Pharmacapsules @ Gowlings - July 7, 2011 - Volume 10, Number 4

Edited by Jennifer Wilkie and Isabel Raasch

RECENT CASES

Eli Lilly & Co. v. Teva Canada Ltd., 2011 FCA 220 (July 5, 2011) – dismissal of appeal of a decision in an impeachment action (atomoxetine)

The Court of Appeal upheld the trial judge's decision invalidating Lilly's patent for lack of utility.  The patent covered the use of the drug atomoxetine for the treatment of attention deficit hyperactivity disorder (ADHD).

Evans J.A., writing for the Court, identified the principal issue between the parties as  whether the "MGH" clinical trial conducted prior to the filing date of the patent was sufficient to demonstrate that the invention was useful within the meaning of section 2 of the Patent Act.  The Court characterized this as essentially a factual issue.

Lilly's argument that the trial judge had required the patent to meet an implied promise that atomoxetine would be useful "in the longer term" was rejected. The Court disagreed that this was an implied promise indicating that the trial judge was simply interpreting what "treatment" means in this patent in the context of ADHD, a chronic disorder requiring sustained treatment.

With respect to the quantum of utility required, the Court held that a low level or scintilla of utility would not suffice, since the patent had promised "that atomoxetine is a clinically effective treatment of ADHD".

The Court upheld the trial judge's  conclusion that this promise had not been demonstrated at the relevant date and  cautioned against trying to compare a factual situation in one patent case (i.e. where a small clinical study was sufficient to demonstrate utility) with another patent case.

On the issue of sound prediction, the Court upheld that trial judge's decision that Lilly could not rely on sound prediction because it had not disclosed the MGH study in the patent. Despite that the patent resulted from a PCT application (Patent Cooperation Treaty incorporated into domestic law by Rule 51 of the Patent Rules), the Court stated that Article 27(4) of the Treaty, which allows an applicant to insist that the requirements of the Treaty be applied for matters of form and contents, was not of assistance since this was a substantive requirement. The Court followed its 2009 decision in Eli Lilly Canada Inc. v. Apotex Inc., 2009 FCA 97 requiring disclosure in the patent itself.

The full text of the decision can be found at:

http://www.gowlings.com/knowledgeCentre/enewsletters/pharmacapsules/pdfs/A-387-10.pdf

Eli Lilly Canada Inc. v. Hospira Healthcare Corporation, 2011 FC 626, (May 27, 2011) - interlocutory order, motion to amend statement of claim (gemcitabine)

This is an appeal of an Order whereby Madam Prothonotary Tabib allowed Lilly to amend its Statement of Claim after the Statement of Defence had been served but prior to examinations for discovery.  Lilly had originally alleged infringement of its '881 Patent which covered a process known as the SN2 reaction.  Hospira countered by alleging that it used a process known as a SN1 reaction.  The proposed amendment included a claim that the '881 SN2 process was the only cost-effective commercial process, and added an infringement allegation for an additional patent which covered the SN1 process.

Lilly's proposed amendment followed the production of documents related to Hospira's supplier's manufacturing process.  Lilly had sought and obtained a further and better affidavit of documents, including (1) the open part of Hospira's Drug Master File; and (2) the relevant and unredacted parts of its ANDS filed with the Minister of Health which led to its obtaining the NOC; and (3) the master production batch records which would disclose the exact nature of the reaction Hospira's supplier (Hansen) used.  Lilly had also issued a subpoena in the U.S. for the deposition of the vice-president of supplier's North American sales and regulatory agent.

Hospira had argued before the Prothonotary that it was abusive for Lilly to have obtained the process documents it did based on an affirmation that the SN2 reaction was commercially viable and then to use these details to assert infringement of another patent. The Prothonotary did not agree.

Reviewing the Prothonotary's decision de novo, the Federal Court upheld the order allowing the amendments.  There was no withdrawal of an admission, it was early on in the case (there had not yet been oral discovery) and the new cause of action was not a radical departure because the issue of the process used in the imported product, be it the SN1 or SN2 reaction, was always on the table.

The full text of the decision can be found at:

http://decisions.fct-cf.gc.ca/en/2011/2011fc626/2011fc626.html

AstraZeneca Canada Inc. v. Apotex Inc., 2011 FC 505 (T-1668-10); aff'd 2011 FCA 211 (A-180-11) – motion for interlocutory injunction in patent case and appeal (esomeprazole) 

The Federal Court of Appeal has upheld a decision to deny an innovator pharmaceutical company's motion for an interlocutory injunction prior to the trial of an infringement action, scheduled to be heard in September 2013.  The Court of Appeal deferred to the lower court's findings of fact, and found no reviewable error.

The action involves five of AstraZeneca's patents.  Two of the patents had been involved in prior NOC applications: one was withdrawn on consent, the other was dismissed on June 16, 2010 on the basis that Apotex's allegations of invalidity were justified.  Apotex obtained their NOC the following day.  On July 13, 2010, Apotex confirmed its intention to launch its Apo-Esomeprazole product, and re-confirmed on July 26, 2010.  Apo-Esomeprazole was listed on the drug formularies in Quebec, Nova Scotia, and New Brunswick in February, 2011.  AstraZeneca brought their motion on March 11, 2011, four days after Apotex launched their product and announced it had commercial inventories available. 

In the end, the Court found that AstraZeneca could not show irreparable harm as their potential damages are likely to be quantifiable and recoverable.  Furthermore, the balance of convenience fell in favour of Apotex.

Justice Crampton made a few general observations relating to the tripartite test for an interlocutory injunction:

1. Serious issue to be tried: prior decisions in NOC proceedings where the allegations of invalidity were justified will not create a presumption of invalidity.  NOC proceedings are not res judicata of the issue in later actions.
2. Irreparable harm: An applicant for an interlocutory injunction is permitted to make a profit and still suffer irreparable harm.  The law does not require applicants to establish that they are likely to become unprofitable if the injunction they seek is not granted.
3. Balance of convenience: The balance of convenience is not automatically awarded to a generic who has succeeded in a prior NOC proceeding.  An innovator company may obtain an interlocutory injunction following a NOC proceeding where they satisfy the tripartite test.  This is not contrary to the spirit of the NOC Regulations.

The full text of the decisions can be found at:

motion - http://decisions.fct-cf.gc.ca/en/2011/2011fc505/2011fc505.html

appeal - http://decisions.fca-caf.gc.ca/en/2011/2011fca211/2011fca211.html

Epicept Corporation v. The Minister of Health, 2011 FCA 209 (June 22, 2011) – motion to dismiss appeal for mootness (histamine dihydrochloride)

The Court of Appeal allowed an intervener's motion dismissing for mootness Epicept's appeal of Justice Near, who affirmed a decision of the Minister of Health denying "innovative drug" status for Epicept's product CEPLENE histamine dihydrochloride.

CEPLENE is used for remission maintenance therapy in acute myeloid leukemia.  Epicept sought to have their product designated as an "innovative drug" pursuant to subsection C.08.004.1(1) of the Food and Drug Regulations, so that it would benefit from an eight year term of market exclusivity under the data protection provisions.  The Minister of Health denied their request, advising that the medicinal ingredient has been previously approved in several drugs and the definition of "innovative drug" contemplates that medicinal ingredients not previously approved in "any drug" are to be considered in the assessment of eligibility of data protection, and not just those drugs that receive a NOC.  Justice Near agreed with the Minister of Health on judicial review (2010 FC 956).

Before the appeal was heard, Epicept withdrew its new drug submission for CEPLENE.  The Canadian Generic Pharmaceutical Association, acting as an intervener, brought a motion to dismiss the appeal as moot.  The Court agreed, and declined to use its discretion to hear the appeal.  There was uncertainty that Epicept would re-file their new-drug submission and the Court did not want to make the decision on a hypothetical.

However, the Court of Appeal made it clear that by dismissing the appeal for mootness, they did not rule on whether Epicept would have been entitled to data protection, leaving that issue for another day.

The full text of the decision can be found at:

http://decisions.fca-caf.gc.ca/en/2011/2011fca209/2011fca209.html

UPCOMING TRIALS, JUDICIAL REVIEWS AND APPEALS OF INTEREST

OTHER EVENTS

Upcoming IP seminars on Gowlings U:

The full list of events and details can be found at http://www.gowlings.com/Events/

Past Issues of Pharmacapsules are available at: http://www.gowlings.com/KnowledgeCentre/newsletters.asp?id=25

OTHER NEWS ITEMS OF INTEREST TO THE PHARMA COMMUNITY

• Nova Scotia's "Fair Drug Pricing Act" Into Effect as of July 1, 2011 – July 5, 2011
• Canadian's Knowledge of Consumer Safety Issues Limited – July 4, 2011
• Canadians Face Long Wait to Access Latest Drugs – June 30, 2011
• How to Get Medical Devices to Market – June 27, 2011
• Rx&D Responds to PMPRB Annual Report – June 24, 2011

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.