The relevance of expert evidence in establishing indirect
infringement of a pharmaceutical in Canada has been questioned. It
is unclear what "facts" a product monograph is to contain
that will amount to "instructions" to infringe a patent
or how a party is to prove that such "facts" amount to
"instructions" or how those "instructions"
would be understood. What is clear is that "speculation"
will not suffice.
On March 26, 2015, the Federal Court released its decision in
Bayer Inc. v. Pharmaceutical Partners of Canada Inc., 2015 FC 388, granting PPC's motion to
strike portions of an application brought by Bayer under the
PM(NOC) Regulations. PPC is seeking regulatory approval
for a generic version of Bayer's antibiotic AVELOX®
(moxifloxacin hydrochloride intravenous solution for injection). In
this proceeding under the PM(NOC) Regulations, Bayer asserts
Canadian Patent No. 2,378,424 (the '424 Patent), which claims a
formulation of moxifloxacin hydrochloride and sodium chloride. PPC
alleges non-infringement. Bayer delivered two expert reports in the
main proceeding and relied on their evidence to support an argument
for indirect infringement (i.e., inducement) based on PPC's
Relying only on this evidence, PPC brought and won a summary
dismissal motion under ss. 6(5) of the Regulations.
Prothonotary Lafrenière heard the motion and explains in his
reasons that dismissal pursuant to ss. 6(5)(b) is an extraordinary
remedy that is only granted if the application is "clearly
futile" or it is "plain and obvious" that it has no
chance of success. Such was his finding on this motion.
Relying on the Federal Court of Appeal's decision in
Weatherford v. Corlac, 2011 FCA 228, Prothonotary Lafrenière
explains the three part test for inducement:
First, the act of infringement must have been completed by the
direct infringer. Second, the completion of the acts of
infringement must be influenced by the acts of the alleged inducer
to the point that, without the influence, direct infringement would
not take place. Third, the influence must knowingly be exercised by
the inducer, that is, the inducer knows that this influence will
result in the completion of the act of infringement.
The Court found that Bayer had no reasonable chance of success
on the second prong of the test, namely, that PPC would influence
the direct infringer. The Court held that there was no evidence
that PPC would exercise influence that would result in the
completion of an act of direct infringement of the patent in issue.
As such, Prothonotary Lafrenière held that Bayer had no
reasonable chance of success on an integral requirement for the
test for inducement:
It should be recalled that PPC is seeking a Notice of Compliance
to permit it to market and sell its own non-infringing product. PPC
has not yet marketed its product. There is no evidence, other than
speculation, that PPC will be seeking to sell its product in
combination with sodium chloride. Moreover, there is no evidence of
any overt attempt by PPC to influence or encourage others to
infringe the 424 Patent.
[...] As the test for inducement is conjunctive, and Bayer has
not adduced any evidence that can arguably satisfy all three prongs
of the test for inducement, I conclude that the prohibition
application as it relates to the 424 Patent will inevitably
Bayer has since appealed Prothonotary Lafrenière's
order. The appeal is scheduled to be heard on May 5, 2015. It seems
as though PPC is seeking health regulatory approval for a generic
submission that includes a product monograph that contains a
statement that the product can be used in a way that would infringe
the patent in issue. In past Federal Court decisions, this has been
sufficient to establish indirect infringement (see for example,
Abbott Laboratories Limited. v. Novopharm, 2006 FC 1411). The appeal may bring more
A recent Saskatchewan Court of Queen's Bench decision allowed a court-appointed receiver to sell and transfer intellectual property rights free and clear of encumbrances, finding that a license to use improvements of an invention was a contractual interest and not a property interest.
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