Docket: T-2044-10
Citation: 2011 FC 1444
Ottawa, Ontario, December
9, 2011
PRESENT: The Honourable Mr. Justice Near
BETWEEN:
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TAKEDA CANADA INC.
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Applicant
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and
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THE MINISTER OF HEALTH
ATTORNEY GENERAL OF CANADA
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Respondents
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REASONS FOR JUDGMENT AND
JUDGMENT
[1]
This
is an application for judicial review of a decision of the Minister of Health
(the Minister) through the Office of the Patented Medicines and Liaison
(OPML) dated November 8, 2010. The Minister refused to list the
Applicant’s drug, DEXILANT, on the Register of Innovative Drugs (Register) and
provide data protection in accordance with section C.08.004.1 of the Food
and Drug Regulations, CRC c 870, as amended by the Regulations Amending
the Food and Drug Regulations (Data Protection), SOR/2006-2411 (the
Regulations).
[2]
For
the following reasons, this application is dismissed.
I. Background
[3]
The
Applicant, Takeda Canada Inc., filed a New Drug Submission (NDS) for DEXILANT
on August 11, 2009. This was based on extensive clinical trial data generated
to establish the safety and efficacy of the drug for marketing approval. A
Notice of Compliance (NOC) to market the drug was issued by the Minister on
July 22, 2010.
[4]
DEXILANT
contains the medicinal ingredient dexlansoprazole. Dexlansoprazole is an
enantiomer, or mirror image, of lansoprazole. Currently marketed as the drug
PREVACID, lansaprazole is a racemic mixture of the two enantiomers.
[5]
DEXILANT
is intended for use in the treatment of gastroesophageal reflux disease (GERD).
[6]
On
July 16, 2009, the Applicant requested data protection from the Minister under
the Regulations for these DEXILANT studies.
II. Decision
Under Review
[7]
The
OPML provided a preliminary assessment on behalf of the Minister in a letter
dated July 22, 2010. DEXILANT was not eligible for data protection because it
did not meet the definition of an “innovative drug” as required under the
Regulations. The medicinal ingredient dexlansoprazole was an enantiomer of a
previously-approved medicinal ingredient lansoprazole, currently marketed as
PREVACID.
[8]
In
response, the Applicant submitted written representations taking issue with the
OPML’s interpretation of the Regulations. Given the nature of the data filed
to support regulatory approval, the Applicant asserted that dexlansoprazole
should be considered an “innovative drug” as opposed to a variation. In
addition, the Applicant called attention to the broader interpretation used in
granting protection to three other drugs (PRECEDEX, AVAMYS and TORISEL) in
comparable circumstances.
[9]
A
final decision was issued by the OPML, on behalf of the Minister, in a letter
dated November 8, 2010. It maintained that dexlansoprazole was a variation
within the meaning of the Regulations as an enantiomer of the
previously-approved medicinal ingredient lansoprazole. The OPML did not agree
with the interpretation suggested by the Applicant and insisted that the nature
and extent of data submitted in the regulatory approval process was not
relevant to the decision to grant data protection. Accordingly,
dexlansoprazole was not eligible for listing on the Register.
[10]
The
OPML also addressed the three drugs raised in the Applicant’s written
submissions, noting that a determination on data protection is case-specific. The
circumstances surrounding the provision of data protection for those drugs
could be distinguished from dexlansoprazole.
III. Data
Protection Provisions
[11]
The
Regulations provide protection for data submitted as part of the drug marketing
approval process leading to the issuance of a NOC. This protection can,
however, only be extended to an “innovative drug” defined in subsection
C.08.004.1(1) as a “drug that contains a medicinal ingredient not previously
approved in a drug by the Minister and that is not a variation of a previously
approved medicinal ingredient such as a salt, ester, enantiomer, solvate or
polymorph.”
[12]
Once
deemed eligible for listing on the Register, an “innovative drug” receives data
protection consisting of two formal restrictions. Firstly, a generic drug
manufacturer cannot file a submission based on a comparison to an “innovative
drug” within the first six years of the eight-year period after the drug has
received a NOC (subsection C.08.004.01(3)(a)). Secondly, the Minister may not
issue a NOC to the generic drug manufacturer before the end of the eight-year
period (subsection C.08.004.01 (3)(b)).
[13]
As
stated in subsection C.08.004.1(2), the data protection provisions apply to the
implementation of Article 1711 of the North American Free Trade Agreement,
1992, 32 ILM 296 (NAFTA) and paragraph 3 of Article 39 in the Agreement on
Trade-Related Aspects of Intellectual Property Rights, 1869 UNTS 299
(TRIPS). Where a person submits undisclosed data for approval of a
pharmaceutical product, and the product utilizes a “new chemical entity”,
signatory states commit to preventing other persons from making “unfair
commercial use” of that data and (for a reasonable time) from relying on that
data in their own applications for approval.
IV. Issues
[14]
This
application raises the following issues:
(a) Did
the Minister err in interpreting the definition of an “innovative drug” to
exclude DEXILANT as a variation within the meaning of subsection C.08.004.1 (1)
of the Regulations?
(b) Did
the Minister breach a duty of fairness owed to the Applicant in refusing to
consider the data submitted?
V. Standard
of Review
[15]
The
parties disagree as to the appropriate standard of review to be applied in the
present case. The Applicant insists that statutory interpretation is a
question of law requiring a standard of correctness. By contrast, the
Respondent contends that the issue raised is whether dexlansoprazole is a
variation within the meaning of the subsection C.08.004.1 (1), a matter of
mixed fact and law reviewed based on reasonableness. If the matter is
considered a purely legal question, however, the Respondent suggests that it
may still be addressed by the reasonableness standard.
[16]
Since
the primary issue I am concerned with in this application is the assessment of
conflicting approaches to statutory interpretation, the appropriate standard of
review is correctness. I must determine whether the Minister
misinterpreted the definition of “innovative drug” to exclude an enantiomer,
such as dexlansoprazole, as a variation.
[17]
The
factors I identified in making a similar determination regarding a review of
the interpretation accorded to an “innovative drug” in Epicept Corporation v
Canada (Minister of Health), 2010 FC 956, [2010] FCJ No 1188 at para 39
remain relevant. These include that:
i. There is no privative clause
in the Regulations or the Food and Drugs Act, R.S.C. 1985, c. F-27 (“Act”)
ii. The statutory interpretation
of the definition of “innovative drug” is a pure question of law.
iii. Under the Act and Regulations,
the Minister has jurisdiction with respect to the approval of drugs. However,
the Minister has no expertise in deciding pure questions of law, as explained
below.
iv. The Court is as well placed
as the Minister to determine the proper statutory interpretation of the Regulations.
[18]
The
correctness standard I applied in Epicept, above, to interpret the
“innovative drug” definition was followed in Teva Canada Ltd v Canada (Minister of
Health),
2011 FC 507, 2011 CarswellNat 1450 at para 35.
[19]
Although
Celgene Corp v Canada (Attorney General), 2011 SCC 1, 89 CPR (4th) 1 at
para 34 recently questioned in obiter whether the correctness
standard was appropriately applied to a decision of a specialized tribunal, the
Patented Medicines Prices Review Board, in interpreting its enabling
legislation; that decision is not applicable to the present case. The Minister
and the OPML are not acting as specialized tribunals in the interpretation of
an enabling statute. In addition, Celgene, above, did not reach any
definitive conclusion on this matter.
[20]
Similarly,
the Respondent relies on Scott Paper Ltd v Canada (Attorney General),
2008 FCA 129, [2008] FCJ No 539 at para 11 to assert that legal questions
may be accorded deference and reviewed on a standard of reasonableness when
they are squarely within a decision-makers’ expertise and the question is not
of central importance to the legal system, even when there is no privative
clause. This decision is, however, of limited assistance. Deference may
occasionally be warranted for questions of law, but this is not always the
case.
[21]
A
more pertinent approach was arrived at in Bristol-Myers Squibb Co v Canada
(Attorney General), 2005 SCC 26, 39 CPR (4th) 449 at para 36 where it was
found that on a question of conflicting interpretations given to the
regulations, the Minister’s opinion is not entitled to deference and a standard
of correctness is required. As Justice Bastarache elaborated at paragraph 88
in his dissent, the Minister’s expertise relates to the evaluation of
scientific evidence in interpreting the safety and efficacy of drugs and “such
expertise is not engaged when simply interpreting the NOC Regulations,
divorced from their relationship to the science.”
[22]
The
same reasoning applies in this case. The Minister’s expertise is confined to
scientific assessments as opposed to legal interpretation. The legal question
is also one of general application to the drug listing determination process. A
standard of correctness must therefore be applied by this Court in reviewing
the interpretation of the “innovative drug” definition and exclusion of
variations.
[23]
It
is well established that questions of procedural fairness are also reviewed
based on the correctness standard (see Canada (Minister of
Citizenship and Immigration) v Khosa, 2009 SCC 12, 2009
CarswellNat 434 at para 43).
VI. Analysis
Issue A: Did the Minister
Err in Interpreting the Definition of an “Innovative Drug” to Exclude DEXILANT
as a Variation Within the Meaning of Subsection C.08.004.1(1) of the
Regulations?
[24]
The
Applicant submits that the Minister’s interpretation of the definition of an
“innovative drug” in the Regulations is overly restrictive. In particular, the
Applicant insists that the phrase “not a variation of a previously approved
medicinal ingredient such as a salt, ester, enantiomer, solvate or polymorph”
should not be used to automatically exclude enantiomers, such as
dexlansoprazole. The Minister should consider the nature and extent of data
submitted. According to the Applicant, the interpretation adopted does not
respect legislative intent, leads to an absurd result and puts Canada in breach of
its international obligations. In addition, the interpretation is inconsistent
with the approach used in providing data protection to other drugs.
[25]
The
Respondent contends that the wording of the Regulations clearly denies
protection to drugs that are mere variations, such as the enantiomer
dexlansoprazole. Data protection is intended to apply to new chemical
entities. A review of the nature and extent of data collected is only relevant
to an assessment of whether products constitute variations not already listed. In
addition, the treatment of other drugs is not pertinent to a determination of
whether the Minister erred in its application of the Regulations in the present
case.
[26]
To
assess these claims, I begin with a brief summary of the relevant principles of
statutory interpretation. This is followed by a consideration of how
subsection C.08.004.1(1) should be interpreted, specifically the phrase related
to potential variations. Based on this interpretation, I will determine
whether the Minister erred in excluding DEXILANT from data protection as one of
these variations.
(i) Principles
of Statutory Interpretation
[27]
The
predominant approach to statutory interpretation was articulated by the Supreme
Court in Canada Trustco Mortgage Co v Canada, 2005 SCC 54, [2005] 2 SCR
601 at para 10:
[10] It has been long established as
a matter of statutory interpretation that “the words of an Act are to be read
in their entire context and in their grammatical and ordinary sense
harmoniously with the scheme of the Act, the object of the Act, and the
intention of Parliament”: see 65302 British Columbia Ltd. v. Canada,
1999 CanLII 639 (SCC), [1999] 3 S.C.R. 804, at para. 50. The interpretation of
a statutory provision must be made according to a textual, contextual and
purposive analysis to find a meaning that is harmonious with the Act as a
whole. When the words of a provision are precise and unequivocal, the ordinary
meaning of the words play a dominant role in the interpretive process. On the
other hand, where the words can support more than one reasonable meaning, the
ordinary meaning of the words plays a lesser role. The relative effects of
ordinary meaning, context and purpose on the interpretive process may vary, but
in all cases the court must seek to read the provisions of an Act as a
harmonious whole.
[28]
Consistent
with these principles, particular attention should be paid in the
interpretation of regulations to the whole context of the authorising statute (Bristol
Myers-Squibb, above, at para 39). In addition, there is a presumption
against an interpretation that would lead to absurd consequences (Ruth Sullivan,
Sullivan on Construction of Statutes, 5th ed (Markham: LexisNexis,
2008) at 223, 300-301).
[29]
Where
possible, statutes should be interpreted in a way that makes their provisions
consistent with Canada’s international treaty obligations and
principles of international law (Németh v Canada (Justice), 2010 SCC
56, [2010] 3 S.C.R. 281 at para 34). Those treaty obligations should be
interpreted “in good faith in accordance with the ordinary meaning to be given
to the terms of the treaty in their context and in light of its object and
purpose” (Vienna Convention on the Law of Treaties, 23 May 1969, 1155
UNTS 331, art 31).
[30]
Mindful
of these principles, I will examine the definition of an “innovative drug” and
the term “variation” within the meaning of subsection C.08.004.1(1) of the
Regulations.
(ii) Interpretation
of “Innovative Drug”
[31]
A
reading of the “innovative drug” definition in its grammatical and ordinary
sense is relatively clear. There are two conditions under which a drug will
not be considered “innovative” and entitled to data protection. This includes
when a drug contains a previously approved medicinal ingredient or is
considered a variation of a previously approved medicinal ingredient.
[32]
While
the term “variation” is not explicitly defined, subsection C.08.004.1(1) does
provide a non-exhaustive list of examples, including “salt, ester, enantiomer,
solvate or polymorph.” These concrete examples represent the types of chemical
compounds presumed to fall under the term “variation” of a previously approved
medicinal ingredient for the purposes of the “innovative drug” definition and
data protection.
[33]
Additional
guidance as to what constitutes a “variation” not formally listed may come from
the dictionary definition of “a change or slight difference in condition,
amount or level” (Oxford English Dictionary 11th ed (New York: Oxford
University Press, 2004) at 1599). As the subsection is worded, however, it is
implied that the examples provided would by their very nature represent a
“change” or “slight difference in condition.” This is certainly true of an
enantiomer which is defined as “a molecule that is the mirror image of another”
(Concise Canadian Oxford Dictionary (Toronto: Oxford
University Press, 2005) at 431). Given the terminology used in the definition
and its ordinary meaning, it is conceivable that an enantiomer, along with the
other examples, will always constitute a “variation” within the meaning of
subsection C.08.004.1(1).
[34]
This
reading is also supported by the Regulatory Impact Analysis Statement (RIAS)
(see Canada Gazette Part II, vol 140, No 21, 2006-10-18). The RIAS
has been used in the past for the purpose of assessing legislative intent (see
for example Bristol-Myers Squibb, above, and Bayer Inc v Canada (Attorney
General et al) (1999), 87 CPR (3d) 293, 243 NR 170 (FCA). A passage at
page 1496 addresses the definition of “innovative drug” and variations:
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The definition
of “innovative drug” specifically prohibits innovators from obtaining
additional terms of data protection for variations of medicinal ingredients.
The list of variations is not exhaustive, but rather meant to give examples
of the types of variations not considered for protection. The exclusion of
variations of a previously approved medicinal ingredient from the scope of
protection was introduced to avoid the granting of an additional eight years
of protection where an innovator seeks approval for a minor change to a drug.
For other arguable variations not included in the list, such as metabolites,
an assessment will be made as to whether or not approval is being sought
primarily on the basis of previously submitted clinical data (i.e. without
the support of new and significant clinical data) or not. This position is
consistent with both NAFTA and TRIPS which only require the granting of
protection for undisclosed data, the origination of which involved a
considerable effort
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La
définition de « drogue innovante » interdit spécifiquement aux innovateurs
d’obtenir une période supplémentaire de protection des données du fait qu’ils
ont varié les ingrédients médicinaux. La liste des variations n’est pas
exhaustive, mais se veut plutôt une liste d’exemples des types de variations
qui n’avaient pas été prises en compte en matière de protection. L’exclusion
de variations d’un ingrédient médicinal préalablement approuvé de la portée
de la protection a été adoptée afin d’éviter l’octroi d’une période de
protection supplémentaire de huit années quand un innovateur tente de faire
approuver une modification mineure à un médicament. Pour d’autres variations
douteuses qui ne sont pas incluses sur la liste, comme les métabolites, une
évaluation sera effectuée dans le but de déterminer si oui ou non
l’approbation demandée est principalement fondée sur des données cliniques préalablement
soumises (c.-à-d. sans l’appui de données cliniques nouvelles et
significatives). Cette position est conforme à l’ALÉNA et aux dispositions
des ADPIC qui n’exigent l’octroi d’une protection que pour les données non
divulguées, dont la création nécessite un effort considérable.
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[35]
The
RIAS provides insight into the anticipated approach to interpretation. It
highlights the importance placed on excluding variations from data protection
where there is a “minor change to a drug.” Although the Minister will consider
variations other than those listed, the examples provided are reflective of the
minor changes contemplated by the provision.
[36]
Of
particular significance is the reference to a further inquiry required “[f]or
arguable variations not included in the list.” This involves an assessment of
new and significant clinical data that involved “considerable effort.” However,
the RIAS only envisions this type of inquiry for “arguable variations” to
determine if they should also be excluded from the definition of an “innovative
drug” – it is not required for the examples provided that are presumed to
constitute variations outside the scope of data protection.
[37]
Moreover,
this interpretation does not lead to an absurd result. Where there is some
dispute as to whether a medicinal ingredient constitutes a variation, the
nature and extent of the data is a factor relevant to the assessment of its
status as an “innovative drug.” By contrast, the medicinal ingredients listed
are excluded from the outset because they are widely recognized chemical
variations. Even if the extent of the data were considered in these instances,
this would not in itself be sufficient to ensure data protection. The Minister
would still be entitled to dismiss these types of medicinal ingredients that,
by their very nature, represent variations based on the overall intent of the
provision. It is therefore appropriate to deny data protection without a more
extensive inquiry.
[38]
Relevant
to the broader context and purpose of data protection is the analysis of the
Federal Court of Appeal in Canadian Generic Pharmaceutical Assn v Canada (Minister of
Health),
2010 FCA 334, [2010] FCJ No 1582 at paras 113-114:
[113] In my view, what the entire
context reveals is that the DPR is a mechanism deemed necessary to balance the
effects of the regulatory scheme set forth in the Regulations, the purpose of
which is to protect public health and safety. In particular, the DPR plays an
important role with regard to the ANDS process by counteracting, or reducing,
the negative aspects thereof. More particularly, by granting innovators a
period of market protection for eight years, the DPR puts in place a regime
which provides incentives for innovators to continue their search for
"innovative drugs". Ultimately, the DPR exists to encourage the
development of new drugs which, there cannot be much dispute, constitutes a
valid public health and safety purpose.
[114] Although it is true, as the
Judge found at paragraph 79 of his Reasons, that the DPR seeks to balance
"commercial considerations between the protection of an innovator drug
manufacturer's investments... and the eventual NOC approval of a generic drug
manufacturer's ANDS", the Judge erred, in my respectful view, in failing
to consider the entire context in which the DPR finds itself. The true purpose
of the DPR is not to balance the commercial interests of innovators and generic
drug manufacturers, but rather to ensure that Canadians have reasonable access,
at reasonable prices, to new, safe and effective drugs. In other words, the
Regulations as a whole encourage the research and development of new medicines
that save lives, prevent diseases, heal and cure and improve the health of
Canadians, who can only benefit from the discovery and development of new
medicines after the information and data generated in extensive pre-clinical
and clinical trials demonstrate the "innovative drug's" safety and
efficacy to the satisfaction of the Minister. The DPR plays an important part
in this regulatory scheme.
[39]
Data
protection is considered central to the overall regulatory scheme in protecting
public health and safety. It is intended to encourage research and development
of drugs to improve the health of Canadians. At all times, however, data
protection is to be extended to “innovators”, providing an incentive to develop
“innovative drugs.” It does not imply that such protection will always be in
the interest of public health where it applies to less significant changes in
medicinal ingredients. It is open to question whether the information related
to the research and development of these mere variations should not be widely
available.
[40]
This
interpretation is also consistent with Canada’s
international treaty obligations under NAFTA and TRIPS. As I alluded to in
paragraph 63 of Epicept, above, data protection is only intended to
protect “new chemical entities” as opposed to “new drugs.” As a consequence,
not all “new drugs” will be entitled to data protection. This is why the
related Canadian Regulations set out clear variations to a medicinal ingredient
that will not be considered an “innovative drug”, even if they qualify as an
NDS. To put it another way, the specified variations cannot be considered “new
chemical entities.”
(iii) DEXILANT
as Variation
[41]
Given
this interpretation, it was correct for the Minister to exclude DEXILANT from
data protection. Dexlansoprazole, the medicinal ingredient in DEXILANT, is a
recognized enantiomer of lansoprazole. It therefore falls under one of the
recognized variations within the meaning of subsection C.08.004.1(1),
irrespective of the extent of the data collected by the Applicant as part of
the NDS. Data protection is only intended to apply to “new chemical entities”
falling under the definition of an “innovative drug” and that do not constitute
variations.
[42]
The
Applicant’s submissions with respect to other drugs that have received data
protection and were not automatically excluded as being one of the recognized
variations do not alter my interpretation. I cannot evaluate what factors were
taken into account in the decision to grant data protection in those instances.
The Minister’s interpretation of the “innovative drug” definition to
automatically exclude DEXILANT as a variation corresponds to the ordinary
meaning, legislative intent and is consistent with international obligations.
Issue B: Did
the Minister Breach a Duty of Fairness Owed to the Applicant in Refusing to
Consider the Data Submitted?
[43]
Given
the conclusion reached on Issue A, it is unnecessary for me to deal extensively
with the Applicant’s argument that fairness was denied by not considering the
nature of the data submitted. In my view, how the Minister has dealt with the
comparator drugs mentioned (PRECEDEX, AVAMYS and TORISEL) that may be similar
is largely irrelevant. Those drugs were dealt with based on their particular
facts situation.
[44]
Irrespective
of the Applicant’s dissatisfaction with the outcome, the process afforded to
them was fair as it provided an opportunity to present written submissions and
reasons were given.
VII. Conclusion
[45]
The
Minister adopted the correct interpretation in determining that, as an
enantiomer, the dexlansoprazole in DEXILANT could not obtain data protection as
a variation within the meaning of the innovative drug definition in subsection
C.08.004.1(1). It could not be listed on the Register for Innovative Drugs. In
addition, I do not find that there was any breach of the duty of fairness owed
to the Applicants.
[46]
Accordingly,
this application for judicial review is dismissed. No costs are awarded.
JUDGMENT
THIS COURT’S JUDGMENT
is that
this application for judicial review is dismissed.
No costs are awarded.
“ D.
G. Near ”
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