Date: 20091223
Docket: A-177-09
Citation: 2009 FCA 378
CORAM: EVANS
J.A.
SHARLOW
J.A.
RYER
J.A.
BETWEEN:
ATTORNEY GENERAL OF CANADA
Appellant
and
CELGENE CORPORATION
Respondent
REASONS FOR JUDGMENT
EVANS J.A.
A. INTRODUCTION
[1]
In law, as
in life, meaning depends heavily on context, although selecting the appropriate
context is not always easy. The question in the present case is whether consumer
protection provisions in the Patent Act, R.S.C. 1985, c. P-4, should be
interpreted in the context of common law principles or the purpose of the statutory
scheme. In this case, contemporary approaches to the interpretation of regulatory
legislation favour the latter.
[2]
This is an
appeal of a decision of the Federal Court (2009 FC 271) in which Justice
Campbell set aside a decision of the Patented Medicine Prices Review Board
(“Board”), dated January 21, 2008. The Board held that it had jurisdiction
under paragraph 80(1)(b) of the Patent Act, to require Celgene
Corporation (“Celgene”) to provide information about the pricing of the drug
Thalomid since January 1995. It rejected Celgene’s argument that it had no
jurisdiction over the pricing of Thalomid because it was not being sold in Canada.
[3]
The
question before the Board was whether a patented medicine, sold by an American
company and shipped f.o.b. from its factory in New Jersey to a physician in
Canada to treat a patient in Canada, was thereby “sold in any market in Canada”
within the meaning of paragraph 80(1)(b), even though it is agreed that
common law commercial principles would regard the sale of the medicine as
having occurred in New Jersey.
[4]
The sale
and advertisement of a new drug in Canada
is generally prohibited without a Notice of Compliance (“NOC”) issued by Health
Canada when it is satisfied that the
medicine is safe and effective: Food and Drug Regulations, C.R.C., c.
870, C.08.002(1) (“Regulations”). Celgene has not applied for an NOC to market
Thalomid in Canada. However, despite the absence
of an NOC, the Director (Assistant Deputy Minister, Health Products and Food
Branch, Health Canada) may authorize the sale of a
new drug to a physician under the Special Access Programme (“SAP”) for the
emergency treatment of a patient: Regulations, C.08.010(1), 08.011(1), (2).
[5]
In my respectful
opinion, the Applications Judge misinterpreted the words “sold in any market in
Canada” by giving insufficient
weight to their statutory context and the purpose of the regulatory scheme of
which they are an integral part.
[6]
The
purpose of this scheme, created by sections 79-103 of the Patent Act and
administered by the Board, is to protect consumers in Canada (or their insurers) from being charged
excessive prices for patented medicines. To interpret these consumer protection
provisions as not including patients whose treatment requires medicines
imported under an SAP authorization is, in my view, contrary to the statutory
objectives.
[7]
Accordingly,
I would allow the appeal and restore the order of the Board. The statutory
provisions relevant to this appeal are contained in an Appendix to these
reasons.
B. FACTUAL BACKGROUND
[8]
In the
1960s, thalidomide, the active ingredient of Thalomid, was linked to severe
birth defects in babies born to women who had taken thalidomide as an
antiemetic during pregnancy. It is now used to treat other medical conditions,
including leprosy and some forms of cancer.
[9]
Although
Thalomid has been approved by the Food and Drug Administration in the United States for the treatment of these
illnesses, Celgene has never made an application for an NOC, a lengthy and
expensive process. Instead, Thalomid has been made available in Canada since 1995 under SAP authorizations,
especially for the treatment of certain forms of cancer.
(i) Special Access Program
[10]
When
requesting Health Canada for an authorization under
the SAP, a physician must: (i) describe the patient’s medical condition; (ii)
explain why the medicine is the best choice for treating the condition; and
(iii) provide data on the use, safety and efficacy of the medicine requested.
If granted, an SAP authorization authorizes, but does not require, a
manufacturer to sell a specified quantity of the medicine to the requesting
physician for the emergency treatment of a specified condition of a named
patient under the care of the physician. The physician must report to Health Canada on the use of the medicine,
including any adverse effects.
[11]
It is not
altogether clear why the Regulations provide that the sale by the patentee must
be to the requesting “practitioner”, whether a physician or a veterinarian.
However, it may simply be to provide a convenient mechanism for preventing
distribution of the medicine to persons other than the patient for whom it has
been prescribed, for ensuring that any amount not needed for the patient’s
treatment is returned and, when requested, for providing accountability with
respect to the quantity of medicine received and any adverse outcomes
attributable to the use of the medicine. Designating the practitioner as the
purchaser may also facilitate payment of the patentee for the medicine. For
these reasons, the physician may purchase the medicine from the patentee as
agent of the patient on whose behalf the request to purchase it was made.
However, this is not an issue that needs to be decided in this appeal.
[12]
SAP
authorizations have been issued with respect to Thalomid for 14 years for
“medical emergency”. They are normally granted for serious or life-threatening
conditions when conventional treatments have proved ineffective or are not
suitable for the particular patient. Typically, medicines authorized under the
SAP are treatments of last resort and are not subject to the same level of
scrutiny for safety and efficacy as medicines for which an NOC has been issued.
Nonetheless, Health Canada reviews the SAP request and any other available data
on the new medicine in order to “manage the risk” of its use.
[13]
Medicines
sold under an SAP authorization comprise only a small portion of the Canadian
pharmaceutical market. Thus, in 2006, 26,000 requests were granted with respect
to 43 drugs. Of these requests, 4,500 were for Thalomid, making it the drug
most often requested under the SAP and, because of its success in the treatment
of multiple myeloma, sales have increased significantly.
[14]
The
standard SAP authorization procedure was followed in the present case. A
physician in Canada requested Health Canada
for permission to purchase a specified quantity of Thalomid to treat a
particular “medical emergency” of a patient under the care of the physician.
Health Canada authorized the sale of a
month’s supply of the medicine, on condition that the patient provided a
negative pregnancy test, and any amount of the medicine not used by the patient
was returned to Celgene.
[15]
The
authorization was sent to the manufacturer, Celgene, which shipped the medicine
f.o.b. from its plant in New
Jersey to the
physician in Canada. After the arrival of the
medicine in Canada, the physician paid for it in
U.S. dollars in accordance with the terms of the invoice. Presumably, it was later
consumed by the patient on whose behalf it had been requested.
(ii) Patented Medicine Prices Review
Board
[16]
The
mandate of the Board is to ensure that patentees do not abuse the monopoly
created by the grant of a patent with respect to a medicine by charging
excessive prices to consumers in Canada.
The regime administered by the Board replaced the system of compulsory
licensing, which was abolished in 1993. Price regulation during the life of the
patent, rather than the injection of competition through compulsory licensing,
thus became the means of protecting consumers from excessive prices for
patented medicines.
[17]
The
present case originated in a motion to the Board by the Board’s staff to
require Celgene to provide information concerning the pricing of Thalomid since
1995, when it was first made available in Canada through the SAP. Celgene had
supplied the recent pricing information requested by the staff, but without
prejudice to its position that the Board had no jurisdiction to demand it.
However, it did not provide pricing information on sales in Canada going back to 1995.
[18]
Hence, the
only issue before the Board was whether it had legal authority to require
Celgene to produce information about Thalomid specified in paragraph 80(1)(b)
of the Patent Act. Information gathered by the Board under subsection
80(1) may assist it to determine if a patentee of an invention pertaining to a
medicine is selling the medicine “in any market in Canada” at a price that in the Board’s opinion
is excessive. If the Board so finds, it may make orders designed to offset the
patentee’s excess revenues. These regulatory powers are conferred on the Board
by section 83.
C. DECISION OF THE BOARD
[19]
The Board
(at para. 6) states Celgene’s argument to be that, since the Board has no
jurisdiction over sales of Thalomid outside Canada, it cannot oblige Celgene to
provide information about the price charged for the medicine to Canadian
purchasers. The bases of Celgene’s argument were as follows.
[20]
First, the
Board’s jurisdiction over the pricing of patented medicines only applies to
those marketed in Canada under an NOC, not to those
sold under an SAP authorization. The Board’s rejection of this argument was not
challenged on judicial review and need not be considered further.
[21]
Second, by
virtue of the rules of commercial law, the sale of Thalomid occurred in New
Jersey, and it was therefore not sold “in any market in Canada”. Although an SAP
authorization only permits, but does not require, the patentee to supply a
medicine for the treatment in Canada of a medical condition, the Board, for the
following reasons, rejected the argument that, when Celgene supplied Thalomid pursuant
to an SAP authorization, it was not thereby “sold in any market in Canada”.
[22]
First,
every sale is closely regulated by Health Canada. Second, the function of the
words ”in any market in Canada” is to enable the Board to oversee the price of
medicines in Canada, either generally or in specific markets defined by
geography, political boundaries, or classes of customers, including “purchasers
receiving medicines through the SAP” (at para. 21). Third, the mandate of the
Board to protect customers from excessive prices for patented medicines
supports this view of its jurisdiction. Thus, the Board (at para. 22) could see
no reason why Canadians purchasing
medicines through the SAP are any
less deserving of protection or needful
of protection by the Board, than
Canadians purchasing medicines for which
an NOC has been issued.
Indeed, since the volume of medicines sold under the SAP is
relatively small, and competition is generally less than for medicines sold
under an NOC, the Board has a particularly important role in protecting consumers
from excessive prices.
[23]
The Board
agreed that the principles of commercial common law located the sale of
Thalomid in New
Jersey, where it
was shipped f.o.b. to the physician in Canada authorized under the SAP to purchase it.
However, it did not regard the location of the sale as determinative, because the
common law rules are concerned to resolve disputes between seller and buyer by,
for example, selecting the law governing the contract. In contrast, the Board
is a public law institution regulating in the public interest the price that
Canadians pay for patented medicines.
D. DECISION OF THE FEDERAL COURT
[24]
The
Applications Judge applied the correctness standard to review the Board’s
interpretation of paragraph 80(1)(b), on the ground that it defined the
Board’s jurisdiction. Dismissing as of little relevance the authorities relied
on by the Attorney General as showing a broad approach to the jurisdiction of
the Board, the Judge held (at para. 26) that “a commercial meaning” should be
given to the words “sold in any market in Canada”.
[25]
This is
because, he reasoned (at para. 27), the Patent Act “functions within a
commercial reality”. In support of this position, the Judge cited cases in
which the provisions of the Act had been given “a commercial meaning” (at para.
28), as well as Canada (Deputy Minister of National Revenue) v. Mattel
Canada Inc., 2001 SCC 36, [2001] 2 S.C.R. 100 at para. 33 (“Mattel”),
where the Court held that the phrase in the Customs Act, “a
condition of the sale of the goods for export to Canada” should be
interpreted as depending on the basis of “concepts which are intrinsic to
commercial law.”
[26]
Turning to
paragraph 80(1)(b), the Judge rejected an interpretation of “market” as
a demand for a good or service. He held (at para. 31) that for a market to
exist in Canada “in the commercial sense”, there must be a purchase and sale in
Canada and, on the basis of commercial law principles, the sale of Thalomid
occurred in New Jersey. The Judge could not find in the purpose of the relevant
provisions of the Patent Act any indication that Parliament intended paragraph
80(1)(b) to have a meaning other than “that expressed in the plain
meaning of the words used” (at para. 36).
E. ISSUES AND ANALYSIS
(i) Standard of review
[27]
On the
basis of earlier decisions, including the decision of this Court in ICN
Pharmaceuticals, Inc. v. Canada (Patented Medicine Prices Review Board),
[1997] 1 F.C. 32 (“ICN”), counsel agreed that the issue in dispute
in this case involves the jurisdiction of the Board and is therefore reviewable
on a standard of correctness.
[28]
However,
since the issue concerns the interpretation of a provision of the Board’s enabling
statute, I doubt whether it is now appropriate to characterize it as
“jurisdictional”: see my reasons in Public Service Alliance of Canada v. Canadian
Federal Pilots Association 2009 FCA 223 at paras. 36-52. Nonetheless,
because the standard of review is not, in my opinion, material to the
disposition of this appeal, I am prepared to review the Board’s determination
on the standard of correctness.
(ii) The decision under review
[29]
This case was
argued before the Board on the basis that, if the Board has power under
paragraph 80(1)(b) to require the production of pricing information
about a patented medicine, it may also regulate the price at which the patentee
has sold the medicine “in any Canadian market” under section 83. The Board also
seems to have proceeded on this assumption: see, for example, paras. 5 and 20
of its reasons.
[30]
However, the
only question before the Board was whether Thalomid was being “sold in any
market in Canada” within the meaning of paragraph 80(1)(b) of the Patent
Act, so as to enable the Board to require the patentee, Celgene, to provide
pricing information about it. The Board’s reasons concluded by finding that it
had jurisdiction “to make a remedial order concerning the pricing of Thalomid
from and after January 12, 1995”.
[31]
In the
proceedings before both the Board and in the Federal Court, the case was argued
on the basis that the only relevant sale of Thalomid was that by Celgene to the
physician, and that if the Board could require Celgene to provide the
information described in paragraph 80(1)(b), it could also make an
excessive price determination, and issue orders against Celgene under section
83, even though that section applies only when the patentee has sold the
medicine Canada.
[32]
Unlike
section 83, paragraph 80(1)(b) does not expressly require that the medicine
in respect of which pricing information was being sought was sold by the
patentee. Consequently, it might be arguable that, even if the sale of Thalomid
by Celgene to the physician occurred in New Jersey, there was also a sale of it
in Canada by the physician to the
patient that would engage paragraph 80(1)(b), but not section 83. Counsel
for the Attorney General suggested that it was implicit in paragraph 80(1)(b)
that the sale must be by the patentee.
[33]
However,
since the case was argued on the basis of the sale by Celgene to the physician,
I shall not explore this point further. Thus, like both the Board and the
Federal Court, my view of the Board’s authority to require Celgene to provide
pricing information about Thalomid applies also to its authority under section
83 to make excessive price determinations and to issue remedial orders, so as
to protect consumers from excessive prices for medicines sold in any market in
Canada by the patentee.
(iii) “sold in any market in Canada and elsewhere ”; « vendu sur
les marchés canadien et étranger »
[34]
The
appellant argues that “market” is the important word in this phrase in
paragraph 80(1)(b). “Market”, counsel argues, connotes the existence in Canada of a demand for a medicine,
which is satisfied when it is purchased by a physician for the treatment of a
patient in Canada. In other words, the phrase
“in Canada” identifies the location of the market, not of the sale. Any other
interpretation, counsel says, would create two classes of patient: those whose
medicine is sold by a manufacturer outside Canada pursuant to an SAP authorization, and
all others. The former are not protected against excessive prices, the others are.
This distinction, counsel submits, is so plainly contrary to the purposes of
the statutory scheme that it cannot have been intended by Parliament.
[35]
The
respondent, on the other hand, says that the statutory text is so clear that
Parliament’s purpose in enacting the disputed phrase, and the regulatory scheme
of which it is part, play little role in its interpretation. In counsel’s
submission, the words “sold in Canada” have an “ordinary meaning”, that is,
that the sale occurred in Canada as determined on the basis of
private international law principles pertaining to contractual disputes.
[36]
In my
view, the following quotation from Canada Trustco Mortgage Co. v. Canada,
2005 SCC 54. [2005] 2 S.C.R. 601 at para. 10, accurately captures the modern
approach to statutory interpretation:
The
interpretation of a statutory provision must be made according to a textual,
contextual and purposive analysis to find a meaning that is harmonious with the
Act as a whole. When the words of a provision are precise and unequivocal, the
ordinary meaning of the words play a dominant role in the interpretive process.
On the other hand, where the words can support more than one reasonable
meaning, the ordinary meaning of the words plays a lesser role. The relative
effects of ordinary meaning, context and purpose on the interpretive process
may vary, but in all cases the court must seek to read the provisions of an Act
as a harmonious whole. (Emphasis added)
[37]
Thus, the
interpretative exercise cannot stop at the text of a statutory provision, but
must also include a purposive and contextual analysis of the disputed words,
although the relative weight to be afforded to each may vary. The ordinary
meaning of “precise and unequivocal” statutory words will be a particularly
important, but not necessarily determinative, factor in the analysis.
[38]
However,
language is malleable and subtle, and, as any dictionary makes clear, the
“ordinary meaning” of words normally connotes a range of meanings. Nonetheless,
when a legislature uses words that constitute a legal term of art, it is to be
presumed that that is their intended meaning.
(a) the text
[39]
Despite the
argument repeated by counsel for Celgene, the Act does not provide that a
patented medicine must be sold in Canada before the Board may exercise its powers
under either paragraph 80(1)(b) or section 83. Celgene is, in effect,
reading out the words “in any market in Canada”, contrary to the interpretative presumption
that meaning should be given to every word of a statutory text. Before the case
reached this Court, Celgene had argued that “in any market in Canada” meant that the Board only had
jurisdiction over the price charged for medicines marketed in Canada under an NOC.
[40]
I doubt
whether even “sold in Canada” rises to the level of a legal
term of art. When a sale has a connection with more than one jurisdiction it
may be necessary to decide which law governs the sale when the relevant law of
these jurisdictions is not the same, or in which jurisdiction should the
parties litigate any contractual dispute. Identifying the jurisdiction with
which a contract is more closely connected for conflict of laws purposes typically
involves a multi-factor analysis, including the place where the contract was
performed.
[41]
In
addition, whether a sale of goods occurred in Canada or elsewhere may be
relevant for determining if the vendor can be liable in Canada for infringing a
patent: Dole Refrigerating Products Ltd. v. Canadian Ice Machine Co. (1957),
28 C.P.R. Section II, 32 (Exch. Ct.) (“Dole Refrigerating”); Domco
Industries Ltd. v. Mannington Mills Inc. (1990), 29 C.P.R. (3d) 481
(F.C.A.) (“Domo Industries”). Whether goods were “sold in Canada” may also be relevant in some
statutory contexts, such as determining liability for customs duty.
[42]
On the other hand, like
“condition of the sale” considered in Mattel, “sold” is a term of legal
art and, when used in legislation, presumptively connotes the existence of a
contract of sale as understood in private law: Pfizer Canada Inc. v. Canada
(Attorney General), 2009 FC 719. It is undisputed in the present case that
Celgene sold Thalomid to a physician in Canada for the treatment of a patient under his
or her care.
[43]
In any
event, the phrase in paragraph 80(1)(b) is “sold in any market in
Canada”, not “sold in Canada”. The French version supports
the appellant’s contention that “in Canada”
is more closely linked to the location of the “market” than of the sale. It reads: « le prix de
vente … du médicament sur les marchés canadien et étranger ».
[44]
Counsel submits that
it would have been easy for Parliament to have said “sold for the treatment of
a patient in Canada” if this is what it had meant. True
enough, except that it would have been equally easy for it to have said “sold
in Canada” if it had meant this. In fact, since
the situation being considered here was probably not foreseen by the drafters,
Parliament has provided no clear answer.
[45]
In these
circumstances, the Court must resolve the ambiguity by selecting from the
possible meanings that the text may reasonably bear that which best implements
the objectives of the legislation. Parliament is taken to intend the legislation
that it enacts to be effective in achieving its objectives: compare Interpretation
Act, R.S.C. 1985, c. I-21, section 12. Regulatory legislation administered
by administrative agencies is called “enabling” precisely because its function
is to enable them to discharge their mandates, and should be interpreted from
this perspective.
[46]
In concluding that
the words “sold in any market in Canada” should not be interpreted by reference
to common law commercial legal principles for determining the location of a
sale, I have also taken into account the recent admonition by the Supreme Court
of Canada in
Association des courtiers et agents immobiliers du Québec v. Proprio Direct
Inc., 2008 SCC 32, [2008] 2 S.C.R. 195 at para. 34, where, writing for the
majority of the Court, Justice Abella said:
The Court of
Appeal’s interpretive error, with respect, was to view the legislation through
the lens of freedom of contract and competition, rather than through the vision
of [the statute in question] as protective consumer legislation.
As applied to the facts of the present case, this sentiment
can be rephrased as follows. The interpretive error of the Applications Judge
was, with respect, to view the legislation through the lens of a commercial law
dispute, rather than through the vision of the price regulation provisions of
the Patent Act as protective consumer legislation.
[47]
Accordingly,
I am unable to conclude that the text of paragraph 80(1)(b) is so “precise
and unequivocal” as to be accorded more weight than that of statutory purpose
and context.
(b) statutory purpose
[48]
The
purpose of the provisions of the Patent Act creating the system for
regulating the price of patented medicines is to strike a balance between the
public interests in encouraging research and the development of new medicines
through the award and protection of a patent, and “the need to ensure that Canadians
have access to patented medicines which are reasonably priced”: ICN at
para. 3.
[49]
This
purpose is advanced by interpreting paragraph 80(1)(b) to apply to all patented
medicines sold for consumption by patients in Canada for which they or their insurers (public
or private) will have to pay. It is inconsistent with legislative intent to
interpret the Act in a manner that deprives patients in Canada of the protection of price
regulation when the medicines that they need happen to be neither the subject
of an NOC, nor available under the SAP from a manufacturer in Canada.
[50]
Counsel
for the Attorney General also argued that, in addition to falling short of implementing
the statutory purpose in the manner described above, Celgene’s interpretation
over extends the Board’s reach. This is because, if the location of the sale,
rather than that of the market, determines whether the price of a medicine is
subject to regulation by the Board, it would follow that the price of a
patented medicine sold by a Canadian patentee for export from Canada and
shipped f.o.b. to, say, Germany, would be subject to regulation by the Board.
[51]
Such a
result would be incongruous, because Canadian consumer protection legislation
is not aimed at regulating the price at which Canadian patented medicines are
sold into foreign markets. However, paragraph 80(1)(b) expressly
authorizes the Board to require a patentee to provide pricing information
relating to a medicine that is being sold in any Canadian market and
elsewhere.
[52]
Counsel for
Celgene argued that, to the limited extent that legislative purpose is relevant
to interpreting the phrase “sold in any market in Canada”, the purpose of the
scheme is to regulate the price of medicine sold in Canada. I do not agree. This is, in my view, an
unrealistically narrow formulation of the statutory purpose underlying the
regulatory scheme and is inconsistent with the broader view expressed in ICN.
(c) statutory context
[53]
Two points
may be made here. First, the disputed phrase appears in a public law context: a
regulatory scheme, administered by a specialized tribunal, to prevent the abuse
of the monopolistic market power, created by a patent, through the charging of excessive
prices for medicines used to treat patients in Canada. In my view, this context provides a
more reliable guide to the meaning of the phrase than private law principles
designed to resolve commercial disputes between seller and buyer or, as in Dole
Refrigeraton and Domco Industries, to locate where a patent
infringement occurred.
[54]
Second, it
was argued that the Board’s interpretation gives an extra-territorial effect to
the legislation by enabling the Board to issue orders respecting the price of
medicines sold outside Canada, which it could not enforce.
Parliament, counsel said, should not be held to have legislated to no practical
effect. I do not agree that this necessarily follows from the Board’s
interpretation.
[55]
The Board has
a legitimate interest in the price paid for medicine purchased under the SAP by
a physician (perhaps as agent of the patient for whose treatment it has been
prescribed) from a patentee outside Canada, because this is the price that will
be paid for the medicine by the ultimate consumer in Canada. For the Board in
these circumstances to find that the price charged by the patentee, and
ultimately paid by a patient, an insurer or an institution in Canada, is excessive, and to order
the patentee to reduce the price of sale, is not, in my view, to give the
legislation extra-territorial effect.
[56]
For one
thing, the patentee may decide that it will no longer sell the medicine in Canada below the price found by the
Board to be excessive. However, this is a course of action open to the
patentees of all medicines in response to an order of the Board. Alternatively,
if it decides to flout the Board’s order by continuing to sell the medicine at
a price that the Board has found excessive, the Board may not be able to
enforce its order if the patentee has no presence in Canada. However, these hypothetical responses
by a patentee to a Board order are speculative.
[57]
In my
view, it is at least as likely that the patentee would be prepared to comply
and to sell the drug at a permitted price. The Board has no interest in finding
a price to be excessive, on the basis of the criteria contained in section 85
and the guidelines developed after consultation with industry, consumers and
Health Canada, when it has reason to believe that the patentee would not be
willing sell the medicine for less.
[58]
Hence, in
my opinion, the statutory and regulatory contexts support the Board’s
interpretation of paragraph 80(1)(b).
F. CONCLUSIONS
[59]
For these
reasons, I agree with the Board’s interpretation of the phrase “sold in any
market in Canada” in sections 80(1), 83 and 85
of the Patent Act. I would therefore allow the appeal with costs here
and below, set aside the order of the Applications Judge, and dismiss Celgene’s
application for judicial review.
“John
M. Evans”
“I
agree.
K.
Sharlow J.A.”
APPENDIX
Patent Act, R.S.C. 1985, c, P-4
|
Pricing information,
etc., required by regulations
80. (1) A patentee of an invention
pertaining to a medicine shall, as required by and in accordance with the
regulations, provide the Board with such information and documents as the
regulations may specify respecting
…
(b) the price
at which the medicine is being or has been sold in any market in Canada and elsewhere;
…
Order re excessive
prices
83. (1) Where the Board finds that a
patentee of an invention pertaining to a medicine is selling the medicine in
any market in Canada at a price that, in the Board’s opinion, is excessive,
the Board may, by order, direct the patentee to cause the maximum price at
which the patentee sells the medicine in that market to be reduced to such
level as the Board considers not to be excessive and as is specified in the
order.
(2) Subject to subsection (4), where
the Board finds that a patentee of an invention pertaining to a medicine has,
while a patentee, sold the medicine in any market in Canada at a price that,
in the Board’s opinion, was excessive, the Board may, by order, direct the
patentee to do any one or more of the following things as will, in the
Board’s opinion, offset the amount of the excess revenues estimated by it to
have been derived by the patentee from the sale of the medicine at an
excessive price:
(a) reduce the
price at which the patentee sells the medicine in any market in Canada, to such
extent and for such period as is specified in the order;
(b) reduce the
price at which the patentee sells one other medicine to which a patented
invention of the patentee pertains in any market in Canada, to such extent
and for such period as is specified in the order; or
(c) pay to Her
Majesty in right of Canada an amount specified in the order.
…
Factors to be
considered
85. (1) In determining under section 83
whether a medicine is being or has been sold at an excessive price in any
market in Canada, the Board shall take into consideration the following
factors, to the extent that information on the factors is available to the
Board:
(a) the prices at
which the medicine has been sold in the relevant market;
(b) the prices at
which other medicines in the same therapeutic class have been sold in the
relevant market;
(c) the prices at
which the medicine and other medicines in the same therapeutic class have
been sold in countries other than Canada;
(d) changes in the
Consumer Price Index; and
(e) such other
factors as may be specified in any regulations made for the purposes of this
subsection.
|
Renseignements
réglementaires à fournir sur les prix
80. (1) Le breveté est tenu de fournir
au Conseil, conformément aux règlements, les renseignements et documents sur
les points suivants :
[…]
(b) le prix
de vente — antérieur ou actuel — du médicament sur les marchés canadien et
étranger;
[…]
Ordonnance relative aux prix excessifs
83. (1) Lorsqu’il estime que le breveté vend sur un
marché canadien le médicament à un prix qu’il juge être excessif, le Conseil
peut, par ordonnance, lui enjoindre de baisser le prix de vente maximal du
médicament dans ce marché au niveau précisé dans l’ordonnance et de façon
qu’il ne puisse pas être excessif.
(2) Sous réserve du paragraphe
(4), lorsqu’il estime que le breveté a vendu, alors qu’il était titulaire du
brevet, le médicament sur un marché canadien à un prix qu’il juge avoir été
excessif, le Conseil peut, par ordonnance, lui enjoindre de prendre l’une ou
plusieurs des mesures suivantes pour compenser, selon lui, l’excédent
qu’aurait procuré au breveté la vente du médicament au prix excessif :
(a)
baisser,
dans un marché canadien, le prix de vente du médicament dans la mesure et
pour la période prévue par l’ordonnance;
(b)
baisser,
dans un marché canadien, le prix de vente de tout autre médicament lié à une
invention brevetée du titulaire dans la mesure et pour la période prévue par
l’ordonnance;
(c)
payer
à Sa Majesté du chef du Canada le montant précisé dans l’ordonnance.
…
Facteurs de fixation
du prix
85. (1) Pour décider si le prix d’un
médicament vendu sur un marché canadien est excessif, le Conseil tient compte
des facteurs suivants, dans la mesure où des renseignements sur ces facteurs
lui sont disponibles :
(a) le prix de
vente du médicament sur un tel marché;
(b) le prix de
vente de médicaments de la même catégorie thérapeutique sur un tel marché;
(c) le prix de
vente du médicament et d’autres médicaments de la même catégorie
thérapeutique à l’étranger;
(d) les variations
de l’indice des prix à la consommation;
(e) tous les
autres facteurs précisés par les règlements d’application du présent
paragraphe.
|
Food and Drug Regulations, C.R.C., c. 870
|
C.08.002. (1) No person shall sell or
advertise a new drug unless
(a) the
manufacturer of the new drug has filed with the Minister a new drug
submission or an abbreviated new drug submission relating to the new drug
that is satisfactory to the Minister;
(b) the Minister
has issued, pursuant to section C.08.004, a notice of compliance to the
manufacturer of the new drug in respect of the new drug submission or
abbreviated new drug submission;
…
Sale of New Drug for
Emergency Treatment
C.08.010. (1) The Director may issue a letter of authorization authorizing the
sale of a quantity of a new drug for human or veterinary use to a
practitioner named in the letter of authorization for use in the emergency
treatment of a patient under the care of that practitioner, if
(a)
the
practitioner has supplied to the Director information concerning
(i)
the
medical emergency for which the drug is required,
(ii)
the
data in the possession of the practitioner with respect to the use, safety
and efficacy of that drug,
(iii)
the
names of all institutions in which the drug is to be used, and
(iv)
such
other data as the Director may require; and
(b)
the
practitioner has agreed to
(i)
report
to the manufacturer of the new drug and to the Director on the results of the
use of the drug in the medical emergency, including information respecting
any adverse reactions encountered, and
(ii)
account
to the Director on request for all quantities of the drug received by him.
(2) The Director shall, in any letter of authorization issued pursuant
to subsection (1), state
(a)
the
name of the practitioner to whom the new drug may be sold;
(b)
the
medical emergency in respect of which the new drug may be sold; and
(c)
the
quantity of the new drug that may be sold to that practitioner for that
emergency.
…
C.08.011. (1) Notwithstanding section C.08.002, a manufacturer may
sell to a practitioner named in a letter of authorization issued pursuant to
section C.08.010, a quantity of the new drug named in that letter that does
not exceed the quantity specified in the letter.
(2) A sale of a new drug made in accordance with subsection (1) is
exempt from the provisions of the Act and these Regulations.
|
C.08.002. (1) Il est interdit de vendre
ou d’annoncer une drogue nouvelle, à moins que les conditions suivantes ne soient
réunies :
(a) le fabricant
de la drogue nouvelle a, relativement à celle-ci, déposé auprès du ministre
une présentation de drogue nouvelle ou une présentation abrégée de drogue
nouvelle que celui-ci juge acceptable ;
(b) le ministre a,
aux termes de l’article C.08.004, délivré au fabricant de la drogue nouvelle
un avis de conformité relativement à la présentation de drogue nouvelle ou à
la présentation abrégée de drogue nouvelle ;
[…]
Vente d'une drogue nouvelle pour un traitement
d'urgence
C.08.010. (1) Le
Directeur général peut fournir une lettre d'autorisation permettant la vente
d'une certaine quantité d'une drogue nouvelle d'usage humaine ou vétérinaire
à un praticien nommé dans la lettre d'autorisation pour le traitement
d'urgence d'un malade traité par ledit praticien, si
(a)
le
praticien a fourni au Directeur général des renseignements concernant
(i)
l'état
pathologique urgent pour laquel la drogue est requise,
(ii)
les
données que possède le praticien à propos de l'usage, de l'innocuité et de
l'efficacité de ladite drogue,
(iii)
le
nom de tous les établissements où la drogue doit être utilisée, et
(iv)
les
autres renseignements que le Directeur général pourrait lui demander; et
(b)
le
praticien a consenti à
(i)
faire
part au fabricant de la drogue nouvelle et au Directeur général des résultats
de l'usage de la drogue au cours de l'urgence, y compris les renseignements
se rapportant à toute réaction défavorable qu'il aura observée, et
(ii)
rendre
compte au Directeur général, sur demande, de toutes les quantités de la
drogue qu'il aura reçues.
(2) Le Directeur général doit,
dans toute lettre d'autorisation fournie conformément au paragraphe (1),
spécifier
(a)
le
nom du praticien auquel la drogue nouvelle peut être vendue;
(b)
l'état
pathologique urgent pour lequel la drogue nouvelle peut être vendue; et
(c)
la
quantité de la drogue nouvelle qui peut être vendue audit praticien pour
ledit cas urgent.
…
C.08.011. (1) Nonobstant l'article
C.08.002, un fabricant peut vendre à un praticien mentionné dans une lettre
d'autorisation fournie conformément à l'article C.08.010, une quantité de la
drogue nouvelle nommée dans ladite lettre qui n'excède pas la quantité
spécifiée dans la lettre.
(2) La vente d'une drogue nouvelle
faite en conformité du paragraphe (1) n'est pas soumise aux dispositions de
la Loi et du présent règlement.
|
RYER J.A.
(Dissenting reasons)
[60]
With respect, I am unable to agree with the
conclusion of my colleague, Justice Evans. In my view, the correct
interpretation of paragraph 80(1)(b) of the Patent Act, R.S.C.
1985, c. P-4 (the “Act”) is that the Patented Medicines Prices Review Board
(the “Board”) has no power to request information of the type contemplated by
that provision respecting the price at which a particular medicine is sold
unless that medicine is being or has been sold in Canada. In other words, the
jurisdiction of the Board is not engaged unless it is established that the
medicine in question has been the subject of a sale that takes place in Canada. Accordingly, I agree with the decision of
Justice Campbell that the decision of the Board, dated January 1, 2008, should
be set aside.
[61]
In support of this conclusion and to address
certain of the reasons of my colleague, I wish to make the following
observations.
[62]
First, in my view, the textual, contextual and
purposive approach espoused by the Supreme Court of Canada in Canada Trustco
Mortgage Co. v. Canada, [2005] 2 S.C.R. 601, 2005 SCC 54, mandates
reliance on the ordinary meaning of the words of the provision under
consideration when those words are precise and unequivocal. To me, the words “
sold in any market in Canada”, as
contained in paragraph 80(1)(b) of the Act, contemplate sales of the
medicine in question occurring in Canada, whether or not that phrase, or any portion of it, can be said to be a
“legal term of art”.
[63]
Secondly, my colleague appears to favour an
interpretation of the phrase “sold in any market in Canada” that places more emphasis on the location of the market than on the
place of sale of the medicine. Thus, under this approach, the Board would have
the power to request information in relation to a sale of the medicine by
Celgene that occurs in a market in Canada. But how is it that a sale of the medicine that admittedly occurred in
the United States could also occur in a market in Canada? In my view, this conundrum illustrates the insurmountable difficulty
with respect to an interpretation that focuses on the requirement for a market
in Canada. Clearly, any sale that
occurs in Canada will also occur in a
market in Canada.
[64]
Without engaging in a debate with respect to the
meaning of the French word “marché”, I note that counsel for the appellant
states, at paragraph 45 of his factum:
The corresponding definition of the word
marché specifically refers to the geographical area where commodities and
services are transacted… [Emphasis added.]
In my view, sale transactions cannot be “transacted” in a geographical
area without the presence of both the buyer and the seller in that area.
Moreover, a mere demand for a commodity is insufficient to bring about a transaction
with respect to that commodity.
[65]
Thirdly, the interpretation of my colleague seems
to rewrite the particular phrase so that it would become “sold into any
market in Canada”. This
interpretation stretches the meaning of the phrase into something beyond its
ordinary meaning. If Parliament had intended the phrase “sold in any market in
Canada”, in paragraph 80(1)(b) of the Act, to have an extended meaning,
it could have done so as it did when it inserted an extended meaning of “patentee”
in section 79 of the Act. That extended meaning operates for the purposes of
section 79 to 103 of the Act. In my view, the absence of an extended meaning in
the Act for the phrase “sold in any market in Canada” indicates that the phrase should be given its ordinary meaning. Since
Parliament did not stipulate that the words in issue were to be given a meaning
outside their ordinary meaning, with respect, I am not persuaded that it is
this Court’s mandate to do so.
[66]
Fourthly, the issue before the Board, the Federal
Court and this Court is the jurisdiction of the Board to make information
requests under paragraph 80(1)(b) of the Act. With respect, the
jurisdiction of the Board to make an order against Celgene under section 83 of
the Act was not in issue, and was not fully argued, before this Court. As such,
I would leave the scope of the Board’s jurisdiction over Celgene under that
provision to be argued in a proceeding in which that issue actually arises.
[67]
Finally, I am not inclined to view the Act as
consumer protection legislation. Indeed, the Board itself appears to believe
that its mandate was broader than that. At paragraph 5 of its reasons, the
Board states:
5. The mandate of the Board
includes balancing the monopoly power held by the patentee of a medicine, with
the interests of purchasers of those medicines. The patentee of a medicine sold
in Canada is subject to the jurisdiction of the Board, and this jurisdiction
requires the patentee to report information to the Board concerning the price
at which it has been selling the patented medicine in any market in Canada. The Board compares this price to the price of
comparable medicines, and to the price at which the medicine is sold in other
countries, to determine whether or not its price in Canada is excessive. In consultation with industry, government and
consumer stakeholders, the Board has developed detailed guidelines that
patentees and Board Staff use to ensure that the prices of patented medicines
in Canada are not excessive (the “Guidelines”). [Emphasis added.]
[68]
For these reasons, I would dismiss the appeal with
costs.
“C. Michael Ryer”
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