On December 3, 2024, the Federal Court of Appeal (FCA) set aside the order of the Patented Medicine Prices Review Board (PMPRB or Board) that had required Galderma to continue to provide information to the PMPRB in relation to its 0.1% adapalene product DIFFERIN because of Galderma's Patent No. 2,478,237 (the 237 patent) claiming the use of 0.3% adapalene for the treatment of dermatological disorders: Galderma Canada Inc v Canada (Attorney General), 2024 FCA 208.
As the jurisdiction of the PMPRB only extends to an invention that "pertains to" a medicine, the question on appeal was whether the 237 patent relating to 0.3% adapalene "pertains to" a 0.1% adapalene product (DIFFERIN). The FCA effectively found that the 237 patent did not pertain to DIFFERIN; rather, DIFFERIN was an unpatented medicine.
In granting Galderma's appeal, the FCA provided a stark reminder of the PMPRB's role:
[the PMPRB] regulates the pricing of medicines under the market power given by a patent—namely, patented medicines. The Board does not regulate the pricing of unpatented medicines. After all, it's right in the Board's name: the Board is the "Patented Medicine Prices Review Board", not the "Patented and Unpatented Medicine Prices Review Board" or the "All Medicine Prices Review Board".
Background
Galderma markets two adapalene cream products: DIFFERIN (0.1% adapalene) and DIFFERIN XP (0.3% adapalene). In 2009, as the relevant patent expired, Galderma stopped providing information regarding DIFFERIN to the PMPRB. In 2016, PMPRB staff alleged that Galderma had failed to provide information regarding DIFFERIN for 2010-2016, pointing to the 237 patent. The Board concluded that the 237 patent pertained to DIFFERIN, noting "although 0.3% is mentioned in the abstract, it is not mentioned in the introductory paragraph or the title of the 237 patent and the patent does not, on its face, relate exclusively to a 0.3% concentration of adapalene."
Galderma was successful in its application for judicial review of the Board's decision. However, the FCA overturned that decision. The FCA determined that the invention of the 237 patent is the use of a 0.3% concentration of adapalene for the treatment of dermatological disorders. It remitted to the Board the question of whether the invention of the 237 patent pertained to DIFFERIN, directing the Board to ask whether the invention of the 237 patent "is intended or capable of being used for" DIFFERIN.
On redetermination, the Board concluded that the 237 patent is intended or capable of being used for DIFFERIN, and therefore "pertained to" DIFFERIN. In January 2024, the Federal Court upheld the Board's decision as reasonable.
FCA sets aside the Board's order as either incorrect or unreasonable: "the Board crashed through the constitutional, statutory and jurisprudential guardrails"
The FCA reasoned that:
The '237 Patent is a "use patent" that covers the use of the 0.3% concentration of adapalene, the active ingredient in Differin XP, not adapalene itself. As a matter of patent law, the Board cannot somehow stretch and pull that "use patent" to cover Differin, which uses a different concentration of adapalene (0.1%). The invention in the '237 Patent, the use of the 0.3% concentration of adapalene, cannot (in the words of subsection 79(2) [of the Patent Act]) be "intended or capable of being used" for Differin or for "the preparation or production" of Differin, because Differin does not embody that use at all.
The FCA further held that the 237 patent did not cover DIFFERIN or give Galderma market power over DIFFERIN, and DIFFERIN had been open to potential price competition since 2009, when the last patent pertaining to DIFFERIN expired. The fact that patients can often use DIFFERIN XP and DIFFERIN interchangeably does not mean the Board can regulate DIFFERIN, an unpatented medicine.
The FCA also warned that the Board "must temper its dedication and enthusiasm with a firm and unwavering obedience to legality and the rule of law. Like all administrative decision-makers, the Board must stay within the constraints imposed by the Constitution, its governing statute (the Patent Act, interpreted reasonably in the administrative law sense), and the jurisprudence under each."
The Attorney General would need leave from the Supreme Court of Canada to appeal.
Should you have any questions, please do not hesitate to contact a member of the Life Sciences Regulatory & Compliance Group or the Pharmaceutical Litigation Group.
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