Earlier today, September 7, 2017, the Government of Canada published final pharmaceutical regulations flowing from CETA. According to an Order in Council, the new regulations will be in force on September 21, 2017.

These amended regulations herald a significant change to the landscape and environment in Canada for pharmaceutical companies, with long lasting impact to innovators in terms of exclusivity and drug product life-cycle management.

We reported (here) on the drafts of:

  1. the Regulations Amending the Patented Medicines (Notice of Compliance) Regulations, 2017 [“PMNOC Regulations amendments”], and
  2. the Certificate of Supplementary Protection Regulations (“CSP Regulations”) which, together with the amendments to the Patent Act in the Canada-European Union Comprehensive Economic and Trade Agreement Implementation Act (see our article on the Patent Act amendments here) will compensate innovators for lost patent term due to regulatory delays.

PMNOC Regulations amendments

There are no differences between the text of the draft and the final regulations.

When in force, the amended regulations will immediately apply to all submissions for which a notice of allegation is served on or after the effective date of the regulations (September 21, 2017). Any notice of allegation served before that date will be governed by the current regulations.

The amendments to the regulations are accompanied by a regulatory impact analysis statement (“RIAS”) outlining the background and objectives and describing the changes. The objectives are stated to include:

  • replacing summary proceedings with a full right of action;
  • providing equivalent and effective rights of appeal to all litigants; and
  • ending dual litigation.

According to the “precis” published with the Order in Council promulgating the amended regulations, the regulations were amended to:

  1. resolve a number of problems by replacing summary prohibition proceedings with full actions to determine patent validity and infringement;
  2. expand the scope of the regulations to cover relevant certificates of supplementary protection, by providing an additional period of protection for new patented pharmaceutical products;
  3. expedite proceedings by introducing a limited number of procedural rules, while still leaving the Court broad discretion to manage proceedings;
  4. address concerns about how damages arising from delayed generic market entry are currently assessed; and
  5. remove barriers that may prevent innovators and generics from litigating certain patents outside the regulations prior to generic market entry.

Key specific amendments in the new scheme include:

  • New right of action for a declaration of infringement following receipt of notice of allegation extending to all claims of listed patents.
  • Sole opportunity to litigate listed patents: a first person cannot bring an action outside the regulations unless it did not have a reasonable basis for bringing the action within the 45-day deadline.
  • No end date for section 8 damages period: a first person can however renounce application of the 24-month stay, precluding any s. 8 liability.
  • Certificates of supplementary protection (“CSPs”) can be listed on the Patent Register [see below].

CSP Regulations

As noted in our earlier newsletter, the CSP Regulations will allow for protection to take effect at the end of the term of the relevant patent which will be calculated by subtracting five years from the period beginning on the filing date of the application for the patent and ending on the day on which the authorization for sale is issued, for a maximum of two years.

The final regulations have two amendments, discussed below, over the prior draft regulations (discussed previously here).

Key provisions of the CSP Regulations, as finalized, include:

  • Prior Approvals and excluded variations: a CSP is only available where no other CSP has been issued with respect to the medicinal ingredient or the combination of medicinal ingredients, which is defined to exclude prescribed variations (for example, esters, non-covalent derivatives, enantiomers, solvates, polymorphs, post-translational modifications). The list of variations has not changed from the draft CSP Regulations.
  • Eligible patents: the patent must be in force and must include at least one claim directed at the same medicinal ingredient or combination; use of the same medicinal ingredient or combination; or the same medicinal ingredient, or combination, as produced by a defined process (product-by-process). Pure process patents and patents claiming formulations are therefore excluded. The list of eligible patents has not changed from the draft CSP Regulations.
  • CSP application must be timely filed: the 120 day deadline for applying for a CSP has not changed from the draft CSP Regulations. However, the final regulations eliminated the earlier-proposed requirement that the CSP application can only be filed if there are more than two years remaining in the patent term.
  • The application for marketing authorization must be timely filed relative to foreign applications: the final regulations extended the deadline to 24 months, rather than the earlier-proposed 18 months, if the application for a CSP is filed no later than September 21, 2018, the first anniversary of the day on which the CSP provisions come into force, and 12 months, in any other case.

It is anticipated that Health Canada will update its guidance documents in light of the PMNOC Regulations amendments, and release new guidance documents relating to the CSP Regulations. We also understand that the Federal Court is working to settle guidelines that will apply to actions covered by the PMNOC Regulations amendments.