Canada: Patents Year In Review 2012

This article summarizes the most noteworthy Canadian patent law decisions of 2012.

1. Viagra: Supreme Court Addresses Sufficiency of Disclosure

In 2012, the Supreme Court of Canada handed down its landmark decision clarifying the law of sufficient disclosure and serving notice that "gaming the system" will not be tolerated.   

In Teva Canada Ltd. v. Pfizer Canada Inc., 2012 SCC 60 (Viagra), the Supreme Court examined the disclosure requirements under section 27 of the Patent Act. Section 27 requires, among other things, that a "specification of an invention must correctly and fully describe the invention and its operation or use as contemplated by the inventor." Reminiscent of its decisions stretching back from Consolboard to Whirlpool, the Supreme Court reaffirmed that a patent's disclosure forms the basis for the bargain, or quid pro quo, of the patent system. That is, the inventor is granted exclusive rights in a new and useful invention for a limited time in exchange for disclosure of the invention so that society can benefit from this knowledge. However, Viagra raises the price of the bargain.

Pfizer's patent at issue included a set of cascading claims covering subject matter broad to specific. While claim 1 encompassed 260 quintillion compounds, the dependent claims that followed contained smaller and smaller groups of compounds. Ultimately, claims 6 and 7 were directed at the use of just one compound each.

In the disclosure of Pfizer's patent, it was noted that "one of the especially preferred compounds" had been shown to be effective in treating erectile dysfunction (ED). While the evidence before the Court was that only sildenafil — the subject of claim 7 — was the effective compound, there was nothing specific in the disclosure that distinguished sildenafil from the other especially preferred compounds, or that confirmed sildenafil was the compound confirmed to be effective in treating ED.

The Supreme Court held that, as a result of the lack of specific disclosure of sildenafil as the compound that was tested and shown to work, Pfizer's patent was "void" for lack of sufficiency under section 27 of the Patent Act (notwithstanding that this proceeding was pursuant to the PM(NOC) Regulations which do not provide for the invalidation of patents). In coming to this conclusion, and in contrast to lower Court decisions in the case, the Supreme Court stated that the invention must be construed on the basis of the whole specification, not on a claim-by-claim basis. Although sildenafil was specifically disclosed in claim 7, so too was another compound in claim 6. The Supreme Court noted that a person of ordinary skill in the art would look to the claims and would note that two claims were directed to the use of individual compounds. The Court noted that this may properly suggest the invention was focused accordingly, however, it cited evidence that it would have taken a "minor research project" to determine which of claims 6 and 7 was the only working invention. As such, the person of ordinary skill could not have made the same use of the invention as could the inventor.

In addition to the disclosure issue, the Court addressed the subject of utility. In particular, the Court held that at the time of filing the application for Pfizer's patent, sildenafil could assist in treating ED. This alone satisfied the requirement for utility: there was no further requirement to disclose an invention's utility in the patent application. The Court did not comment further on disclosure issues related to sound prediction of utility, as sound prediction was not at issue in the case.

2. Eurocopter: Punitive Damages and Promised Utility in Mechanical Inventions

The decision of the Federal Court of Canada in Eurocopter v. Bell Helicopter, 2012 FC 113 is important from the perspectives of (i) the prospect of an award of punitive damages in a patent infringement action, and (ii) the application of the Court's relatively new promised utility doctrine in the context of a mechanical invention.

A Court will generally award punitive damages only where a defendant's activities have been malicious, oppressive and high-handed, have offended the Court's sense of decency, or have represented a marked departure from ordinary standards of decent behaviour. Until Eurocopter, it was rare for a patent dispute to attract an award of punitive damages.

Based on evidence related to Bell's development activities, including the finding that Bell's product was a "slavish copy" of the patented technology, and the marketing of Eurocopter's patented technology as Bell's own, the Court held Bell liable for punitive damages. This conclusion was reached notwithstanding that Bell was quick to change its product design to something non-infringing as soon as it became aware of Eurocopter's lawsuit. Indeed, the Court placed emphasis on the fact that Bell had implied knowledge of Eurocopter's patent. That is, notwithstanding that there was no evidence that Bell had any knowledge of Eurocopter's patent, the Court found that there was "willful blindness or intentional and planned misappropriation of the claimed invention" on the part of Bell, and that Bell was a "sophisticated corporate entity" such that it must have known or ought to have known of the patent.

With respect to the "promise of the patent" doctrine, this relatively new concept has typically been applied in pharmaceutical cases. Eurocopter is the first trial decision that applies this doctrine in a mechanical context.

In construing the promise of Eurocopter's patent, the Court found that it was more than merely providing a working product (i.e., landing gear for helicopters). In particular, the Court found a promise to significantly reduce prior art shortcomings. Although there was no evidence that the invention would not work or would not meet the construed promise, the next step for the Court was to consider whether the invention's utility was demonstrated or soundly predicted as of the Canadian filing date. In this regard, the Court found that, as a result of testing, utility could be demonstrated with respect to only one claim. All other claims included embodiments that either were not the subject of demonstrated utility (i.e., pre-filing date testing), or were not soundly predicted. Therefore, those claims were held to be invalid.

Both Eurocopter and Bell have appealed the trial Court's decision.

3. Promised Utility in Pharmaceutical Inventions

Canada's Federal Court and Federal Court of Appeal have continued to closely examine a patent's disclosure, as opposed to its claims, for the purpose of construing the "promise of the patent." In this regard, the Court has, in some cases, elevated laudatory statements in a patent disclosure to become promises of utility.

Prior to 2005, patents in Canada were seldom invalidated due to an alleged inadequate patent disclosure. Since then, disclosure-related allegations of invalidity have become commonplace, and have found considerable success. While recognition of a promise in a patent disclosure is not new, it was rarely invoked as a key enabler in an allegation of invalidity. Promised utility was traditionally considered in respect of the claims or very explicit statements of utility in the disclosure. In contrast, the recent incarnation of the "promise of the patent" has become the threshold issue for analyzing utility and validity.

Under the mantra of "promise of the patent," the Courts have ventured beyond explicit promises to dissect the specification and elevate statements of benefit or advantage to become promises of utility. Each "promise" has become a battleground to test the validity of a patent.

In AstraZeneca Canada Inc. v Mylan Pharmaceuticals ULC, 2012 FCA 109, the Federal Court of Appeal heard Mylan's appeal from a decision granting a prohibition order with respect to the drug anastrozole (ARIMIDEX). There was no dispute that the claimed compound was useful. However, Mylan argued that the phrase "[i]t is a particular object of the present invention to provide ... fewer undesirable side effects" should be elevated to the status of a promise of utility. The Court of Appeal, in rejecting this argument, held that the phrase was merely aspirational such that its effect depended on its context and the rest of the patent. In this case, there was nothing else in the patent discussing side effects.

In Mylan Pharmaceuticals ULC v. Pfizer Canada Inc., 2012 FCA 103, the Federal Court of Appeal heard Mylan's appeal from a decision granting a prohibition order with respect to the drug donepezil (ARICEPT). The Court of Appeal held that the patent in suit did not contain any promise related to side effects or toxicity, notwithstanding that it was an object to develop a drug having "a persistent activity and a high safety." In particular, the Court of Appeal made it clear that just because a disclosure may refer to potential benefits or advantages over the prior art, such statements are not necessarily promises. In this regard, use of the specification of a patent in order to construe its promise "is not to serve as an invitation to a zealous lawyer to read a patent specification in such a way as to persuade a Court, one way or the other, as to what the promise is." Rather, the disclosure in the specification is to be understood from the viewpoint of a skilled person in the art or science to which the invention pertains, without resort to technicalities but rather for the purpose of seeking a construction of the claims which is reasonable and fair for both the patentee and the public.

In Fournier Pharma Inc. v. Canada (Health), 2012 FC 741, the Federal Court placed emphasis on the claims when construing any promise of a patent. In particular, the Court held that "promise of a patent" is nothing more than the utility the inventor claims for his invention. Statements found outside the claims should be presumed to be mere statements of advantage unless the inventor clearly and unequivocally states they are part of the promised utility. That is, the disclosure should not be examined microscopically to find additional promises that are outside the scope of the inventor's claimed monopoly.

In Bristol-Myers Squibb Canada Co. v. Mylan Pharmaceuticals ULC, 2012 FC 1142, the Court rejected Mylan's argument that the promise of the patent, based on the disclosure, was that the compound at issue potently inhibited all major resistant mutant HIV reverse transcriptase strains. In particular, the Court found that Mylan's reference to and reliance on "stray words" found in the disclosure were not appropriate. Because testing data for only certain mutant strains was disclosed, it was not appropriate to construe the claims as promising utility against other, untested strains.

In Eli Lilly Canada Inc. v Novopharm Limited, 2012 FCA 232, which affirmed Eli Lilly Canada Inc. v Novopharm Limited, 2011 FC 1288, the Court declined to uphold the validity of the patent in suit on the basis that, as of the Canadian filing date, the construed promise of the patent (namely, that the compound at issue met the promise that it would provide markedly superior clinical treatment with a better side-effects profile) was neither demonstrated to be useful, nor soundly predicted. The conclusion regarding demonstrated utility was made notwithstanding that Lilly had a number of studies, including studies in dogs, studies with volunteers, and preliminary clinical trial data, as the studies were not enough to demonstrate the promised utility as construed. Notwithstanding that there was a sufficient factual basis for the prediction, the Court concluded that utility was not soundly predicted, as an inference could not be drawn that the promised utility would be met.

4. Damages under Section 8 of the PM(NOC) Regulations

In 2012, the Federal Court released its first decisions related to quantification of damages under section 8 of the PM(NOC) Regulations. Section 8 provides that an innovator is liable to compensate a generic in damages in the event that the innovator's application for a prohibition order under the PM(NOC) Regulations is unsuccessful.

In Teva Canada Limited v. Sanofi-Aventis Canada Inc., 2012 FC 552, and Apotex Inc. v. Sanofi-Aventis Canada Inc., 2012 FC 553, both of which relate to the drug ramipril, the Court made a number of key findings related to section 8 proceedings.

First, the Court upheld the validity of section 8, and awarded damages based on the finding that an authorized generic and another generic would have entered the market. In another section 8 case (namely, Apotex v. AstraZeneca Canada, 2012 FC 559), the Court also upheld the validity of section 8. In determining damages, the Court stated that each case must be decided on its own facts: the Court rejected the submission of Sanofi-Aventis that a single "but for" conclusion should be drawn in respect of all generics.

With respect to the period of time that on which the quantification of section 8 damages is to be based, the Court found that the period cannot begin before the first day on which the statutory stay under the PM(NOC) Regulations begins.

In addition, the Court held that a generic may not claim "lost business value" beyond the date on which the generic receives its Notice of Compliance. In particular, future lost profits and duplicate ramp-up losses are not recoverable. This finding is consistent with the Court of Appeal's earlier decision in Apotex Inc. v. Merck & Co., 2009 FCA 187.

5. Gilead: Eligibility of Patents for the Patent Register 

In Gilead Sciences Canada, Inc. v. Canada (Minister of Health), 2012 FCA 254, the Court of Appeal maintained strict product specificity requirements for patentees who intend to list patents on the Patent Register for the purposes of the PM(NOC) Regulations.

Three ingredients were claimed in the patent at issue: two were specific to the drug (COMPLERA), and one was a general class (namely, an antiviral agent that could be a non-nucleoside reverse transcriptase inhibitor (NNRTI)). COMPLERA included rilpivirine, an NNRTI, as one of its ingredients.

The Court of Appeal held that the claims of a patent must specifically identify, by name or by chemical structure, the medicinal ingredients within a drug for that patent to be listed on the Patent Register. It is not enough that the medicinal ingredient, although not specifically identified, may still be covered by the claims, and therefore infringed by a generic. Accordingly, because rilpivirine was not specifically claimed, the patent at issue was held to be ineligible for listing on the Patent Register.

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 Mondaq.com.

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

Authors
Events from this Firm
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.

17 Dec 2016, Other, Ontario, Canada

Podcast summary

In the inaugural episode of Diversonomics, co-hosts Roberto Aburto and Sarah Willis introduce listeners to the podcast and discuss their experiences with diversity and inclusion in the legal industry. They also outline some of the obstacles the profession faces with respect to adopting new strategies and overhauling old practices.

22 Dec 2016, Other, Toronto, Canada

Podcast summary

For episode two of Diversonomics, co-hosts Roberto Aberto and Sarah Willis interview Mark Greenburgh, a partner in Gowling WLG's London office. They discuss the exciting new diversity and inclusion opportunities that have arisen since the combination of Gowlings and Wragge Lawrence Graham, as well at Gowling WLG UK's LGBT OpenHouse initiative.

 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
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
Password
Confirm Password
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (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 www.mondaq.com

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 Mondaq.com’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.

Disclaimer

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.

Registration

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 unsubscribe@mondaq.com 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.

Cookies

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.

Links

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.

Mail-A-Friend

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.

Security

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 webmaster@mondaq.com.

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 EditorialAdvisor@mondaq.com.

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 enquiries@mondaq.com.

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