Introduction

In Apotex Inc. v. Shire LLC, 2018 FC 637 (“Vyvanse”), Justice Fothergill of the Federal Court dismissed Apotex’s action to impeach Shire’s patent covering its drug Vyvanse. Vyvanse contains the active ingredient lisdexamfetamine, a prodrug of the central nervous system stimulant dextroamphetamine, used to tread attention deficit hyperactivity disorder. When Vyvanse is administered to a patient, the prodrug, which is inactive, converts over an extended period of time to dextroamphetamine, the active form of the drug. Peak levels in the body are substantially reduced. Because of this, Vyvanse is less prone to abuse (for instance by crushing and snorting, or dissolving and injecting) and oral overdose compared to other stimulant drugs. Shire’s patent claimed the prodrug itself, compositions containing the prodrug, as well as uses for the prodrug.

Apotex additionally sent Shire a notice of allegation (“NOA”) under the former Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations”). In response, Shire commenced an application to prohibit the Minister of Health from granting Apotex a notice of compliance (“NOC”). The parties generally agreed that the result of the impeachment action should govern the prohibition application. Since Apotex’s impeachment action was dismissed, the prohibition application was granted, and the Minister of Health was prohibited from issuing Apotex a NOC.

In response to Apotex’s action to impeach, Shire commenced a counterclaim for infringement, which was dismissed. The court held that all of Apotex’s copycat version of Vyvanse had been manufactured for regulatory and experimental uses, which are exempted from infringement under subsections 55.2(1) and (6) of the Patent Act.

This blog summarizes a few interesting portions of the Federal Court’s decision.

Effect of Foreign Judgments in Canadian Litigation

Shire argued decisions from the US and Europe upholding the validity of Shire’s patents should be considered instructive.[1] The Court rejected Shire’s argument, holding that it was to “decide the legal issues raised…in accordance with the factual record and Canada’s own laws.”[2]

This holding is consistent with a number of cases from the Federal Court including a recent decision by Justice Phelan, SNF Inc. v. Ciba Specialty Chemicals Water Treatments Limited, 2015 FC 997 (“SNF FC”), who faced an argument that an Australian decision upholding a patent should be influential. Justice Phelan held that, “[a]s persuasive as judgments from the Australian Federal Court may be, the decision here turns on the facts and law applicable here.”[3] It now seems clear that the Federal Court will not consider foreign decisions on the validity or infringement of corresponding foreign patents.[4]

Selection Patent Criteria and Invalidity

Shire and Apotex also disputed whether the patent at issue was a selection patent. The court cited the Supreme Court’s famous recitation of the three conditions for a “valid selection patent” set out in Apotex Inc. v. Sanofi Synthelabo (“Sanofi”) – that (1) the selected class have a substantial advantage over the genus, (2) all of the selected class have the advantage, and (3) the advantage be more or less unique to the selected class and not shared with the genus – but held that the failure of any of these conditions is not an independent basis to invalidate a patent.[5]

Rather, the court held that the three conditions only serve to characterize the patent as a selection patent, and informed the grounds of validity set out in the Patent Act.[6] The court held:

By statute, the basis for assessing anticipation cannot depend on whether the patent is a selection patent or not…A selection patent, like any other patent, is therefore vulnerable to any attack set out in the Patent Act, but no other.[7]

In the end, the court doubted whether the patent was a selection patent. However, nothing ultimately turned on this issue.[8]

Persuasiveness of Moot NOC Application Decisions

Interestingly, Justice Fothergill appeared to call into question the persuasiveness of a prior decision of the Federal Court, Hoffman La-Roche v. Apotex Inc., 2013 FC 718 (“Hoffman La-Roche”). Hoffman was an application under the old PM(NOC) Regulations to prohibit the Minister of Health from issuing Apotex an NOC. In that case, a different judge of the Federal Court held that Apotex’s allegation that a selection patent was anticipated by the genus patent was justified and dismissed the application.[9]

Justice Fothergill noted that Hoffman La-Roche had been severely criticized in academic commentary and the decision was immune from correction on appeal because Apotex had received the disputed NOC, and hence the appeal was moot:

Hoffman La-Roche concerned a NOC application rather than an impeachment action, and any appeal of the judgment by the unsuccessful patentee would likely have been moot.

Professor Siebrasse’s criticisms may be reason to approach Hoffman La-Roche with caution.[10]

Justice Fothergill’s dicta on this issue echoes, without citing, earlier Federal Court of Appeal jurisprudence in the context of moot appeals from dismissed applications under the PM(NOC) Regulations, including Eli Lilly Canada Inc. v. Novopharm Limited, 2007 FCA 359 (“Eli Lilly”). In that case, the appeal court held that it was inappropriate to rely on decisions from summary applications under the PM(NOC) Regulations to set binding precedent on controversial and uncertain questions in patent law.[11] However, later jurisprudence from the Federal Courts seems to have left this principle behind. Justice Fothergill’s ruling may have given the principle some additional force.

In the end, however, nothing turned on this issue either. Justice Fothergill held that Hoffman La-Roche was distinguishable and declined to apply it.

Inventive Concept of the Patent

Under the second step of the Sanofi obviousness framework, when considering whether a claim is obvious, the court must determine its “inventive concept”.[12]

Apotex argued that the Federal Court of Appeal’s recent decision Ciba Specialty Chemicals Water Treatments Limited v. SNF Inc., 2017 FCA 225 (“SNF FCA”, our commentary here), held that the inventive concept of the claims was no longer relevant to obviousness, and that the claim construction should be used instead.[13] In that case, the appeal court held:

There may be cases in which the inventive concept can be grasped without difficulty but it appears to me that because “inventive concept” remains undefined, the search for it has brought considerable confusion into the law of obviousness. That uncertainty can be reduced by simply avoiding the inventive concept altogether and pursuing the alternate course of construing the claim. Until such time as the Supreme Court is able to develop a workable definition of the inventive concept, that appears to me to be a more useful use of the parties’ and the Federal Court’s time than arguing about a distraction or engaging in an unnecessary satellite debate.[14]

Nonetheless, Justice Fothergill rejected Apotex’s argument, noting that as a matter of stare decisis, the Federal Court of Appeal could not have overruled Sanofi. Accordingly, he proceeded to consider the inventive concept,[15] and it appears that the inventive concept will continue to play a dominant role in obviousness.

Irrespective, Justice Fothergill held that Ciba was distinguishable on the basis that the claims at issue were close to those in Sanofi (in which the inventive concept was considered) than those in Ciba (in which it was not).[16]

Obvious-to-try

Under the Sanofi obviousness framework, the court must decide whether the differences between the state of the art and the inventive concept of the claims constitutes a step that would have required any inventiveness to overcome. At this stage, the court frequently invokes an “obvious to try” test. Under that test, in addition to other considerations, the court must decide whether it is “more or less self-evident that what is being tried ought to work”.

Justice Fothergill held that the patent at issue was not obvious to try because “there was no way of knowing what the properties of [the prodrug] might be without testing. [The prodrug] could not therefore be “obvious to try”, because it was not more or less self-evident that it ought to work. This is true even if the testing may itself have been routine.”[17]

Interface between actions and applications under the PM(NOC) Regulations

Finally, although Apotex and Shire generally agreed that the result of the impeachment action ought to govern the outcome of Shire’s application under the PM(NOC) Regulations, they disagreed on some of the finer details.

Shire argued that, even if the impeachment action was dismissed, the application under the PM(NOC) Regulations should be allowed if the court allowed the impeachment action based on documents and allegations not included in Apotex’s NOA.

Apotex argued that, in the event of a tie in the impeachment action, Apotex would not have met its burden to impeach the patent, but Shire would not have met its burden to show that Apotex’s allegations in the NOA were not justified.

In the end, this disagreement was of no moment. The impeachment action was dismissed, and not because of a tie. Vyvanse may have been the last parallel impeachment action and application under the PM(NOC) Regulations. Now that proceedings under the PM(NOC) Regulations proceed by way of action, this issue is unlikely to reoccur.