing Apotex Inc. (“Apotex”) from selling a generic version of NEXIUM (esomeprazole magnesium) in Canada pending trial in September 2013.

Motion for an interim and interlocutory injunction

The Court applied the following three-part test from RJR-MacDonald: (1) is there a serious issue to be tried; (ii) will the plaintiff suffer irreparable harm if the motion is not granted; and (iii) does the balance of convenience favour the granting of an injunction? 

  1. Serious issue to be tried

The Court held that the issues raised in the action are not frivolous, vexatious, or destined to fail.  The complex and technical nature of patent infringement actions distinguishes them from other types of actions in which injunctions have been denied.

  1. Irreparable harm

The Court rejected AZ's evidence of irreparable harm which included the following:

(a) Permanent Loss of NEXIUM market

(b) Negative Impact on other products, customer relationships, and employees

(c) Negative Impact on Pipeline Products

(d) Negative impact on reputation and future business development opportunities

(e) Loss of Innovation and Creativity

  1. Balance of convenience

AZ argued that the balance of convenience should take into account the harm to the public interest in patent rights, and in the promotion of innovation and drug discovery, which would result from a decision not to grant an interlocutory injunction.  The Court agreed that this "may well be a legitimate consideration" in appropriate cases.  However, AZ "provided no evidence whatsoever of any adverse impact that would result from a decision not to grant the requested injunction."  Unsubstantiated harms do not merit material weight in the balance of convenience.  The likely and substantial adverse impact of delayed genericization on the public may be taken into account.  On the evidence, the balance of convenience in this case favoured Apotex.

Costs

In a supplementary Order dated June 22, 2011, Apotex was awarded its costs in the sum of $55,000 (Tariff B, column V), plus disbursements in the sum of $175,000, plus HST.  The Court awarded elevated costs for the following reasons:

  • AZ’s delay in bringing their motion; 
  • the volume of materials filed in support of the motion;
  • the urgency with which AZ pursued the motion placed Apotex in a position where it could not reasonably defend the motion without having to incur very substantial legal costs and disbursements; 
  • the relief sought by AZ was extraordinary and has not been granted by the Federal Court in the last twenty or twenty-five years; 
  • AZ's submissions were largely unsubstantiated or speculative in nature; and
  • Apotex's actual legal fees were $493,551, exclusive of HST. 

Apotex was only entitled to recover a portion of the "disproportionately high expert fees paid to Mr. Andrew Harington".  Given that AZ's motion was not "entirely without merit", the costs are payable at the final disposition of this action, rather than forthwith.

An appeal of this decision was heard June 23, 2011 and dismissed.

Link to decision: http://decisions.fct-cf.gc.ca/en/2011/2011fc505/2011fc505.html