The Court of Appeal dismissed Bristol-Myers Squibb's appeal
from the Trial Judge's decision refusing its application for a
writ of prohibition on the basis that Teva's allegation of
invalidity for obviousness was justified. The underlying proceeding
related to two patents and an order of prohibition was granted in
respect of the '840 Patent, but not the '736 Patent (see 2016 FC 580,
our summary here). This appeal concerned only the '736
Patent, which covered a salt of atazanavir.
The Trial Judge had found that the allegation of obviousness was
justified since it was more or less self-evident to a person
skilled in the art that improving the solubility of atazanavir
ought to improve its bioavailability. On appeal, Bristol-Myers
Squibb argued that the Trial Judge had failed to properly apply the
"obvious to try" test as set out by the Supreme Court in
Apotex Inc. v. Sanofi-Synthelabo Canada
Inc., 2008 SCC 61 ("Plavix").
The Court of Appeal came to the same conclusion as the Trial
Judge but for different reasons. After a thorough review of
Plavix as it related to obviousness, the Court of Appeal
found that Bristol-Myers Squibb's categorical approach to
obviousness was inappropriate. Bristol-Myers Squibb had submitted
that obviousness cannot be shown unless all the elements of the
inventive concept can be predicted with a high degree of certainty.
The Court of Appeal disagreed, noting that not every case requires
recourse to the "obvious to try" test and not every
recourse to the "obvious to try" test must follow in the
furrow of the preceding application of that test.
With respect to the Trial Judge's findings, the Court found
that she had erred in the identification of the inventive concept,
which focused on the properties of atazanavir bisulfate. The Court
of Appeal found that the inventive concept in this case was
atazanavir bisulfate, a salt of atazanavir which is
pharmaceutically acceptable because it has equal or better
bioavailability than the atazanavir free base. Having correctly
identified the inventive concept, the Court of Appeal concluded
that there was no difference between the prior art and the
inventive concept or the solution taught by the patent. Therefore,
Teva's allegation of obviousness was justified according to
step 3 of the obviousness framework, and it was not necessary to
apply the "obvious to try" test. The Court of Appeal
noted that Teva's allegation that the '736 Patent was
obvious would have still been justified under the "obvious to
Court of Appeal Grants Appeal as it Relates to Duty to
In this decision, the Court of Appeal was considering an appeal
by Apotex of various findings of the Court relating to its action
seeking damages from Her Majesty the Queen, as representative of
the Minister of Health (see 2014 FC 1087,
our summary here). Apotex asserted, among other allegations,
that the Health Protection Branch committed misfeasance in a public
office and acted negligently, as well as breach of a settlement
agreement. The Court found that Health Canada was liable on the
basis of the tort of misfeasance in a public office and negligence.
The Court lowered Apotex's damages on the basis that Apotex
failed to mitigate its damages. The allegation of breach of the
agreement was dismissed. Apotex appealed on several grounds and
Health Canada cross-appealed.
The Court of Appeal reversed only in respect of the Court's
finding that Apotex's damages should be reduced for failure to
The Court of Appeal provided a lengthy summary of the
Court's decision. With respect to the duty to mitigate, the
Court of Appeal noted that Apotex made a number of arguments in
this regard. However, the Court of Appeal considered only whether
the Court erred by "requiring Apotex to accede to the use of a
Canadian reference product in order to mitigate its loss." The
Court of Appeal indicated that it was necessary for the Court to
consider whether Apotex acted reasonably in its course of action,
and not determine that there is only one reasonable course of
action, which was not followed by Apotex. Upon reviewing
Apotex's actual course of conduct, the Court of Appeal found
that Apotex took a number of steps, including repeated interactions
with Health Canada, to address the issue. Further, the Court of
Appeal noted that the Court failed to recognize that Apotex's
position related to its strategic and economic interests beyond a
single drug submission.
The Court of Appeal varied the judgment to remove the finding
that Apotex failed to mitigate its loss. As the case was
bifurcated, the damages portion was to proceed on this basis. The
Court of Appeal found that each party should bear its own
Materials from a recent "refresher training" for examiners at the Canadian Intellectual Property Office (CIPO) highlight inconsistencies between CIPO's examination practices and Supreme Court precedent.
In this recently reported decision, the Court granted Apotex leave to deliver Fresh as Amended Responding Statement of Issues for the reference into AstraZeneca's damages or Apotex's profits, following the Court's decision that the ‘693 Patent is valid and infringed by Apotex.
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