[1] This is an appeal from the order of O'Keefe J. dismissing the Appellants' application for an Order prohibiting the Minister of National Health and Welfare from issuing a Notice of Compliance to Apotex Inc. with respect to omeprazole capsules for oral administration until after the expiration of Canadian Patent 2,025,668.

Facts

[2] The Appellant, AB Hassle ("Hassle"), is the owner of Canadian Patent No. 2,025,668 ("'668"), entitled "Use of Omeprazole as an Anti-Microbial agent".

[3] The Appellant, AstraZeneca Canada Inc., formerly Astra Pharma Inc., ("Astra") is a Canadian company involved in the manufacture, marketing and sale of a variety of pharmaceutical products. Astra is also a licensee under the '668 patent. Hassle and Astra are related companies, and, together, they will be referred to as "the Appellants".

[4] The Respondent, Apotex Inc. ("Apotex"), is a Canadian generic pharmaceutical manufacturer seeking the issuance of a Notice of Compliance ("NOC") from the Minister of National Health and Welfare (the "Minister") for the manufacturing and selling of omeprazole. Where appropriate, the Respondent Minister has jurisdiction to issue an NOC when an application has been made and the applicant has complied with the Patented Medicines (Notice of Compliance) Regulations, SOR / 93-133, as amended. ("NOC Regulations").

[5] The '668 patent held by Hassle contains three claims, each relating to use of the compound, Omeprazole as follows:

1. In the manufacture of a medicament for the treatment of Campylobacter infections.

2. In the treatment of Campylobacter infections.

3. In a pharmaceutical preparation for use in the treatment of Campylobacter infections.

[6] Omeprazole was a known or existing compound. The patent held by Hassle only relates to the new use of omeprazole. Therefore, the '668 patent only reserves exclusive rights to omeprazole that are somehow related to the treatment of Campylobacter infections; it does not contain any claims for the compound omeprazole itself.

[7] The Appellants received Apotex' Notice of Allegation ("NOA") in a letter dated October 4, 1999. The NOA stated in part:

With respect to patent 2025668, 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 capsules for oral administration containing omeprazole in strengths 10 mg, 20 mg, and 40 mg.

The legal and factual basis for the aforesaid allegation is as follows:

The claims of this patent relate to the use and treatment of Campylobacter infections. Our product will not be made, used or sold for the treatment of Campylobacter infections and, more particularly, we are not seeking approval for such use and no such use will be included in our product monograph [my emphasis].

[8] On November 18, 1999, the Appellants commenced an application for an Order prohibiting the Minister from issuing a NOC to Apotex. In support of the application, the Appellants served and filed the affidavit evidence of Ms. Philippa Murphy, Dr. Christopher Pinto and Ms. Linda Samuel. The Appellants attempted to show, through this evidence, that Apotex' proposal for using omeprazole will result in infringement of the patent. The three affidavits each claim that, regardless of whether omeprazole is approved for the use of treating Campylobacter infections, it will, in fact, be used for such treatment, thereby infringing the patent owned by Hassle.

[9] By Notice of Motion dated January 19, 2000, Apotex sought to have the proceeding dismissed on the grounds that the application was frivolous, vexatious and an abuse of process. McKeown J. dismissed Apotex' motion in its entirety, including the request to file evidence responding to the main application. Thus, Apotex was not able to file any evidence in this matter.

[10] In conjunction with and as part of its New Drug Submission, each manufacturer must submit a proposed product monograph which sets out the proposed uses to which the product may be put once approved by the Minister. Once approved, a final product monograph is issued by the Minister as part of the NOC documents. Although the product monograph is not before this Court, Apotex has undertaken that the product monograph for which Apotex will obtain approval will not include any use for the treatment of Campylobacter infections. Rather, the product monograph will make no mention of Campylobacter infections, and will be limited to use for the reduction of gastric acid secretions.

[11] Nowhere in the Appellants' evidence is it shown that Apotex intended to sell its drug for the use prohibited by the '668 Patent, specifically for the treatment of Campylobacter infections. In fact, to the contrary, Apotex stressed in its NOA that its product would not be made, used or sold for the treatment of Campylobacter infections.

Findings of the Motions Judge, O'Keefe J.

[12] In his decision, O'Keefe J. made four factual findings. Firstly, he found that there was no evidence that Apotex will directly infringe the Appellants' '668 patent. According to O'Keefe J., the Appellants had not adduced evidence that successfully established an infringement of the first claim, which claims the exclusive right to use omeprazole for the manufacture of a medicine for the treatment of Campylobacter infections. Therefore, under the first claim, the manufacture by Apotex only falls within the exclusive domain of the patent holder if the medicine is being manufactured for the treatment of Campylobacter infections, and Apotex alleges in its NOA that it is not manufacturing the medicine for this limited treatment.

[13] As for the second claim, he found that the Appellants had conceded that it is impossible for Apotex, as a company itself, to use omeprazole to treat a Campylobacter infection. Therefore, Apotex does not and will not directly infringe the second claim of the '668 patent.

[14] With respect to third claim, he held that the claim is limited by the wording "for use in the treatment of Campylobacter infections". Therefore, pharmaceutical preparations of omeprazole for uses other than the treatment of Campylobacter infections would not infringe the '668 patent.

[15] Consequently, at the core of O'Keefe J.'s judgment is the finding that there was no evidence that Apotex intends to make, use or sell its drug for the specific use patented by the Appellants in their three use claims.

[16] Secondly, O'Keefe J. held that the Minister may only refuse to issue a NOC to a second person on the ground of anticipated patent infringement by a third person if there is a connection between the second person and an infringement by a third party. The second person must be involved in the infringement either directly or indirectly, such as through inducement or procurement. A person who induces or procures another party to infringe a patent is itself responsible for infringement of the patent, and thus the infringing actions of the third party can become relevant under the NOC Regulations. Therefore, infringement by third parties, such as use of a medicine by a patient, is only relevant under the NOC Regulations where it can be shown that the second person has induced or procured the infringement by that third party. O'Keefe J. found no such connection between Apotex and the potential third party infringements alleged by the Appellants.

[17] Thirdly, O'Keefe J. held that Apotex had neither induced nor procured any infringement. He outlined the test that must be satisfied when a patentee relies on the doctrine of induced infringement. Each of the following elements must be proved:

(1) that the act of infringement was completed by the direct infringer;

(2) the completed act of infringement was influenced by the seller, to the point where without said influence, infringement by the buyer would not otherwise take place; and;

(3) the influence must knowingly be exercised by the seller, such that the seller knows that his influence will result in the completion of the act of infringement.

[18] He further explained that a direct infringement by someone must take place, and the Appellants have the burden, on a balance of probabilities, to demonstrate that an infringement by someone is likely to occur if a NOC is issued.

[19] Specifically, O'Keefe J. found that the Appellants had alleged and were obliged to prove the following theory: a pharmacist typically does not know the particular reason or indication for which a physician has prescribed a drug. Therefore, even if a pharmacist was aware that Apotex' generic omeprazole product was not approved for use in the treatment of Campylobacter infections, the pharmacist would likely dispense the generic product because of its lower cost and because the pharmacist was unaware of the medical problem for which the product was being prescribed.

[20] To prove this theory, the Appellants filed three affidavits, each of which offered their opinion on the following two points: (1) a physician would likely prescribe the medicine omeprazole by its generic name for the treatment of Campylobacter infections; and, (2) a pharmacist would likely dispense to the patient the lowest cost generic product, which would result in an infringement of the '668 patent.

[21] O'Keefe J. rejected the Appellants' submissions that the affidavit evidence tendered by the Appellants could be accepted as expert evidence and that it proved the above theory on a balance of probabilities.

[22] With respect to the first affiant, Ms. Murphy, he found that she was neither a pharmacist nor a physician. Also, she was employed, as Vice-President of Medical Affairs, by one of the Appellants, Astra, at the time of swearing the affidavit. Consequently, he found that she was not qualified to give opinion evidence. As a result, he would not accept her opinion evidence regarding the general practices of physicians, pharmacists, and their state of knowledge with respect to the permitted uses of generic brands in the medical community. Also, he refused to accept Ms. Murphy's conclusion that the product would likely be used by patients for the treatment of Campylobacter infections, even though it had not been approved for such a use. Finally, he focussed on the admissions made by Ms. Murphy in her cross-examination regarding interchangeability and government approval. For instance, Ms. Murphy agreed that if a product was approved by the Federal Government for limited uses, the Provincial Government could agree to treat the product as interchangeable with limitations on use and could name those limitations. Also, Ms. Murphy agreed that she would have no reason to believe that if a drug manufacturer filed a submission seeking approval only for certain uses, the Minister would, nevertheless, give an approval for other uses. O'Keefe J. found that these admissions undermined Ms. Murphy's evidence regarding the Appellants' theory.

[23] With respect to the second affiant, Ms. Samuel, a pharmacist, O'Keefe J. found that she did not have the expertise to testify regarding the general practice of doctors in prescribing medicine. She was entitled to testify to what she knows from her practice of pharmacy, but she was not otherwise qualified as an expert. Also, he found that there was no basis in fact for the evidence presented by Ms. Samuel. As a result, O'Keefe J. attributed little weight to Ms. Samuel's evidence.

[24] With respect to the third affiant, Dr. Christopher Pinto, a practising physician, he held that Dr. Pinto was not qualified as an expert to give opinion evidence regarding what other physicians did in Ontario. There was no evidence presented as to how Dr. Pinto reached his conclusions. Therefore, he found that Dr. Pinto's evidence was either inadmissible or admissible with very little weight. Finally, he noted that, like Ms. Murphy, Dr. Pinto admitted in his cross-examination that the Minister would not approve a drug for certain indications which had not been sought by a drug manufacturer.

[25] In summary, O'Keefe J. held that the Appellants had failed to show on a balance of probabilities that the Respondents would infringe the Appellants' patent.

Issues

[26] I propose to deal with the issues as follows:

1. Did Mr. Justice O'Keefe make any palpable and overriding errors in rejecting the evidence of the Appellants' witnesses?

2. Does the case of Genpharm Inc. v. Minister of Health, Procter & Gamble Pharmaceuticals Canada Inc. and Procter and Gamble Company (2002) F.C.A. 290 ["Genpharm"] apply in the circumstances of this case?

Relevant Statutory Provisions

[27] The relevant provisions of the Patented Medicines (Notice of Compliance) Regulations, SOR93-133 read as follows:

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 méédicament 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 méédicament)

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) [...]

(b) allege that

(i) [...]

(ii) [...]

(iii) [...]

(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.

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.

[28] The relevant provisions of the Patent Act, R.S.C. 1985, c. P-4 read as follows:

55.2 (4) The Governor in Council may make such regulations as the Governor in Council considers necessary for preventing the infringement of a patent by any person who makes, constructs, uses or sells a patented invention in accordance with subsection (1) or (2) including, without limiting the generality of the foregoing, regulations

(a) [...]

(b) [...]

(d) [...]

(e) generally governing the issue of a notice, certificate, permit or other document referred to in paragraph (a) in circumstances where the issue of that notice, certificate, permit or other document might result directly or indirectly in the infringement of a patent.

Analysis

Standard of Review

[29] The standard of review is that of palpable and overriding error - an appellate Court will only intervene where it is satisfied that the trial judge made a palpable and overriding error, which affected the assessment of the facts. An appellate Court should be extremely reluctant to assume the role of a trial judge in making findings of fact.

[30] Specifically, an appellate Court is not entitled to re-assess expert evidence and substitute its own view. These limits on the scope of Appellate review apply equally to documentary expert evidence. In N.V. Bocimar, S.A. v. Century Ins. Co. of Can., [1987] 1 S.C.R. 1247 at 1250, for instance, the Supreme Court held that the Court of Appeal had erred by taking the position that it could assess the weight of the evidence in support of the facts on which the expert expressed an opinion because the evidence of those facts was before the trial court in a documentary form. Also, in Kirin-Anger Inc. v. Hoffman-La Roche Ltd. (2000), 267 N.R. 150 (F.C.A.), the Federal Court of Appeal held that it is wrong for an appeal court to second-guess the trial judge's assessment of the credibility of experts, unless an egregious error can be demonstrated. Therefore, an appellate Court should not substitute its views for those of the trial judge just because it would have concluded the matter differently. To interfere, the appellate Court must conclude that the trial judge misapprehended the evidence, or that the trial judge made a manifest error with respect to the inferences drawn from that evidence.

[31] The Supreme Court of Canada in Housen v. 2002 SCC 33">Nikolaisen, 2002 SCC 33 at paras. 5 and 6, defined "palpable error" as "plainly seen or clear to the mind".

[32] In Housen, the Court said at para. 23:

it is not the role of appellate courts to second-guess the weight to be assigned to the various items of evidence. ... The appellate court is not free to interfere with a factual conclusion that it disagrees with where such disagreement stems from a difference of opinion over the weight to be assigned to the underlying facts.

[33] Further comments from the decision in Housen are helpful in describing the narrow standard of review that should be applied to O'Keefe J.'s decision in this matter. In Housen at para. 25, the Court stated:

Although the trial judge will always be in a distinctly privileged position when it comes to assessing the credibility of witnesses, this is not the only area where the trial judge has an advantage over appellate judges. Advantages enjoyed by the trial judge with respect to the drawing of factual inferences include the trial judge's relative expertise with respect to the weighing and assessing of evidence, and the trial judge's inimitable familiarity with the often vast quantities of evidence. This extensive exposure to the entire factual nexus of a case will be of invaluable assistance when it comes to drawing factual conclusions. In addition, concerns with respect to cost, number and length of appeals apply equally to inferences of fact and findings of fact, and support a deferential approach towards both. As such, we respectfully disagree with our colleagues's view that the principal rationale for showing deference to findings of fact is the opportunity to observe witnesses first-hand. It is our view that the trial judge enjoys numerous advantages over appellate judges which bear on all conclusions of fact, and, even in the absence of these advantages, there are other compelling policy reasons supporting a deferential approach to inferences of fact. We conclude, therefore, by emphasizing that there is one, and only one, standard of review applicable to all factual conclusions made by the trial judge - that of palpable and overriding error.

Thus, a highly deferential approach must be applied to the factual findings and inferences made by O'Keefe J. because he had the advantages described above.

Application of the Standard of Review

[34] The Appellants have argued this case as though it constituted a de novo hearing. They relied upon the same three pieces of affidavit evidence, which were rejected by O'Keefe J. No compelling argument was presented as to how he erred in rejecting this evidence. Without this evidence, the Appellants have no foundation upon which to build their case.

[35] As stated in Hoffman-La Roche et al. v. Minister of National Health and Welfare et. al., 70 C.P.R. (3d) 206 at 210 (F.C.A.), the initial burden of proof rests on the person having the carriage of the litigation to establish a case to a civil standard of proof. Thus, the onus for proving that Apotex' allegations in the NOA are not justified rests upon the Appellants, on a balance of probabilities. The onus is not on Apotex to provide evidence supporting their allegations in their NOA. Rather, as stated in Hughes and Woodley on Patents, looseleaf (July 2002, Issue 52 at 413, the Appellants must prove on a balance of probabilities that an infringement will occur if the Minister issues a NOC.

[36] The Appellants have not met this burden: they have not proved on a balance of probabilities that any future infringements will occur. The evidence failed to prove the Appellants' theory on a balance of probabilities.

[37] There are many weaknesses in the Appellants' affidavit evidence that contribute to this inability to meet the burden. First, the Appellants did not present sufficient evidence to qualify the affiants as expert witnesses in the subject matter on which they purported to opine. Consequently, the affiants' evidence cannot speak beyond their individual viewpoint. No groundwork was laid to establish that Dr. Pinto could speak to the practices of other physicians. For the same reason, Ms. Samuel, while a qualified pharmacist, cannot speak to the practices and knowledge of other pharmacists and physicians because she provided no basis for her statement. Finally, Ms. Murphy is neither a physician nor a pharmacist, and establishes no other base of knowledge which would establish her qualifications to speak authoritatively on the practices in those professions.

[38] Second, aside from their general lack of qualifications, the three affiants offer no evidence as to how they arrived at their opinions to support their generalized statements. For instance, Dr. Pinto qualified his statements by limiting them to his own experience: "It has been my experience that generic products are dispensed when they are available". When speaking about pharmacists not honouring prescriptions, he stated: "I just think that is the practice" (my emphasis).

[39] Third, even if the affiants' evidence concerning the practices of others was admissible, they made admissions in their cross-examinations that undermine the authoritativeness of their generalizations and diminish the weight that should be attributed to the evidence. In particular, Ms. Murphy agreed that the Minister would only provide approval for those indications sought by the drug manufacturer for approval. Dr. Pinto made a similar admission.

[40] Thus, O'Keefe J. gave little weight to, and, ultimately, refused to accept, the affidavit evidence as support for the Appellant's theory. Without an evidential foundation, their theory collapses.

[41] In fact, there is a further weakness in the evidence of the affiants: at the time of swearing her affidavit, Ms. Murphy was a senior officer of Astra Pharma Inc., one of the Appellants to this action and, as a result her "opinion" evidence could be viewed as biassed or self-serving statements of an interested party.

[42] Certain aspects further weakened Dr. Pinto's evidence, such as: (1) his acknowledgment that a patient trusts that the physician has made himself or herself aware of what ailments the prescribed medication can treat; (2) his inability to provide any examples of incidents where pharmacists conducted themselves illegally in dispensing generic drugs for which "no substitution" was indicated; and, (3) his lack of experience in circumstances where a generic drug product is approved for only limited uses - he has only had experience with drugs that have been approved as interchangeable for all uses. Consequently, Dr. Pinto cannot speak authoritatively on the subject of new and limited uses of an existing compound. As a result, his theory constitutes mere speculation of what might happen in circumstances beyond his level of experience.

[43] The evidence of Linda Samuel is further weakened by the fact that, during her cross-examination, it became clear she was ignorant of many aspects of the regulatory regime governing the approval and dispensation of drug products in Canada: she could not provide the name of the legislation that governs the interchangeability of drug products in Ontario and was unaware of the interchangeability requirements; she did not know which branch of government approves a pharmaceutical product as safe and effective; she did not know that a drug manufacturer had to set out the specific uses for which it sought approval for its drug product; and, she was unaware that once the federal government is satisfied that a product is safe and effective, it issues an NOC and a Product Monograph to the submitting drug manufacturer.

[44] The comments by O'Keefe J. about the inappropriateness of the affiants providing expert evidence are consistent with the existing jurisprudence about the matter. As stated in The Law of Evidence in Canada, by Sopinka, Lederman, and Bryant, 2nd edition at page 623, an expert's usefulness is circumscribed by the limits of his or her own knowledge. Before a court will receive the testimony, it must be demonstrated that the witness possesses special knowledge and experience going beyond the trier of fact's respective knowledge. The court must be satisfied that the witness is sufficiently experienced in the subject-matter in issue. O'Keefe J. found that the affiants were not knowledgeable enough to speak beyond their own experiences.

[45] The Supreme Court of Canada stated in [1982] 2 S.C.R. 24">R. v. Abbey, [1982] 2 S.C.R. 24, that a party tendering expert evidence has "the obligation of establishing, through properly admissible evidence, the factual basis on which such opinions are based. Before any weight can be given to an expert's opinion, the facts upon which the opinion is based must be found to exist". Thus, even if the affiants in this case can be considered "experts", nowhere do they provide evidence to support their generalized statements about the practice of physicians and pharmacists. No independent studies or properly conducted surveys were tendered.

[46] In order to allow this appeal, therefore, it must be found that the trial judge, O'Keefe J., made a palpable and overriding error with respect to these facts and factual inferences. No such error was made. The Appellants cannot build a case upon such a shaky foundation.

The Genpharm Case

[47] The Appellants made additional argument based on the Genpharm decision of this Court, which was released on July 8, 2002. The thrust of this argument was that infringement by patients alone, with no further evidence beyond the mere fact that the generic sold the product initially, is sufficient to support the grant of an Order of Prohibition under the Regulations.

[48] In Genpharm, Procter & Gamble ("P & G") owned a patent for a new way of using an existing drug (a polyphosphonate, specifically, etidronate or etidronate disodium) in intermittent cycles in the treatment of osteoporosis. The use of polyphosphanates to inhibit bone loss was well known, but was not considered very useful in a chronic condition, such as osteoporosis because it also tended to inhibit bone formation.

[49] Genpharm Inc. ("Genpharm") applied for a NOC by issuing a NOA, and P & G applied for an order of prohibition to prevent the Minister from issuing the NOC.

[50] Genpharm's NOA characterized the '376 Patent owned by P & G as a pharmaceutical regimen consisting of a kit containing etidronate or etidronate disodium and a nutrient supplement. In contrast, Genpharm claimed that it would not package its etidronate disodium product in a kit in combination with any other active ingredient or nutrient supplement. Therefore, Genpharm claimed that the patent would not be infringed by its making, constructing, using or selling its etidronate disodium product.

[51] This Court in Genpharm made two findings in particular that are important to this analysis. First, the Court found that Genpharm's NOA was fatally flawed and deficient. The case could have been disposed of on that basis, but the Court anticipated that Genpharm would simply make a second application with the appropriate amendments to the NOA, and, thus, decided to opine on what would then happen with a second application. This was done to avoid more litigation.

[52] The Court, therefore, went on to deal with the proper interpretation of section 5(1)(b)(iv) of the NOC Regulations. Genpharm submitted that the infringement contemplated under the NOC Regulations is infringement by the generic producer, not infringement by patients who will use Genpharm's product. Thus, Genpharm argued that the only way they could be found to have infringed the patent is through inducement or procurement.

[53] The Court, however, found that the phrase "would be infringed" in subparagraph 5(1)(b)(iv) is not qualified. It does not say that the act of infringement must be the act of the generic producer. By not using the same phrase "by that person" in respect of the act of infringement within the same subparagraph, the Governor in Council cannot have intended that infringement be limited only to acts of the generic producer. The Court concluded that for Genpharm to suggest that the act of infringement must be by the generic producer reads words into the NOC Regulations, something the Court must not do. The Court also pointed to the definition of "claims for the use of the medicine" in section 2 of the NOC Regulations for support of its interpretation, in that the use claims referred to in subparagraph 5(1)(b)(iv) contemplate use by both generic producers and patients.

[54] First of all, Genpharm can be distinguished on its facts. The Court said:

The evidence cited above satisfies me that Genpharm's actions and intentions would lead inevitably to the use of its etidronate disodium product, Gen-etidronate, for the treatment of osteoporosis if it obtains the notices of compliance that it seeks.

There was no such evidence adduced in the present case, and it would, I suggest, be essential in

order to reach the same result.

[55] In addition, when reaching its conclusion as to Genpharm's intention, the court in Genpharm had the benefit of examining Genpharm's product monograph. Upon attaining government approval, a drug manufacturer receives a NOC together with a product monograph. The product monograph, among other things, sets out what the indications are for the drug product - the uses for which the government has approved a product. Therefore, a product monograph limits indications, and is available on the Compendium of Pharmaceutical Specialities (CPS). The CPS is a reference book which lists the dosages, ingredients and directions for certain drugs, and is widely used by pharmacists and physicians. Again, it should be reiterated that Apotex' product monograph was not available in these proceedings. Apotex had sought to file evidence but was late in doing so, and their application for an extension of time was opposed by the Appellants and was refused by McKeown J. However, during the present appeal hearing, Apotex' representatives stated that it had produced its product monograph to the Appellants in the course of a cross-examination. The Appellants did not place this document before the Court, and, as a result, the Court was without the benefit of the document, a document which played a key role in the Genpharm decision by providing the Court with an indication of the intentions of the generic company and the likelihood of infringement.

[56] The Appellants relied on the following passage from Genpharm at paragraphs 47 to 50 to argue that Genpharm should be applied to the present appeal:

The point is that use claims referred to in subparagraph 5(1)(b)(iv) contemplate use, not just by the generic producer, but by patients as well, and that infringement will result by patients using a medicine sold by a generic producer, even if there is no inducement or procurement by the generic producer.

The scheme of the Regulations seems obvious. If a generic producer sells a product and infringement by anyone using the product results, that is the infringement the Regulations are intended to preclude. There is no suggestion that the generic producer must have induced or procured patients or others to infringe the patent.

For this reason, I am satisfied that in the case of use claims, it is not necessary for a patentee to demonstrate that a generic producer's actions will induce or procure patent infringement by patients or others. Provided that the generic producer cannot establish that no claim for the use of the medicine would be infringed by patients or others by its selling of its product, it will not satisfy the justification test in subsection 6(2) of the Regulations and a prohibition order must be made.

In this case, if a patient used the Genpharm product for osteoporosis, the use claims of P & G's 376 Patent would be infringed. It would be Genpharm's selling of its product that would result in the infringement. Here, the evidence is overwhelming that it is not only probable, but inevitable, that Genpharm's Gen-etidronate product would, if notices of compliance issue, be used for the treatment of osteoporosis in the cyclical regimen that constitutes the invention under the 376 Patent. [my emphasis]

It should be emphasized, however, that the Court made these statements after having concluded that the evidence in Genpharm overwhelmingly demonstrated that the actions and intentions of Genpharm would inevitably lead to an infringement. Because no such conclusion can be reached in the case before us, the Genpharm case can be distinguished on that basis. I do not view Genpharm as being authority for the proposition that mere sale by a generic, without more, of a medicine subject to a use patent is sufficient to constitute infringement for the purpose of subparagraph 5(1)(b)(iv).

[57] Thus Apotex cannot be prevented from obtaining a NOC solely on the basis that it will sell omeprazole. If it were otherwise, then serious policy issues would arise. If there was any likelihood that a patient would consume a generic product for a patented use, then the generic product would not be approved. This would prevent new uses from being approved for existing drugs because there is always the possibility that someone somewhere will use the drug for the prohibited, patented purpose. This would result in a real injustice: since a generic company cannot possibly control how everyone in the world uses its product, the prevention of the generic from marketing the product would further fortify and artificially extend the monopoly held by the patent holders. The patent holder would, therefore, effectively control not just the new uses for the old compound, but the compound itself, even though the compound itself is not protected by the patent in the first place. The patent holders, as a result, would obtain a benefit they were not meant to have. In the end, society would be deprived of the benefit of new methods of using existing pharmaceutical medicines at a lower cost.

[58] Nor can Apotex be held liable in patent infringement proceedings under the Patent Act if, contrary to the evidence presented in the NOC proceeding, third party infringements do occur after the issue of a NOC, unless Apotex has implicated itself in the infringements by, for example, inducing or encouraging them. Genpharm has no application to a generic's liability under the Patent Act for any patent infringement by a third party that occurs after a NOC has been issued.

[59] The Appellants have not proved that, if a NOC were issued to Apotex and it were to sell omeprazole, patients or other third parties would infringe the Appellants' use patent. If a first person cannot prove in prohibition proceedings that future infringements will occur if a NOC is issued, it cannot obtain a prohibition by relying on subparagraph 5(1)(b)(iv), however the required nexus between the generic and the infringement is defined.

Conclusion

[60] This appeal should be dismissed with costs.

"J. EDGAR SEXTON"

J.A.

"I agree

A.M. Linden J.A."

"I agree

John M. Evans J.A."

FEDERAL COURT OF APPEAL

NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET: A-716-01

STYLE OF CAUSE: AB Hassle and Astrazeneca Canada Inc. v. The Minister

of National Health and Welfare and Apotex Inc.

PLACE OF HEARING: Ottawa, Ontario

DATE OF HEARING: September 17, 2002

REASONS FOR

JUDGMENT BY: SEXTON J.A.

CONCURRED IN BY: LINDEN J.A.

EVANS J.A.

DATED: November 1, 2002

APPEARANCES:

Mr. Gunars Gaikis FOR THE APPELLANTS

Mr. Sheldon Hamilton

Mr. Harry Radomski FOR THE RESPONDENT

Mr. Andrew Brodkin APOTEX INC.

SOLICITORS OF RECORD:

Smart & Biggar FOR THE APPELLANTS

Toronto,Ontario

Goodmans LLP. FOR THE RESPONDENT

Toronto,Ontario Apotex Inc.

Mr. Morris A. Rosenberg FOR THE RESPONDENT

Deputy Attorney General of Canada Minister of National Health

Ottawa, Ontario and Welfare

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AB Hassle v. Canada (Minister of National Health and Welfare), 2002 FCA 421

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