Canada: Experimental Use Exception To Patent Infringement In Canada

Last Updated: November 2 2005

Article by Sheldon Burshtein, ©2005 Blake, Cassels & Graydon LLP

This article was originally published in Blakes Bulletin on Intellectual Property, October 2005.

Significant research and development is conducted in Canada, especially in the biotechnology and pharmaceutical industries. Therefore, there has been much interest in a recent United States decision on experimental activity in the context of potential liability for patent infringement and the corresponding position in Canada.

United States Decision

In a much anticipated decision, the United States Supreme Court held that the use of a patented compound in preclinical studies is exempt from patent infringement where there is a reasonable basis for believing that the compound could be the subject of a regulatory filing to the United States Food and Drug Administration (USFDA) or where the experiment may produce information for use in a USFDA submission: Merck v. Integra Lifesciences. Merck funded research by the Scripps Research Institute on potential anti-cancer drugs, some of the most promising of which made use of a peptide sequence that Merck supplied but which had been patented by Integra. Tests identified one of these drugs as a useful anti-cancer medicine that appeared to be worth testing on humans. When Merck sought approval from the USFDA, Integra sued Merck and the researchers for patent infringement.

Under United States law, any person who makes, uses or sells a patented product without authorization is ordinarily liable for infringement, but it is not infringement to make or use a patented invention "solely for uses reasonably related to the development and submission of information under a federal law which regulates the manufacture, use or sale of drugs or veterinary biological products". A person who conducts research on new drugs must provide experimental data to the USFDA to obtain approval to perform clinical tests of the drug on humans. If such clinical tests are successful, approval must then be sought from the USFDA to make and market the drug in the United States.

The United States Supreme Court held that use of a patented compound in research does not constitute patent infringement, at least where the researcher has a reasonable basis for believing that the compound may work, through a particular biological process, to produce a particular physiological effect, and uses the compound in research that, if successful, would be appropriate to include in a submission to the USFDA. The exempt activity need not be related to safety, but may also be directed to other areas of inquiry, such as efficacy, toxicology or pharmacological, pharmacokinetic or biological properties. The activity may be exempt even if the results of the research are never included in a USFDA submission. The ruling creates a fact-based standard that requires courts to determine whether a person reasonably believes that its research is relevant to seeking USFDA approval. The Court remanded the case for a determination of whether the research in this case satisfied the legal standard.

However, the Court said that the exemption does not apply to all experimental activity. Specifically, the Court held that basic research on a compound, performed without a particular reasonable belief that the compound will cause a particular physiological effect that the research is meant to induce, is not necessarily related to the development and submission of information to the USFDA. The Court expressly declined to express a view as to whether the exemption applies to the use of patented research tools in the development of information for the regulatory process.

Canadian Position

In 1993, the Canadian Patent Act (the Act) was amended to include a statutory exemption from infringement which is almost identical to that of the United States law. The Act provides that it is not infringement to make, use or sell a patented invention "solely for uses reasonably related to the development and submission of information required under the law of Canada, a province or a country other than Canada that regulates the manufacture, construction, use or sale of any product". The wording "solely for uses reasonably related to the development and submission of information under ... law" is identical to that in the United States legislation, so the holding and other comments in the Merck decision may be equally applicable in Canada. It is worth noting that, unlike the United States exemption, the Canadian exemption is not limited to drugs and is also available for research in Canada for a submission to a foreign regulatory agency, such as the USFDA.

The Canadian provision goes on to say that the statutory exemption does not affect any exception to a patent right that exists at law in respect of acts done: (i) privately and on a non-commercial scale; (ii) for a non-commercial purpose; or (iii) in respect of any use, manufacture or sale of the patented invention solely for the purpose of experiments that relate to the subject matter of the patent. This merely codifies the pre-existing judicial exception for experimental use.

The leading decision on the judicial exemption is that of the Supreme Court of Canada in Micro Chemicals v. Smith Kline & French Inter-American Corp. Micro Chemicals arose in the context of an application for a compulsory licence under a drug patent. Prior to the grant of the license, Micro made a small amount of the drug to enable it to state in its compulsory license application that it had made, and was capable of making, the product by the patented process, as was then required by the Act. Then, Micro made several batches of the product to explore the procedure and conditions of manufacture, to get increased yields, and to establish that it could produce the product economically.

The Supreme Court of Canada held that, in this activity, Micro’s activities during both of these periods were within the judicial experimental use exception. Even though Micro’s experiments were carried out, not for the purpose of improving the process, but to enable Micro to produce the patented substance commercially as soon as the compulsory license could be obtained, they did not constitute infringement. The use Micro made of the patented substance was not for profit, but to establish that it could manufacture a quality product in accordance with the specification. Such experimentation and preparation is not an infringement.

The Supreme Court focused on the fact that, in this activity, Micro was not making the patented substance for commercial production and sale, but rather was acting prudently to establish whether it could manufacture a quality product in accordance with the specification of the patent. Consequently, it appears that, to qualify under the common law experimental use doctrine in Canada, it is the purpose for which the experimental use is conducted that is determinative. Micro’s subsequent commercial activities conducted prior to settlement of the terms of the license were not exempt.

In more recent decisions, it has been held that, where use of the invention does not proceed beyond the experimental and testing phrase, the activity is not an infringing use. Until a person, at some stage of its product development, decides to finalize a particular product and takes steps to manufacture, promote and sell it, use of a patented invention does not constitute patent infringement.

Therefore, in Canada, neither the use of a patented product or process to obtain information to be used for a regulatory approval process, nor the use, manufacture or sale of a patented product or process solely for the purpose of experimental or testing activity prior to finalization of a commercial product for manufacture, promotion or sale is an infringing use. The Canadian exemption appears to extend to basic research.

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
27 Oct 2016, Seminar, Toronto, Canada

Please join members of the Blakes Commercial Real Estate group as they discuss five key provisions of a commercial real estate purchase agreement that are often the subject of much negotiation but are sometimes misunderstood.

1 Nov 2016, Seminar, Toronto, Canada

What is the emotional culture of your organization?

Every organization and workplace has an emotional culture that can have an impact on everything from employee performance to customer or client satisfaction.

3 Nov 2016, Seminar, Toronto, Canada

Join leading lawyers from the Blakes Pensions, Benefits & Executive Compensation group as they discuss recent updates and legal developments in pension and employee benefits law as well as strategies to identify and minimize common risks.

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.