Date: 19990817
Docket: T-160-99
BETWEEN:
NOVARTIS PHARMACEUTICALS CANADA INC.
and NOVARTIS AG
Applicants
- and -
ABBOTT LABORATORIES, LIMITED, and
THE MINISTER OF HEALTH
Respondents
| An Application under Section 55.2(4) of the Patent Act and Section |
6 of the Patented Medicines (Notice of Compliance) Regulations
REASONS FOR ORDER
EVANS J.:
A. INTRODUCTION
[1] The issue in this motion is whether an order should be issued at Novartis" request requiring the disclosure to it of aspects of the abbreviated new drug submission that Abbott filed with the Minister of Health as part of its application for a notice of compliance under the Patented Medicines (Notice of Compliance) Regulations .
[2] The motion arises from a proceeding by Novartis for an order prohibiting the Minister from issuing a notice of compliance to Abbott with respect to its formulation of cyclosporin, on the ground that Abbott"s formulation infringes patents held by Novartis. This proceeding was instituted in response to Abbott"s notice of allegations that its formulation did not infringe Novartis" patents.
B. THE LEGAL FRAMEWORK
[3] In 1998 Regulations Amending the Patented Medicines (Notice of Compliance) Regulations SOR/98-166 expressly conferred on the Court the power to order the disclosure of material contained in a NDS for the purpose of prohibition proceedings.
6.(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
(b) order the Minister to verify that any portion produced corresponds fully to the information in the submission.
(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.
[4] Since the Minister has already issued a notice of compliance to Novartis for its formulation of cyclosporin, Novartis is "the first person" for the purpose of subsection 6(7). Since Abbott has filed an application with the Minister for a notice of compliance on the basis of a comparison of its formulation of cyclosporin with that of Novartis, Abbott is "the second person".
[5] Counsel advised me that they were aware of no previous case law interpreting and applying subsection 6(7). However, counsel for Abbott referred me to several cases decided by this Court prior to the enactment of this provision in 1998, and before the Court"s jurisdiction in prohibition proceedings to order the disclosure of material filed as part of a NDS under the unamended Regulations was put in doubt. It was conceded by counsel for Novartis that my approach to the exercise of the discretion expressly conferred by subsection 6(7) should for the most part be guided by this jurisprudence.
[6] There is no doubt that the test formulated by the Court in these decisions was quite stringent. Thus, an applicant must include in the application for disclosure "compelling" (Janssen Pharmaceutica Inc. v. Apotex Inc. (1996), 68 C.P.R. (3d) 114, 117 (F.C.T.D.); Eli Lilly & Co. v. Novopharm Ltd. (1996), 69 C.P.R. (3d) 81, 84 (F.C.T.D.)), "clear and persuasive" or "strong" (Merck Frosst Canada Inc. Minister of Health and Welfare (1994), 53 C.P.R. (3d) 368, 377-379 (F.C.T.D.), aff"d. (1994), 55 C.P.R. (3d) 306, 322 (F.C.A.)) evidence demonstrating that the material sought is "essential and relevant" or "necessary" (Merck Frosst Canada Inc., supra ) for the disposition of the issue of infringement.
[7] However, counsel for Novartis pointed out that more permissive versions of the test could also be found. He noted, in particular that in Janssen Pharmaceutica, supra McGillis J. found in favour of the applicant on being satisfied that the information sought "may be relevant" to the issue of infringement.
[8] On the basis of his very considerable experience in this area counsel also suggested that the test was often applied more flexibly than might be inferred from reading the legal propositions admittedly contained in most of the cases. Thus, while "compelling evidence" of the existence of discrepancies between the NDS and the statements supporting the notice of allegations has been said to justify disclosure of the NDS, "compelling evidence" of incompleteness of those statements should also suffice (Eli Lilly & Co., supra) .
[9] The reasons for the Court"s previous reluctance in prohibition proceedings to order the disclosure of information contained in the NDS have no doubt included the following. First, the proceedings are summary in nature, and it is important that they not be delayed by a discovery stage, especially since the institution of prohibition proceedings triggers a statutory stay on the issue of a notice of compliance. Second, an applicant"s failure to obtain an order of prohibition is not determinative of its private law rights and remedies as a patentee. Infringement proceedings, where there is full discovery, always remain available. Third, despite the Court"s best efforts to ensure the confidentiality of information disclosed pursuant to an order, there is inevitably some risk that commercially valuable confidential information, such as that contained in a NDS, may find its way into the hands of, and be improperly used by, a competitor.
[10] On the other hand, of course, applicants are entitled to a full and fair hearing on the merits of their claim. The question for the Court is how best to balance these competing interests.
[11] In my opinion, the addition to the Regulations of subsection 6(7) does not significantly weaken any of the reasons previously motivating judicial caution in ordering the disclosure of information in the NDS. It does, however, make clear that limited discovery is permissible, despite the summary nature of prohibition proceedings. Since such a power was already recognized in the cases to which I have referred, I see no reason to apply a less stringent test than the one adopted in most of the cases.
[12] Novartis bases its claim for disclosure of specified information from Abbott"s NDS on the alleged incompleteness of Abbott"s statements in its notice of allegations about its formulation of cyclosporin. I am prepared to accept that this is in principle an appropriate basis for a disclosure order.
C. A PRELIMINARY POINT
[13] The motion record filed by counsel for Abbott contains an affidavit from a Dr. Charman, an outside expert retained by Abbott for the purpose of the prohibition proceedings. Dr. Charman has not yet been cross-examined on his affidavit, and therefore it does not constitute evidence to support this motion.
[14] Counsel for Abbott submitted that I could nonetheless take it into account and assume the truth of the statements of fact that it contains, in much the same way as statements of fact contained in a notice of allegations are presumed true. However, as counsel for Novartis pointed out, this is only so in the case of statements of fact that are uncontroverted. The statements by Dr. Charman that are of most assistance to Abbott are either conclusions or opinions, or controverted statements of fact.
[15] For these reasons I have decided to disregard Dr. Charman"s affidavit, and any assertions in counsel"s memorandum of fact and law that rely on it, except to the extent that the affidavit provides uncontroverted background information.
[16] Thus, I am prepared to accept as evidence Dr. Charman"s statement that cyclosporin A, the active ingredient involved here, is widely prescribed for patients who have had organ transplants because it reduces the likelihood that the organ will be rejected by the patient"s immune system. I accept also Dr. Charman"s evidence that cyclosporin is hydrophobic, that is, it is not readily soluble. Thus, when administered orally it will not dissolve after being swallowed and hence cannot be absorbed by the patient"s body. The following patents held by Novartis seek to overcome this problem by increasing cyclosporin"s solubility in aqueous environments, such as the stomach or intestine.
D. ISSUES AND ANALYSIS
[17] The prohibition proceeding instituted by Novartis is based on the alleged infringement by Abbott of two patents that Novartis holds with respect to cyclosporin: Canadian Patent 1,332,150, and Canadian Patent 1,308,656.
1. The "150 Patent
[18] This patent claims a formulation of cyclosporin comprising an oil in water microemulsion preconcentrate. The emulsion forms when cyclosporin is combined with a hydrophilic phase component, a lipophilic phase component and a surfactant. Novartis says that, while Abbott has described explicitly three of the components used in its formulation of cyclosporin, which are also found in Novartis" formulation, it has provided only a general description of the fourth as a specified class of ester.
[19] Counsel for Novartis argued that Novartis was entitled to three pieces of information about Abbott"s formulation, which were not apparent from any statements made on its behalf, but which would all be contained in Abbott"s ANDS, and were relevant to enabling Novartis to respond to Abbott"s notice of allegations. Each concerns a question that is essential to determining whether there has been a patent infringement by the formation of a microemulsion.
(a) the ester
[20] Without knowing more precisely which specified class of ester comprises the fourth component of Abbott"s formulation that Novartis cannot tell, counsel submits, whether it functions either as a lipophilic phase component, and thus infringes the patent or, as Abbott alleges, as a second surfactant. Changing the ester may prevent a microemulsion from forming.
[21] Dr. Guy Rousseau is employed by Novartis as Executive Director of Regulatory Affairs, and holds a Ph.D. in pharmaceutical sciences. He swore an affidavit in support of Novartis" motion in which he stated that, unless it was known which specific specified class of ester was contained in Abbott"s formulation, it was difficult to know whether it could be considered as the lipophilic component.
[22] On the other hand, Dr. Michelle Long, who is employed by Abbott as a Senior Research Scientist and has a Ph. D. in chemical engineering, stated in her affidavit that, according to the "150 Patent, the lipophilic phase component has virtually no surfactant function. However, since all specified class of esters are surfactants, it cannot be relevant for Novartis to know which particular ester is contained in Abbott"s formulation because it does not constitute the lipophilic phase component.
[23] Dr. Long agreed during her examination for discovery that the patent teaches that a surfactant could also be part of the lipophilic phase, and that specified class of esters are generally lipophilic in nature. However, she was also adamant that the specified class of ester could not be considered a lipophilic phase for the purpose of forming a microemulsion.
[24] On the basis of the material before me Novartis has not produced compelling evidence that it is necessary for it know which ester is contained in Abbott"s formulation to enable it to rebut Abbott"s allegation of non-infringement.
(b) the proportions
[25] Novartis also wants to know the proportions of the various components used in Abbott"s formulation because this is relevant to knowing whether they form a microemulsion when mixed. In some proportions they will, in which case Novartis" claim of patent infringement is advanced, but in others they will not. Abbott has not said whether its formulation ever forms a microemulsion.
[26] Dr. Rousseau has stated that it is impossible to tell from Abbott"s list of ingredients whether they will ever form a microemulsion without also knowing the proportions of the various ingredients.
[27] Dr. Long was somewhat equivocal on this question. At one point she agreed that whether a microemulsion formed depended on the proportions of the components. However, she also said that the "150 patent could be "understood" without knowing the proportions, and that it could be determined simply from a list of ingredients whether they would form a microemulsion.
[28] Dr. Long"s statement in her affidavit that whether the known ingredients of Abbott"s formulation will form a microemulsion does not depend on the proportions was not significantly shaken in her examination. Accordingly, I cannot regard Dr. Rousseau"s affidavit as "compelling evidence" that it is necesary to know the proportions of the components in order to know whether they form a microemulsion, and thus infringe the patent.
(c) adding to water
[29] Novartis argued that it is entitled to know what happens when Abbott"s formulation is added to water. Dropping it into water indicates whether it forms a microemulsion. Abbott has never stated how its formulation is to be administered.
[30] Dr. Long states that, because there is no lipophilic phase in Abbott"s formulation, it cannot form a microemulsion when dropped into water. It cannot be relevant, therefore, to know the recommended quantity of water with which Abbott"s formulation of cyclosporin is to be taken.
[31] However, she admitted during discovery that she had never observed what happened when the cyclosporin formulation was added to water. Her conclusion was based on her knowledge of the scientific principle that there could be no microemulsion without a lipophilic phase component.
[32] In my view, Novartis is not obliged to rely on Dr. Long"s assertion, which she could not support on the basis of direct observation but is of obvious relevance to an issue that is at the heart of the dispute between the parties. Accordingly, Abbott must produce information from its ANDS indicating what happens to its product when it is added to water.
2. The "656 Patent
[33] This patent claims that Novartis" cyclosporin formulation comprises either a hydrosol (that is, solid particles of cyclosporin suspended in a liquid), or the stabilized particulate phase of the hydrosol in dry form. In its notice of allegation Abbott denies that its formulation comprises either a hydrosol or a stabilized particulate phase.
[34] In its submissions Novartis contends that Abbott"s statement is not definitive because it does not preclude the possibility that a hydrosol forms when Abbott"s formulation of cyclosporin is added to water. Accordingly, Novartis wants to know what happens to Abbott"s formulation when it is dropped into water, and in particular whether it then forms a hydrosol. It also asks for specific ingredients and their proportions, and manufacturing instructions, so that it can see whether Abbott"s product forms a hydrosol.
[35] Although Dr. Rousseau stated in his affidavit that the hydrosol is only formed before or during administration, in cross-examination he conceded that he did not know if this actually occurred in the manufacturing stage (that is, before administration to the patient), or only during the administration of cyclosporin to the patient.
[36] I have carefully read the submissions made on behalf of Novartis, and Abbott"s reply, and I am not persuaded that the applicants have discharged the heavy onus of showing "compelling evidence" that the additional information that it is seeking is essential or necessary to enable it effectively to respond to Abbott"s allegation of non-infringement of this patent.
[37] Further, the relevant question is whether the information supplied by Abbott is sufficient to enable Novartis to refute the allegation, not to enable Novartis to reproduce the Abbott formulation itself. The manufacturing instructions for the Abbott product are therefore not necessary or essential to the applicants" ability to refute the respondents" allegation.
E. CONCLUSIONS
[38] For these reasons the applicants" motion is granted, but only to the extent of requiring Abbott to disclose any information included in its Abbreviated New Drug Submission indicating whether an emulsion is formed when its product is added to water.
[39] The Minister is ordered to confirm that the information produced by Abbott in accordance with these reasons corresponds to that contained in Abbott"s ANDS.
[40] The costs of this motion will be in the cause.
OTTAWA, ONTARIO "John M. Evans"
August 17, 1999. J.F.C.C.
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