ARTICLE
1 December 2023

Federal Court Of Appeal Dismisses Appeal Relating To Minister Of Health's Decision To Disclose Records Pursuant To Access To Information Act Request

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On November 1, 2023, the Federal Court of Appeal (FCA) dismissed Actial's appeal from an application for judicial review of the Minister of Health's decision to disclose records pursuant to a request under the Access to Information Act.
Canada Food, Drugs, Healthcare, Life Sciences

On November 1, 2023, the Federal Court of Appeal (FCA) dismissed Actial's appeal from an application for judicial review of the Minister of Health's decision to disclose records pursuant to a request under the Access to Information Act (Act): Actial Farmaceutica SRL v Canada (Health), 2023 FCA 216, aff'g 2022 FC 971.

The records at issue related to two probiotic products marketed under the brand name VSL#3 for which Ferring Inc (Ferring) obtained natural health product licences in 2012 and 2013 (Licences). Ferring marketed VSL#3 in Canada prior to transferring one of the Licences to Actial (the parent company of Ferring's supplier) in 2019.

The Minister's decision to disclose records and subsequent licence transfer from Ferring to Actial

VSL#3 was the subject of complaints to Health Canada in May 2017 and February 2018 as well as an investigation by Health Canada in or around the same time.

In November 2018, a request under the Act was made to the Minister for "any information pertaining to a recall, stop sale or any compliance and enforcement related activities" involving VSL#3 from January 1, 2018 to the date of the request. Health Canada's Access to Information and Privacy (ATIP) Division notified Ferring of the request in October 2019.

At this time, the ATIP Division gave Ferring an opportunity to make written submissions on the application of subsection 20(1) of the Act. This provision requires (in part) that, "the head of a government institution shall refuse to disclose any record requested under this Part that contains

(a) trade secrets of a third party;

(b) financial, commercial, scientific or technical information that is confidential information supplied to a government institution by a third party and is treated consistently in a confidential manner by the third party;

...

(c) information the disclosure of which could reasonably be expected to result in material financial loss or gain to, or could reasonably be expected to prejudice the competitive position of, a third party; or

(d) information the disclosure of which could reasonably be expected to interfere with contractual or other negotiations of a third party."

After further correspondence with Ferring (including in relation to redactions), the ATIP Division provided notice of its decision to Ferring in December 2019. The ATIP Division also provided 140 pages of records to be disclosed; most (but not all) of the redactions sought by Ferring were applied to these records.

In December 2019, Actial submitted a licence transfer notification to Health Canada's Natural and Non-Prescription Health Products Directorate (NNHPD) in respect of the Licences. The NNHPD confirmed in February 2020 that ownership of one of the Licences had been transferred from Ferring to Actial but ownership of the other Licence had not (as this second product was "inactive").

The Federal Court dismisses Actial's application for judicial review of the Minister's decision

On January 3, 2020 (before the NNHPD confirmed transfer of one of the Licences from Ferring to Actial), Actial commenced an application for judicial review of the Minister's decision. Actial sought to prevent the disclosure of information contained in two of the documents included in the records to be disclosed (Disputed Information).

On June 29, 2022, the Federal Court dismissed Actial's application. Justice Fothergill found that Actial lacked standing and that, in any event, Actial had not met its burden of demonstrating that the Disputed Information should be exempt from disclosure:

  • Standing: Subsection 44(1) of the Act provides (in part) that a "third party" to whom the head of a government institution is required to give notice of a decision to disclose records may apply to the Federal Court for review of the matter:

44 (1) Any third party to whom the head of a government institution is required under paragraph 28(1)(b) to give notice of a decision to disclose a record or a part of a record under this Part may, within 20 days after the notice is given, apply to the Court for a review of the matter.

The Court found that Actial was not a "third party" pursuant to subsection 44(1) of the Act. Rather, Health Canada had reasonably identified Ferring as the appropriate third party – Ferring was the licence-holder with the statutory responsibility to respond to Health Canada's investigation (i.e., the focus of the November 2018 request for disclosure of records). The Court noted further that Health Canada was not made aware of the licence transfer between Ferring and Actial until December 23, 2019. Nor had Actial demonstrated that Ferring had transferred the right to commence legal proceedings under subsection 44(1) of the Act.

  • Whether the Disputed Information should be exempt from disclosure: The Court noted first that applications under section 44 of the Act require it to independently determine whether the exemptions from disclosure in section 20 of the Act are applicable. The Court determined that Actial had not established that the Disputed Information would reveal trade secrets or harm a third party's commercial interests if disclosed. The Minister's evidence instead identified several instances in which the Disputed Information was already in the public domain. Actial's claims that "strain characteristics" and "manufacturing procedures" were closely guarded trade secrets were insufficient to ground an exemption from disclosure.

Actial had moreover not provided (i) evidence to demonstrate how the Disputed Information would facilitate copying by a competitor, or (ii) evidence to establish a reasonable expectation that the information Ferring provided to Health Canada for oversight purposes would always remain confidential.

The FCA dismissed Actial's appeal

Actial appealed the Federal Court's determinations of standing and whether the Disputed Information should be exempt from disclosure.

The parties agreed that palpable and overriding error was the applicable standard of review for the question of exemption from disclosure. On this issue, the FCA found no reviewable error in the Federal Court's reasons. In view of its conclusion on exemption from disclosure, the FCA dismissed the appeal without considering the issue of standing.

Actial would need leave from the Supreme Court of Canada to appeal the FCA's decision.

Should you have any questions, please do not hesitate to contact a member of the Pharmaceutical Litigation Group.

The preceding is intended as a timely update on Canadian intellectual property and life sciences regulatorylaw. The content is informational only and does not constitute legal or professional advice. To obtain such advice, please communicate with our offices directly.

The preceding is intended as a timely update on Canadian intellectual property and technology law. The content is informational only and does not constitute legal or professional advice. To obtain such advice, please communicate with our offices directly.

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