Date: 20020904
Docket: T-1747-00
Neutral citation: 2002 FCT 931
Between:
AB HASSLE, ASTRAZENECA AB
and ASTRAZENECA CANADA INC.
Applicants
- and -
APOTEX INC. and THE MINISTER OF HEALTH
Respondents
REASONS FOR ORDER
KELEN J.:
[1] This is an application pursuant to the Patented Medicines (Notice of Compliance) Regulations, (the "Regulations"), by the applicants for:
- (a) a declaration that a letter from Apotex dated August 1, 2000 does not comply with the Regulations and does not constitute a Notice of Allegation ("NOA") under the Regulations; and,
- (b) in the alternative, an Order prohibiting the respondent Minister of Health from issuing a Notice of Compliance ("NOC") to Apotex in respect of the pharmaceutical products omeprazole and/or omeprazole magnesium tablets, 10mg, 20mg and 40mg until after the expiration of Canadian Patents 1,292,693 ("693"); 1,302,891 ("891"); and 2,166,483 ("483") (collectively "the Patents").
BACKGROUND FACTS
[2] This action relates to patents for pharmaceutical preparations containing omeprazole. Omeprazole is effective in the treatment of gastric and duodenal ulcers. The patented pharmaceutical preparations allow omeprazole to reach the location of the ulcer in the intestine without first being degraded from contact with gastric acid. To prevent the degradation and to increase the storage stability, the medicine is mixed with alkaline materials and coated. The composition of the pharmaceutical preparations consist of the "core", an "inert subcoat" and an outer "enteric coating".
[3] The three patents in issue are the same for the purposes of this action. The Court will focus on patent '693. The patents include several patent claims including a "process patent claim" and a "composition patent claim". Patent '693 contains 19 patent claims.
[4] By letter dated August 1, 2000, Apotex served a NOA pursuant to the Regulations in respect of "Apo-omeprazole tablets". The NOA alleged non-infringement of the applicants' patents because the enteric coating is applied directly to the core, so that the new drug has no subcoating.
[5] The applicants commenced this action in response to Apotex' NOA on four grounds:
iii. the NOA fails to identify the drug or active ingredient for which approval is sought;
iv. the NOA lacks sufficient details to permit the applicants to evaluate its validity;
v. the NOA is an abuse of process in view of proceedings T-179-98 and T-180-98 before this Court. The applicants allege that Apotex withdrew its allegations in those proceedings on the eve of hearing in order to address deficiencies in its evidence so that this NOA is an abuse of process; and,
vi. the Apotex process of applying the enteric coating directly to an omeprazole core may actually generate a subcoat in situ by chemical reaction, such that the Apotex process will infringe the patent claim.
HISTORY OF THE PROCEEDINGS
[6] In the Reasons for Order and Order of Blanchard J. in AB Hassle v. Apotex Inc., [2002] F.C.J. No. 343 (F.C.T.D.), an interlocutory proceedings in this matter, dated February 28, 2002, there is a short history of the interlocutory proceedings, which I will adopt:
By notice of motion dated October 6, 2000, Apotex sought an order, pursuant to paragraph 6(5)(b) of the Regulations, dismissing the application on the grounds that it was frivolous, vexatious and an abuse of process ("dismissal motion").
By order dated November 29, 2000, Associate Senior Prothonotary Giles granted the relief sought by Apotex and dismissed the application as frivolous, vexatious and abusive.
On appeal by the applicants, Mr. Justice Blais, by order dated May 25, 2001, set aside the order of the Associate Senior Prothonotary Giles. However, in his reasons, Mr. Justice Blais made certain observations agreeing in part with the decision of the Associate Senior Prothonotary regarding the procedural complaints made by the applicants. Such observations are:
- (Paragraph 34, Blais J., reasons for order) "I agree with the Prothonotary that the Regulations do not require that the drug or active ingredient be identified in a notice of allegation."
- (Paragraph 41, Blais J., reasons for order) "I agree with the Prothonotary that the matter is not res judicata nor that it is an abuse of process."
- (Paragraph 65, Blais J., reasons for order) "..., I agree with Apotex that construction of a patent is always engaged by an assertion of non-infringement in any proceeding. Furthermore, as was pointed out by Apotex, the applicants had the opportunity to file expert evidence as to the construction of the Patents. I do not believe that the Prothonotary erred in making a determination about patent construction on a motion for summary dismissal."
Following the order of Mr. Justice Blais, the applicants brought a motion for disclosure of information relevant to Apotex' Apo-Omeprazole tablets. By order dated July 16, 2001, Prothonotary Aronovitch ordered disclosure of Apotex's regulatory submission and verification of same by the Minister.
THE PATENTS
[7] The parties agree that the three patents in issue are substantially the same for the purpose of this action. Using patent '693 as typical of the three patents, it reads in part:
The present invention is related to a new stable pharmaceutical preparation containing omeprazole for oral use, to a method for the manufacture of such a preparation and to a method for affecting gastric acid secretion and providing gastrointestinal cytoprotective effect when using them.
[...]
The object of the present invention is to provide an enteric coated dosage form of omeprazole, which is resistant to dissolution in acid media and which dissolves rapidly in neutral to alkaline media and which has a good stability during long-term storage. The new dosage form is characterized in the following way. Cores containing omeprazole [...] are coated with two or more layers, whereby the first layer/layers is/are soluble in water [...]. This/these first layer/layers separates/separate the alkaline core material from the outer layer, which is an enteric coating.
[...]
The separating layer(s) can be applied to the cores [...] by conventional coating procedures [...]
[8] The final section of the patent marked "THE EMBODIMENTS OF THE INVENTION IN WHICH AN EXCLUSIVE PROPERTY OR PRIVILEGE IS CLAIMED ARE DEFINED AS FOLLOWS", sets out nineteen patent "claims". Patent claim No. 1 in patent '693 is pertinent to this action, and it reads:
1. An oral pharmaceutical preparation comprising:
(a) a core region comprising an effective amount of a material selected from the group consisting of omeprazole plus an alkaline reacting compound, an alkaline omeprazole salt plus an alkaline reacting compound and an alkaline omeprazole salt alone;
(b) an inert subcoating which is soluble or rapidly disintegrating in water disposed on said core region, said subcoating comprising one of more layers of materials selected from among tablet excipients and polymeric film forming compounds; and
(c) an outer layer disposed on said subcoating comprising an enteric coating.
[9] Patent claim No. 17 is for the process of manufacturing the preparation.
[10] At issue in this matter is not the drug omeprazole itself. The patent claims, and Apotex' NOA, are concerned with the tablet composition or structure, and a process for manufacturing the tablet.
NOTICE OF ALLEGATION
[11] The Notice of Allegation identifies three patents owned by the applicants and alleges 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 of the drug. The Notice of Allegation reads, in part:
The legal and factual basis for the aforesaid allegation is as follows:
The claims of these patents cover compositions comprising a core containing a medicine, an inert subcoating, and an outer enteric coating. Our tablets will not fall within the scope of the claims of these patents.
More specifically, our tablets comprise cores containing the drug, and an enteric coating applied directly to the cores without any subcoating between the cores and the enteric coating. Our tablets will not infringe, by reason there being no subcoating between the cores and the enteric coating.
This is the complete "legal and factual basis" for the NOA. The applicants submit that this NOA does not either, as required in subparagraph 5(3)(a) of the Regulations, "provide a detailed statement of the legal and factual basis for the allegation", nor, as required in subparagraph 5(3)(c)(ii) of the Regulations, include in the NOA "a description of the dosage form, strength and route of administration of the drug in respect of which the submission has been filed."
RELEVANT SECTIONS OF THE REGULATIONS
[12] The relevant sections of the Patented Medicines (Notice of Compliance) Regulations are as follows:
5.
[...]
(3) Where a person makes an allegation pursuant to paragraph l(b) or (1.1)(b) or subsection (2), the person shall [SOR/99-379, s. 2(3)]
(a) provide a detailed statement of the legal and factual basis for the allegation;
[...]
(c) if the allegation is made under subparagraph (1)(b)(iv) or (1.1)(b)(iv);
[...]
(ii) include in the notice of allegation a description of the dosage form, strength and route of administration of the drug in respect of which the submission has been filed;
Right of Action
6.
(1) A first person may, within 45 days after being served with a notice of an allegation pursuant to paragraph 5(3)(b) or (c), apply to a court for an order prohibiting the Minister from issuing a notice of compliance until after the expiration of a patent that is the subject of the allegation. [SOR/98-166, s. 5(1)]
(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 ....]
5.
[...]
(3) Lorsqu'une personne fait une allégation visée aux alinéas (1)b) ou (1.1)b) ou au paragraphe (2), elle doit:
a) fournir un énoncé détaillé du droit et des faits sur lesquels elle se fonde;
[...]
c) si l'allégation est faite aux termes des sous-alinéas (1)b)(iv) ou (1.1)b)(iv) :
[...]
(ii) insérer dans l'avis d'allégation une description de la forme posologique, de la concentration et de la voie d'administration de la drogue visée par la demande;
Droits d'action
6.
(1) La première personne peut, dans les 45 jours après avoir reçu signification d'un avis d'allégation aux termes des alinéas 5(3)b) ou c), demander au tribunal de rendre une ordonnance interdisant au ministre de délivrer un avis de conformité avant l'expiration du brevet visé par l'allégation.
(2) Le tribunal rend une ordonnance en vertu du paragraphe (1) à l'égard du brevet visé par une ou plusieurs allégations si elle conclut qu'aucune des allégations n'est fondée.
ANALYSIS
- 7. Preliminary Arguments
- (h) Identifying an ingredient
[13] The applicants submit that Apotex' NOA does not identify an active ingredient for which Apotex seeks approval , referring only to 'Apo-omeprazole' , which is a brand name, as opposed to either omeprazole or omeprazole-magnesium, two distinct drugs, either of which could be the subject of the NOA. The active ingredient was subsequently identified by Order of this Court, as being omeprazole-magnesium, also referred to as a "salt of omeprazole" or a "magnesium salt". However, the applicants submit that the initial defect should serve to render the NOA invalid, as under the Regulations, amendment to a NOA is not permitted.
[14] The respondent Apotex submits in reply that the applicants' interpretation of the Regulations is mistaken, and that a requirement to identify an active ingredient is not present.
[15] This issue has already been brought before this Court by way of motion by the applicants. By decision in AB Hassle v. Apotex Inc., [2001] F.C.J. No. 809 (F.C.T.D.), dated May 25, 2001, Blais J. found that there was no obligation under the Regulations to specifically identify an active ingredient.
[16] I agree and adopt the reasoning of Mr. Justice Blais and find no grounds to support the applicants on this point.
[17] The applicants submit that the NOA is an abuse of process since the respondent Apotex made the same allegations regarding omeprazole and omeprazole-magnesium in previous separate, discontinued Court files.
[18] By a "side-agreement" dated May 14, 1999, the applicants consented to the discontinuance of the legal actions and specifically agreed that Apotex could file a new NOA on the same legal and factual basis with respect to omeprazole capsules. The agreement did not refer to omeprazole tablets. However, it is clear that the parties understood that Apotex was withdrawing its previous NOAs with the understanding that Apotex may file a new NOA in the future. The evidence in this action demonstrated that the previous NOA were withdrawn because Apotex had experienced problems in the formulation of the new drug, not because of any deficiency in its evidence with respect to patent infringement.
[19] Mr. Justice Blais also considered this issue in the previous interlocutory proceeding and found that the previous actions were withdrawn on consent and no res judicta resulted as the issues were never tried on the merits.
[20] I agree and adopt with the reasoning of Mr. Justice Blais on this point. I add that the evidence before the Court does not establish, on the balance of probabilities, an abuse of process by Apotex.
2. Justification of Allegation of Non-infringement
[21] The applicants submit that the NOA is not justified on the following grounds:
- · Apotex did not deny, and in fact admitted, that an "intervening neutral layer" (a subcoat) would come into effect;
- · Apotex failed to provide relevant evidence, specifically samples of the tablets;
- · Apotex' references in the NOA to the construction of the patents did not limit the processes therein to exclude the in situ subcoating; and,
- · the different patent claims cover a structure of a tablet, as well as the process whereby the tablet is formed. The structure includes a core, a subcoat and an enteric coating regardless of whether the subcoat was applied by production process or came into existence through other means.
[22] In reply, Apotex submits:
- · no admission as to the existence or creation of a subcoat was made, and regardless, if a layer comes into existence it does not serve the purpose of the subcoat under the patents or constitute a "subcoat" under the patents;
- · that the construction of a patent is automatically engaged by the filing of an NOA under the Regulations, and the onus is on the patentee, here the applicants, to show the alleged infringement - specifically, the applicants must demonstrate to the Court that the Apotex formulation contains a "subcoat" within the meaning of the patents;
Principles of Patent Construction
[23] Blais J., in his decision in AB Hassle v. Apotex Inc., supra., set out the necessity of patent construction in this matter. The Supreme Court of Canada in Whirlpool Corp. v. Camco Inc. (2000), 9CPR (4th ) 129 per Binnie J. succinctly set out the principles of patent claims construction:
1. The Principles of Patent Claims Construction
¶ ¶ 42 The content of a patent specification is regulated by s. 34 of the Patent Act. The first part is a "disclosure" in which the patentee must describe the invention "with sufficiently complete and accurate details as will enable a workman, skilled in the art to which the invention relates, to construct or use that invention when the period of the monopoly has expired"[...] The disclosure is the quid provided by the inventor in exchange for the quo of a 17-year (now 20-year) monopoly on the exploitation of the invention. The monopoly is enforceable by an array of statutory and equitable remedies and it is therefore important for the public to know what is prohibited and where they may safely go while the patent is still in existence. The public notice function is performed by the claims that conclude the specification and must state "distinctly and in explicit terms the things or combinations that the applicant regards as new and in which he claims an exclusive property or privilege" (s. 34(2)). An inventor is not obliged to claim a monopoly on everything new, ingenious and useful disclosed in the specification. The usual rule is that what is not claimed is considered disclaimed.
¶ ¶ 43 The first step in a patent suit is therefore to construe the claims. Claims construction is antecedent to consideration of both validity and infringement issues [...]
[24] The Supreme Court states that the first step in a patent suit is to construe or interpret the claims. The case at bar is focussed on claim No. 1 for the "composition" of the drug. This claim is a distinct and separate claim from claim No. 17, which is a "process" patent claim, i.e. a claim for the process or method of making the drug.
[25] The question in each patent case is the meaning of the descriptive words and phrases appearing in the patent claim as understood by persons with a practical knowledge and experience in the kind of work to which the patent relates. Mr. Justice Binnie held at paragraphs 44 and 45:
¶ 44[...]The question in each case is: whether persons with practical knowledge and experience of the kind of work in which the invention was intended to be used, would understand that strict compliance with a particular descriptive word or phrase appearing in a claim was intended by the patentee to be an essential requirement of the invention so that any variant would fall outside the monopoly claimed, even though it could have no material effect upon the way the invention worked.
¶ 45[...]The key to purposive construction is therefore the identification by the court, with the assistance of the skilled reader, of the particular words or phrases in the claims that describe what the inventor considered to be the "essential" elements of his invention.
[26] The meaning in patent claim No. 1 of an "inert subcoating" and "an outer layer disposed on said subcoating" was the subject of the expert evidence.
THE EVIDENCE
[27] The evidence in this action, by affidavit and transcript of cross-examinations, consisted of three expert witnesses for Apotex, one expert witness for the applicants, and the chief executive officer for Apotex. I will review the evidence of each witness beginning with the witnesses for Apotex.
Evidence of Dr. Paul J. Niebergall
[28] Dr. Niebergall testified at paragraph 17 of his Affidavit:
[...] It is absolutely clear to me that the product of any reaction between the core and the enteric coating in such formulation is not a sub-coat in the way that term is discussed in the Patents. In fact, the Patents teach away from such a formulation to avoid just such a reaction.
[29] Dr. Niebergall testified that the patents require that the outer coating and the medicinal core be separated to avoid any contact and the resulting adverse reaction. As a result, Dr. Niebergall testified at paragraph 26 that the patents require a separately applied subcoat to separate the core from the enteric coating. Dr. Niebergall testified at paragraph 41 that the product of a reaction between the core and the enteric coating would not constitute an "inert subcoating" as that term is used in the patents.
[30] Dr. Niebergall refers to the specifications of the patents which state that the separating layer for tablets is preferably not less than 10 microns. At paragraph 43 he deposed:
It is not conceivable that a controlled sub-coating depth of this size could be formed in situ by plating out some of the components of an enteric solution.
[31] In cross-examination, Dr. Niebergall testified, that the word "disposed" in Claim 1 means that the subcoating "was actively put-on". At question 252, the witness said that the word "disposed" is:
[...] not an American English type of wording. We say we coated something. So when I see "disposed", my interpretation, I assume, I look at it as any person reading this thing would probably come up with the same type of opinion. That was put on to something".
Application Record, page 1241, question 250.
[32] Dr. Niebergall testified that it is impossible to have an in situ layer formed "that's continuous and will act as an inert sub-layer, I say that is not possible". (Question 279, page 1252 of the Application Record.). In cross-examination he stated:
I am saying that reaction will not take place to form a continuous film, and if it doesn't form a continuous film, it is no longer an inert subcoat. Period.
Application Record, page 1256, question 288.
[33] Dr. Niebergall stated that "when you say "subcoating", you mean a manufacturing process, in this case a coating process, done the only way I know how [...]". (Question 361, page 1272, Application Record.). Dr. Niebergall states that the word "subcoating" in Claim 1 implies a manufacturing process to coat the tablets.
[34] I accept Dr. Niebergall as a highly qualified expert. It is difficult to assess credibility of witnesses by reviewing transcripts without the benefit of viva voce evidence in open Court. Dr. Niebergall was strong in presenting his position under persistent and lengthy cross-examination. There is a fine line in an expert's evidence between being an objective firm witness and being an advocate for his client. It is difficult to determine if Dr. Niebergall crossed that line.
[35] The applicants questioned Dr. Niebergall's credibility in that he had been a witness for Apotex on previous occasions and that he is a personal friend of another expert witness for Apotex. I realize that this does not necessarily affect his credibility.
Evidence of Dr. Roger Schnaare
[36] Dr. Schnaare deposed at paragraph 11 of his Affidavit:
"I further concluded that any by-product caused by a reaction between the core and the enteric coating is not a "subcoat" as that term is used in the Patents."
[37] Under cross-examination Dr. Schnaare agreed that the spraying of a solution of polymers onto the core of omeprazole and an alkaline reacting compound can cause a reaction on the surface of the core. For the purpose of the hypothetical example, the reaction material is labelled "X". As the polymer is continually sprayed onto the core, X forms around the core and becomes a barrier between the core and the enteric coating being sprayed onto the core. (Transcript, pages 1370 to 1373.) Dr. Schnaare testified that the layer of "X" is not a "subcoating" because:
"A subcoat is a coating that is applied to a surface by using a coating technique. This layer of "X" was not applied, it was formed in situ, and its just not a coat, you didn't apply it."
Transcript, page 1383, question 394.
On re-examination, Dr. Schnaare stated that the "X" layer in the hypothetical would not be continuous because the reaction would not take place equally for all the different surface areas of the core. Dr. Schnaare also questioned whether the thickness of the "X" layer would ever approach the preferred thickness described in the patent of 10 microns. (Transcript, page 1396 and 1397.)
[38] The opinion of Dr. Schnaare was requested on January 24th, 2002 and initially required by Apotex the next day. Dr. Schnaare obtained an extension until January 28th. Dr. Schnaare had the opinion of Dr. Niebergall, who is a personal friend. Dr. Schnaare worked closely with Dr. Niebergall for many years and co-authored a number of papers with him. Accordingly, the independence and credibility of Dr. Schnaare was questioned by the applicants.
[39] During the cross-examination of Dr. Schnaare, counsel for Apotex constantly interrupted. If the cross-examination took place in open Court, the Court would have stopped Apotex' counsel from the unreasonable interventions. The interruptions undermine the value of this witness' evidence. The protective interventions imply that the witnesses answers would have been unsatisfactory for Apotex. For example, see pages 1340, 1341, 1342 and 1343 of the Record. On an occasion the intervention by counsel for Apotex suggested an answer to the witness, e.g. see page 1360.
Evidence of Dr. Michael Sefton
[40] The Affidavit of Dr. Sefton, Record, page 485, deposed at paragraph 13:
When a subcoating is not used, the outer surface of the core and inner surface of the enteric coating, which are in contact with each other, form an interface which may comprise some reacted material. However, it would be a complete distortion to characterize this reactive material as constituting a "subcoating" [...]
[41] While Dr. Sefton acknowledged that a reactive layer is conceivable, the product of the reaction could not be considered a layer. The thickness would depend upon the ingredients, but Dr. Sefton did not have information about the ingredients. Dr. Sefton acknowledged that the interface, as he called the reactive material between the core and the enteric coating, may protect the core. The reactive material could "slow down and prevent further reaction," from taking place between the core and the enteric coating. (Record, page 717.)
Evidence of Dr. Bernard Sherman
[42] Dr. Sherman, the Chair and Chief Executive Officer of Apotex, deposed that the applicants' position that a subcoat "can be spontaneously generated" is "both speculative and legally irrelevant". Dr. Sherman states in paragraph 31 of his Affidavit:
Further, the Notice of Allegation provided by Apotex is clear and categorical in stating that the tablets will not contain an inert sub-coat. This statement, which must be presumed to be true, is not limited to sub-coatings that are applied, and would also preclude a sub-coating that is spontaneously generated even if it is accepted that there could be such a coating".
[43] In cross-examination, Dr. Sherman acknowledged the possibility of a reaction between the enteric coating and the core but says that the reaction could not be described as a sub-coating or a layer between the core and the enteric coating.
[44] Paragraph 31 is not deposing facts, but stating a legal argument. The presumption that the tablets will not contain an inert subcoat can be rebutted. In this case, the presumption was rebutted and the burden shifted to Apotex to prove that its tablets do not contain a subcoat. The best evidence would have been samples of the Apotex tablets for testing. Apotex refused. The Court can infer that the results of this testing would be adverse to the position of Apotex or else Apotex would have conducted such an analysis and submitted the results. The Affidavit by Dr. Sherman also belies the position of Apotex with respect to whether the reactive layer could be considered a coating. Dr. Sherman uses the word "coating" in paragraph 31 to refer to a "spontaneously generated" subcoating.
[45] Dr. Sherman's evidence recognizes that there will be a reactive material formed on the core caused by a reaction with the enteric coating sprayed on the core. The question for the expert witnesses and for the Court is whether this reactive material constitutes a "subcoating" for the purposes of Patent Claim No.1.
Evidence of Dr. John Rees
[46] For the applicants, Dr. Rees deposed at paragraph 31 of his Affidavit sworn November 26, 2001:
The subcoating layer is "disposed on said core region". This phrase describes the location of the subcoating relative to the core region. In the finished preparation the subcoating layer is located on the core and it separates the core from the enteric coating.
[47] In paragraph 55, Dr. Rees deposed that the alkaline material could neutralize the enteric coating polymers and form a layer in situ. He concludes: "Such a layer would be expected to function as an inert subcoating as described in the Patents".
[48] Dr. Rees deposed that the Apotex disclosure in the NOA provides insufficient details. Part of the details required would be the production of actual samples of the finished Apotex tablets. Through analysis, the presence or absence of a subcoating layer could be determined. The NOA also provides incomplete information with respect to the ingredients (so that the applicants could not reproduce and test the Apotex tablets).
[49] The Affidavit of Dr. Rees sworn October 20, 2000 deposed in paragraph 15:
[...] a subcoating layer may be generated during the process used to make the formulation, even in the absence of a separate subcoating step. Accordingly, even if Apotex does not specifically employ a separate subcoating step as part of the process used to make its Apo-omeprazole tablets, it is possible for a sub-coating to be formed spontaneously [...] Since the claims of the patents cover formulations having a subcoating irrespective of the manner in which it is formed, such tablets would infringe the patents.
[50] In paragraph 17, Dr. Rees deposes that the presence of a subcoating may be detected through analysis and that the allegation that the Apotex tablets do not contain a subcoating can only be tested by appropriate analysis of the tablets.
Conclusions Regarding the Expert Evidence
[51] Based upon the evidence, I conclude:
- 5. There will be a reactive material or "interface" spontaneously generated when the enteric coating, which consists of polymers, is sprayed on the core which contains omeprazole and alkaline materials;
- 6. The nature of the reactive material or interface cannot be known without analytical testing of the tablets themselves;
- 7. The experts disagree whether the reactive material or interface can be considered a "sub-coating" within the meaning of the patents or whether the reactive material would form a continuous layer around the core and what its thickness might be;
- 8. The reactive material would insulate the core from dissolving and would serve the same purpose to an unknown extent as the sub-coating described in Claim 1 of the Patent;
5. It is not possible to assess conflicting expert evidence in terms of credibility without the benefit of viva voce evidence in this case;
- 6. It is not possible to determine whether the allegation of non-infringement is justified based on speculation and conjecture by the experts. This is particularly frustrating when the best evidence, and probably the conclusive evidence, would be the results of analytical testing of the Apotex tablets themselves;
- 7. The overwhelming conclusion of the Court from the expert evidence is that the Apo-omeprazol tablets could have been analytically tested to identify the existence of the reactive layer or reactive material or spontaneous subcoating, and to obtain key technical information about its characteristics. Without this information, the experts are speculating, guessing, and "shadow-boxing"; and,
The Rhoxalpharma Case
[52] In the Rhoxalpharma case, cited as AB Hassle v. Canada (Minister of National Health and Welfare) (2000) 10 C.P.R. (4th) 38, per Tremblay-Lamer J., this Court considered a similar generic drug (omeprazole tablets), a similar NOA, and two of the same patents. At paragraph 63, the trial judge held that the evidence established on the balance of probabilities that the generic tablets will have an "inert subcoating" which is spontaneously generated by a chemical reaction between the ingredients in the core and the enteric coating, and will therefore infringe patent '693.
[53] Like the case at bar, the generic manufacturer, Rhoxalpharma Inc., alleged that the patents will not be infringed because the tablets do not have a subcoating. In that case, samples of the tablets were analyzed with a spectrometer and fluorescence microscope which confirmed that there was a subcoating of approximately three to four microns separating the omeprazole core and the enteric coating.
[54] The case is important for two reasons: (1) it considered whether similar generic omeprazole tablets infringed the same patents on the basis that they did not contain an inert subcoating; and, (2) it demonstrated that the proper detailed information necessary for the patentee to test the allegation of non-infringement is actual samples for testing to determine if there was an "inert subcoating".
[55] Madam Justice Tremblay-Lamer held at paragraph 30:
[...]The Federal Court of Appeal concluded that the detailed statement should be sufficiently complete to enable the patentee to assess its course of action in response to the allegation. As pointed out by Stone J.A. speaking for the Court, the intent appears to be that the entire factual basis be set forth in the statement rather than be revealed piece-meal when some need happens to arise in a proceeding pursuant to section 6 of the Regulations [...]
[56] In the case at bar, the detailed statement is not sufficiently complete for the patentee to respond to the allegation. The expert witnesses called by both sides were expected to "shadow-box". They had no tablets to analyze. The had insufficient information to know whether the generic omeprazole tablets have a subcoating. The experts agreed that there may be a type of subcoating, but they could only speculate. The reason for the speculation is not because the patentee had not proven, on the balance of probabilities, that the subcoating exists, but because the patentee cannot, o n the basis of the information provided by the generic manufacturer, respond to the allegation of non-infringement. The statement of facts in the NOA is not sufficiently detailed or complete. For this reason, I find that the NOA is deficient under the Regulations.
[57] The Federal Court of Appeal, on April 23, 2002 upheld Tremblay-Lamar J. in Rhoxalpharma Inc. v. AB Hassle et al. 2002 F.C.A. 147 per Noël J.A. at paragraph 2:
The record before the motions Judge and in particular the nature of the evidence led by the parties over the course of the proceeding allowed her to conclude that the notice of allegation was based on a pure assertion of fact, namely that the appellant's proposed product did not contain an inert subcoating. It is only after this assertion was disproved that the appellant attempted to recast its notice of allegation in terms which brought into play the construction of the two patents in issue.
[58] In the case at bar, the NOA similarly is based on a pure assertion of fact, namely that the Apotex drug did not contain a "subcoating". In Rhoxalpharma, supra. the Court found that the generic omeprazole tablets did contain a spontaneously generated subcoating which infringed patent claim no. 1 in patent '693. In this case, the Court cannot ignore this finding that a spontaneously generated subcoating is considered a "subcoating" within the meaning of patent '693, particularly since this construction of the patent claim was upheld by the Federal Court of Appeal.
[59] The Federal Court of Appeal also upheld the Trial Judge that the generic manufacturer could not rewrite its NOA after realizing that there was a subcoating between the core and the enteric coating. Apotex seeks to have the patent claim construed to mean a "subcoating" created by the process in the patent specifications. That allegation should have been in the NOA. The NOA in the
Rhoxalpharma, supra. is not much different than the case at bar. In the case at bar the only additional fact in the NOA is the Apotex process of applying the enteric coating directly on the core. This additional fact is relevant to the "process" patent claim, but does not constitute an allegation that the "inert subcoating" in patent claim no.1 is restricted to the subcoating created by the process described in the patent specifications. The NOA should have alleged that patent claim no.1 has a "process limitation". In fact, the NOA makes reference to the process, but that reference is relevant to process patent claim no.17 in the '693 patent.
Adequacy of the Notice of Allegation
[60] Subparagraph 5(3)(a) of the Regulations requires that the NOA provide a detailed statement of the legal and factual basis for the allegation of non-infringement. In the case at bar, the NOA simply states:
[...] Our tablets will not infringe, by reason there being no subcoating between the cores and the enteric coating (sic) [...]
[61] The evidence establishes that there may be something between the cores and the enteric coating and this "something" may be considered a "subcoating".
[62] The required scope of the NOA is higher than the mere assertion that the new drug lacks a subcoating between the core and the enteric coating. The NOA must provide adequate and sufficient details of the factual and legal basis for claiming non-infringement.
[63] The NOA must provide all of the facts the generic producer intends to rely upon in subsequent prohibition proceedings and it cannot rely on facts that exceed those laid out in the NOA. The NOA must address all of the patent claims that describe the basic invention or else its NOA will be defective and not in compliance with section 5 of the Regulations. See Genpharm Inc. v. The Minister of Health and Procter and Gamble Pharmaceuticals Canada Inc. 2002 F.C.A. 290 (F.C.A.), per Rothstein J.A. at paragraphs 22 to 25:
¶ ¶ 22 However, the notices of allegation and the detailed statement of legal and factual basis for the allegation must provide all the facts the generic producer intends to rely upon in subsequent prohibition proceedings. It cannot rely on facts that exceed those laid out in its detailed statement. See Merck Frosst Canada Inc. v. Canada (Minister of Health) (2002), 12 C.P.R. (4th) 447 at paragraph 19 per Stone J.A.
¶ ¶ 23 The requirement of subparagraph 5(1)(b)(iv) that the generic producer "... allege ... that no claim for the medicine itself and no claim for the use of the medicine would be infringed ..." necessarily implies that the detailed statement must provide the legal and factual basis for the allegation that none of the patent claims will be infringed.
¶ ¶ 24 I do not say that it is necessary for the generic producer to address each and every dependent patent claim if the basic claim or claims that describe the invention are addressed in the detailed statement. However, it is not open to the generic producer to ignore patent claims that describe the basic invention. If it does so, it will not be providing facts demonstrating that "no claim for the use of the medicine would be infringed", and its notice of allegation will be defective and not in compliance with section 5.
¶ ¶ 25 Genpharm's detailed statements do not demonstrate that no claim for the use
of a polyphosphonate, i.e. etidronate disodium, in an intermittent, cyclical regimen for the treatment of osteoporosis, which is the new use for etidronate disodium invented by P & G, would be infringed by Genpharm making, constructing, using or selling its etidronate disodium product. The detailed statements only address the kit claims, i.e. claims 1 to 16. They do not address the use claims, i.e. claims 17 to 37. They do not say that Genpharm's product cannot be used in an intermittent, cyclical therapy for the treatment of osteoporosis. Therefore, the detailed statements in the notices of allegation ignore the use claims in the 376 Patent.
[emphasis added]
[64] Were the results of the direct application of the enteric coat to the core to truly not infringe the patents, it seems reasonable that Apotex would have conducted a chemical analysis and submitted the results. In Rhoxalpharma, supra. the Court had the benefit of a scientific analysis of the omeprazol tablets in question. This is the best evidence. Apotex could have submitted this evidence to prove non-infringement in this case, but declined at its own risk and peril. Justice in this case required this evidence.
[65] The refusal by Apotex to provide samples and the resultant speculative and inconclusive expert evidence, underlines the applicants' first submission that the Notice of Allegation is deficient in providing the detailed factual and legal information required under the Regulations. The Court agrees that the NOA is deficient in this respect because without the information, the experts' evidence about infringement is inconclusive and speculative.
[66] To summarize, the NOA is deficient in that the required detailed statement of the legal and factual basis for the allegation of non-infringement does not:
DISPOSITION
[67] For the foregoing reasons, this application is allowed for a declaration that the Apotex letter dated August 1, 2000 does not comply with the Regulations, and therefore does not constitute a Notice of Allegation under the Regulations. Accordingly, the Minister of Health is prohibited from issuing a Notice of Compliance with respect to this purported Notice of Allegation.
(signed) Michael A. Kelen _________________________
JUDGE
OTTAWA, ONTARIO
September 4, 2002
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1747-01
STYLE OF CAUSE: AB HASSLE, ASTRAZENECA AB
and ASTRAZENECA CANADA INC.
Applicants
- and -
APOTEX INC. and THE MINISTER OF HEALTH
Respondents
PLACE OF HEARING: Vancouver, British Columbia
DATE OF HEARING: August 6, 2002 and August 7, 2002
REASONS FOR ORDER OF THE HONOURABLE MR. JUSTICE KELEN
APPEARANCES:
Mr. Gunars Gaikis FOR THE APPLICANTS
Mr. J. Sheldon Hamilton
Mr. H.B. Radomski FOR THE RESPONDENT (APOTEX)
Mr. Andrew R. Brodkin
No Appearance FOR THE RESPONDENT (MINISTER OF HEALTH)
SOLICITORS OF RECORD:
Smart & Biggar FOR THE APPLICANT
Toronto, Ontario
Goodmans LLP FOR THE RESPONDENT (APOTEX)
Toronto, Ontario
Mr. Morris Rosenberg FOR THE RESPONDENT (MINISTER OF HEALTH)
Deputy Attorney General of Canada
Date: 20020904
Docket: T-1747-00
Ottawa, Ontario, this 4th day of September, 2002
PRESENT: THE HONOURABLE MR. JUSTICE KELEN
BETWEEN:
AB HASSLE, ASTRAZENECA AB
and ASTRAZENECA CANADA INC.
Applicants
- and -
APOTEX INC. and THE MINISTER OF HEALTH
Respondents
ORDER
UPON an application pursuant to the Patented Medicines (Notice of Compliance) Regulations by the Applicants for a declaration that a letter from Apotex dated August 1, 2000 does not comply with the Regulations and does not constitute a Notice of Allegation under the Regulations and in the alternative, an Order prohibiting the Respondent Minister of Health from issuing a Notice of Compliance to Apotex in respect of the pharmaceutical products omeprazole and/or omeprazole magnesium tablets, 10mg, 20mg and 40mg until after the expiration of Canadian Patents 1,292,693 ("693"); 1,302,891 ("891"); and 2,166,483 ("483") (collectively "the Patents");
Page: 2
AND UPON reading the material filed and hearing submissions from the parties;
AND for the reasons for order issued today;
THIS COURT HEREBY ORDERS THAT:
vii. This application is allowed for a declaration that the Apotex letter dated August 1, 2000 does not comply with the Regulations, and therefore does not constitute a Notice of Allegation under the Regulations;
viii. The Minister of Health is prohibited from issuing a Notice of Compliance with respect to this purported Notice of Allegation; and,
ix. The costs of the Applicants are payable by the Respondent Apotex.
(signed) Michael A. Kelen _________________________
JUDGE