The PMPRB released its June 14, 2012 decision relating to Sanofi Pasteur’s vaccines QUADRACEL and PENTACEL. Following reconsideration, it opted to issue an order for the identical amounts as were found to be owing under its previous order that the Federal Court of Canada had declared a nullity.
This is the next chapter following the Federal Court’s July 12, 2011 decision (Sanofi Pasteur Limited v. Attorney General of Canada 2011 FC 859 (T-83-10)) (“Sanofi”) (http://decisions.fct-cf.gc.ca/en/2011/2011fc859/2011fc859.html) that declared a decision of the Patented Medicine Prices Review Board (“Board”) to be null and void. It required the Board to return amounts paid by Sanofi Pasteur pursuant to the Board’s order, and directed the matter back for reconsideration.
Upon reconsideration, the Board Panel stated that it had jurisdiction to make an order that did not fully offset the excessive revenues (s.83(2) uses the word “may” in addressing the powers of the Board when excessive pricing is found). However, absent special circumstances, the remedy should fully offset the excess revenues calculated by the Board Panel. In the absence of special circumstances, the choice is among the methods of offsetting the revenues and not about whether there are reasons not to make a remedial order or to adjust the dollar amount. Special circumstances were not present in this case and therefore the entire amount of excess revenues was to be repaid.
The Board Panel stated two reasons why the patentee could not reduce the excessive revenues in 2007 from foregone revenues when pricing was below the maximum non-excessive (“MNE”) price in earlier years: 1) The price paid by the Government of Canada in the prior years was as a result of a competitive bid. It should not be deprived of the benefits of the pricing procurement strategy by allowing those savings to offset prices in excess of the MNE in a subsequent year; and 2) The Guidelines’ price averaging parameters for a calendar year were appropriate in this case. These parameters balanced flexibility and the ability to correct for unexpected revenues with preventing patentees from charging excessive prices at will and later reducing or eliminating excess revenues to sometime of their choosing.
Since the March 16, 2010 order was a nullity, the Board Panel reissued a replacement order.
The decision may be found at: http://www.pmprb-cepmb.gc.ca/english/View.asp?x=1628&mp=271