Date:
20130430
Docket:
T-586-12
Citation:
2013 FC 448
Ottawa, Ontario,
April 30, 2013
PRESENT: The
Honourable Mr. Justice Zinn
BETWEEN:
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TEVA CANADA INNOVATION
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Applicant
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and
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ATTORNEY GENERAL OF CANADA
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Respondent
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REASONS FOR
JUDGMENT AND JUDGMENT
[1]
Teva
Canada Innovation (Teva) asks the Court to set aside a decision of the Patented
Medicine Prices Review Board (the Board) dated February 23, 2012, wherein the
Board ordered that Teva pay Her Majesty in Right of Canada the sum of
$2,801,285 for having sold its Copaxone Syringe in the Canadian market at an
“excessive price” between 2004 and 2010, contrary to section 83 of the Patent
Act, RSC, 1985, c P-4.
[2]
This
is the second time that Teva has challenged a decision of the Board regarding a
finding of excessive pricing of the Copaxone Syringe. Teva was previously
successful before Justice Hughes in quashing a decision of the Board and having
it referred back for redetermination in Teva Neuroscience GP-SENC v Canada (Attorney General), 2009 FC 1155. The decision currently under review was
rendered by the Board as a result of that redetermination. For the reasons
that follow, I find that this decision suffers from much the same problem as
was found by Justice Hughes in the first decision, and accordingly, it too must
be set aside.
Background
[3]
Copaxone
is a medicine Teva markets for use in the treatment of multiple sclerosis.
[4]
Teva
first introduced Copaxone in the Canadian market in 1997. At that time,
Copaxone was sold in a vial format (Copaxone Vial) at $36.00 per daily dose,
which was considerably lower than the Board-approved price for a competitor’s
drug in the same therapeutic class - Betaseron.
[5]
Teva
later developed an improved delivery method for Copaxone – a syringe (Copaxone
Syringe). A Notice of Compliance for the Copaxone Syringe was issued by Health
Canada on March 20, 2002. Teva initially sold the Copaxone Syringe, i.e.
from 2002, at the same $36.00 per daily dose as Copaxone Vial.
[6]
In
2002, two other competitors’ medicines in the same therapeutic class as
Copaxone – Avonex and Rebif – were introduced into the Canadian market at
prices higher than Copaxone’s.
[7]
In
July 2004, Teva increased the price of the Copaxone Syringe and discontinued
the Copaxone Vial. The Board found that the price of the Copaxone Syringe
increased 20% (i.e. to $43.20), as follows:
2003
– $36.00 (no increase)
2004 – $38.6038 (7.23% increase)
2005 – $40.9029 (5.96% increase)
2006 – $41.0145 (0.27% increase)
2007 – $41.1977 (0.45% increase)
2008 – $42.076 (2.13% increase)
2009 – $43.1989 (2.67% increase)
2010 – $43.20 (0.003% increase)
[“increase”
meaning increase relative to the prior, not initial year.]
[8]
Notwithstanding
the increases in the price of the Copaxone Syringe, the Board found that between
2002 and 2010 it was the lowest-priced medicine in its therapeutic class in Canada. The Copaxone Syringe price in Canada also remained, again according to the Board’s
reasons, “consistently the lowest” compared to the price charged in the seven
countries listed in the Schedule to the Patented Medicines Regulations,
SOR/94-688: France, Germany, Italy, Sweden, Switzerland, United Kingdom, and the United States.
Procedural
History
[9]
On
May 8, 2006, the Board issued a Notice of Hearing as to whether Copaxone
Syringe was being sold at an excessive price in Canada. The Board held
hearings in the summer of 2007. By decision dated February 25, 2008, the Board
found that the price of the Copaxone Syringe was excessive after July 1, 2004,
by $2,417,223.29, and ordered that amount be paid to the Crown.
[10]
Teva
initiated judicial review proceedings to challenge the Board’s decision. By
decision dated November 12, 2009, Justice Hughes granted Teva’s application on
the basis that the Board had improperly limited its attention to only one of
the four factors that must be considered under subsection 85(1) of the Patent
Act, namely paragraph 85(1)(d) – “changes in the Consumer Price Index,” and
that “[l]ip service only was given to [the] other factors [in subsection 85(1)].”
Justice Hughes returned the matter to the Board “for redetermination preferably
by a different panel if sufficient members can be provided for that purpose […]
[and] [i]n redetermining the matter the Board must consider all factors in
section 85(1) and provide intelligible, clear reasons as to the consideration
and weight given to each factor.”
[11]
A
differently-constituted panel of the Board was struck in February 2010. The
parties agreed that the evidence led before the first panel would form part of
the evidentiary record. By motion, Board staff moved to supplement that record
with evidence from the period 2008 to 2010. Teva opposed this motion. The
Board granted the motion, which decision Teva challenged in this Court.
Justice Hughes dismissed that challenge in November 2010. Both parties
submitted evidence for the 2008 to 2010 period, and the Board also heard oral
testimony and received additional exhibits in March 2011, and reserved its
judgment.
Decision
Under Review
[12]
By
decision dated February 23, 2012, the Board found that Copaxone Syringe was
being sold at an “excessive” price, and ordered that Teva pay to the Crown
$2,801,285.00.
[13]
In
its decision, after reviewing the background of the case and the parties’
positions, the Board “turn[ed] to [its] consideration and weighing of the
factors enumerated in subsection 85(1) of the Act” as follows.
Paragraph
85(1)(a) –
“the prices at which the medicine has been sold in the relevant market”
[14]
The
starting point of the Board’s analysis was to establish what “medicine” it was
to consider. Teva argued that the Board ought to consider the history of the
pricing of Copaxone (both Copaxone Vial and Syringe), as it had done in the
previous decision, whereas Board staff argued that the “medicine” was Copaxone
Syringe. The Board agreed with the latter:
67. The Board regulates medicines at the DIN
[Drug Identification Number] level. The entire regulatory regime is premised
upon that fact. It follows, then, that the pricing history of Copaxone Vial is
immaterial to our assessment of the allegation of excessive pricing of Copaxone
Syringe.
The Board continued:
68. At introduction in 2002, the price of
Copaxone was not excessive as it was sold at the same price as Copaxone Vial.
This is the result of the application of the Reasonable Relationship Test. The
ATP [average transaction price] was $36.00.
[15]
The
Board then noted how the average transaction price of Copaxone Syringe had
increased in years 2003 to 2010, as excerpted above:
2003 – $36.00 (no increase)
2004 – $38.6038 (7.23% increase)
2005 – $40.9029 (5.96% increase)
2006 – $41.0145 (0.27% increase)
2007 – $41.1977 (0.45% increase)
2008 – $42.076 (2.13% increase)
2009 – $43.1989 (2.67% increase)
2010 – $43.20 (0.003% increase).
Paragraph 85(1)(b) –
“the prices at which other medicines in the same therapeutic class
have been sold in the relevant market”
[16]
The
Board determined that according to the Therapeutic Class Comparison Test (TCC
Test), “Copaxone Syringe [was] the lowest priced medicine in its class relative
to the nearest comparators after 2004” (it being equal to Copaxone Vial between
2002 and 2004). However, the Board then proceeded to discount the importance
of this factor in the following paragraph:
74. Teva relies upon the fact that Copaxone Syringe
was the lowest priced medicine in its therapeutic class to argue that it was
not excessively priced. In the Panel’s view, the information that Copaxone
Syringe was the lowest priced medicine is an important consideration though, in
weighing this factor, it is important to state that the relevant period of time
is the eight years from 2002 to 2010. Further, until 2004, the closest
comparator was Copaxone Vial and would have remained as such had it not been
taken off the market. It was the same price as Copaxone Syringe while both
were on the market.
Paragraph
85(1)(c) – “the
prices at which the medicine and other medicines in the same therapeutic class
have been sold in countries other than Canada”
[17]
With
the exception of one data point, the Board staff’s data agreed that Copaxone
Syringe was priced lower in Canada than in other countries for the years 2004
to 2010. The Board found that this one inconsistent data point “[did] not
detract from the fact that Copaxone Syringe in Canada was consistently the
lowest priced medicine.” However, the Board concluded its analysis of this
factor which was favourable to Teva by again discounting its importance:
77. While the Panel has taken this factor into
consideration, in our view, on the evidence before us, it is of limited
application as compared to the other factors for determining whether the drug
is excessively priced in Canada. This is because the evidence lead on this
factor suffers from a degree of imprecision relative to the evidence led in
respect of other factors. The comparator drugs’ prices are not from Canada and as much might be affected by exogenous factors such as a different regulatory
regime, different income levels, and different health and other socio-economic
factors.
Paragraph 85(1)(d) – “changes
in the Consumer Price Index”
[18]
Relative
to this factor, the Board reasoned:
78. This factor requires that the Panel
consider changes in the Consumer Price Index. In the normal course, Schedule 4
to the Guidelines provides for the assessment of the actual increases in the
ATP of the medicine relative to allowable increases as calculated by the
CPI-Adjustment Methodology. Under this approach, the benchmark price at
introduction becomes the MNE [maximum non-excessive price] upon which increases
in price are calculated in accordance with the allowable increases provided for
by the CPI-Adjustment Methodology formula.
79. In this case, the MNE of Copaxone Syringe
at the introduction was $36.00. Accordingly, it follows that on the evidence
presented, the ATP increases for Copaxone exceeded the MNE. For convenience we
reproduce the chart previously set out in these reasons:
|
YEAR
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MNE (allowable %
increase)
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ATP (actual % increase)
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Excess
ATP
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2002
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36.00
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36.00
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0.00
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2003
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36.00
(0.0%)
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36.00
(0.0%)
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0.00
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2004
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37.008
(2.8%)
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38.6038
(7.23%)
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1.5958
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2005
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37.188
(0.49%)
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40.9029
(5.96%)
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3.7149
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2006
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38.1921
(2.7%)
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41.0145
(0.27%)
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2.8224
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2007
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38.232
(0.10%)
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41.1977
(0.45%)
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2.9657
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2008
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39.3752
(2.99%)
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42.076
(2.13%)
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2.7008
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2009
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40.7128
(3.4%)
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43.1989
(2.67%)
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2.4861
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2010
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41.2685
(1.36%)
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43.2
(0.003%)
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1.9315
|
80. The panel accepts the submission that
Copaxone Syringe was excessively priced, as the price increases exceeded the
permissible increases as calculated by the CPI-Adjustment Methodology. The
Panel considers that the Board’s rationale for the CPI-Adjustment Methodology
is relevant to our review of paragraph 85(1)(d). It constitutes an important
protection from sudden and significant price increases and it should be given
considerable weight in this case. The Panel considers the following statement
in the ratio-Salbutamol HFA decision to apply equally to this case:
84. [The
CPI-Adjustment Methodology] is intended to moderate the extent to which a
patentee may increase the price of a medicine from year to year. The panel
concludes that it should be given considerable weight in this case, where the
price of a widely-used patented medicine was increased suddenly and
significantly in 2004 in circumstances that, in the Panel’s view, did not
warrant such an increase.
81. Furthermore, even if the Panel were to
refer to the actual Consumer Price Index during this period (see paragraph 25),
the same conclusion would follow. Thus, with reference to this factor,
Copaxone Syringe is excessively priced.
Conclusion
[19]
In
two terse paragraphs, the Board then “weighs” all of the above factors:
82. In
the Panel’s view, it is important to recognize that the determination of
excessive pricing includes an analysis of both the relative price of the
medicine within the market (domestic and internationally) and the price
increases of the medicine relative to the introductory price. In the Panel’s
view, paragraph 85(1)(d) provides protection for the public which complements
the limits that paragraphs 85(1)(b) and (c) place on relative pricing within
the marketplace.
83. Here, the evidence
establishes that following the removal of Copaxone Vial, Copaxone Syringe
became the lowest priced medicine relative to its therapeutic comparators as
identified by the TCC Test. However, in the period following 2004, the impact
of the price increases that were imposed upon the consumer exceeded the
protection that Parliament has provided. There is no evidentiary basis in this
case to justify ignoring this impact on consumers that was both sudden and
significant. Taking all the factors into account, the Panel concludes that
Copaxone Syringe was excessively priced.
Remedies
[20]
The
Board reasoned that since “Copaxone Syringe became the lowest priced medicine
relative to its therapeutic price comparators but also that the price increase
was both sudden and significant […] the remedy must seek a balance between both
of these factors.”
[21]
The
Board concluded that the actual increase of $7.20 per unit (i.e. $36.00 to
$43.20) “should be spread equally over a four year period,” specifically 2004
to 2007. Using this approach, the hypothetically–“allowed” increases in price
in these years were 5.0%, 4.76%, 4.55%, and 4.35%, respectively. Teva had
actually increased its price by 7.23%, 5.96%, 0.27%, and 0.45% in those years,
respectively. The result was that Teva’s revenues in 2004 and 2005 were
“excessive,” in the amount of $1,029,159.00 and $1,772,126.00, respectively
(totalling the final amount at issue: $2,801,285.00).
[22]
The
Board concluded by ordering that Teva pay its excessive revenues from 2004 and
2005 to the Crown pursuant to paragraph 83(2)(c) of the Patent Act.
Issues
[23]
Teva
raises a sole issue: “Should the Board’s decision be left undisturbed or
quashed?”
[24]
Teva
particularizes its submissions as to why the decision ought to be quashed with
submissions made that the decision is unreasonable and, as a “complimentary
submission, that the decision is unconstitutional.”
Unreasonable
Decision
(a) Undue
Emphasis on CPI
[25]
Teva
submits that the Board “brazenly” ignored Justice Hughes’ decision and once
again used CPI as a “trump card” against all the other factors in subsection
85(1). It also submits that “section 83 of the Act makes [it] clear [that the Patent
Act is ultimately concerned with excessive price levels, not any particular
price increase],” and that the Board therefore erred by concerning
itself with the price increase.
[26]
Teva
also draws this Court’s attention to the legislative history of subsection
85(1) of the Patent Act, most notably a disagreement between certain
Senators, who were in favour of elevating the status of CPI to a primary
factor, and the Minister of Health and the House of Commons who ultimately
rejected the Senate’s recommendations and placed all of the factors in
subsection 85(1) on an equal footing.
(b) Common
Sense
[27]
Teva
submits that common sense, rationality, and consistency dictate that the price
of a medicine that is the lowest-priced among its competitors domestically and
internationally is not “excessive.”
(c) Price
of Betaseron
[28]
Teva
points to Betaseron, which is a medicine in the same therapeutic class and has
always been more expensive than Copaxone, and notes that its price is
Board-approved as non-excessive. Teva submits that the Board’s decision is
unreasonable because it did not address this in its Decision.
(d)
The “Medicine” at Issue
[29]
Teva
submits that the Decision is unreasonable because “[It] may make sense in other
cases to do so, [but] this is not an appropriate case in which the Board should
regulate mechanically "at the DIN level".”
(e) Lack
of Evidence Supporting Conclusion
[30]
Teva
submits the Decision is unreasonable because the Board held that Copaxone’s
one-time price increase had an adverse impact on consumers when the evidence
was that only one consumer ever complained about the price increase.
(f) Unintelligible
Remedy
[31]
Teva
submits that the Board’s remedy is, on its face, completely arbitrary. The
Decision contained “no reasons in support of its conclusion as to why
Copaxone’s permitted price increase was not excessive (i.e., why implementing a
20% increase from 2004 to 2007 was acceptable) while the $2,801,285 that [Teva]
was ordered to pay constituted excessive revenues.”
Unconstitutional Decision
[32]
Summarized,
Teva’s submission is this:
(i)
Federal
jurisdiction is defined by section 91 of the Constitution, and includes
“patents of invention and discovery … [and therefore also extends to]
prevent[ing] abuses of monopoly power arising form the market exclusivity
created by the grant of patent;”
(ii)
The
regulation of pricing in a particular trade or industry, on the other hand, is
outside of section 91, and falls to the provinces;
(iii)
The
only exceptions to the proposition at (ii) are matters of emergency or national
concern;
(iv)
The
pharmaceutical industry is a particular trade or industry, and the regulation
of its pricing is not a matter of emergency or national concern;
(v)
The
Board therefore has no jurisdiction to engage in pure price regulation of the
pharmaceutical industry;
(vi)
Teva’s
expert witness at the Board hearing said that Teva had engaged in “market
restraint, not market abuse arising from the monopoly granted by its patent;”
(vii)
Therefore,
because of Teva’s witness’ statements, “it was incumbent upon the Board … to
find and rely on evidence [of market abuse] in order to have jurisdiction to
make a finding of excessive pricing,” failing which it was necessarily engaging
in pure regulation, for which it has no jurisdiction.
Analysis
The
Medicine
[33]
As
noted above, Teva submits that the Board placed an unreasonable interpretation
on the term “medicine” as found in the Patent Act, namely, by equating
it with the DIN. Teva submits that the medicine flows from the patent of
invention, not from the delivery mechanism. In its submission, regardless of
whether the medicine is in the vial format or the syringe, and thus carries a
different DIN, it is the same medicine. What hinges on the Board’s
interpretation is whether 1997 or 2002 is the appropriate starting point for
Copaxone Syringe’s pricing history under paragraph 85(1)(a).
[34]
However,
as the Respondent notes in its factum, Teva initially took the position in
correspondence with Board staff, after being informed by the latter that it
considered Copaxone Vial to be the appropriate therapeutic class comparator for
Copaxone Syringe:
“the
comparison … is not appropriate… […] the differences in format of the vial and
pre-filled syringe result in vastly difference administrative profiles.”
[35]
The
Board is entitled to deference when interpreting its home statute, except
regarding “questions of law of central importance to the legal system and
outside the adjudicator’s specialized expertise,” constitutional questions, and
the “exceptional other case:” Rogers Communications Inc v Society of
Composers, Authors and Music Publishers of Canada, 2012 SCC 35 at para 16.
It has not been advanced that the interpretation of the term “medicine” falls
into any one of these categories, and I see nothing unreasonable with the
interpretation the Board has given the term or its application in this case.
Indeed, as shown above, Teva initially argued during the preliminary phases of
the proceeding before the Board that Copaxone Vial should not even be used as a
comparator for the purposes of subsection 85(1)(b) and (c). Logic dictates
that if Copaxone Vial is not an appropriate therapeutic class comparator for
the purposes of paragraphs 85(1)(b) and (c), it surely is not the same
“medicine” for the purposes of 85(1)(a).
Interpreting
and Applying Subsection 85(1) of the Act
[36]
Teva
submits that the Board “brazenly” ignored Justice Hughes previous decision and
used CPI as the “trump card” against all other factors in subsection 85(1) of
the Patent Act.
[37]
It
was clear in the first decision that the Board had considered only one of the
factors in section 85(1) – CPI. In sending back the matter for
redetermination, Justice Hughes provided the following direction to the Board:
In
redetermining the matter the Board must consider all factors in section 85(1)
and provide intelligible, clear reasons as to the consideration and weight
given to each factor. If the Board is unable to reach a conclusion having
regard to all factors under section 85(1) it must say so and then consider
section 85(2) and provide intelligible, clear reasoning as to its
consideration. The Board should not simply give lip service to these
matters and arrive at the same result. The Board should give a thorough
reconsideration of the matter without considering that it is in any way bound
to arrive at the same result.
[emphasis
added]
[38]
In
the decision presently under review, as shown above, the Board sequentially
laid out the subsection 85(1) factors in its analysis. Therefore, on its face,
it appears as though the Board gave careful consideration to each factor, in
accordance with Justice Hughes’ Judgment. However, in my view, the Board’s
decision must be set aside because it again paid no more than lip service to
the factors favouring the conclusion that the medicine was not
excessively priced, namely paragraphs 85(1)(b) and (c), and again treated
paragraph 85(1)(d), CPI, as a conclusive factor.
[39]
I
will first discuss the Board’s discounting of the former factors, and then turn
to the more fundamental legal error that underlies the Board’s analysis.
[40]
Regarding
paragraph 85(1)(b), the medicine’s price relative to “other medicines in the
same therapeutic class” in Canada, as excerpted above, the Board stated:
74. Teva relies upon the fact that Copaxone
Syringe was the lowest priced medicine in its therapeutic class to argue that
it was not excessively priced. In the Panel’s view, the information that
Copaxone Syringe was the lowest priced medicine is an important consideration
though, in weighing this factor, it is important to state that the relevant
period of time is the eight years from 2002 to 2010. Further, until 2004, the
closest comparator was Copaxone Vial and would have remained as such had it not
been taken off the market. It was the same price as Copaxone Syringe while
both were on the market.
The Board says that Copaxone
Syringe being “the lowest priced medicine in its therapeutic class” was “an
important consideration,” but goes on to lessen that significance in stating
that:
[U]ntil 2004, the closest competitor was Copaxone
Vial and would have remained as such had it not been taken off the market. It
was the same price as Copaxone Syringe while both were on the market.
The Board offers no explanation why
this “fact” is of any significance. Is it suggesting that the Applicant
deliberately removed Copaxone Vial from the market in order to increase the
price of Copaxone Syringe? If so, there is no evidence in the record to
support that speculation. Or, is it suggesting that the price of Copaxone Vial
would not have increased after 2004? Again, there is nothing in the record
that would support that view. Frankly, I am at a loss to comprehend why this
is a relevant “fact” and why the Board, because of it, apparently thought it
appropriate to assign less weight to this factor; one that clearly favoured the
Applicant’s position. In other words, as it relates to this important factor,
the decision suffers from a lack of intelligibility.
[41]
Regarding
paragraph 85(1)(c), the Board found that Copaxone Syringe was priced lower in
Canada than in other countries for the years 2004-2010 and “was
consistently the lowest price medicine.” As such, this is again a factor that
one would think favours the conclusion that the medicine was not being sold at
an “excessive” price in Canada. However, the Board lessens the significance of
this factor because “the comparator drugs’ prices
are not from Canada and as such might be affected by exogenous factors such as
a different regulatory regime, different income levels, and different health
and other socio-economic factors.” The Board is certainly entitled to place
less reliance on any of the factors in any given case for justifiable reasons;
yet, other than this general caution which would be applicable in all cases,
the Board does not point to any concrete examples of exogenous factors that
lessen the impact of this factor in this particular case. Having enacted this
provision, Parliament is presumed to be aware of the difficulties in comparing
the price of medicines across borders; despite this, it saw fit to include “the
prices at which the medicine and other medicines in the same therapeutic class
have been sold in countries other than Canada” as a factor to be considered
when determining whether a drug is being sold at an “excessive” price in
Canada. What the Board appears to be saying is that this factor is inherently
unreliable and should be given little if not no weight. The Board appears
therefore to be subverting the will of Parliament, which clearly saw this as a
relevant factor to be accorded weight.
[42]
In
my view, the lip service paid to both paragraphs 85(1)(b) and (c) is alone
sufficient to render the Board’s conclusion unreasonable. This is particularly
so when considered in the context of Justice Hughes’ clear directions for the
redetermination, which included to “provide intelligible, clear reasons as to
the consideration and weight given to each factor.” Nowhere in the discussion
of these factors or in the Board’s concluding paragraphs is there any
indication as to how much weight these factors are ultimately given.
[43]
However,
the more fundamental legal error committed by the Board is in its
interpretation of subsection 85(1) generally, which may explain why it gave
decisive weight to CPI.
[44]
At
paragraph 82 of its decision, the Board first correctly notes that “the
determination of excessive pricing includes an analysis of both the relative
price of the medicine within the market (domestic and internationally) and the
price increases of the medicine relative to the introductory price.” However,
the Board then goes on to give weight only to the CPI factor in paragraph
85(1)(d) stating: “[I]n the period following 2004, the impact of the price
increases that were imposed upon the consumer exceeded the protection that
Parliament has provided” [emphasis added]. Parliament has provided no such
“protection;” rather, Parliament has provided protection from “excessive”
prices, stating that CPI is one factor to consider – it is not the only
factor, or even the determinative factor, as this passage suggests. The Board
confirms its error when it states that “paragraph 85(1)(d) provides protection
for the public which complements the limits that paragraphs 85(1)(b) and (c)
place on relative pricing within the marketplace [emphasis added].” Again,
paragraphs 85(1)(b) and (c) place no such “limits;” nor is CPI itself a
“limit.” Rather, the meaning of the opening words in subsection 85(1) is
straightforward and allows for only one reasonable interpretation: each of the
factors listed in that provision are relevant to a singular determination,
which is whether a medicine is or has been sold at a price that is
“excessive.”
[45]
In
short, the Board has fallen into exactly the error suggested by Justice Hughes
– it has considered the Guidelines, and specifically those portions dealing
with CPI to be binding. The Guidelines are not binding: See Patent Act,
s 96(4). As Justice Hughes noted at para 32 of his decision: “Where the
Guidelines or their application conflicts with the Act or Regulations, they
cannot prevail.” As was noted by Justice Rothstein, as he then was, in ICN
Pharmaceuticals, Inc v Canada (Patented Medicines Prices Review Board),
[1996] FCJ No 112, para 6, footnote 2: “Had it treated the Guidelines as
binding, the Board may well have erred.”
[46]
For
these reasons this decision is unreasonable and must be set aside on terms identical
to those issued by Justice Hughes previously.
[47]
Teva
asked the Court to "provide the Board with further directions in the
nature of a directed verdict, specifically that the Board redetermine the
matter on the basis that the allegations against [Teva] be dismissed.” Just
prior to these reasons issuing, Teva provided the Court with the Reasons of the
Court of Appeal in Canada (Minister of Public Safety and Emergency
Preparedness) v Lebon, 2013 FCA 55. The facts there are substantially
different. Specifically, all of the factors validly considered directed only
one result. This is not the present case. No verdict will be directed.
[48]
The
Applicant seeks costs fixed at $12,000.00, which is a reasonable sum based on
the record before this Court.
[49]
The
Applicant submitted at the hearing that if the decision was set aside on this
basis, the constitutionality argument need not be considered. I agree.
[50]
However,
it is appropriate to state that I was not persuaded that there is anything
unconstitutional about the decision. Briefly, I note that it is not “market
abuse” that the Board is required by the Patent Act to find, but rather
“excessive price.” Second, and more fundamentally, Teva has raised no argument
that the excessive price provisions of the Patent Act are themselves ultra
vires Parliament for failing to relate, in pith and substance, to the
federal patent power. Indeed, as the Respondent points out, the general
argument that the excessive prices provisions of the Patent Act are ultra
vires for being purely price regulation, and thus encroaching on provincial
jurisdiction, was tersely dismissed in Manitoba Society of Seniors Inc v
Canada, 96 D.L.R. (4th) 606, 45 CPR (3d) 194 (Man CA).
JUDGMENT
THIS
COURT’S JUDGMENT is that:
1.
The
application is allowed;
2.
The
decision of the Board dated February 23, 2012 is quashed and returned for
redetermination by a Board differently constituted than that which rendered
either of the two decisions regarding this medicine, if available, in
accordance with these Reasons; and
3.
Teva
is entitled to its costs which are fixed at $12,000.00.
"Russel W.
Zinn"
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