Apotex v. Merck; s. 8 Decision on merits; October 21, 2008

On October 21, 2008, the Court released its first decision on a s. 8 damages case. The Court held it has jurisdiction to hear a case pursuant to s. 8 of the Patented Medicines (Notice of Compliance) Regulations ("Regulations"). In addition, the section is intra vires and does not violate the division of powers in the Constitution Act.

The Court held that Apotex was not entitled to claim Merck's profits. "Profits" as referred to in s. 8 refers only to a second person's lost profits. The entire content of s. 8 focuses on compensation for loss suffered by the generic. It is a reasonable balance when compared to the injunction-like provisions of the remainder of the Regulations. The Court also held that although the Federal Courts Act allows for equitable remedies, these must be found in the Regulations, and are not.

The Court accepted that it had discretion to move the start date of the compensation period (from the date the Minister certifies the NOC could otherwise have been issued). However, in order to do so, it had to be satisfied on the evidence that another date was more appropriate. In this case, it was argued that Apotex should have served its NOA earlier approximately 2 months earlier than it did and therefore the compensation period should be reduced accordingly. However, the Court held that there was no evidence that the Minister knew or cared when the NOA was sent or that this would have impacted the approvability date. Thus, no other date was accepted.

In addition, the Court refused to dismiss, at this stage, Apotex' claim for compensation due to alleged lost market share and acknowledge Apotex may argue for damages beyond the compensation period in this regard if said damage could not have been or was not rectified in that period. No costs were awarded for the trial.

The full text of the decision can be found at:

http://decisions.fct-cf.gc.ca/en/2008/2008fc1185/2008fc1185.html