AstraZeneca AB v. Apotex Inc., 2004 FC 44

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2004 FC 44

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Date: 20040114

Docket: T-148-02

Citation: 2004 FC 44

Ottawa, Ontario, this 14^th day of January, 2004

Present: The Honourable Mr. Justice Russell

BETWEEN:

ASTRAZENECA AB and

ASTRAZENECA CANADA INC.

Applicants

and

APOTEX INC. and THE MINISTER OF HEALTH

Respondents

REASONS FOR ORDER

INTRODUCTION

[1] This is an application by AstraZeneca AB and AstraZeneca Canada Inc. (collectively "AstraZeneca") for an Order prohibiting the Minister of Health ("Minister") from issuing a Notice of Compliance ("NOC") to Apotex Inc. ("Apotex") in respect of Apo-Omeprazole tablets for oral administration in strengths of 10 mg, 20 mg and 40 mg until after the expiration of Canadian patent 2,166,794 ("'794" Patent) and for a declaration that Apotex's letter dated December 12, 2001 is not a notice of allegation as contemplated by the Patented Medicines (Notice of Compliance) Regulations ("Regulations").

BACKGROUND

[2] This proceeding was initiated by Notice of Application filed January 31, 2002, in response to a letter dated December 12, 2001, from Apotex purporting to be a notice of allegation ("NOA"). The Notice of Application was subsequently amended on April 19, 2002.

[3] AstraZeneca is seeking a declaration that the NOA is not a notice of allegation as contemplated by the Regulations and, in the alternative, an Order prohibiting the Minister from issuing an NOC to Apotex in respect of Apo-Omeprazole tablets for oral administration in strengths of 10 mg, 20 mg and 40 mg until after the expiration of the '794 Patent.

[4] The '794 Patent claims magnesium omeprazole having a degree of crystallinity of not less than 70%. Claim 1 of the '794 Patent states as follows:

1. Magnesium omeprazole characterized in having a degree of crystallinity which is higher than 70% as determined by X-ray powder diffraction.

[5] The '794 Patent also claims a tablet formulation containing magnesium omeprazole having a degree of crystallinity higher than 70%:

22. A tablet formulation containing magnesium omeprazole according to any one of claims 1 to 8 as active ingredient, together with a pharmaceutically acceptable diluent or carrier.

[6] In the NOA, Apotex asserts that it has "filed with the Minister of Health a New Drug Submission for Apo-Omeprazole tablets for oral administration in strengths of 10 mg, 20 mg and 40 mg."

[7] Apotex makes the following allegation of non-infringement in the NOA:

With respect to patent 2166794, we allege that no claim for the medicine itself and no claim for the use of the medicine would be infringed by the making, constructing, using or selling by us of the said tablets.

[8] The legal and factual basis for the non-infringement allegation given by Apotex is as follows:

The claims of this patent relate only to magnesium omeprazole having a degree of crystallinity higher than 70% as determined by x-ray powder diffraction, processes for making same, compositions containing same, and use of same.

Our tablets will not infringe by reason of the fact that the tablets will contain only amorphous magnesium omeprazole.

[9] On July 3, 2002, Apotex served a notice of motion returnable on July 22, 2002, seeking summary dismissal of AstraZeneca's application pursuant to subsection 6(5) of the Regulations. The motion was heard by Prothonotary Lafrenière on August 16, 2002. Prothonotary Lafrenière dismissed Apotex's 6(5) motion following submissions by counsel for AstraZeneca on the sole issue of the sufficiency of the allegation and after hearing reply submissions of counsel for Apotex on this issue.

[10] Apotex appealed the decision of Prothonotary Lafrenière by motion to a Judge of the Trial Division. The motion was heard by Layden-Stevenson J. on October 28, 2002. Layden-Stevenson J. rendered a decision dated December 2, 2002 in which she dismissed the motion.

[11] By Notice of Motion dated August 6, 2002, originally returnable August 12, 2002, AstraZeneca sought to compel Dr. Sherman of Apotex to answer questions refused during his cross-examination. Prothonotary Lafrenière heard that motion on October 21, 2002 and dismissed the motion for delay.

[12] This is the second time that Apotex has delivered an NOA alleging that the '794 Patent will not be infringed. In a letter dated December 18, 1997, Apotex alleged non-infringement with respect to the '794 Patent on the following legal and factual basis:

In this patent any claim for the medicine itself or the use for the medicine is limited to omeprazole magnesium characterized by having a degree of crystallinity which is higher than 70% as determined by x-ray powder diffraction. The omeprazole magnesium used by us will not fall within the scope of the claims. More specifically we will use only omeprazole magnesium having a degree of crystallinity lower than 70% as determined by x-ray powder diffraction.

[13] In response to the December 18, 1997 letter, a proceeding was initiated under Court File T-179-98 (the "Prior Proceeding").

[14] In the Prior Proceeding, Apotex and AstraZeneca filed numerous expert affidavits and cross-examinations were conducted.

[15] In the Prior Proceeding, Apotex did not make any disclosure regarding the degree of crystallinity of magnesium omeprazole used in its tablets or during processing.

[16] Prior to the hearing on the merits, which was scheduled to begin on May 25, 1999, the Prior Proceeding was discontinued by Order of Tremblay-Lamer J. dated May 18, 1999, which stated, in part:

WHEREAS Apotex wishes to withdraw its Notice of Allegation dated December 18, 1997, which Notice of Allegation give rise to the within proceedings.

...

WHEREAS the withdrawal of the notice of allegation will render the proceedings herein moot.

WHEREAS the Applicants and Apotex consent to the issuance of the following order.

IT IS HEREBY ORDERED:

1. The Notice of Allegation is hereby deemed to be withdrawn by Apotex.

2. This application is deemed to be discontinued.

[17] At approximately the same time as the Prior Proceeding was discontinued, a "side agreement" was entered into by Apotex and AstraZeneca regarding future allegations with respect to omeprazole capsules.

EVIDENCE

[18] In support of this application, AstraZeneca filed affidavits from Mr. Wilton, sworn February 22, 2002, Mr. Oxhammar, sworn February 27, 2002, Dr. Ymén, sworn February 28, 2002, and Ms. Da Costa, sworn March 4, 2002.

[19] Dr. Ymén, an expert in x-ray powder diffraction (xrpd) analysis gave evidence that the NOA makes no assertion regarding the crystallinity of magnesium omeprazole used to make the tablets. He also gave evidence that a skilled person can determine whether a tablet contains crystalline magnesium omeprazole by analysing the tablet. Dr. Ymén was not cross-examined.

[20] Mr. Wilton and Mr. Oxhammar gave evidence that AstraZeneca has no knowledge or access to knowledge regarding the existence, contents, date of filing or present status of the new drug submission ("NDS") referred to by Apotex in the NOA. Mr. Wilton and Mr. Oxhammar were not cross-examined.

[21] Ms. Da Costa's affidavit refers to evidence that was part of the Prior Proceeding.

[22] Apotex filed no evidence beyond an affidavit from Dr. Sherman, sworn April 19, 2002.

[23] Dr. Sherman was cross-examined on June 18, 2002. On June 28 and October 18, 2002, Apotex provided answers to certain matters outstanding from Dr. Sherman's cross-examination.

ISSUES

[24] AztraZeneca has asked the Court to address the following issues:

a. whether the NOA is sufficient to justify a conclusion of non-infringement of the '794 Patent;

b. whether the allegation in the NOA that the tablets will contain amorphous magnesium omeprazole is also deficient; and

c. whether the NOA is an abuse of process.

RELEVANT STATUTORY AND REGULATORY PROVISIONS

[25] The relevant portions of the Patented medicines (Notice of Compliance) Regulations SOR 93-133 are as follows:

Patented Medicines (Notice of Compliance) Regulations

P.C. 1993-502 12 March, 1993

His Excellency the Governor General in Council, on the recommendation of the Minister of Consumer and Corporate Affairs, pursuant to subsection 55.2(4)* of the Patent Act, is pleased hereby to make the annexed Regulations respecting a notice of compliance pertaining to patented medicines.

*S.C. 1993, c. 2, s. 4REGULATIONS RESPECTING A NOTICE OF COMPLIANCE PERTAINING TO PATENTED MEDICINES

1. These Regulations may be cited as the Patented Medicines (Notice of Compliance) Regulations.

INTERPRETATION

2. In these Regulations,

"claim for the medicine itself" includes a claim in the patent for the medicine itself when prepared or produced by the methods or processes of manufacture particularly described and claimed or by their obvious chemical equivalents; (revendication pour le médicament en soi)

"claim for the use of the medicine" means a claim for the use of the medicine for the diagnosis, treatment, mitigation or prevention of a disease, disorder or abnormal physical state, or the symptoms thereof; (revendication pour l'utilisation du médicament)

"court" means the Federal Court of Canada or any other superior court of competent jurisdiction; (tribunal)

"expire" means, in relation to a patent, expire, lapse or terminate by operation of law; (expiré)

"first person" means the person referred to in subsection 4(1); (première personne)

"medicine" means a substance intended or capable of being used for the diagnosis, treatment, mitigation or prevention of a disease, disorder or abnormal physical state, or the symptoms thereof; (médicament)

"Minister" means the Minister of National Health and Welfare; (ministre)

"notice of compliance" means a notice issued under section C.08.004 of the Food and Drug Regulations; (avis de conformité)

"patent list" means a list of all patents that is submitted pursuant to section 4; (liste de brevets)

"register" means the register maintained by the Minister under section 3. (registre)

"second person" means the person referred to in subsection 5(1) or (1.1), as the case may be. (seconde personne) SOR/98-166, s. 1; SOR/99-379, s. 1.

3. (1) The Minister shall maintain a register of any information submitted under section 4. To maintain it, the Minister may refuse to add or may delete any information that does not meet the requirements of that section.

(2) The register shall be open to public inspection during business hours.

(3) No information submitted pursuant to section 4 shall be included on the register until after the issuance of the notice of compliance in respect of which the information was submitted.

(4) For the purpose of deciding whether information submitted under section 4 should be added to or deleted from the register, the Minister may consult with officers or employees of the Patent Office. SOR/98-166, s. 2.

PATENT LIST

4. (1) A person who files or has filed a submission for, or has been issued, a notice of compliance in respect of a drug that contains a medicine may submit to the Minister a patent list certified in accordance with subsection (7) in respect of the drug.

(2) A patent list submitted in respect of a drug must

(a) indicate the dosage form, strength and route of administration of the drug;

(b) set out any Canadian patent that is owned by the person, or in respect of which the person has an exclusive licence or has obtained the consent of the owner of the patent for the inclusion of the patent on the patent list, that contains a claim for the medicine itself or a claim for the use of the medicine and that the person wishes to have included on the register;

(c) contain a statement that, in respect of each patent, the person applying for a notice of compliance is the owner, has an exclusive licence or has obtained the consent of the owner of the patent for the inclusion of the patent on the patent list;

(d) set out the date on which the term limited for the duration of each patent will expire pursuant to section 44 or 45 of the Patent Act; and

(e) set out the address in Canada for service on the person of any notice of an allegation referred to in paragraph 5(3)(b) or (c), or the name and address in Canada of another person on whom service may be made, with the same effect as if service had been made on the person.

(3) Subject to subsection (4), a person who submits a patent list must do so at the time the person files a submission for a notice of compliance.

(4) A first person may, after the date of filing of a submission for a notice of compliance and within 30 days after the issuance of a patent that was issued on the basis of an application that has a filing date that precedes the date of filing of the submission, submit a patent list, or an amendment to an existing patent list, that includes the information referred to in subsection (2).

(5) When a first person submits a patent list or an amendment to an existing patent list in accordance with subsection (4), the first person must identify the submission to which the patent list or the amendment relates, including the date on which the submission was filed.

(6) A person who submits a patent list must keep the list up to date but may not add a patent to an existing patent list except in accordance with subsection (4).

(7) A person who submits a patent list or an amendment to an existing patent list under subsection (1) or (4) must certify that

(a) the information submitted is accurate; and

(b) the patents set out on the patent list or in the amendment are eligible for inclusion on the register and are relevant to the dosage form, strength and route of administration of the drug in respect of which the submission for a notice of compliance has been filed. SOR/98-166, s. 3.

5. (1) Where a person files or has filed a submission for a notice of compliance in respect of a drug and compares that drug with, or makes reference to, another drug for the purpose of demonstrating bioequivalence on the basis of pharmaceutical and, where applicable, bioavailability characteristics and that other drug has been marketed in Canada pursuant to a notice of compliance issued to a first person and in respect of which a patent list has been submitted, the person shall, in the submission, with respect to each patent on the register in respect of the other drug,

(a) state that the person accepts that the notice of compliance will not issue until the patent expires; or

(b) allege that

(i) the statement made by the first person pursuant to paragraph 4(2)(c) is false,

(ii) the patent has expired,

(iii) the patent is not valid, or

(iv) no claim for the medicine itself and no claim for the use of the medicine would be infringed by the making, constructing, using or selling by that person of the drug for which the submission for the notice of compliance is filed.

(1.1) Subject to subsection (1.2), where subsection (1) does not apply and where a person files or has filed a submission for a notice of compliance in respect of a drug that contains a medicine found in another drug that has been marketed in Canada pursuant to a notice of compliance issued to a first person and in respect of which a patent list has been submitted, the person shall, in the submission, with respect to each patent included on the register in respect of the other drug containing the medicine, where the drug has the same route of administration and a comparable strength and dosage form,

(a) state that the person accepts that the notice of compliance will not issue until the patent expires; or

(b) allege that

(i) the statement made by the first person pursuant to paragraph 4(2)(c) is false,

(ii) the patent has expired,

(iii) the patent is not valid, or

(1.2) Where a person referred to in subsection (1.1) has served, in accordance with paragraph (3)(b) or (c), a notice of allegation on a first person in respect of a patent included on the register, the person is not required to serve a notice of allegation in respect of the same submission, the same allegation and the same patent on another first person.

(2) Where, after a second person files a submission for a notice of compliance but before the notice of compliance is issued, a patent list or an amendment to a patent list is submitted in respect of a patent pursuant to subsection 4(4), the second person shall amend the submission to include, in respect of that patent, the statement or allegation that is required by subsection (1) or (1.1), as the case may be.

(3) Where a person makes an allegation pursuant to paragraph (1)(b) or (1.1)(b) or subsection (2), the person shall

(a) provide a detailed statement of the legal and factual basis for the allegation;

(b) if the allegation is made under any of subparagraphs (1)(b)(i) to (iii) or (1.1)(b)(i) to (iii), serve a notice of the allegation on the first person;

(i) serve on the first person a notice of the allegation relating to the submission filed under subsection (1) or (1.1) at the time that the person files the submission or at any time thereafter, and

(ii) include in the notice of allegation a description of the dosage form, strength and route of administration of the drug in respect of which the submission has been filed; and

(d) serve proof of service of the information referred to in paragraph (b) or (c) on the Minister. SOR/98-166, ss. 4, 9; SOR/99-379, s. 2.

RIGHT OF ACTION

6. (1) A first person may, within 45 days after being served with a notice of an allegation pursuant to paragraph 5(3)(b) or (c), 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 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.

(3) The first person shall, within the 45 days referred to in subsection (1), serve the Minister with proof that an application referred to in that subsection has been made.

(4) Where the first person is not the owner of each patent that is the subject of an application referred to in subsection (1), the owner of each such patent shall be made a party to the application.

(5) In a proceeding in respect of an application under subsection (1), the court may, on the motion of a second person, dismiss the application

(a) if the court is satisfied that the patents at issue are not eligible for inclusion on the register or are irrelevant to the dosage form, strength and route of administration of the drug for which the second person has filed a submission for a notice of compliance; or

(b) on the ground that the application is redundant, scandalous, frivolous or vexatious or is otherwise an abuse of process.

(6) For the purposes of an application referred to in subsection (1), where a second person has made an allegation under subparagraph 5(1)(b)(iv) or (1.1)(b)(iv) in respect of a patent and where that patent was granted for the medicine itself when prepared or produced by the methods or processes of manufacture particularly described and claimed or by their obvious chemical equivalents, it shall be considered that the drug proposed to be produced by the second person is, in the absence of proof to the contrary, prepared or produced by those methods or processes.

(7) On the motion of a first person, the court may, at any time during a proceeding,

(a) order a second person to produce any portion of the submission for a notice of compliance filed by the second person relevant to the disposition of the issues in the proceeding and may order that any change made to the portion during the proceeding be produced by the second person as it is made; and

(b) order the Minister to verify that any portion produced corresponds fully to the information in the submission.

(8) A document produced under subsection (7) shall be treated confidentially.

(9) In a proceeding in respect of an application under subsection (1), a court may make any order in respect of costs, including on a solicitor-and-client basis, in accordance with the rules of the court.

(10) In addition to any other matter that the court may take into account in making an order as to costs, it may consider the following factors:

(a) the diligence with which the parties have pursued the application;

(b) the inclusion on the certified patent list of a patent that should not have been included under section 4; and

(c) the failure of the first person to keep the patent list up to date in accordance with subsection 4(6). SOR/98-166, ss. 5, 9; SOR/99-379, s. 3.

NOTICE OF COMPLIANCE

7. (1) The Minister shall not issue a notice of compliance to a second person before the latest of

(a) [Repealed, SOR/98-166, s. 6]

(b) the day on which the second person complies with section 5,

(d) subject to subsection (3), the expiration of 45 days after the receipt of proof of service of a notice of any allegation pursuant to paragraph 5(3)(b) or (c) in respect of any patent on the register,

(e) subject to subsections (2), (3) and (4), the expiration of 24 months after the receipt of proof of the making of any application under subsection 6(1), and

(f) the expiration of any patent that is the subject of an order pursuant to subsection 6(1).

(2) Paragraph (1)(e) does not apply if at any time, in respect of each patent that is the subject of an application pursuant to subsection 6(1),

(a) the patent has expired; or

(b) the court has declared that the patent is not valid or that no claim for the medicine itself and no claim for the use of the medicine would be infringed.

(3) Paragraphs (1)(c), (d) and (e) do not apply in respect of a patent if the owner of the patent has consented to the making, constructing, using or selling of the drug in Canada by the second person.

(4) Paragraph (1)(e) ceases to apply in respect of an application under subsection 6(1) if the application is withdrawn or discontinued by the first person or is dismissed by the court hearing the application.

(5) If the court has not yet made an order under subsection 6(1) in respect of an application, the court may

(a) shorten the time limit referred to in paragraph (1)(e) on consent of the first and second persons or if the court finds that the first person has failed, at any time during the proceeding, to reasonably cooperate in expediting the application; or

(b) extend the time limit referred to in paragraph (1)(e) on consent of the first and second persons or, if the court finds that the second person has failed, at any time during the proceeding, to reasonably cooperate in expediting the application. SOR/98-166, ss. 6, 9.

8. (1) If an application made under subsection 6(1) is withdrawn or discontinued by the first person or is dismissed by the court hearing the application or if an order preventing the Minister from issuing a notice of compliance, made pursuant to that subsection, is reversed on appeal, the first person is liable to the second person for any loss suffered during the period

(a) beginning on the date, as certified by the Minister, on which a notice of compliance would have been issued in the absence of these Regulations, unless the court is satisfied on the evidence that another date is more appropriate; and

(b) ending on the date of the withdrawal, the discontinuance, the dismissal or the reversal.

(2) A second person may, by action against a first person, apply to the court for an order requiring the first person to compensate the second person for the loss referred to in subsection (1).

(3) The court may make an order under this section without regard to whether the first person has commenced an action for the infringement of a patent that is the subject matter of the application.

(4) The court may make such order for relief by way of damages or profits as the circumstances require in respect of any loss referred to in subsection (1).

(5) In assessing the amount of compensation the court shall take into account all matters that it considers relevant to the assessment of the amount, including any conduct of the first or second person which contributed to delay the disposition of the application under subsection 6(1). SOR/98-166, ss. 8, 9.

SERVICE

9. (1) Service of any document referred to in these Regulations shall be effected personally or by registered mail.

(2) Service by registered mail shall be deemed to be effected on the addressee five days after mailing.

Règlement sur les médicaments brevetés (avis de conformité)

C.P. 1993-502 12 mars 1993

Sur recommandation du ministre de la Consommation et des Affaires commerciales et en vertu du paragraphe 55.2(4)* de la Loi sur les brevets, il plaît à Son Excellence le Gouverneur général en conseil de prendre le Règlement concernant les avis de conformité portant sur les médicaments brevetés, ci-après.

*L.C. 1993, ch. 2, art. 4

RÈGLEMENT CONCERNANT LES AVIS DE CONFORMITÉ PORTANT SUR LES MÉDICAMENTS BREVETÉS

1. Règlement sur les médicaments brevetés (avis de conformité).

DÉFINITIONS

2. Les définitions qui suivent s'appliquent au présent règlement.

« avis de conformité » Avis délivré au titre de l'article C.08.004 du Règlement sur les aliments et drogues. (notice of compliance)

« expiré » Se dit du brevet qui est expiré, qui est périmé ou qui a pris fin par l'effet d'une loi. (expire)

« liste de brevets » Liste de brevets soumise aux termes de l'article 4. (patent list)

« médicament » Substance destinée à servir ou pouvant servir au diagnostic, au traitement, à l'atténuation ou à la prévention d'une maladie, d'un désordre, d'un état physique anormal, ou de leurs symptômes. (medicine)

« ministre » Le ministre de la Santé nationale et du Bien-être social. (Minister)

« première personne » La personne visée au paragraphe 4(1). (first person)

« _registre_ » Le registre tenu par le ministre conformément à l'article 3. (register)

« revendication pour le médicament en soi » S'entend notamment d'une revendication, dans le brevet, pour le médicament en soi préparé ou produit selon les modes du procédé de fabrication décrits en détail et revendiqués ou selon leurs équivalents chimiques manifestes. (claim for the medicine itself)

« revendication pour l'utilisation du médicament » Revendication pour l'utilisation du médicament aux fins du diagnostic, du traitement, de l'atténuation ou de la prévention d'une maladie, d'un désordre, d'un état physique anormal, ou de leurs symptômes. (claim for the use of the medicine)

« _seconde personne_ » Selon le cas, la personne visée aux paragraphes 5(1) ou (1.1). (second person)

« tribunal » La Cour fédérale du Canada ou tout autre cour supérieure compétente. (court) DORS/98-166, art. 1; DORS/99-379, art. 1.

REGISTRE

3. (1) Le ministre tient un registre des renseignements fournis aux termes de l'article 4. À cette fin, il peut refuser d'y ajouter ou en supprimer tout renseignement qui n'est pas conforme aux exigences de cet article.

(2) Le registre est ouvert à l'inspection publique durant les heures de bureau.

(3) Aucun renseignement soumis aux termes de l'article 4 n'est consigné au registre avant la délivrance de l'avis de conformité à l'égard duquel il a été soumis.

(4) Pour décider si tout renseignement fourni aux termes de l'article 4 doit être ajouté au registre ou en être supprimé, le ministre peut consulter le personnel du Bureau des brevets. DORS/98-166, art. 2.

LISTE DE BREVETS

4. (1) La personne qui dépose ou a déposé une demande d'avis de conformité pour une drogue contenant un médicament ou qui a obtenu un tel avis peut soumettre au ministre une liste de brevets à l'égard de la drogue, accompagnée de l'attestation visée au paragraphe (7).

(2) La liste de brevets au sujet de la drogue doit contenir les renseignements suivants :

a) la forme posologique, la concentration et la voie d'administration de la drogue;

b) tout brevet canadien don't la personne est propriétaire ou à l'égard duquel elle détient une licence exclusive ou a obtenu le consentement du propriétaire pour l'inclure dans la liste, qui comporte une revendication pour le médicament en soi ou une revendication pour l'utilisation du médicament, et qu'elle souhaite voir inscrit au registre;

c) une déclaration portant, à l'égard de chaque brevet, que la personne qui demande l'avis de conformité en est le propriétaire, en détient la licence exclusive ou a obtenu le consentement du propriétaire pour l'inclure dans la liste;

d) la date d'expiration de la durée de chaque brevet aux termes des articles 44 ou 45 de la Loi sur les brevets;

e) l'adresse de la personne au Canada aux fins de signification de tout avis d'allégation visé aux alinéas 5(3)b) ou c), ou les nom et adresse au Canada d'une autre personne qui peut en recevoir signification avec le même effet que s'il s'agissait de la personne elle-même.

(3) Sous réserve du paragraphe (4), la personne qui soumet une liste de brevets doit le faire au moment du dépôt de la demande d'avis de conformité.

(4) La première personne peut, après la date de dépôt de la demande d'avis de conformité et dans les 30 jours suivant la délivrance d'un brevet qui est fondée sur une demande de brevet don't la date de dépôt est antérieure à celle de la demande d'avis de conformité, soumettre une liste de brevets, ou toute modification apportée à une liste de brevets, qui contient les renseignements visés au paragraphe (2).

(5) Lorsque la première personne soumet, conformément au paragraphe (4), une liste de brevets ou une modification apportée à une liste de brevets, elle doit indiquer la demande d'avis de conformité à laquelle se rapporte la liste ou la modification, en précisant notamment la date de dépôt de la demande.

(6) La personne qui soumet une liste de brevets doit la tenir à jour mais ne peut ajouter de brevets à une liste que si elle le fait en conformité avec le paragraphe (4).

(7) La personne qui soumet une liste de brevets ou une modification apportée à une liste de brevets aux termes des paragraphes (1) ou (4) doit remettre une attestation portant que :

a) les renseignements fournis sont exacts;

b) les brevets mentionnés dans la liste ou dans la modification sont admissibles à l'inscription au registre et sont pertinents quant à la forme posologique, la concentration et la voie d'administration de la drogue visée par la demande d'avis de conformité. DORS/98-166, art. 3.

5. (1) Lorsqu'une personne dépose ou a déposé une demande d'avis de conformité pour une drogue et la compare, ou fait référence, à une autre drogue pour en démontrer la bioéquivalence d'après les caractéristiques pharmaceutiques et, le cas échéant, les caractéristiques en matière de biodisponibilité, cette autre drogue ayant été commercialisée au Canada aux termes d'un avis de conformité délivré à la première personne et à l'égard de laquelle une liste de brevets a été soumise, elle doit inclure dans la demande, à l'égard de chaque brevet inscrit au registre qui se rapporte à cette autre drogue :

a) soit une déclaration portant qu'elle accepte que l'avis de conformité ne sera pas délivré avant l'expiration du brevet;

b) soit une allégation portant que, selon le cas :

(i) la déclaration faite par la première personne aux termes de l'alinéa 4(2)c) est fausse,

(ii) le brevet est expiré,

(iii) le brevet n'est pas valide,

(iv) aucune revendication pour le médicament en soi ni aucune revendication pour l'utilisation du médicament ne seraient contrefaites advenant l'utilisation, la fabrication, la construction ou la vente par elle de la drogue faisant l'objet de la demande d'avis de conformité.

(1.1) Sous réserve du paragraphe (1.2), lorsque le paragraphe (1) ne s'applique pas, la personne qui dépose ou a déposé une demande d'avis de conformité pour une drogue contenant un médicament que l'on trouve dans une autre drogue qui a été commercialisée au Canada par suite de la délivrance d'un avis de conformité à la première personne et à l'égard de laquelle une liste de brevets a été soumise doit inclure dans la demande, à l'égard de chaque brevet inscrit au registre visant cette autre drogue contenant ce médicament, lorsque celle-ci présente la même voie d'administration et une forme posologique et une concentration comparables :

a) soit une déclaration portant qu'elle accepte que l'avis de conformité ne soit pas délivré avant l'expiration du brevet;

b) soit une allégation portant que, selon le cas :

(i) la déclaration faite par la première personne aux termes de l'alinéa 4(2)c) est fausse,

(ii) le brevet est expiré,

(iii) le brevet n'est pas valide,

(iv) aucune revendication pour le médicament en soi ni

aucune revendication pour l'utilisation du médicament ne seraient contrefaites advenant l'utilisation, la fabrication, la construction ou la vente par elle de la drogue faisant l'objet de la demande d'avis de conformité.

(1.2) Si une personne visée au paragraphe (1.1) a signifié, conformément aux alinéas (3)b) ou c), un avis d'allégation à une première personne à l'égard d'un brevet inscrit au registre, elle n'est tenue de signifier un avis d'allégation à l'égard de la même demande, de la même allégation et du même brevet à aucune autre première personne.

(2) Lorsque, après le dépôt par la seconde personne d'une demande d'avis de conformité mais avant la délivrance de cet avis, une liste de brevets ou une modification apportée à une liste de brevets est soumise à l'égard d'un brevet aux termes du paragraphe 4(4), la seconde personne doit modifier la demande pour y inclure, à l'égard de ce brevet, la déclaration ou l'allégation exigées par les paragraphes (1) ou (1.1), selon le cas.

(3) Lorsqu'une personne fait une allégation visée aux alinéas (1)b) ou (1.1)b) ou au paragraphe (2), elle doit :

a) fournir un énoncé détaillé du droit et des faits sur lesquels elle se fonde;

b) si l'allégation est faite aux termes de l'un des sous-alinéas (1)b)(i) à (iii) ou (1.1)b)(i) à (iii), signifier un avis de l'allégation à la première personne;

c) si l'allégation est faite aux termes des sous-alinéas (1)b)(iv) ou (1.1)b)(iv) :

(i) signifier à la première personne un avis de l'allégation relative à la demande déposée selon les paragraphes (1) ou (1.1), au moment où elle dépose la demande ou par la suite,

(ii) insérer dans l'avis d'allégation une description de la forme posologique, de la concentration et de la voie d'administration de la drogue visée par la demande;

d) signifier au ministre une preuve de la signification effectuée conformément aux alinéas b) ou c). DORS/98-166, art. 4 et 9; DORS/99-379, art. 2.

DROITS D'ACTION

6. (1) La première personne peut, dans les 45 jours après avoir reçu signification d'un avis d'allégation aux termes des alinéas 5(3)b) ou c), demander au tribunal de rendre une ordonnance interdisant au ministre de délivrer un avis de conformité avant l'expiration du brevet visé par l'allégation.

(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.

(3) La première personne signifie au ministre, dans la période de 45 jours visée au paragraphe (1), la preuve que la demande visée à ce paragraphe a été faite.

(4) Lorsque la première personne n'est pas le propriétaire de chaque brevet visé dans la demande mentionnée au paragraphe (1), le propriétaire de chaque brevet est une partie à la demande.

(5) Lors de l'instance relative à la demande visée au paragraphe (1), le tribunal peut, sur requête de la seconde personne, rejeter la demande si, selon le cas :

a) il estime que les brevets en cause ne sont pas admissibles à l'inscription au registre ou ne sont pas pertinents quant à la forme posologique, la concentration et la voie d'administration de la drogue pour laquelle la seconde personne a déposé une demande d'avis de conformité;

b) il conclut qu'elle est inutile, scandaleuse, frivole ou vexatoire ou constitue autrement un abus de procédure.

(6) Aux fins de la demande visée au paragraphe (1), lorsque la seconde personne a fait une allégation aux termes des sous-alinéas 5(1)b)(iv) ou (1.1)b)(iv) à l'égard d'un brevet et que ce brevet a été accordé pour le médicament en soi préparé ou produit selon les modes ou procédés de fabrication décrits en détail et revendiqués ou selon leurs équivalents chimiques manifestes, la drogue que la seconde personne projette de produire est, en l'absence d'une preuve contraire, réputée préparée ou produite selon ces modes ou procédés.

(7) Sur requête de la première personne, le tribunal peut, au cours de l'instance :

a) ordonner à la seconde personne de produire les extraits pertinents de la demande d'avis de conformité qu'elle a déposée et lui enjoindre de produire sans délai tout changement apporté à ces extraits au cours de l'instance;

b) enjoindre au ministre de vérifier que les extraits produits correspondent fidèlement aux renseignements figurant dans la demande d'avis de conformité.

(8) Tout document produit aux termes du paragraphe (7) est considéré comme confidentiel.

(9) Le tribunal peut, au cours de l'instance relative à la demande visée au paragraphe (1), rendre toute ordonnance relative aux dépens, notamment sur une base avocat-client, conformément à ses règles.

(10) Lorsque le tribunal rend une ordonnance relative aux dépens, il peut tenir compte notamment des facteurs suivants :

a) la diligence des parties à poursuivre la demande;

b) l'inscription, sur la liste de brevets qui fait l'objet d'une attestation, de tout brevet qui n'aurait pas dû y être inclus aux termes de l'article 4;

c) le fait que la première personne n'a pas tenu à jour la liste de brevets conformément au paragraphe 4(6). DORS/98-166, art. 5 et 9; DORS/99-379, art. 3.

AVIS DE CONFORMITÉ

7. (1) Le ministre ne peut délivrer un avis de conformité à la seconde personne avant la plus tardive des dates suivantes :

a) [Abrogé, DORS/98-166, art. 6]

b) la date à laquelle la seconde personne se conforme à l'article 5;

c) sous réserve du paragraphe (3), la date d'expiration de tout brevet inscrit au registre qui ne fait pas l'objet d'une allégation;

d) sous réserve du paragraphe (3), la date qui suit de 45 jours la date de réception de la preuve de signification de l'avis d'allégation visé aux alinéas 5(3)b) ou c) à l'égard de tout brevet inscrit au registre;

e) sous réserve des paragraphes (2), (3) et (4), la date qui suit de 24 mois la date de réception de la preuve de présentation de la demande visée au paragraphe 6(1);

f) la date d'expiration de tout brevet faisant l'objet d'une ordonnance rendue aux termes du paragraphe 6(1).

(2) L'alinéa (1)e) ne s'applique pas si, à l'égard de chaque brevet visé par une demande au tribunal aux termes du paragraphe 6(1) :

a) soit le brevet est expiré;

b) soit le tribunal a déclaré que le brevet n'est pas valide ou qu'aucune revendication pour le médicament en soi ni aucune revendication pour l'utilisation du médicament ne seraient contrefaites.

(3) Les alinéas (1)c), d) et e) ne s'appliquent pas à l'égard d'un brevet si le propriétaire de celui-ci a consenti à ce que la seconde personne utilise, fabrique, construise ou vende la drogue au Canada.

(4) L'alinéa (1)e) cesse de s'appliquer à l'égard de la demande visée au paragraphe 6(1) si celle-ci est retirée ou fait l'objet d'un désistement par la première personne ou est rejetée par le tribunal qui en est saisi.

(5) Lorsque le tribunal n'a pas encore rendu d'ordonnance aux termes du paragraphe 6(1) à l'égard d'une demande, il peut :

a) abréger le délai visé à l'alinéa (1)e) avec le consentement de la première personne et de la seconde personne, ou s'il conclut que la première personne n'a pas, au cours de l'instance relative à la demande, collaboré de façon raisonnable au règlement expéditif de celle-ci;

b) proroger le délai visé à l'alinéa (1)e) avec le consentement de la première personne et de la seconde personne, ou s'il conclut que la seconde personne n'a pas, au cours de l'instance relative à la demande, collaboré de façon raisonnable au règlement expéditif de celle-ci. DORS/98-166, art. 6 et 9.

8. (1) Si la demande présentée aux termes du paragraphe 6(1) est retirée ou fait l'objet d'un désistement par la première personne ou est rejetée par le tribunal qui en est saisi, ou si l'ordonnance interdisant au ministre de délivrer un avis de conformité, rendue aux termes de ce paragraphe, est annulée lors d'un appel, la première personne est responsable envers la seconde personne de toute perte subie au cours de la période :

a) débutant à la date, attestée par le ministre, à laquelle un avis de conformité aurait été délivré en l'absence du présent règlement, sauf si le tribunal estime d'après la preuve qu'une autre date est plus appropriée;

b) se terminant à la date du retrait, du désistement ou du rejet de la demande ou de l'annulation de l'ordonnance.

(2) La seconde personne peut, par voie d'action contre la première personne, demander au tribunal de rendre une ordonnance enjoignant à cette dernière de lui verser une indemnité pour la perte visée au paragraphe (1).

(3) Le tribunal peut rendre une ordonnance aux termes du présent article sans tenir compte du fait que la première personne a institué ou non une action pour contrefaçon du brevet visé par la demande.

(4) Le tribunal peut rendre l'ordonnance qu'il juge indiquée pour accorder réparation par recouvrement de dommages-intérêts ou de profits à l'égard de la perte visée au paragraphe (1).

(5) Pour déterminer le montant de l'indemnité à accorder, le tribunal tient compte des facteurs qu'il juge pertinents à cette fin, y compris, le cas échéant, la conduite de la première personne ou de la seconde personne qui a contribué à retarder le règlement de la demande visée au paragraphe 6(1). DORS/98-166, art. 8 et 9.

SIGNIFICATION

9. (1) La signification de tout document prévu dans le présent règlement doit être faite à personne ou par courrier recommandé.

(2) La signification par courrier recommandé est réputée être effectuée le cinquième jour suivant sa mise à la poste.

THE OBJECTION

[26] Early in his submissions, counsel for AstraZeneca referred me to the affidavit of Ms. Da Costa and indicated that this would be important for dealing with the abuse of process issue.

[27] Ms. Da Costa's affidavit refers to evidence that was part of the Prior Proceeding.

[28] Counsel for AstraZeneca wished to draw my attention to what had been said in, and the legal and factual basis of, the Prior Proceeding because consideration of the scope of the notice of allegation in the Prior Proceeding is relevant to his argument that the NOA at issue in these proceedings is not separate and distinct.

[29] Counsel for Apotex objected to proceeding in this manner and to the use that counsel for AstraZeneca intended to make of the materials in Ms. Da Costa's affidavit. The grounds for such objection were lack of notice of the evidence from the Prior Proceeding to be relied upon and that the matters referred to in such evidence could not be established through the affidavit of Ms. Da Costa, who is a law clerk.

[30] Counsel for Apotex referred me to the decision of Campbell J. in AB Hassle v. Apotex Inc., [2003] F.C.J. No. 994 (F.C.T.D.) where a similar preliminary objection had been raised and dealt with by Campbell J..

[31] The Court questioned counsel for AstraZeneca on his rationale for introducing this evidence in these proceedings and asked him whether he could distinguish the present situation from what had occurred before Campbell J. In AB Hassle, supra. He made it quite clear that he did not wish to rely upon the evidence referred to in Ms. Da Costa's affidavit for the truth of its contents, but merely to draw the Court's attention to what documentation had been part of the Prior Proceeding.

[32] Counsel for AstraZeneca took the position that, although he could not use the materials in the Da Costa affidavit to establish the truth of their contents, he should be able to use them to establish what had been said in the Prior Proceeding, and that this could be important for his abuse of process argument. Counsel submitted as follows:

It matters because you can't assess properly, in my view, whether what Apotex is doing the second time around is an abuse or not; whether there's prejudice to the Applicants, unless you have an understanding of factually what happened in the previous case

...

And so who said what; who did what, those facts, I say, are important to the abuse issue.

[33] On this issue, the Court accepted Apotex's arguments that there had not been sufficient notice of AstraZeneca's specific reliance upon the evidence in the Prior Proceeding, that the Court could not accept Ms. Da Costa's affidavit as establishing anything other than the bare facts of what had been filed in the Prior Proceeding and ruled that Ms. Da Costa's affidavit and its exhibits were admissible on that basis alone.

Is the NOA sufficient to justify a conclusion of non-infringement of the '794 Patent?

ARGUMENTS

[34] AstraZeneca submits that the NOA is not sufficient to support a conclusion of non-infringement. The NOA asserts only that Apotex's tablets will contain amorphous magnesium omeprazole. There is no assertion regarding the crystallinity of magnesium omeprazole used to make the tablets. Therefore, the allegation addresses, at best, the tablet formulation claims of the '794 Patent and does not address the main claim (claim 1) to magnesium omeprazole per se (i.e. raw material) and claims which depend upon claim 1 (claims 2 to 9). As such, AstraZeneca says that the basis asserted in the NOA, even if assumed to be true, does not lead to the conclusion that the '794 Patent will not be infringed and that, in this regard, the evidence of Dr. Ymén, AstraZeneca's expert, is uncontroverted.

[35] AstraZeneca points out that the courts have adopted a very strict approach when considering the sufficiency of an allegation. In Syntex v. Novopharm, [1996] F.C.J. No. 86 (F.C.T.D.) , a decision of Noël J. (as he then was), Novopharm asserted non-infringement of a product by process patent claim, stating that it would not use a particular step. However, Novopharm failed to address whether it would use the step claimed by the patent. As a result, the factual assertion could not lead to a conclusion of non-infringement, and the Court granted an Order of Prohibition.

[36] AstraZeneca also referred me to the decision in Procter & Gamble Pharmaceuticals Canada, Inc. V. Canada (Minister of Health), [2003] 1 F.C. 402, where the Federal Court of Appeal held that the detailed statement in an allegation must provide the legal and factual basis why none of the relevant patent claims will be infringed. In that case, the Court found that the allegation of non-infringement could not be justified because the detailed statement only addressed claims to a "kit" but did not address the use claims in the patent, and that the trial judge was therefore correct in prohibiting the issuance of an NOC.

[37] In the case at bar, AstraZeneca says that Apotex has not addressed claims to magnesium omeprazole per se and, therefore, its allegation of non-infringement cannot be justified. In accordance with the Court of Appeal decision in Procter & Gamble Pharmaceuticals Canada, Inc., supra, in such circumstances, AstraZeneca says an order of prohibition must be granted.

[38] AstraZeneca points out that Dr. Sherman, on behalf of Apotex, attempted to correct the deficiency in the NOA by subsequently giving evidence related to the crystallinity of magnesium omeprazole used to make Apotex's tablets. However, AstraZeneca says the law is clear that Apotex is strictly limited to the legal and factual basis set out in the NOA and Apotex cannot rely on any such subsequent evidence. In any event, AstraZeneca says that Dr. Sherman is not a credible witness for at least the following reasons:

(a) he has an interest in the outcome of these proceedings;

(b) he does not have the knowledge or expertise to comment on xrpd analysis which can establish that the magnesium omeprazole used to make Apo-Omeprazole tablets is amorphous;

(c) he conceded in cross examination that he could not answer crucial questions with factual certainty: "I cannot know for sure what anyone (at Apotex) might or might not have done."

[39] AstraZeneca also points out that Dr. Sherman's evidence has been previously rejected by this Court as lacking credibility in previous proceedings.

[40] Consequently, AstraZeneca says Apotex's NOA is not sufficient to justify a conclusion of non-infringement of all relevant claims.

[41] In response to these assertions by AstraZeneca, Apotex points out that the '794 Patent can only be infringed by Apotex if Apotex utilizes magnesium omeprazole with a degree of crystallinity higher than 70%.

[42] AstraZeneca asserts that Apotex's allegation, which specifically states that its "tablets will contain only amorphous magnesium omeprazole," does not address the raw material to be contained in Apotex's tablets. AstraZeneca thus asserts that Apotex's allegation is deficient and that Apotex should not be permitted to rely upon the evidence filed by it which establishes beyond doubt that the raw material to be used by Apotex is non-infringing amorphous magnesium omeprazole. Apotex says that AstraZeneca's position is entirely ill-conceived in this regard.

[43] First, Apotex says that its NOA does, in fact, address the ingredients to be contained in Apotex's tablets. To suggest otherwise requires one to distort the plain words of the allegation. In particular, when Apotex alleges that its tablets will "contain only" amorphous magnesium omeprazole, Apotex is specifically addressing the ingredients that which will be utilized to make its tablets. The allegation does not admit of any other interpretation. See Glaxo Group Ltd. v. Canada (Minister of National health and Welfare), [1998] F.C.J. No. 399 (F.C.T.D.) ("Glaxo"), and SmithKline Beecham Pharma Inc. v. Canada (2001), 10 C.P.R. (4^th) 338 (F.C.A.).

[44] Second, Apotex argues that the standard by which the sufficiency of an allegation is measured requires the Court to ask whether AstraZeneca has a sufficient understanding as to the case it has to meet in order to establish that the allegation is not justified; that is, that there would be infringement. AstraZeneca was clearly aware that it could establish infringement by proving that the magnesium omeprazole utilized to make the tablets was within the scope of the '794 Patent because of the fact that, from the outset, AstraZeneca specifically adverted to the question of the crystallinity of the magnesium omeprazole utilized to make the Apotex tablets. On this issue, Apotex refers the Court to the following authorities:

SmithKline Beecham Pharma Inc. v. Canada, supra at 346-347

Glaxo Group Ltd. v. Canada, supra at 426

Merck Frosst Canada Inc. v. Canada (Minister of Health) (2000), 8 C.P.R. (4^th) 87 at 92-93 (F.C.T.D.), aff'd (2001), 12 C.P.R. (4^th) 447 (F.C.A.)

Pfizer Canada Inc. v. Nu-Pharm Inc. (1998), 83 C.P.R. (3d) 1 at 4-6 (F.C.T.D.)

Hoffmann La-Roche v. Canada (Minister of National Health and Welfare) (1999), 86 C.P.R. (3d) 303 at 308 (F.C.T.D.)

[45] Finally, in advancing its complaint that Apotex's allegation does not address the bulk material to be used by Apotex in making its tablets, AstraZeneca must necessarily be arguing that it could be "possible" that Apotex is using magnesium omeprazole having a degree of crystallinity of 70% in making its tablets but that, by reason of a chemical conversion, Apotex's tablets would, in the end, contain only non-infringing amorphous magnesium omeprazole. Moreover, AstraZeneca must necessarily be suggesting that Apotex ought to have anticipated this and ought to have dealt with it in its NOA.

[46] Apotex points out, however, that AstraZeneca has not adduced a shred of evidence to suggest that such a "conversion" is at all possible. In considering the foregoing, it is significant to consider that AstraZeneca did adduce the evidence of Dr. Ymén who is said to possess expertise in matters pertaining to the crystallinity of omeprazole. Accordingly, AstraZeneca was obviously in a position to adduce evidence that the "conversion" was possible, but did not do so. The only inference that can be drawn from AstraZeneca's silence is that neither Dr. Ymén, nor any other qualified expert, was prepared to provide an opinion that would give substance to AstraZeneca's theory of conversion. Apotex says that for AstraZeneca to now suggest that Apotex ought to have addressed this unsubstantiated theory in its allegation is absurd.

[47] In conclusion, and by way of summary on this last point, Apotex says that AstraZeneca's complaint, when properly understood, is that Apotex's allegation failed to address a fanciful theory unsubstantiated by any evidence whatsoever and, for this reason, is deficient. If this proposition were correct it could be used to render any notice of allegation deficient through the simple expedient of raising an unsupported theory that could not have been anticipated.

[48] Apotex says that this approach to attacking a notice of allegation has been repeatedly rejected by this Honourable Court and the Court of Appeal.

[49] In Glaxo, supra, Hugessen J. was asked to assess the adequacy of a notice of allegation served by Apotex which provided as follows:

This patent has claims only for a particular form of ranitidine hydrochloride, which is known as form 2. We undertake that until the expiry of this patent, any 75 mg tablets made and sold by us will contain only form 1 ranitidine hydrochloride and not form 2.

[50] The applicants in Glaxo, supra, filed expert affidavit evidence that "under appropriate solvents and reaction conditions" form 1 ranitidine hydrochloride could convert to form 2 ranitidine hydrochloride. In response to this evidence of conversion, Apotex filed detailed evidence that its product would indeed be form 1 ranitidine hydrochloride and would not convert to form 2 ranitidine hydrochloride.

[51] On the basis of their theory of conversion, the applicants in Glaxo, supra, attacked the sufficiency of Apotex's notice of allegation in that case on the basis that it did not address and "respond to" the issue of conversion.

[52] In dismissing the proceeding in Glaxo, supra, Hugessen J. rejected any complaints as to the adequacy of Apotex's allegation and specifically considered Apotex's evidence regarding conversion. Hugessen J. thus considered the very type of evidence that AstraZeneca, in the case at bar, says should be ignored. An appeal from the decision in Glaxo, supra, was not pursued.

[53] In Merck Frosst Canada, supra, Muldoon J. considered a very similar attack on a notice of allegation to the one being advanced by AstraZeneca in the case at bar.

[54] In Merck Frosst Canada, supra, the relevant patent claimed a pharmaceutical composition containing polysaccharide in aqueous solution of the type which undergoes liquid-gel phase transition. In respect of that patent, the respondent served a notice of allegation asserting that its product contained "xanthan gum" which was alleged not to be a polysaccharide of the type that undergoes liquid-gel phase transition.

[55] In response to this allegation, the applicants, in their evidence, attacked the respondent's use of the term "gel". In their responding evidence, the respondents adduced their own evidence as to the proper definition of gel, which evidence arguably went beyond the scope of the notice of allegation. The applicants thus complained that this evidence should be ignored as it constituted new "facts" not contained in the notice of allegation.

[56] In rejecting the applicants' argument in Merck Frosst, supra, Muldoon J. , at paragraph 11 of his reasons, commented as follows:

The struggle surrounding the term "gel", however, was initiated by the applicants, through the first affidavit of Prof. Morris, in order to help disprove Alcon's allegation in its NOA that xanthan gum does not undergo a liquid-to-gel phase transition in situ. Alcon had, therefore, every right to adduce Prof. Ross-Murphy's competing definition of "gel" as a defence. To conclude otherwise would be to strip a respondent in a section 5 proceeding of any ability to defend itself. It would also force a respondent first, to prophesy down which path an applicant will march in construing the patent so as to attack the NOA and second, predict what scientific evidence it will need to guard the ramparts. Such a process, however, would be inefficient and serve no purpose. [emphasis added]

[57] Finally, the adequacy of an almost identical notice of allegation to the one at bar was considered by the Federal Court of Appeal in SmithKline Beecham Pharma Inc. v. Canada ("SmithKline"), supra. In SmithKline, the patent at issue claimed a particular form of paroxetine hydrochloride, namely, crystalline paroxetine hydrochloride hemihydrate.

[58] In its notice of allegation in SmithKline, supra, Apotex alleged that it would not infringe the relevant patent on the basis that "the tablets to be made and sold by Apotex Inc. will not be made using crystalline paroxetine hydrochloride hemihydrate, but will be made using the medicine paroxetine hydrochloride." During the course of the prohibition proceedings, Apotex amplified its allegation so as to advise the applicants in that case that the specific form of paroxetine hydrochloride to be used by Apotex would be paroxetine hydrochloride anhydrate.

[59] The applicants in SmithKline, supra, filed detailed evidence and test results in an attempt to prove that hydrochloride anhydrate had a tendency to convert to paroxetine hydrochloride hemihydrate during the process to make the tablets. On the basis of this theory of conversion, the applicants asserted that, since Apotex's allegation addressed only the form of paroxetine to be used in manufacturing its paroxetine product, and not the form of paroxetine after the tableting process, Apotex's allegation was deficient. The applicants' position in SmithKline, supra, was, says Apotex, identical to AstraZeneca's position herein, only in the reverse.

[60] Although the applicants in SmithKline, supra, (unlike the case at bar) had filed evidence that a chemical conversion was possible, the Federal Court of Appeal, at paragraph 27 of its reasons, still rejected their complaints as to the adequacy of the Apotex notice of allegation.

That being said, the detailed statement in this case was not insufficient in the sense that it left SmithKline having to guess at the real grounds for the respondent's allegation that the patent would not be infringed. Indeed, SmithKline appears to have well understood at the time the section 6 application was commenced that conversion of anhydrate to hemihydrate was raised by the detailed statement and that Apotex' tablets would not contain the hemihydrate. This is apparent from the evidence which it filed in support of its application. In my view, therefore, the detailed statement did provide the factual and legal basis required in paragraph 5(3)(b) of the Regulations sufficient to make the appellants fully aware of the grounds on which the respondents claimed that the patent would not be infringed if the notice of compliance issued.

[61] The conclusions reached by the Court of Appeal in SmithKline, supra, are, Apotex argues, applicable to the facts herein. In the case at bar, AstraZeneca cannot, with any credibility, suggest that it was not aware of the basis upon which Apotex framed its allegation. Rather, it is quite evident from the manner in which this proceeding has been litigated, that, at all times, AstraZeneca knew that it would have to prove that Apotex would, in making, constructing, using or selling its Apo-Omeprazole tablets, utilize magnesium omeprazole having a degree of crystallinity greater than 70%. AstraZeneca, in fact, attempted to address this issue, filed deficient evidence and, in response, Apotex filed "iron clad" evidence that its product would not infringe.

ANALYSIS

[62] In AB Hassle v. Canada (Minister of National Health and Welfare) (2000), 7 C.P.R. (4^th) 272, the Federal Court of Appeal provided a comprehensive account of the role played by a detailed statement within the scheme of the Regulations and the basic approach that should be deployed in analysing the issue that is now before this Court:

16. It seems to me that a key to the determination of this appeal is an appreciation of the role played by a detailed statement within the scheme of the Regulations. As has been indicated, that statement is to be provided before a section 6 prohibition proceeding can be contemplated by the affected patentee. It serves the purpose of notifying the patentee that, in the view of a second person, a patent listed by the first person pursuant to section 4 of the Regulations will not be infringed or, alternatively, that the patent is invalid. This accords with the views of Marceau J.A. in Apotex Inc. v. Canada (Minister of National Health and Welfare) (1997), 76 C.P.R. (3d) 1 (F.C.A.) at 11:

The basic purpose of the Regulations is to provide a means by which patents are noted and protected from possible infringement at the instance of the patent-holder. The Regulations thus ensure that an NOC is not issued without a patent-holder having the opportunity to defend its patent. This opportunity is not diminished by the fact that the notice of allegation is given first, if, as here, it contains sufficient information for the patent-holder to determine whether to seek a prohibition order and the Court can immediately proceed to determine its justification.

17. Indeed, this Court has recognized that the detailed statement must be such as to make the patentee fully aware of the grounds for claiming that the issuance of an NOC would not lead to infringement of a listed patent for, otherwise, the patentee would be unable to decide whether or not to initiate a section 6 proceeding. Thus in Bayer AG, supra, at 337-338, Mahoney J.A. stated:

One further matter warrants comment. Section 5(3)(a) of the Regulations requires that the applicant for the NOC provide a detailed statement of the basis in fact and law of his statement of allegation. It seems intended that the patentee be fully aware of the grounds on which the applicant says issuance of an NOC will not lead to an infringement of the patent before the patentee decides whether or not to apply to a court for a determination. Such disclosure would define the issues at a very early stage.

18. From the point of view of the patentee, the opportunity to initiate a section 6 proceeding presents advantages and disadvantages. The main advantage is that by paragraph 7(1)(e) the Minister of National Health and Welfare is not to issue the NOC for up to 24 months after receipt of proof of the making of the application for prohibition pursuant to section 6 of the Regulations. The effect, as was pointed out by Mahoney J.A. in Bayer AG, supra, at 337 "is tantamount to an interlocutory injunction" for up to the now reduced period of 24 months. This advantage, while significant, is short term. The principal disadvantage is that where the section 6 proceeding is withdrawn, discontinued or dismissed the patentee is liable to compensate the second person for its loss incurred during the period described in subsection 8(1) of the Regulations. Hence the patentee would have less reason than formerly to be tardy in prosecuting a section 6 proceeding. On the other hand, the assurance that compensation must be paid to a second person at the end of an unsuccessful section 6 proceeding is no guarantee that the second person will act with dispatch in that proceeding.

19. The detailed statement is not a pleading per se but represents a pivotal step in the process leading up to the issuance of an NOC. By taking that step the second person puts the patentee on notice of the grounds on which he or she considers that the making, constructing, using or selling of the drug will not infringe the second person's patent rights during the unexpired term of the patent. In theory, this procedure ought to enable the patentee to confidently decide within the 45-day time limit whether to resist the issuance of an NOC. It is to be noted that, subject to business exigencies, the second person had no obligation to make its allegation and provide its detailed statement by an imposed deadline. As much time as the second person deems necessary is available under the scheme of the Regulations.

20. While it is true that the detailed statement is not filed in a section 6 proceeding, it nevertheless casts a long shadow over that proceeding. Indeed, it is upon the content of that statement that the patentee must decide whether or not to commence a section 6 proceeding and to assess its chances of success or failure. In this sense the allegation and detailed statement assist in an important way in framing the issues and facts to be determined in the section 6 proceedings for in seeking prohibition the patentee is obliged to show that, contrary to what is stated in the detailed statement, the patentee's patent right will be infringed if an NOC for the drug is issued prior to the expiration of the listed patent.

21. In my view, all of these considerations suggest that a second person must do what, in fact, paragraph 5(3)(a) requires, i.e. set forth in the detailed statement "the legal and factual basis" for the paragraph 5(1)(b) allegation and to do so in a sufficiently complete manner as to enable the patentee to assess its course of action in response to the allegation. See Pharmacia Inc. v. Canada (Minister of National Health and Welfare) (1994), 58 C.P.R. (3d) 209 (F.C.A.) at 216, per Strayer J.A.. An examination of the detailed statement in issue is thus required in order to determine whether it measures up to this requirement with respect to the allegation that the '693 and '891Patents are not valid for obviousness.

[63] In the case at bar, an examination of the detailed statement at issue is required to determine whether it provides the legal and factual basis for the allegation of non-infringement and whether it does so in a sufficiently complete manner so as to enable AstraZeneca to assess its course of action in response to the allegation of non-infringement.

[64] In the case at bar, the detailed statement reads as follows:

The claims of this patent relate only to magnesium omeprazole having a degree of crystallinity higher than 70% as determined by x-ray powder diffraction, processes for making the same, compositions containing same, and use of same.

Our tablets will not infringe by reason of the fact that the tablets will contain only amorphous magnezium omeprazole.

[65] In essence, AstraZeneca says that this statement is not sufficiently complete because it does not address the crystallinity of the magnesium omeprazole used to make the tablets and so does not address claim 1 (the main claim) in the '794 Patent.

[66] It seems to me that AstraZeneca's argument might have some merit if the Apotex tablets could be made from raw material that contains magnezium omeprazole with a crystallinity of greater than 70%, or if the process for making the tablets creates, at some stage, magnezium omeprazole with a crystallinity that is greater than 70%. Otherwise, when read together, the two paragraphs are clear enough to me that there will be no infringement of process, composition or use claims because only amorphous magnezium omeprazole will be involved.

[67] This situation differs somewhat from that which confronted McGillis J. in SmithKline Beecham Inc. v. Apotex Inc. (1999), 1 C.P.R. (4^th) 99 (F.C.T.D.) a case heavily relied upon by Apotex in the case at bar. In SmithKline Beecham, supra, there was some ambiguity in the notice of allegation because there was no "specific reference to anhydrate," but McGillis J. was satisfied with the allegation in its totality because it specifically alleged that "no claim for the medicine itself and no claim for the use of the medicine would be infringed by the making, constructing, using or selling by Apotex Inc. of tablets containing the medicine ...," and because "the legal and factual basis for the allegation indicates, among other things, that ... the tablets to be made by Apotex Inc. will not be using crystalline paroxetine hydrochloride hemihydrate, but will be made using the medicine paroxetine hydrochloride."

[68] When this case came before the Federal Court of Appeal, Noël J.A., delivering the judgment for the court made it clear that he "would not differ from the conclusion reached by the motions judge" but that he had "difficulty with the reason she gave for arriving at that conclusion and which is recited in paragraph 22 of these reasons."

[69] The difficulty was that the motions judge appeared to consider the allegation made pursuant to subsection 5(1)(b)(iv) of the Regulations in conjunction with the detailed statement required under 5(3)(a) to arrive at her conclusion that "when considered in its totality" the notice of allegation was not insufficient.

[70] The Federal Court of Appeal, however, was of the view that "a deficiency in a detailed statement cannot be cured by reading that statement along with a notice of allegation":

As I have indicated, the whole purpose of the detailed statement is to make the patentee full aware of the grounds on which the person seeking a notice of compliance claims that the patent will not be infringed. Whether that purpose has been accomplished must depend, in my view, on the facts and law relied upon in the detailed statement itself.

[71] Hence the Federal Court of Appeal felt that "the detailed statement in this case was not insufficient in the sense that it left SmithKline having to guess at the real grounds for the respondent's allegation that the patent would not be infringed" (para. 27).

[72] It seems to me, however, that the Court of Appeal decision in SmithKline, supra, also emphasizes the importance, when considering the sufficiency of a detailed statement, of what the relevant patent actually teaches and what the patent holder understands at the time the detailed statement is made. In other words, sufficiency and ambiguity cannot be assessed by merely considering the wording of the statement itself without reference to context, as I believe AstraZeneca is asking the Court to do in the case at bar.

[73] In the Federal Court of Appeal decision in SmithKline, supra, the relevant patent itself taught that "anhydrate converts to the hemihydrate under pressure and that the process of tableting requires the anhydrate to be placed under pressure" and this is why SmithKline argued that it was "essential for Apotex to state as a fact that its anhydrate tablets, when sold, would not contain the hemihydrate" (para. 21). There is no equivalent teaching in the '794 Patent under consideration in the case at bar.

[74] The question before me on this issue is whether, in the absence of a specific statement in the NOA that the tablets will not be made using crystalline magnesium omeprazole with crystallinity greater than 70%, the NOA is, when considered in its totality, deficient and, if deficient, whether that deficiency can be remedied in any way.

[75] Whether the NOA is truly ambiguous in the absence of such a specific statement depends upon the total context in which the detailed statement is made, including the teachings in the '794 Patent and what AstraZeneca actually knows, or is legally obliged to ascertain, about whether amorphous magnesium omeprazole tablets can be made from greater than 70% crystalline material.

[76] When we turn to the evidence, Mr. Stephen Wilton, the Executive Director, Business Development at AstraZeneca has the following to say:

AstraZeneca has no knowledge or access to knowledge regarding the existence, contents (including ingredients, process steps, reference product, nature of composition, indications and uses referred to), date of filing or present status of the new drug submission ("NDS") referred to by Apotex in the NOA. New Drug Submissions are as a rule submitted and maintained on a confidential basis. In the present circumstances only Apotex and the Minister have knowledge of the NDS (and its contents) referred to by Apotex in the NOA.

[77] Because this is directed to the NDS, it tells us nothing about what AstraZeneca knew concerning the properties of either crystalline or amorphous magnesium omeprazole and whether amorphous tablets can be made from material that is greater than 70% crystalline.

[78] The affidavit of Peder Oxhammer, legal counsel at AstraZeneca AB in Sweden, merely confirms Mr. Wilton's position on the lack of knowledge concerning Apotex's NDS.

[79] The only evidence from AstraZeneca that really addresses the point at issue is contained in the affidavit of Dr. Ingvar Ymén, the Principal Scientist and Manager of the Solid State Analysis Group at AstraZeneca R. & O., which is a part of AstraZeneca AB in Sweden. Dr. Ymén claims to be an expert in the art of the '794 Patent as it pertains to crystallinity in general, and in particular to the degree of crystallinity of omeprazole magnesium as determined by xrpd.

[80] Notwithstanding his claimed expertise, what Dr. Ymén has to say on this point is surprisingly brief and unhelpful:

...

10. The assertion that Apotex' tablets will contain only amorphous magnesium omeprazole only addressed the state of magnesium omeprazole in the Apotex tablet. Apotex makes no assertion regarding the crystallinity of the magnesium omeprazole used during the processing steps leading to such tablets, which could have a degree of crystallinity higher than 70%.

[81] In paragraph 10 of his affidavit, Dr. Ymén suggests that "the crystallinity of the magnesium omeprazole used during the processing steps" leading to the tablets "could have a degree of crystallinity higher than 70%."

[82] It is true that Dr. Ymén was not cross examined on this point. It is somewhat surprising, however, that on such a crucial issue, Dr. Ymén was not a little more forthcoming about the basis for such a claim and whether, for instance, he has empirical knowledge to back up such an assertion or is merely engaging in wild speculation.

[83] It is noteworthy that, in SmithKline Beecham, supra, the patentee conducted experiments to support its assertion that the conversion of anhydrate to hemihydrate would result in the infringement of the '060 patent by Apotex and reported on the results to the Court. McGillis J. reviewed this evidence and concluded as follows, at paras. 39 & 40:

In my opinion, the evidence adduced by SmithKline, including the two experiments, raises no more than a possibility of infringement by Apotex, and does not establish, on a balance of probabilities, that Apotex's allegation of non-infringement is not justified. ...

I have therefore concluded that Apotex should not be prevented from taking its anhydrate tablets to market on the basis of a potential conversion to hemihydrate at some undisclosed and imprecise time in the future ...

[84] In the case at bar, there was no teaching in the '794 Patent that material with a degree of crystallinity higher than 70% could be used to make amorphous tablets and AstraZeneca made no attempt to substantiate Dr. Yméns' brief suggestion that the crystallinity of the magnesium omeprazole used during the processing steps "could have a degree of crystallinity higher than 70%." There is also no record of AstraZeneca attempting to obtain relevant information on the crystallinity of Apotex's raw material or to compel its production.

[85] In the absence of any explanation for such a claim it remains in the realm of mere speculation and "raises no more than a possibility of infringement by Apotex," to use the words of McGillis J. in SmithKline Beecham, supra. AstraZeneca's approach to this issue suggests that its principal concern, through the affidavit of Dr. Ymén, was to float a vague theoretical doubt that could be used to attack the sufficiency of the NOA, rather than voice a real concern, with a factual base, that the '794 Patent could be infringed by Apotex in this case. Dr. Ymén could quite easily have explained matters further, but he chose not to do so. In my opinion, his affidavit is more revealing for what it chooses not to say on this matter than what it does. On the facts before me in this case, there is nothing to suggest that AstraZeneca had any real concerns about the grounds on which Apotex claimed the '794 Patent would not be infringed.

[86] Quite apart from the evidence offered by Apotex on this issue, through the affidavit of Dr. Scherman, AstraZeneca provides no convincing evidence of a concern that the '794 Patent might be infringed by Apotex and, more particularly, that it perceived a true deficiency in the detailed statement that prevented it from deciding whether or not to resist the issuance of an NOC. In my opinion, then, the NOA was sufficient to justify a conclusion of non-infringement of the '794 Patent.

Is the allegation in the NOA that the tablets will contain amorphous magnesium omeprazole also deficient?

ARGUMENTS

[87] On this issue, AstraZeneca alleges that the tablets can be analysed to determine the crystallinity of magnesium omeprazole. Dr. Sherman admitted on cross-examination that Apotex has not tested its tablets. Apotex has also refused AstraZeneca's request for production of tablets. AstraZeneca is therefore not in a position to assess infringement and, AstraZeneca argues, this Court has held that an allegation in such circumstances is deficient. If the testing of AstraZeneca's position is that samples will be determinative of the issue of non-infringement, the failure by the generic to provide such samples as part of its NOA means the NOA is deficient and that the Minister should be prohibited from granting an NOC to the generic.

[88] Apotex's reply on this issue is that AstraZeneca's position amounts to a non-sequitur. An otherwise sufficient NOA cannot become insufficient at the evidentiary stage of a proceeding. Provided the allegation addresses the basis upon which Apotex' tablets will not infringe the '794 Patent, the allegation is clearly sufficient and the only matter left to be considered is whether the detailed statement contained in the allegation justifies the claim of non-infringement.

[89] Apotex also says that AstraZeneca's position is contrary to the jurisprudence in this area.

[90] Finally, Apotex says that AstraZeneca's decision never to assert in its written or oral submission to the Court that Apotex's tablets, in fact, contain infringing magnesium omeprazole is significant and is obviously a result of AstraZeneca's not wanting to expressly accuse Apotex of fraud in asserting in its NOA that its tablets would be amorphous when they are, in fact, crystalline. Hence, Apotex says that AstraZeneca's assertions pertaining to Apotex's alleged refusal to produce samples must be construed as amounting to little more than a veiled and wholly unsubstantiated accusation of precisely this sort, which type of allegation this Court has refused to entertain in the past.

[91] AstraZeneca says that if it can prove that the process underlying Apotex's allegation of non-infringement is not commercially workable or reliable from a safety standpoint, it will show that Apotex does not intend to go to the market with a product produced by the process disclosed in its NOA, but with a product produced by some other undisclosed process.

ANALYSIS

[92] I agree with counsel for Apotex that this is tantamount to an allegation of fraud. The notion that Apotex would obtain an NOC by reference to a specified process and circumvent the Regulations by thereafter going to the market with a product produced by another process is not substantiated. This type of allegation must be proven and cannot rest on mere insinuation. There is no foundation for the suggestion advanced by counsel for AstraZeneca in this regard.

[93] AstraZeneca's reliance upon the dicta of Kelen J. in AB Hassle v. Apotex Inc., [2002] F.C.J. No. 1221 (F.C.T.D.) is, in my opinion, misplaced. In that case, Kelen J. specifically found as follows at para. 56:

In the case at bar, the detailed statement is not sufficiently complete for the patentee to respond to the allegation. The expert witnesses called by both sides were expected to "shadow-box". They had no tablets to analyze. The (sic) had insufficient information to know whether the generic omeprazole tablets have a subcoating. The experts agreed that there may be a type of subcoating, but they could only speculate. The reason for the speculation is not because the patentee had not proven, on the balance of probabilities, that the subcoating exists, but because the patentee cannot, on the basis of the information provided by the generic manufacturer, respond to the allegation of non-infringement. The statement of facts in the NOA is not sufficiently detailed or complete. For this reason, I find that the NOA is deficient under the Regulations.

[94] Relying upon Rhozalpharma Inc. v. AB Hassle et al. 2002 FCA 147, a case in which the evidence led by the parties revealed that the assertion of fact contained in the allegation was disproved, Kelen J., in AB Hassle, supra, concluded at para. 58 that he could not ignore the finding "that a spontaneously generated subcoating is considered a 'subcoating' within the meaning of patent '693, particularly since this construction of the patent claim was upheld by the Federal Court of Appeal." In AB Hassle, supra, the generic manufacturer had attempted, in effect, to re-write its NOA after realizing that there was a subcoating between the core and the enteric coating.

[95] In the case at bar, I have found that the detailed statement is sufficiently complete for AstraZeneca to respond to the NOA. Consequently, the witnesses are not expected to "shadow box." The contrast with the situation in AB Hassle, supra, is brought out by the following words of Kelen J. at para. 65 of that case:

The refusal by Apotex to provide samples and the resultant speculative and inconclusive expert evidence, underlines the applicants' first submission that the Notice of Allegation is deficient in providing the detailed factual and legal information required under the Regulations. The Court agrees that the NOA is deficient in this respect because without the information, the experts' evidence about infringement is inconclusive and speculative.

[96] The AB Hassle, supra, case is not, in my opinion, authority for AstraZeneca's assertion that the NOA is deficient because tablet samples were not produced to allow AstraZeneca to assess infringement. In the case at bar, the NOA was not deficient and there is no acceptable evidence before me that the assertions in the allegation are incorrect. The facts in the allegation are presumed to be true and AstraZeneca has produced no convincing evidence to the contrary or to show that either the NOA, or the statement of fact that supports it, are fraudulent. Consequently, in my opinion, the NOA is not deficient on this ground.

Is the NOA an abuse of process?

ARGUMENTS

[97] On this issue, AstraZeneca argues that a generic may not re-litigate an allegation based upon the same legal and factual basis asserted in a previous proceeding. Moreover, the doctrine of abuse of process precludes a generic from raising matters that could have been previously raised. Further, the doctrine of abuse of process does not require that there has been a disposition on the merits of the earlier proceeding.

[98] AstraZeneca says that, in the case at bar, the NOA is an abuse of process as it is not separate and distinct from the prior allegation. In the Prior Proceeding, Apotex also alleged non-infringement of the '794 Patent by asserting that Apotex would use only omeprazole magnesium having a degree of crystallinity lower than 70%. The present allegation that Apotex's tablets will only contain amorphous magnesium omeprazole is, according to AstraZeneca, encompassed by, and is therefore not separate and distinct from, the prior allegation. Apotex is not entitled to make an allegation that is not separate and distinct from the prior allegation, and the NOA is therefore not an allegation contemplated by the Regulations.

[99] AstraZeneca goes further and says that, while Dr. Sherman purports to justify the withdrawal of the prior allegation on the basis of formulation difficulties, there is no evidence that such difficulties related to the crystallinity of magnesium omeprazole, and no explanation has been provided as to why such difficulties necessitated withdrawal of the prior allegation. Indeed, it is Apotex's position that "formulations are not relevant" and that Apotex has refused AstraZeneca's request for production of details of the prior formulations. Consequently, Apotex has failed to establish that the alleged formulation difficulties were related to crystallinity.

[100] In the Prior Proceeding, AstraZeneca points out that Apotex filed no evidence regarding the crystallinity of the magnesium omeprazole used to make, or contained in, its tablets. As a result, AstraZeneca says that Apotex would have failed on the merits in the Prior Proceeding had it not withdrawn its allegation. In the present proceeding, Dr. Sherman has now given such evidence and, aside from the issue of whether this evidence carries any weight or is relevant, it is apparent that Apotex is now attempting to substantiate its NOA with evidence previously not offered in order to improve its position (whether or not there is a justification for the previous withdrawal). For this and the reasons stated above, the NOA is an abuse of process. AstraZeneca relies upon Eli Lilly v. Nu-Pharm Inc. (1996), 69 C.P.R. (3d) 1 (F.C.A.).

[101] Apotex's reply is that there is no merit to AstraZeneca's argument on this issue. Apotex says that the allegation under scrutiny in the case at bar is separate and distinct, and there is no factual underpinning for assertions of abuse in this case.

[102] On or about December 18, 1997, Apotex served a notice of allegation pursuant to the Regulations which ultimately gave rise to the proceeding commenced by the Applicants in Court File No. T-179-98.

[103] A careful reading of Apotex's earlier allegation reveals that, in respect of non-infringement, Apotex would not infringe the '794 Patent because, while the omeprazole magnesium to be used by Apotex would be crystalline, it would have a degree of crystallinity lower than 70% as determined by xrpd. This allegation is separate and distinct from the allegation made in the case at bar since, as indicated, the present allegation asserts that Apotex will not infringe because its tablets will only contain "amorphous magnesium omeprazole," that is, non-crystalline magnesium omeprazole.

[104] In this respect, Apotex has produced documents in the within proceeding that prove that, at the time of Apotex's withdrawal of the earlier allegation, Apotex's formulation was substantially different from the formulation that Apotex has now filed with the Minister.

[105] Multiple notices of allegation are permissible provided they are "separate and distinct." Accordingly, Apotex argues, given that Apotex's allegation is "separate and distinct" from its earlier allegation, AstraZeneca's theory of abuse must necessarily fail. Apotex relies upon Apotex Inc. v. Canada (Minister of National Health and Welfare) (1997), 76 C.P.R. (3d) 1 at 9-10 (F.C.A.), and Novartis AG v. Apotex Inc. (2001), 15 C.P.R. (4^th) 417 at 435 (F.C.T.D.).

[106] Finally, Apotex argues that it is significant that AstraZeneca, in paragraph 49 of its Memorandum of Fact and Law, apparently accepts that the current allegation is distinct from the earlier allegation. In particular, in that paragraph, AstraZeneca argues that the current allegation is "encompassed by" the earlier allegation, thus conceding the differences between the two allegations.

[107] As regards the absence of a factual underpinning for abuse, Apotex points out that this Court has repeatedly held that the determination of whether a subsequently served notice of allegation is abusive requires a consideration of the "factual underpinning" to the prior withdrawal of a notice of allegation which is not separate and distinct.

[108] Thus, in order to assess AstraZeneca's assertion of abuse, it is necessary to examine the events that led to the withdrawal of Apotex's earlier allegation.

[109] After Apotex's earlier allegation was served and the proceeding in Court File No. T-179-98 was commenced, Apotex encountered difficulties with respect to complying with the health and safety requirements of the Food and Drug Act and the Food and Drug Regulations. This is made clear in the Dr. Sherman's affidavit.

[110] By reason of these difficulties, Apotex instructed its counsel to approach AstraZeneca's counsel to attempt to work out a resolution whereby Apotex's earlier allegation giving rise to Court File No. T-179-98 would be withdrawn and the proceedings commenced in relation thereto would be discontinued.

[111] In accordance with Apotex's instructions, Apotex's counsel approached AstraZeneca's counsel and concluded an agreement whereby Apotex's earlier allegation was withdrawn. This agreement was eventually embodied in an Order of the Court dated May 18, 1999, which Order deemed the earlier allegation giving rise to Court File No. T-179-98 as withdrawn and the Application as discontinued.

[112] At the time the agreement was reached, AstraZeneca did not request, and did not make it a term of the Order, that at such time as Apotex addressed the difficulties encountered by it in respect of the Food and Drugs and Act and the Food and Drug Regulations, Apotex would be barred from serving a subsequent notice of allegation based upon any grounds that Apotex chose to pursue. Having not done so, Apotex argues AstraZeneca should not now be permitted to advance such a position.

[113] The question that is thus raised by the foregoing is whether, on these facts, even assuming Apotex's NOA is not "separate and distinct" from Apotex's earlier allegation, there is a "factual underpinning" for a finding of abuse. In this respect, this Court has already held on numerous occasions that, where a notice of allegation is withdrawn due to legitimate regulatory difficulties, there is no abuse in re-serving the allegation once those reasons are overcome.

[114] The recent decision of Kelen J. in AB Hassle, supra, is particularly significant to the within proceeding. In that case, AstraZeneca raised the same issue of abuse to that at bar. In particular, that case involved the withdrawal of the same earlier allegation and the same explanation provided by Apotex, namely, that the earlier allegation had been withdrawn by reason of Apotex encountering health and safety difficulties.

[115] Kelen J., having considered the identical issues that this Court is now asked to also consider, concluded that there was no substance whatsoever to AstraZeneca's assertions of abuse and, indeed, Kelen J. concluded that AstraZeneca's position in respect of abuse was frivolous and vexatious.

ANALYSIS

[116] In my opinion, there is no abuse of process in the case at bar. To begin with, a review of Apotex's prior allegation reveals that the basis for the assertion that there would be no infringement was that Apotex would use material whose crystallinity would be less than 70%. The use of crystalline material was clearly contemplated. In the NOA, Apotex has moved away from crystalline material entirely and bases its claim for non-infringement on the use of amorphous material. In my view, this allegation was not "encompassed" by the earlier allegation, as alleged by AstraZeneca, because the earlier allegation contemplated crystalline material and did not contemplate amorphous material.

[117] In addition, a review of the "factual underpinning" for Apotex's withdrawal of the earlier allegation reveals real and convincing difficulties in complying with the health and safety requirements of the Food and Drug Act and the Food and Drug Regulations. Consequently, there is no "factual underpinning" for a finding of abuse in this case.

"James Russell"

JFC

FEDERAL COURT

NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET: T-148-02

STYLE OF CAUSE: ASTRAZENECA AB and

ASTRAZENECA CANADA INC.

Applicants

and

APOTEX INC. and

THE MINISTER OF HEALTH

Respondents

PLACE OF HEARING: Toronto, Ontario

DATE OF HEARING: November 12, 2003

REASONS FOR [ORDER or JUDGMENT] : Honourable Mr. Justice Russell

DATED: January 14, 2004

APPEARANCES:

Gunars Gaikis

Kavita Ramamoorthy For the Applicants

H. B. Radomski

Andrew Brodkin For the Respondent,

Apotex Inc. No appearance

Minister of Health For the Respondent,

SOLICITORS OF RECORD:

SMART & BIGGAR

Barristers & Solicitors

Toronto, ON

For the Applicants

GOODMANS LLP

Barristers & Solicitors

Toronto, ON

For the Respondent,

Apotex Inc.

Morris Rosenberg

Deputy Attorney General of Canada

For the Respondent,

Minister of Health

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AstraZeneca AB v. Apotex Inc., 2004 FC 44

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2004 FC 44