Date: 20080620
Docket: T-2300-06
Citation: 2008 FC 782
Ottawa, Ontario, June 20,
2008
PRESENT: The Honourable Madam Justice Mactavish
BETWEEN:
SANOFI-AVENTIS
CANADA INC.
Applicant
and
PHARMASCIENCE INC. and
THE MINISTER OF HEALTH
Respondent
and
SCHERING CORPORATION
Respondent / Patentee
REASONS FOR JUDGMENT AND JUDGMENT
[1]
This proceeding under the Patented
Medicines (Notice of Compliance) Regulations, SOR/93-133 (“PM(NOC)
Regulations”) has proceeded in a somewhat unusual, two-stage fashion. Arguments
relating to issue estoppel and abuse of process advanced by both sides were
determined first. What remains in issue between the parties at this point are
the form of the order that should go disposing of Sanofi-Aventis’ application
for prohibition, as well as the determination of the issue of costs.
Background
[2]
Canadian patent No. 1,341,206 (the
“’206 patent”) is owned by Schering Corporation. Under licences from Schering,
Aventis Pharma Inc. and its successor, Sanofi-Aventis Canada Inc. manufacture a
drug containing a medicine called ramipril, which is an ACE inhibitor.
Ramipril is one of the compounds covered by the ’206 patent.
[3]
In a November 15, 2006 Notice of
Allegation, Pharmascience Inc. asserted that the ’206 patent was invalid on
several different grounds, including lack of sound prediction, lack of utility,
the claims being broader than the invention, and by operation of section 53(1)
of the Patent Act, R.S., 1985, c. P-4.
[4]
This was the second Notice of
Allegation that had been served by Pharmascience alleging the invalidity of the
‘206 patent. An earlier NOA was found by Justice Snider not to
have been justified: see Aventis Pharma Inc. v. Pharmascience Inc., 2005
FC 340 (“Aventis Pharma”), aff’d (2006 FCA 229), leave to appeal to the
Supreme Court of Canada denied ([2006] S.C.C.A. No. 362).
[5]
In response to Pharmascience’s
November 15, 2006, Notice of Allegation, Sanofi-Aventis Canada Inc. commenced
this application, seeking to prohibit the Minister of Health from issuing a
Notice of Compliance to Pharmascience in relation to ramipril until after the
expiry of the ’206 patent. In its Notice of Application, Sanofi-Aventis
also sought a declaration that Pharmascience’s November 15, 2006 Notice of
Allegation was “invalid”.
[6]
In its response to Sanofi-Aventis’
Notice of Application, Pharmascience asserted that it was an abuse of process
for Sanofi-Aventis to dispute Pharmascience’s allegation that the ’206 patent
was invalid for lack of sound prediction, in light of my decision in Aventis
Pharma Inc. v. Apotex Inc., 2005 FC 1283 (“Apotex”).
[7]
In Apotex, I found that
Schering did not have a sound basis for predicting the utility of the invention
claimed in the ’206 patent at the time that it applied for the patent. My
decision in Apotex was subsequently upheld by the Federal Court of
Appeal: see Aventis Pharma Inc. v. Apotex Inc., 2006 FCA 64. Leave to
appeal was refused by the Supreme Court in April of 2006: [2006] S.C.C.A.
136.
[8]
In an Order dated July 25, 2007,
Prothonotary Tabib found that Pharmascience’s and Sanofi-Aventis’ arguments
were interdependent, and that they had to be determined in advance of any
determination as to whether the allegations in Pharmascience’s NOA were
justified. As a consequence, she ordered that Sanofi-Aventis’ request for
a declaration that Pharmascience’s November 15, 2006 Notice of Allegation was
not a valid NOA, and Pharmascience’s argument that Sanofi-Aventis was estopped
from arguing the validity of the ’206 patent in this proceeding be determined
first. These issues have been referred to collectively in this proceeding as
“the First Issue”.
[9]
In Sanofi-Aventis Canada Inc.
v. Pharmascience Inc., 2007 FC 1057, I found that the reasoning of the
Federal Court of Appeal in Pharmascience Inc. v. Canada (Minister of Health)
et al., 2007 FCA 140 (“Abbott”) applied in this case. As a
consequence, I held that as Pharmascience’s allegations of invalidity asserted
in its first NOA had been finally determined, issue estoppel should operate to
preclude it from making further allegations of invalidity with respect to the ’206 patent, on different grounds. I also declined to exercise my discretion to
allow Pharmascience to proceed with its allegations of invalidity.
[10]
My decision was recently upheld by
the Federal Court of Appeal: see Pharmascience Inc. v. Sanofi-Aventis Canada
Inc., 2008 FCA 213.
[11]
In the order issued on November
27, 2007 with respect to the First Issue, I observed that other issues relating
to this application remained to be determined, stating that:
These issues
may include - but are limited to - whether a prohibition order should issue,
whether the application should be deemed to have been discontinued, the
implications of my decision in relation to section 8 of the PM(NOC)
Regulations, and who should bear the costs relating to the application
(apart from those associated with the resolution of the First Issue).
[12]
Based upon the parties’
submissions, it appears that what actually remains in issue at this point are
the form that the order disposing of Sanofi-Aventis’ application for
prohibition should take, and the determination of issues of costs.
What Form Should the Order Disposing of Sanofi-Aventis’
Application Take?
[13]
As I understand Pharmascience’s
argument, it says that as a result of the decision of the Federal Court of
Appeal in Sanofi-Aventis Canada Inc. v. Novopharm Ltd., 2007 FCA 163 (“Novopharm”),
“the validity of the ’206
patent is not a fact that can be put into
play by Sanofi-Aventis”. As a result, Pharmascience says, Sanofi-Aventis
cannot seek an order of prohibition, given that such relief is only available
in relation to a valid patent.
[14]
In Novopharm, the Federal
Court of Appeal held that it was an abuse of process for an innovator company
to assert the validity of a patent in a Notice of Application under the PM(NOC)
Regulations involving one generic, if the same allegation of invalidity had
already been found to be justified in an earlier PM(NOC) proceeding
involving a different generic.
[15]
Given that I found in Apotex that
the generic’s allegations of invalidity with respect to the ’206 patent were justified, Pharmascience says that there is no basis on which
prohibition can issue in favour of Sanofi-Aventis in this case.
[16]
This was essentially the argument
that was advanced by Pharmascience in relation to the First Issue. In this
regard, I found that Sanofi-Aventis’ allegation that Pharmascience is precluded
from making further allegations of invalidity in relation to the ’206 patent by
the doctrines of abuse of process, res judicata and/or issue estoppel
had to be determined before addressing Pharmascience’s contention that it was
an abuse of process for Sanofi-Aventis and Schering to argue the validity of
the ‘206 patent.
[17]
Having then found that
Pharmascience was estopped from relying on allegations of invalidity in
relation to the ’206 patent in its second Notice of Allegation, I concluded that
the question of the scope of Sanofi-Aventis’ ability to assert the validity of
the patent in its Notice of Application did not arise in this case.
[18]
In determining whether prohibition
should issue here, it is helpful to have regard to the wording of section 6 of
the PM(NOC) Regulations, which provides that:
|
6. (1) A first
person may, within 45 days after being served with a notice of allegation
under paragraph 5(3)(a), apply to a court for an order prohibiting the
Minister from issuing a notice of compliance until after the expiration of a
patent that is the subject of the notice of allegation.
(2) The court shall make an order pursuant to subsection
(1) in respect of a patent that is the subject of one or more allegations if
it finds that none of those allegations is justified.
|
6. (1) La
première personne peut, au plus tard quarante-cinq jours après avoir reçu
signification d’un avis d’allégation aux termes de l’alinéa 5(3)a),
demander au tribunal de rendre une ordonnance interdisant au ministre de
délivrer l’avis de conformité avant l’expiration du brevet en cause.
(2) Le tribunal rend une ordonnance en vertu du paragraphe (1) à
l’égard du brevet visé par une ou plusieurs allégations si elle conclut
qu’aucune des allégations n’est fondée.
|
[19]
Pharmascience acknowledges that
the sole substantive allegation raised by its November 15, 2006, Notice of
Allegation is its allegation that the ’206 patent is invalid. Given my earlier ruling that Pharmascience is estopped from asserting
the invalidity of the ’206
patent, it follows that there is no allegation contained in the November 15, 2006, Notice of Allegation that is justified.
[20]
As a consequence, based
upon subsection 6(2) of the Regulations, I am satisfied that an order should issue prohibiting the Minister from
issuing a notice of compliance to Pharmascience until after the expiration of
the ’206 patent.
Costs
[21]
In my order relating to the First
Issue, I awarded Sanofi-Aventis its costs associated with the determination of
the First Issue, including the cost of second counsel, to be assessed at the
upper end of Column 5 of Tariff B, as well as its reasonable disbursements. In
light of the limited role that Schering played in the proceeding, I awarded it
its costs at the upper of Column 3 of Tariff B.
[22]
What remains to be determined are
the costs to be awarded in relation to the balance of this application,
including those relating to the motion for summary dismissal brought by
Pharmascience. In dismissing that motion, Prothonotary Tabib ruled that the
costs of that motion should be in the cause.
[23]
Pharmascience says that it is
content to have Sanofi-Aventis and Schering receive their costs on the same
scales as were awarded in relation to the First Issue, subject to two caveats.
[24]
Firstly, Pharmascience says that
Sanofi-Aventis should not be entitled to reimbursement for the costs of its
expert witnesses, whose evidence was directed to the validity of the ’206 patent, given that Sanofi-Aventis was not in a position to assert the validity
of the patent.
[25]
Secondly Pharmascience says that
the motion for summary dismissal brought before Prothonotary Tabib was not
frivolous, and that this should affect the costs awarded in this regard.
[26]
Pharmascience also objects to
certain portions of the affidavit of Gunars Gaikis, filed in relation to the
issue of costs. Mr. Gaikis was lead counsel to Sanofi-Aventis throughout much
of this proceeding. According to Pharmascience, portions of Mr. Gaikis’
affidavit contain contentious statements relating to matters which are for the
Court to decide, which statements should be given little or no weight by the
Court.
[27]
Dealing first with Mr. Gaikis’
affidavit, I note that the affidavit does not deal with substantive matters
relating to this application, but is confined to the issue of costs. That
said, I am prepared to give little weight to those portions of Mr. Gaikis’
affidavit identified at paragraph 99 of Pharmascience’s memorandum of fact and
law.
[28]
Insofar as the costs of
Sanofi-Aventis’ four expert witnesses are concerned, I note that the affidavits
of these witnesses were sworn between April 5 and April 13, 2007. The Federal
Court of Appeal’s decision in Novopharm was not released until April 23, 2007.
[29]
As a result,
at the time that the affidavits were prepared, it was not yet clear whether it
was an abuse of process for an innovator
company to assert the validity of a patent in a Notice of Application under the
PM(NOC) Regulations involving one generic, if the same allegation of
invalidity had already been found to be justified in an earlier PM(NOC)
proceeding involving a different generic.
[30]
As the jurisprudence notes, in
awarding costs, the need for adducing the evidence of expert witnesses should
not be determined with the benefit of hindsight. Rather, the task for the
Court is to ascertain whether the party’s conduct in adducing the evidence in
question was reasonable at the time that the evidence was led: see, for
example, Rothmans, Benson & Hedges et al. v. Imperial Tobacco Ltd.
(1993), 50 C.P.R. (3d) 59 at 65.
[31]
In these circumstances, I am
satisfied that it was reasonable for Sanofi-Aventis to have filed expert
evidence relating to the issue of validity, when faced with an NOA from
Pharmascience alleging that the ’206 patent was invalid. As a
consequence, Sanofi-Aventis is entitled to the costs of its expert witnesses,
namely Professor Wuest and Drs. Nelson, Timmermans and Chong.
[32]
I am also satisfied that
Sanofi-Aventis and Schering should have their costs associated with
Pharmascience’s motion for summary dismissal, at the upper end of Column 5 of
Tariff B, in Sanofi-Aventis’ case, and the upper end of Column 3 of Tariff B in
the case of Schering, together with their reasonable disbursements. None of
these costs would have been incurred had Pharmascience not endeavoured to
re-litigate a battle that it had already fought and lost.
[33]
Finally, I do not understand
Pharmascience to take issue with Sanofi-Aventis’ entitlement to the costs of
second counsel. In any event, this was a matter of some complexity, and both
sides were represented by two counsel. In the circumstances, Sanofi-Aventis
should be entitled to the costs of second counsel.
JUDGMENT
THIS
COURT ORDERS AND ADJUDGES that:
1.
The application is
granted;
2.
The Minister of Health is
prohibited from issuing a Notice of Compliance to Pharmascience in respect of
its ramipril capsules 1.25 mg, 2.5 mg, 5 mg and 10 mg, until after the expiration
of Canadian patent No. 1,341,206;
3.
Sanofi-Aventis shall have its
costs of this application, as agreed by the parties or as assessed, at the
upper end of Column 5 of Tariff B, including the costs of second counsel, the
costs of the summary dismissal motion, the costs of the expert witnesses and
any other reasonable disbursements, but not including the costs already awarded
to Sanofi-Aventis in relation to the determination of the First Issue; and
4.
Schering shall have its costs of
this application, as agreed by the parties or as assessed at the upper of
Column 3 of Tariff B, together with its reasonable disbursements, but not
including the costs already awarded to Schering in relation to the
determination of the First Issue.
“Anne
Mactavish”
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