Canada: Pharmacapsules @ Gowlings: September 21, 2010

Last Updated: September 23 2010

Edited by Jennifer Wilkie and Isabel Raasch


  • New Study Argues for Economic Efficacy of National "Pharmacare" Program
  • Generic Drug Companies Complain About Lower Prices
  • European Generics Pressing for Global Agreement On Biosimilars
  • Recent Cases
  • Upcoming Trials and Appeals of Interest

New Study Argues for Economic Efficacy of National "Pharmacare" Program
By Michel O'Hara

A study released on September 13, 2010 by the Canadian Centre for Policy Alternatives claims that billions of dollars could be saved if the provincial governments could agree on a joint, national plan for purchasing both brand-name and generic pharmaceuticals. The report claims that the provinces deliberately pay between 16 and 40 per cent more than other industrialized countries in order to attract pharmaceutical investment and suggests that if Canada were to buy pharmaceuticals in bulk at a reduced rate, over $10 billion could potentially be saved.

Additionally, the report claims that Canada's industrial policy of paying higher amounts for brand name drugs has been completely ineffective, since only Ontario, Quebec, and BC benefit from the pharmaceutical industry.  More significantly, the report claims that Canada is spending "$1,530 million more than the average prices of brand-name drugs in OECD countries in order to generate $537 million in R&D spending."  However, no mention is made in the report of other significant factors that might be negatively affecting R&D spending in Canada.

For more information, please see the following link:

Generic Drug Companies Complain About Lower Prices
By Isabel Raasch

As reported on September 13, 2010 in the National Post, representatives of Canadian generic companies, including Apotex, Teva and the Canadian Generic Pharmaceutical Association are warning that lower prices for generic medicines could backfire.  In particular, they claim that  without changes to the patent system and pricing regimes, generic firms may be forced to stop making products in Canada and move their manufacturing overseas.  In addition, as profit margins fall, generic companies say that they will be less likely to launch the costly court actions required to get generics on the market early.   In response to these arguments, Russell Williams, president of Canada's Research-based Pharmaceutical Companies (Rx&D) points out that Canadian generic process have long been among the steepest anywhere and that, if anything, the brand-name industry needs more protection from the patent system, especially given that it is increasingly making drugs that target smaller patient populations and therefore have lower sales.  Asked to comment, Mark Rovere, of the Fraser Institute, a conservative think-tank, noted that generics are still doing better under the lower prices recently mandated by Ontario than they would be in a free market. 

For more information, please see the following link:

European Generics Pressing for Global Agreement On Biosimilars
By Adrian Howard

The European Generic Medicines Association (EGA) is pressing governments to draft a global agreement regarding the approval process for biosimilar medicines ("follow-on biologics").  Addressing the 8th EGA International Symposium on Biosimilar Medicines in London, EGA Director General Greg Perry advocated that now is the time to seek an international guideline. 

Countries around the world, including Canada, U.S.A., Australia, Japan, Turkey and others already have a regulatory framework for biosimilar medicines.  It is expected that the WHO will finalize their guidelines for evaluating similar biotherapeutic products (SBPs) this year.  As a result, "there is a need to reach a global agreement on criteria and guidelines for biosimilar medicines in the interest of patients and the better availability of high quality medicines," he said.  It is essential to demonstrate the biosimilar matches the innovator product in terms of quality, safety and efficacy, and also to reassure patients and healthcare professionals.  This will be addressed with a thorough comparability exercise with the reference product.

With the first major group of originator's biosimilar products coming off of patent and/or data protection, it is expected the market for biosimilars to greatly increase in the coming years.

For more information, please see the following links:

Recent Cases
By Scott Foster

Apotex v Shire, motion to amend statement of defence, modafinil, August 19, 2010

In an action brought by Apotex for damages pursuant to Section 8 of the PMNOC Regulations against Shire after an unsuccessful PMNOC proceeding brought by Shire, Shire moved to amend the statement of defence.  The first of the two new pleadings sought to be introduced by Shire was denied by the Prothonotary. The pleading in question related to a defence that in the event  Apotex is held to have infringed the '967 patent in the patent infringement proceeding commenced by the patentee of the '967 patent, then Apotex should be precluded from recovering damages in the present proceeding for loss of sales ultimately found to be infringing in another action.  In dismissing the amendment, the Prothonotary held that the outcome in the parallel proceeding was an uncertain event; the extent of which could not be determined in the present case.  Moreover, any success or failure in the parallel proceedings was contingent upon the actions of a third party and therefore the proposed pleading was no more than speculative and hypothetical.  The Prothonotary also referred to (and was clearly influenced by) the potential delay that would be caused should she allow this particular amendment to the pleadings.

The second ground sought to be introduced by Shire related to an undertaking alleged to have been given by Apotex in 2005 in respect of a patent related to the '967 patent.  That patent (the '824 patent) was directed to a particular use of modafinil and Shire alleged that Apotex had undertaken not to make, use or sell its tablets for that patented use.  Shire submitted that Apotex's Monograph declares that its Apo-modafinil product is indicated for the use covered by the '824 patent and, furthermore, states that Apotex had already sold its product for that use in Canada and therefore was in breach of the undertaking. In response, Apotex argued that any such misrepresentation or breach of undertaking (if established) occurred in respect of another patent (i.e. the '824 patent) and not the patent at issue in these proceedings (i.e. the '967 patent) and therefore cannot be a proper defence to the present proceedings.  The Prothonotary allowed the amendment.  She said that this is a difficult decision on a point of law and it should not be determined upon a motion.  She said that Apotex's alleged breach of an undertaking in relation to another patent, if established, may influence the starting point for determining the period in which damages should be paid in the present proceeding.  Therefore it was a proper defence, or at least an arguable defence, in the present proceedings.

The full text of the decision can be found at:

Apotex v. Janssen-Ortho, motion to vary order of Federal Court of Appeal, levofloxacin, August 20, 2010

For a detailed history of this particular proceeding see the July edition of this newsletter.  Apotex filed a Notice of Allegation alleging that a particular patent licensed by Janssen-Ortho was invalid and not infringed.  Janssen-Ortho sought an order prohibiting the Minister from issuing a Notice of Compliance.  At trial, Justice Shore granted the Order of Prohibition and on appeal the Federal Court of Appeal ("FCA") allowed the appeal and remitted the decision back to Justice Shore for redetermination.  In doing so, the FCA ordered Justice Shore to assess the evidence before him independently of Justice Hughes' decision in some related proceedings.  On being remitted back to the Federal Court, Justice Shore recused himself from sitting on any redetermination because he would be unable to reach a different conclusion to that which he had already reached.   

Janssen-Ortho brought a motion in the FCA asking the FCA to vary its judgment remitting the decision to Justice Shore for redetermination.  Janssen-Ortho said that on reading the decision of Justice Shore to recuse himself it is apparent that Justice Shore was not influenced by the decision of Justice Hughes and the FCA erred in remitting the decision for redetermination.  The FCA denied the motion and held that contrary to Janssen-Ortho's submissions, Justice Shore's findings had not been made independently of Justice Hughes' decision.  Furthermore, procedurally speaking, the FCA noted that Janssen-Ortho did not appeal the FCA judgment to the Supreme Court of Canada and it was therefore a final decision.

The full text of the decision can be found at:

Eli Lilly v Novopharm, motion for reconsideration of judgment of Federal Court of Appeal ("FCA"), olanzapine, September 7, 2010

Novopharm moved for reconsideration of the FCA's judgment allowing Lilly's appeal of a Federal Court decision that impeached Lilly's patent.  For a summary of the FCA judgment, see the July 28, 2010, release of this newsletter.  By it judgment, the FCA set aside the order of Justice O'Reilly invalidating Lilly's patent and entitling Novopharm to seek damages pursuant to Section 8 of the PMNOC Regulations.  Novopharm brought the motion because it was concerned that the FCA judgment might preclude it from seeking damages pursuant to section 8 of the Regulations.  The FCA dismissed the motion.  The FCA held that there was no need for it to reconsider its judgment (or amend it) because its judgment did not (if the Lilly patent was ultimately held to be invalid) preclude Novopharm from seeking damages pursuant to section 8 of the Regulations. 

The full text of the decision can be found at:

Apotex v Lundbeck, motion to strike pleadings and for security for costs, escitalopram, August 5, 2010

In earlier PMNOC proceedings, Lundbeck successfully obtained an order prohibiting the Minister from issuing a Notice of Compliance to Apotex in respect of its escitalopram product.  Although Apotex appealed the decision (appeal hearing commenced on September 14, 2010), Apotex also commenced the present action to invalidate the Lundbeck patent and at the same time sought a declaration of non-infringement.  Lundbeck counterclaimed in the action but had to accept that in doing so it had knowledge of no material facts that demonstrated that Apotex had actually commenced any infringing activities.  Lundbeck had to accept that it was trite law that speculative pleadings could be struck for being an abuse of process but argued that because its counterclaim for infringement was in response to Apotex's declaration for non-infringement, the usual principles didn't apply.  This was because Apotex itself had put before the court the question of whether Apotex's product infringes the Lundbeck patent and Lundbeck was simply responding in pleadings to that allegation.  The Prothonotary dismissed the motion to strike and held that it would not be improper or abusive for Lundbeck to seek from the court – even without having any evidence at this stage – a remedy that was opposite to what Apotex was seeking and which Apotex had itself put in issue between the parties.  If, however, Apotex had not sought a declaration of non-infringement, Lundbeck's infringement allegation would have been struck. 

In the motion for security for costs, even though the particular Lundbeck entity in the proceeding is not ordinarily resident in Canada, it did provide evidence that it had some assets in Canada and did demonstrate a capability to pay an award of costs from assets outside of Canada.  Given this, the Prothonotary exempted Lundbeck from the requirement to post security for costs.

The full text of the decision can be found at:

Upcoming Trials and Appeals of Interest

September 22-23, 2010, Court of Appeals, Ottawa:

Eli Lilly & Company (Eli Lilly Canada Inc.) v. Apotex Inc. et al (A-451-09)
Appeal from Patent Infringement Trial Decision - Cefaclor

November 1, 2010, 30 days, Federal Court, Toronto:

Apotex Inc. v. Glaxo Group Ltd And Glaxosmithkline Inc. (T-428-01)
Patent Infringement Trial - Cefuroxime Axetil

November 10, 2010, Supreme Court, Ottawa:

Celgene Corporation v. Attorney General of Canada (33579)
Health law – Drugs – Patent Act, s. 80(1)(b) – Patented Medicine Prices Review Board's decision holding that Board had jurisdiction to require Celgene Corporation to provide information about the pricing of the drug Thalomid – Board decision set aside on appeal – Federal Court of Appeal upheld Board's decision – Whether the majority decision of the Federal Court of Appeal conflicts with jurisprudence of this Court, the Federal Court of Appeal and Exchequer Court – Whether the Federal Court of Appeal ignored the international comity-based presumption against the extraterritorial application of domestic law – Whether the decision of the Federal Court of Appeal wrongly extends the jurisdiction of an important Canadian regulator to sales made in the US, contrary to its enabling legislation – Whether the Federal Court of Appeal erred by ignoring Parliament's wording of the Patent Act, and inserting its own and whether the majority changed "in any market in Canada" to "into any market in Canada" – Whether the appeal court erred in obiter and extended the Board's jurisdiction by also ruling on jurisdiction over price regulation when this case involved jurisdiction over disclosure of data – Whether this case has wide implications for other foreign suppliers of medicines.

November 12, 2010, Supreme Court, Ottawa:

Merck Frosst Canada Ltd. v. Minister of Health (33290 and 33320)
Access to information - Exemptions - Third party information - Food and drugs - Confidentiality of scientific information concerning new drugs - Interpretation of statutes and regulations - Information provided to Health Canada protected for five years - Competitor requesting access to departmental information within that time - Whether access exemption for department's third party information applies to scientific information provided by manufacturer of new drug - Whether third party innovator manufacturer bears burden of proving that access exemption must apply - Whether department may disclose certain third party information without notice - Food and Drug Regulations, C.R.C., c. 870, ss. C.08.002(1), (2), (3) and C.08.004.1(2), (3), (4) - Access to Information Act, R.S.C. 1985, c. A-1, ss. 20, 25, 27.

November 15, 2010, 15 days, Federal Court, Toronto:

Mycogen Plant Science, Inc. v. Bayer Bioscience N.V. et al (T-1524-08)
Monsanto Technology Llc v. Bayer Bioscience N.V. et al (T-1569-08)
Patent Infringement Trial

December 6, 2010, 8 days, Federal Court, Toronto:

Apotex Inc. v. Servier Canada Inc. (T-1783-08)
Patent Conflict, Section 8 Patented Medicines (Notice of Compliance) Regulations - Gliclazide

December 6, 2010, 4 days, Federal Court, Ottawa:

Hoffmann-LaRoche Limited v. Apotex Inc. (T-1165-09)
Patented Medicines (Notice of Compliance) Regulations, mycophenolate mofetil<

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
8 Nov 2016, Seminar, Ottawa, Canada

The prospect of an internal investigation raises many thorny issues. This presentation will canvass some of the potential triggering events, and discuss how to structure an investigation, retain forensic assistance and manage the inevitable ethical issues that will arise.

22 Nov 2016, Seminar, Ottawa, Canada

From the boardroom to the shop floor, effective organizations recognize the value of having a diverse workplace. This presentation will explore effective strategies to promote diversity, defeat bias and encourage a broader community outlook.

7 Dec 2016, Seminar, Ottawa, Canada

Staying local but going global presents its challenges. Gowling WLG lawyers offer an international roundtable on doing business in the U.K., France, Germany, China and Russia. This three-hour session will videoconference in lawyers from around the world to discuss business and intellectual property hurdles.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.