On December 10, 2019, Canada, Mexico, and the United States formally agreed to amend the successor to NAFTA, officially known as CUSMA (short for the Canada-U.S.-Mexico Agreement) in Canada but popularly referred to as USMCA following the American acronym. Our firm's comprehensive review of the amendments can be found here. This blog focuses on changes affecting biologic drugs and patents.
CUSMA was first published in an agreed form on October 1, 2018. The version released on December 10, 2019 removes a number of key biologic drug and patent-related provisions that were agreed to in principle last year, as we wrote about here. As a result, under this revised USMCA, Canada will not be required to change its domestic patent or pharmaceutical IP regimes.
There are three key amendments:
- Removal of 10-Year Data Protection for Biologic Drugs: In the original agreement, Canada was required to extend the period of data protection for new biologic drugs from eight to ten years, meaning that a biosimilar could not be approved for ten years following the approval of an innovative biologic drug. This two-year extension of data protection for biologics has been removed from the revised regime. Canada's existing Food and Drug Regulations already provide for eight years' data protection for innovative drugs, as required by TRIPS and NAFTA.1
- Removal of Patent Term Restoration for Patent Prosecution Delays: In the original agreement, Canada was required to extend patent term restoration for unreasonable delays in the prosecution and issuance of any patent. This patent term restoration amendment has now been removed. Notwithstanding the removal of this obligation, Canada was obligated to provide patent term restoration by the Comprehensive Economic and Trade Agreement ("CETA"), a free-trade agreement between Canada and the European Union, in respect of regulatory delays in receiving Health Canada's marketing approval. This obligation was ratified by with the enactment of Canada's certificates of supplementary protection regime, as we wrote about here and here.
- Removal of Obligation to Provide Patents for New Uses, New Methods, and New Processes: The amendments also remove a provision explicitly requiring that patents be made available for new uses, new methods or new processes of using a known product. While this provision has been removed, new uses for known compounds have long been patentable in Canada.2
Canada will not be required to amend its existing IP legislation to ratify these provisions of CUSMA.
While the final text and terms of the amendments have not yet been released, both the Government of Canada and the United States House of Representatives Committee on Ways & Means have posted summaries of the outcomes.
1 Food and Drug Regulations, C.R.C., c. 870, s. C.08.004.1. See para. 3 of Art. 39 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (also known as TRIPS); Art. 1711 of the North American Free Trade Agreement.
2 Shell Oil Co. v. Commissioner of Patents,  2 S.C.R. 536.
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