Canada: Pharmacapsules - October 2004

Last Updated: November 3 2004

Edited by Adrienne Blanchard and Jennifer Wilkie


  • Draft Regulations On Bill C-9 Published
  • Generic Can Come To Market Without Sending New Notice Of Allegation
  • Generic Need Not Address Patents When Added To Register After Drug Ceased Marketing In Canada
  • Report On Smart Regulation Is Released
  • Competition Tribunal Denies Hearing Of Complaint By Ontario Pharmacies
  • FDA Issues Report On Regulation Of Pharmaceutical Manufacturing
  • European Commission Asks Pharmaceutical Industry For Priorities On Policy
  • Australian Group Seeks "Interpretive Declaration" On Trade Pact With U.S.

Draft Regulations On Bill C-9 Published

Draft regulations to implement Bill C-9, An Act to Amend the Patent Act and the Food and Drugs Act (The Jean Chretien Pledge to Africa) primarily aimed at facilitating access to pharmaceuticals from Canada for export to developing and least developed countries were published in the Canada Gazette for comment on Saturday, October 2, 2004. There will be a 75-day comment period.

For text of proposed Regulations please see:

Generic Can Come To Market Without Sending New Notice Of Allegation

In a recent ruling, the Federal Court held that the Minister of Health could rely on a consent Order from an earlier dispute that dealt with the same parties, drug and patents, and not require a generic manufacturer under the Patented Medicines (Notice of Compliance) Regulations to send a new notice of allegation, when the generic company filed a revised drug formulation. Under the consent Order, the generic manufacturer undertook not to sell capsules that would fall within the scope of the patents.

The Court held that the Minister was not required to assess whether the formulation was materially different from the earlier formulation, and was allowed to rely on the generic manufacturer's representation that the new formulation was not materially different from the previous formulation. The court held that if that representation was misleading, the generic manufacturer will be subject to grave consequences in an infringement proceeding.

For more information, please see the full text of the decision at:

Generic Need Not Address Patents When Added To Register After Drug Ceased Marketing In Canada

In a proceeding involving the Patented Medicines (Notice of Compliance) Regulations, the Federal Court has held that a generic manufacturer is not required to send a notice of allegation in respect of patents added to the Patent Register after marketing of the particular formulation had ceased.

The innovator had replaced its capsule formulation with a tablet formulation. The generic manufacturer sought to market the capsule formulation. Health Canada requested information from the innovator to establish whether the capsules were being marketed in Canada. The innovator was able to show the sale of 15 units across Canada over a 4½-year period. This was deemed insufficient to establish "marketing." Thus, the Therapeutic Products Directorate did not require the generic manufacturer to address those patents added to the Patent Register after marketing ceased. The Federal Court upheld the decision.

For more information, please see the full text of the decision at:

Report On Smart Regulation Is Released

On September 23, 2004, the External Advisory Committee on Smart Regulation (EACSR) released its report "Smart Regulation: A Regulatory Strategy for Canada."

The report came after 15 months of extensive research and consultation, and recommends substantial changes aimed at improving effectiveness, responsiveness, cost-efficiency, transparency and accountability of the regulatory system.

In respect of manufacturing and product approvals, the recommendations state: "With regard to the drug approval process, the government should review Canada's international cooperation framework for the regulation of therapeutics to achieve a level of performance reflecting international best practices. In the short term, the government should implement measures that permit the use of data produced and reviews performed in other jurisdictions when appropriate."

In respect of biotechnology and life sciences, the report states, "The federal government should develop and implement a comprehensive biotechnology regulatory strategy to provide a more coherent government-wide approach, ensure strategic leadership and report on progress. The government should address legislative gaps and review relevant legislation regularly to ensure that it remains appropriate. Building on Canada's leadership internationally in the regulation of food biotechnology, the government should identify areas where Canada would benefit from taking on a leadership role. Finally, the federal government should implement a new approach to engage all stakeholders on public policy issues with respect to biotechnology. This should include the sharing of information on current scientific evidence and risk management analysis."

The full report is available at:

For more information on this initiative, please contact Ron Doering, member of Gowlings' Government Relations and Regulatory Affairs Group and former President of the Canadian Food Inspection Agency.

Competition Tribunal Denies Hearing Of Complaint By Ontario Pharmacies

Canada's Competition Tribunal has refused to entertain a complaint from four Ontario pharmacies who claim that they have been wrongly targeted by drug companies for allegedly selling drugs over the Internet to Americans. The drug companies claim that their actions will protect the Canadian drug supply. The federal Competition Tribunal held that the four pharmacies could not substantiate a loss of profit that was directly attributed to the decision of the drug companies. Judge Blais wrote in one decision, "The evidence must be direct, not speculative."

A spokesperson for one innovator commented that the Tribunal's decision supports the drug company's decision to protect the Canadian drug supply and that the innovator has no interest in hurting pharmacies that only serve Canadians. The spokesperson stated, "We feel that our actions that we've taken are appropriate and consistent with our objectives of protecting the integrity of the pharmaceutical supply system in Canada."

For more information, please see:

FDA Issues Report On Regulation Of Pharmaceutical Manufacturing

The U.S. Food and Drug Administration (FDA) has issued a final report outlining its accomplishments and future plans in its Pharmaceutical Manufacturing Initiative, two years after the Initiative's launch. Assessments were conducted of the current good manufacturing practice (CGMP) regulations, current practices and new tools in manufacturing science. Some specific steps to be taken by the FDA include the issuance of a draft guidance on the role of quality systems in the pharmaceutical CGMP regulations, as well as seeking membership in the Pharmaceutical Inspection Cooperation Scheme, a cooperative agreement among national health regulatory authorities.

For more information, please see:

European Commission Asks Pharmaceutical Industry For Priorities On Policy

The three main pharmaceutical industry associations in the European Union: the AESGP, the EGA and the EFPIA, have been asked to identify the policy areas that the new European Commission should concentrate on over the next five years. The request was made informally by the Commission to help prepare the ground for the incoming industry and enterprise Commissioner, Günter Verheugen, who takes office along with the other new Commissioners on November 1. Issues likely to be tabled include: the use of trade names after OTC switches and free pricing for non-reimbursed products; the implementation of the new EU legislation, including the "Bolar" clause allowing generic development work before patent expiry; speeding-up access to innovator medicines in Europe; the improvement of the science base and the push for increased liberalization to allow market forces to play.

Source: SCRIP Daily News Alert, September 28, 2004, PJB Publications Ltd.

Australian Group Seeks "Interpretive Declaration" On Trade Pact With U.S.

A coalition of Australian medical, legal and health organizations is demanding that "additional safeguards" be attached to the U.S.-Australia Free Trade Agreement prior to the exchange of final letters signifying the start of the agreement. The group is concerned that the Agreement will allow U.S. drug companies to challenge Australia's drug price control legislation, known as the Pharmaceutical Benefits Scheme (PBS). One concern is that the Agreement will permit U.S. drug companies to appeal a decision of the Pharmaceutical Benefits Advisory Committee to refuse to list their products on the PBS. The Australian parliament has already added controversial amendments to its legislation implementing the U.S.-Australian Free Trade Agreement. The amendments alter Australian patent law to allow U.S. companies to be penalized if the courts conclude that the companies have filed false or misleading certificates aimed at extended drug patents. The amendments impose a maximum penalty of 10 million Australian dollars for contravention. The Pharmaceutical Research and Manufacturers of America (PhRMA) has concluded that the amendments likely do not undermine the Agreement, but that they do violate Australia's obligations under the WTO TRIPS Agreement.

For more information, please see:
World Trade Online, "PHRMA Memo Concludes Australian FTA Amendments Violate TRIPS," September 24, 2004.,5744,10891102%255E23289,00.html

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