CASE: Apotex Inc. v. Janssen-Ortho Inc. et al. (Federal Court of Appeal)

DRUG: LEVAQUIN (levofloxacin)

NATURE OF CASE: NOC Regulations: s. 6 Prohibition Proceedings

SUCCESSFUL PARTY: Apotex Inc.

DATE OF DECISION: June 22, 2009

SUMMARY:

On June 22, 2009, the Federal Court of Appeal ("FCA") allowed Apotex Inc.’s ("Apotex") appeal from the decision of Shore J., who had granted Janssen-Ortho Inc.'s ("Janssen-Ortho") application for a prohibition order in respect of the drug LEVAQUIN (levofloxacin) and Canadian Patent No. 1,304,080 (the "'080 patent")1. In doing so, the FCA found that it is not an abuse of process for a second generic to re-litigate issues that had already been decided in favour of the innovator in previous litigation against a first generic. The case has been sent back to Shore J. for reconsideration.

In an earlier prohibition application against Novopharm Ltd. ("Novopharm") regarding the '080 patent, the Federal Court held that Novopharm’s allegations of invalidity were justified. Upon market entry, Janssen-Ortho initiated a patent infringement action against Novopharm, in which Hughes J. found the '080 patent to be valid and infringed. The FCA upheld Hughes J.'s decision.

Apotex subsequently served its notice of allegation in respect of the '080 patent, alleging invalidity and non-infringement. Relying on Sanofi-Aventis Inc. v. Novopharm ("Sanofi-Aventis")2 , Shore J. determined that Apotex required "better evidence or a more appropriate legal argument" in order for it to succeed on issues previously decided in favour of Janssen-Ortho. Justice Shore concluded that it was an abuse of process for Apotex to raise issues already litigated in the Novopharm trial, as Apotex's "new evidence" was only conflicting evidence, or a repetition of evidence.

The FCA unanimously held that Shore J. erred in applying the test for abuse of process, and distinguished Sanofi-Aventis as a case concerning whether the innovator’s application, and not the generic's allegations, amounted to an abuse of process. According to the FCA, Sanofi-Aventis "does not lead to the conclusion that a second person can only put forward a NOA on grounds similar to those put forward by a different generic in other proceedings when it has better evidence to offer or better legal arguments to make", and "fairness require[s] that a generic, such as Apotex in the present case, which had not yet litigated the issues which it raised in its NOA, be allowed to have its day in court."

Although the FCA agreed that Apotex's allegations did not constitute an abuse of process, they split on whether Shore J.'s error warranted intervention. Justice Nadon for the majority found that Shore J. "did not conduct a parallel enquiry, but an enquiry which co-mingled the evidence before him and the findings made by Hughes J. in the Novopharm trial", and sent the matter back to Shore J. for reconsideration. In dissent, Layden-Stevenson J.A. found that Shore J. had conducted an invalidity analysis distinct from the issue of abuse of process, and would have dismissed the appeal.

LINK TO DECISION:

http://decisions.fca-caf.gc.ca/en/2009/2009fca212/2009fca212.html