Notice of Compliance: Working With the New Canadian Patented Medicines Regulations



NOTICEOFCOMPLIANCE:WORKINGWITHTHENEWCANADIANPATENTED
MEDICINESREGULATIONS

by
FrançoisM.Grenier
*
LEGERROBICRICHARD,Lawyers,
ROBIC,Patent&TrademarkAgents
CentreCDPCapital
1001Square-Victoria-BlocE–8
thFloor
Montreal,Quebec,CanadaH2Z2B7
Tel.(514)9876242-Fax(514)8457874
www.robic.ca-info@robic.com

ThispresentationconcernsthenewCanadianPatentedMedicines(Noticeof
Compliance)RegulationsintroducedinCanadain1993.Adetailedanalysis
oftheRegulationswillbeprovidedandrelevantcaselawevolutionwillbe
discussed.
LEGISLATIVEVALIDITY
UndertheCanadianconstitution,theFederalgovernmenthasexclusive
jurisdictiontolegislatewithrespecttopatentsofinvention(PatentActR.S.C.
1985ch.P-4).PursuanttothePatentActAmendmentAct(1992S.C.1993c.
2)whichreceivedRoyalAssentonFebruary4,1995,thecompulsorylicencing
provisionswererepealedintheirentiretyandcompulsorylicencesissued
on/orafterDecember20,1991wereextinguished.Withtheabolitionof
compulsorylicencesforpatentedmedicines,itisnowpossibleforamedical
patenteetosueinfringersofitspatentandobtainusualreliefincluding
interlocutoryinjunction,pendingtrial
1.Additionally,section55.1wasadded,
creatingapresumptionthat,inanactionforinfringementofapatent
grantedforaprocessforobtaininganewproduct,anyproductthatisthe
sameasthenewproductshall,intheabsenceofprooftothecontrary,be
consideredtohavebeenproducedbythepatentedprocess.Section55.2



















































©LEGERROBICRICHARD,1997.
*Lawyer,FrançoisM.GrenierisaseniorpartnerinthelawfirmLEGERROBICRICHARD,g.p.and
inthepatentandtrademarkagencyfirmROBIC,g.p.Thismaterialwasdesignedforthe
purposeofageneralpresentationonCanadianLegislationmadeduringthe33rdAnnual
MeetingoftheDrugInformationAssociationheldinMontrealJune22-261997…Itwas
meantfordiscussionanddoesnotconclusivelystatetheopinionoftheirauthorsorthe
membersoftheirrespectivefirmsonthesubjectmatternordoesitprovideanexhaustive
reviewthereof.Publication217E.
1MerckFrosstCanadaInc.etal-vs-MinisterofNationalHealthandWelfare(1994),55C.P.R.
(3d),302



wasalsoadded,essentiallycreatingtwoexceptionswithrespectto
infringement:Itisnotconsideredinfringementtomake,construct,useorsell
thepatentedinventionsolelyforusesreasonablyrelatedtothedevelopment
andsubmissionofinformationrequiredunderanylawofCanadaregulating
themanufacture,construction,useorsaleofanyproductorforpurposesof
stockpiling,sixmonthsbeforetheexpiryofthepatent.Newsection55.2(4)
givestheGovernorsinCouncilpowerAtomakeregulationstoprevent
infringementbyanypersonwhomakes,constructs,usesorsellsapatented
invention.
ThePatentedMedicines(NoticeofCompliance)Regulationsproclaimed
March12,1993,allowapatentholdertoobtainanorderprohibitingthe
MinisterfromissuingaNoticeofCAomplianceuntilaftertheexpirationofthe
patentinissue,whenasecondpersonwishestoobtainaNoticeof
Complianceforthesamemedicine,unlessthesecondpersonshowsthatno
claimforthemedicineitselfandnoclaimfortheuseofthemedicine,found
insaidpatent,wouldbeinfringed.
LEGISLATIVEFRAMEWORK
InaccordancewiththeCanadianFoodandDrugsAct
2andregulations
adoptedthereunder,amanufacturerwishingtosellanewdrug,asdefinedin
theRegulations,mustobtainfromtheMinistryofHealthandWelfareaNotice
ofCompliance(NOC).ANOCisobtainedbythefilingofanewdrug
submission(NDS)oranabbreviatednewdrugsubmission(ANDS)withthe
Minister,soastoenabletheMinistertoassessthesafetyandeffectivenessof
thenewdrug.Detailsofthemanufactureofapharmaceuticalproductand
thecontrolstobeusedinthemanufacture,preparationandpackagingof
thenewdrugmustbeprovidedbythepersonfilingtheNDS/ANDS.
TheRegulations,adoptedin1993,providetomedicalpatenteesan
additionalmeans,directandeasy,topreventpossibleinfringement:by
seekinganorderofprohibitionagainsttheMinisterpreventinghimfrom
allowinganotherallegeduserofthepatentedmedicinetomarketthe
allegedlyinfringingproduct.Ineffect,patenteescannowprevent,ordelay
forupto30months,theissuanceofaNOC.Indiscussingtheregulations,the
FederalCourtofAppealwroteinFebruary1997″Thus,theMinister’sauthority
torefuseaNoticeofCompliance,originallydesignedtoprotectthepersonal
healthofCanadians,hasbeenharnessedtoprotectthefinancialhealthof
drugpatentees”
3.ThesameCourt4hadearliercommentedonthedifficult



















































2
R.S.C.1985,ch.F27
3ApotexInc.-vs-MerckFrosstCanadaInc.,anunreporteddecisionoftheFederalCourtof
AppealdatedFebruary10,1997(A-843-96)



taskofinterpretingtheregulations:”Inlargemeasure,thedifficultyisdueto
thefactthatthoseregulations,whoseclearintentionistofacilitatethe
protectionofprivatecommercialpatentrights,havebeengraftedontoa
regulatoryscheme,theFoodandDrugRegulationsC.R.C.1978c.870,as
amended,whosesolepurposeistheprotectionofpublichealthandsafety.
Theunionisnotahappyone!”
PATENTLIST
PursuanttoSection4oftheRegulations,apersonwhofilesasubmissionfora
NoticeofComplianceinrespectofadrugthatcontainsamedicinemay
submittotheMinisterapatentlistsettingoutanyCanadianpatentthe
personownsorinrespectofwhichhehasobtainedanexclusivelicence,that
containsaclaimforthemedicineitselforaclaimfortheuseofthemedicine.
“Claimforthemedicineitself”isdefinedinSection2oftheRegulationsas
includingaclaimforthemedicineitselfwhenpreparedorproducedbythe
methodsorprocessesofmanufactureparticularlydescribedandclaimedor
bytheirobviouschemicalequivalents.
Theterm”claimforthemedicineitself”isnotrestrictedtoaclaimforasimple
substanceastheactiveingredienttotheexclusionofaclaimfora
compositionwhichincludestheactiveingredient.Suchaclaimcomeswithin
theambitoftheRegulationswhetheritisintheformofasingleactive
ingredientorinthatofacomposition.
5
InCanada,untilveryrecently,amedicineitselfcouldnotbepatented
exceptwhenpreparedbyaspecificprocess,evenifthemedicinewasnew.
Ifthemedicinewasknown,butanovelprocesstoproduceitwasdiscovered,
onlytheprocesscouldbeclaimed.Medicinesthemselvescannowbe
patented.Accordingly,therearethreetypesofclaimsthatcanbemadein
amedicinepatent:aclaimforthemedicineitself,knownasaproductclaim
,
aclaimforthemedicinewhenpreparedbyaparticularprocess,knownasa
process-dependentproductclaim
andaclaimfortheparticularprocessthat
producesamedicine,knownasaprocessclaim
.
Ithasbeendecidedthatthephrase”claimforthemedicineitself”inthe
Regulationsmeansaclaimforthemedicineitselfintheordinaryandnatural
senseofthewordsandaclaimforthemedicinewhenpreparedbya
particularprocess,intheordinaryandnaturalsenseofthewordsusedin
section2.Thereisnothinginthelanguageofthelegislationwhichsuggests
































































































































































4
Seenote1above
5Hoffmann-LaRocheLtd.etal-vs-MinisterofNationalHealthandWelfare(1995),62C.P.R.
(3d),58(confirmed1996,67C.P.R.(3d),25)



thephrasealsocoversaclaimforaparticularprocessusedtoproducea
medicine
6.
“Claimfortheuseofthemedicine”isdefinedasaclaimfortheuseofthe
medicineforthediagnosis,treatment,mitigationorpreventionofadisease,
disorderorabnormalphysicalstate,orthesymptomsthereof.
Ithasalsobeenarguedthatclaimsforintermediatesusedtomanufacture
medicineswereincludedinthedefinitionof”claimsforthemedicineitself”.
TheFederalCourtofAppealhasheldthatsuchclaimswerenotcoveredby
theRegulations
7.
FILINGOFANEWDRUGSUBMISSIONANDSERVICEOFTHENOTICEOF
ALLEGATIONBYASECONDPERSON.
WhereapersonfilesasubmissionforNoticeofComplianceinrespectofa
drugandwishestocomparethatdrugwith,ormakereferenceto,adrug
thathasbeenmarketedinCanadapursuanttoaNoticeofCompliance
issuedtothefirstpersoninrespectofwhichapatentlisthasbeensubmitted,
thesecondpersonshall,initssubmissionwithrespecttoeachpatentonthe
patentlist,eitherstatethatthesecondpersonacceptsthattheNoticeof
Compliancewillnotissueuntilthepatentexpiresorallegesthatthepatent
hasexpired,isnotvalidorthatnoclaimforthemedicineitselfandnoclaim
fortheuseofthemedicinewouldbeinfringedbythemaking,constructing,
usingorsellingbythatpersonofthedrugforwhichthesubmissionforthe
NoticeofComplianceisfiled(Section5oftheRegulations).
Section5(3)(a)oftheRegulationsrequiresthattheapplicantfortheNoticeof
Complianceprovideadetailedstatementofthebasisinfactandinlawfor
hisallegation.Itisintendedthatthepatenteebefullymadeawareofthe
groundsonwhichtheapplicantsaysissuanceofaNoticeofCompliancewill
notleadtoaninfringementofthepatent,beforethepatenteedecides
whetherornottoapplytoacourtfordetermination.Suchdisclosuredefines
theissuesatanearlystage
8.TheCourtwillstartfromthepropositionthatthe
allegationsoffactintheNoticeofAllegationaretrue,unlessthecontraryis
shownbytheapplicant.Indeterminingwhetherornottheallegationsare
“justified”,theCourtwilldecideonthebasisoftheassumedorprovenfact,if



















































6
DeprenylResearchLtd.etal-vs-ApotexInc.(1994)55C.P.R.(3d),171(confirmed1995,60
C.P.R.(3d),501)
7EliLillyandCo.etal-vs-ApotexInc.(1996),68C.P.R.(3d),126
8BayerAGetal-vs-MinisterofNationalHealthandWelfare(1993),51C.P.R.(3d),329



theallegationswouldgiveriseinlawtotheconclusionthatthepatentwould
notbeinfringedbytherespondent
9.
TheNoticeofAllegationisinitiallyoutsideofthereachoftheCourtsinceitis
notadocumentsubmittedtotheCourt
10.Consequently,itcannotbe
strickenbytheCourt,amendedpursuanttoanorderoftheCourtand
particularscannotberequestedbytheapplicant.
ANoticeofAllegationmustbecarefullydrafted.Thereisnorequirement
undertherulesoftheCourtthattheNoticeofAllegationbesupportedby
affidavitevidence.IthasbeennotedbytheCourtthatonceasecond
personproductreachesthemarket,thefirstpersonisinapositiontotestthe
accuracyofthedetailedstatement;ifitwereshowntobeinaccurate,the
consequencesforasecondperson”…couldwellbeverygraveindeed”
11.
Whentheallegationistheabsenceofinfringement,thesecondpersonisnot
expectedtomakeafulldisclosureofitsprocesswithoutaprotectiveorder
dulyinplace,whichcannotbeobtaineduntilthereisaproceedingin
Court
12.Inpractice,thestatementssupportingtheallegationwillinitiallybe
vagueandincludeanundertakingtofullydisclosethefacts,oncethe
protectiveorderisinplace.
CHALLENGINGTHENOTICEOFALLEGATION
Within45daysafterbeingservedwithaNoticeofAllegation,thefirstperson
mayapplyforanorderprohibitingtheMinisterfromissuingaNoticeof
Complianceuntilaftertheexpirationofoneormoreofthepatentsthatare
subjectofanallegation.TheCourtwillissuethewritofprohibitionifitfinds
thattheallegationsarenotjustified
13.TheorderoftheCourtappliesonlyto
thespecificNoticeofAllegationthattriggeredthemotionfortheissuanceof
awritofprohibition.ThesecondpersonmayserveasecondNoticeof
Allegation(forexampleallegingadifferentprocessincasesofprocess
dependentproductclaims).Thecourtfocusindealingwiththeregulationsis
theNoticeofAllegationandwhethertheissuanceofaNOCshouldbe
prohibited.TheCourt’staskistodeterminewhethertheallegationisjustified.
Thus,thescopeofanyprohibitionorderissuedinproceedingsbroughtunder
subsection6(1)mustbeconfinedtothespecificallegationadvancedin



















































9
Seenote1above
10
PharmaciaInc.-vs-MinisterofNationalHealthandWelfare(1994)58C.P.R.(3d),209
11
Hoffmann-LaRocheLtd.-vs-MinisterofNatioanHealthandWelfare(1996),70C.P.R.(3d)
206
12
Seenote8,above
13
Regulations,Section6



thoseproceedings14.However,asubsequentNoticeofAllegationmustnot
beessentiallythesameasonepreviouslyfiled.
Whenthefirstpersonisnotthepatentee(anexclusivelicensee)theowner
shallbemadeapartytotheapplication
15.Eventhoughthewritisaddressed
totheMinister,thesecondpersonshallalsobemadeaparty
16.
NATUREOFTHEPROCEEDINGS
Litigantshavetriedtohavethesecasesheardasfull-fledgedpatent
infringementactions.InOctober1993,earlyaftertheregulationswere
adopted,itwasdecidedbytheFederalCourtofAppeal
17thatproceedings
undertheregulationsshouldbegovernedbypartV.1oftheFederalCourt
Rules
18(applicationsforjudicialreview,rules1600-1619).PartV.1ofthe
FederalCourtRulesdictatesatimetablefortheexpeditiousconductof
proceedings”…alientothecourtandpractitionersinthisfieldofthelaw”.
Therefore,theproceedinginitiatedundertheRegulationsisnotanactionin
infringementanditsobjectissolelytoprohibittheissuanceofaNoticeof
Compliance.Thesoleissueiswhethertheallegationsofthesecondperson
aresufficienttoallowtheMinistertoissueaNoticeofCompliance.
BURDENOFPROOF
Ithasbeendecided
19thatthemovingpartyunderSection6ofthe
Regulations(thefirstperson)hasthecarriageofthelitigationandbearsthe
initialburdenofproof.Thatburdenhasbeenqualifiedasdifficultsincethe
firstpersonmustdisprovetheallegationsintheNoticeofAllegationwhich,if
leftunchallenged,wouldallowtheMinistertoissueaNoticeofCompliance.
Wherethenoticeallegednon-infringement,theCourtwillstartfromthe
propositionthattheallegationsoffactintheNoticeofAllegationaretrue
excepttotheextentthatthecontraryhasbeenshownbytheapplicant.
TheCourtmustdecidewhether,onthebasisofthefactsassumedorproved,



















































14
Apotexinc-vs-MinisterofNationalHealthandWelfare,anunreporteddecisionoftheTrial
DivisionoftheFederal(Mr.JusticeJerome),datedApril25,1997(T-1237-95)
15
Regulations,Section(4)
16
Seenote1above
17
Seenote8,above
18
C.R.C.1978c.663
19
Seenote1above



theallegationswouldgiveriseinlawtotheconclusionthatthepatentwould
notbeinfringedbytherespondent.
Thefirstpersonbearsthelegalburden.Thesecondpersonbearsthe
evidentialburden.TheFederalCourtofAppealconvenientlysummarizedthe
caselawasfollowswithregardstotheburdenofproof
20:
-Theinitialburdenofproofisknown,inacivilcase,asthe
persuasiveburdenorthelegalburdenanditistheburden
ofestablishingacasetothecivilstandardofproof.By
contrast,theevidentialburdenconsistsofaburdenof
puttinganissueinplayandmeansthatapartyhasthe
responsibilitytoensurethatthereissufficientevidenceof
theexistenceornon-existenceofafactoranissueonthe
recordtopassthethresholdforthatparticularfactorissue.
-Consequently,wheresecondpersonsfailtofileNoticesof
AllegationoradequateNoticesofAllegation,theymust
assumetheirownriskwhenitcomestoattacksonthe
adequacyofsuchallegationsonceprohibition
proceedingsarecommenced.
Abaldstatementofnon-infringementinadetailed
statementwithoutanyfactualassertioninsupportthereof
doesnotmeettherequirementsoftheRegulations.
-Acommonlawpresumptionthatasecondperson’s
processwouldinfringethepatentapplieswherethat
personhasassertednofactstosupporthisallegationof
non-infringement,theevidenceofnon-infringementlay
particularlywithinhisknowledge,noevidenceofnon-
infringementhasbeenpresentedbythatpersonandthe
firstpersonhasnootheravailablemeansofassessingsuch
evidence.

RULESOFTHEFEDERALCOURT
UndertherulesoftheFederalCourt,anapplicationforjudicialreviewis
madebyanoriginatingnoticeofmotion,identifyingtheprecisereliefsought
andsettingoutthegroundsintendedtobeargued
21.Allpartiesadversein



















































20
Seenote11above
21
Rule1602,RulesoftheFederalCourt

interesttotheapplicantmustbenamedasrespondent22.Thefactsreliedon
bytheapplicantsmustbeverifiedbyoneormoreaffidavits.Anyadverse
partymayfileaffidavitsinreplywithinthirtydaysafterserviceofthenoticeof
motion
23.Therulesdonotspecificallyallowreplyaffidavits.Inpractice,
sincethefirstsubstantiveevidenceisfiledbytherespondent,leaveisgranted
totheapplicantbytheCourttofilereplyevidence.
Theapplicantmustfileitsmotionrecordwithinsixtydaysafterthefilingofthe
originatingnoticeofmotion.Therespondentmustfileitsmotionrecordthirty
dayslater
24.Intheory,thefilemustbereadyforhearingwithinfourmonths,
clearevidencethattheproceedingsaresummaryinnature.
Withoutleaveofthecourt,adeponentofanyaffidavitmaybecross-
examinedbyanadverseparty
25.
DECISIONOFTHECOURT
Asmentionedbefore,thedecisionwillapplyonlytotheparticularallegation
madebythesecondperson.Anappealispossibleagainstthedecisionand
mustbefiledwithinthirtydaysofthejudgment
26.Thefilingofthenoticeof
appealdoesnotstaytheeffectofthedecisionbelow.Ifthemotionforthe
issuanceofawritisdismissed,theNOCwillissue.
TIMELIMITTOCOMPLETETHEPROCEEDINGS
TheregulationsprovidethattheMinistershallnotissueaNoticeof
Compliancetoasecondpersonbeforeatthelatest
30monthsafterthefiling
ofanapplicationfortheissuanceofawritofprohibition,unlessthepatent
hasexpiredorthecourthasdismissedtheapplication
27.Bymerely
commencingtheproceedings,thefirstpersonobtainstheequivalentofan
interlocutoryinjunctionforupto30months,withouthavingtosatisfythe
criteriaanycourtintheworldwouldrequirebeforegrantingsuchan
extraordinaryremedy(seriousquestiontobetried-primafacierights-
irreparableharm-balanceofconveniencebetweentheparties-urgency).



















































22
Rule1602(3),RulesoftheFederalCourt
23
Rule160(3),RulesoftheFederalCourt
24
Rules1606and1607,RulesoftheFederalCourt
25
Rule332.1,RulesoftheFederalCourt
26
Rule1201,RulesoftheFederalCourt
27
Regulations,Section7

Thethirtymonthbartomarketing(NoNOC-nomarketing)bycompetitors
triggeredbythepatenteefilinganapplicationforprohibitionwasqualified
bytheCourtasalegislativestay,subjecttothetermsimposedbythe
regulations,notajudicialinjunction
28.
WheretheCourtfindsthatapartytotheapplicationfailedtoreasonably
cooperateinexpeditingtheapplication,itmayalterthelegislativeduration
ofthethirty-monthperiodandextendorshortenit
29.Thelegislativestayisan
extraordinarysanctiondistractingfromthenormalrightsofadefendant
underordinarypatentlaw.Itwasintendedtofocusthemindsoftheparties
andtheCourtastotheneedofanexpeditiousprosecutionofthe
applicationforprohibition.Theregulationsdiscloseanintentionthatthe
proceedingsshouldbeconductedexpeditiouslyandarenotmeantto
becomeapatentaction
30.Commentingontheimportancefortheparties
tomeetthethirty-monthdelay,theFederalCourtofAppealrecentlysaid:
Atimelimitforthelegislativestaywasfixedatthirtymonths,not
justasoneofmanyoptionsforthepartiesbutasatimelimit
whichwastoberespectedunlessalteredbytheCourtforthe
solereasonauthorizedinsection7(5).Themessageforthe
partiesisclear:Theymusteithersoconductthemselvesthat
theycannotbefoundtohavefailedtocooperatereasonablyto
expeditetheproceedingsortheymayfaceanalterationofthe
thirty-monthstay,eitherashorteningorlengtheningdepending
onwhichpartyisatfault.Agreementbythepartiestodelaywill
notavailtoprotractthelegislativestay.Unwarrantedrefusalsto
makewitnessesavailable,thefailuretorespectundertakingsor
toanswerquestions,orextravagantdemandsforinformationon
cross-examinations,andrequestsforwastefuladjournmentsfor
flimsyreasons,mustbeviewedasfailurestocooperate
reasonably.Partieswhoarethevictimsofsuchtacticsmustnot
assumethethirty-monthperiodwillbealteredunlesstheyare
preparedtodocumentthroughthesetacticsafailurebytheir
opponenttocooperatereasonablyintheexpeditionofthe
application.Apartywillconsenttoadjournmentsatthecostof
notbeingabletoblametheotherfordelayonasubsection7(5)
application.Interlocutorymotionsindulgedinbyapartywillbe
assessedbytheiroutcome,todeterminewhethertheywere
broughtoropposedunreasonably.Therearealsoimplications
fortheCourt:thatitmustcontrolorsuppressunnecessary
interlocutoryproceedingsandtheconductthatgivesriseto



















































28
Seenote3above
29
Regulations,Section7(5)
30
Seenote10above



them;limitthelengthandfrequencyofadjournments;insistthat
mattersproceedatapacelikelytoallowahearingofthe
applicationbeforetheexpirationofthe(notunreasonable)
periodofthirtymonths;andfinally,refuseextensionsunlessthe
criteriaofsubsection7(5)arestrictlymetafteracareful
assessmentoftheconductoftheparties”.
31
CONCLUSION
TheRegulationswereproclaimedfouryearsago.Theiradoptioncreateda
substantialamountoflitigation.Motionsfortheissuanceofwritsofprohibition
arefiledbymedicalpatenteesroutinelyassoonasNoticesofAllegationare
served.Caseshavingdoubtfulmeritsornomeritsatalldragthroughthe
courtsystem.ItismyviewthattheRegulationshavenotreachedthe
objectivecontemplatedbytheirenactment.Bothsidesareresponsiblefor
thissituation.Forexample,patenteesarestillfilingmotionsraisingpatents
withprocessclaimonly.GenericsareservingNoticesofAllegationbefore
evenfilingtheirNDSorANDSandarethereafterprocessshopping,leaving
patenteesinthedarkastotheirtrueintentions.
Fortunately,manyimportantissueshavebeendecidedbytheCourtof
Appealhavingtheeffectofunfeatheringthelitigiousprocess.Manymore
arestilloutstandingandmustbeclarified.
Pressurehasbeenputonthegovernmentbybothsidestosubstantially
overhaultheRegulations.Thegovernment’strueintentionisunknown.

31
Seenote3above



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