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Canadian Patent Office Issues Policy on Patentability of
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Pharma Price Pressure
There have been several pharma pricing developments, described below.
Ontario Modifies Price Controls and Broadens “Interchangeability” Criteria for Generic Drugs
The Ontario government has recently passed legislation to overhaul purchase and provision of pharmaceuticals and pharmacy services (Bill 102, Transparent Drug System for Patients Act, 2006). The Ontario government is the largest purchaser of drugs in the province. Among the changes, manufacturers are now prohibited from selling a listed drug product to anyone at a higher price than its Formulary price. Manufacturers are prohibited from providing rebates to pharmacies, which should save manufacturers money. The rebates will be replaced by a limited system of allowances.
An aspect of the legislation relevant to patent owners is the broadening of the criteria under which a generic drug can be designated as interchangeable and substituted by a pharmacy for a brand name drug prescription. Previously, only the same generic drug could be substituted. Now, a “similar” generic drug can be designated as interchangeable and substituted for a brand name drug. The “similar” drug must be a similar active ingredient (salt, ester, complex or solvate of the same therapeutic moiety) in a similar dosage form. As a result, more generic compounds may potentially be designated as interchangeable with brand name drugs. As always, companies with patents on improved formulations and uses will still be entitled to try to monitor generic drugs designated as interchangeable to determine if patent infringement is occurring.
Patented Medicine Price Review
The federally created Patented Medicine Prices Review Board (“PMPRB”) reviews and sets the maximum price of patented Canadian medicines. We reported in our Winter 2005-2006 newsletter that the Hoechst v. Canada Federal Court case decided that the PMPRB cannot review the price of a medicine covered only by a pending patent application. No appeal was filed and the PMPRB has stated that its general practice in relation to applications will be to wait for a patent to issue, then retroactively take jurisdiction over a medicine's price during the pre-grant period when the patent application was published.
Hoechst Marion Roussel Canada Inc. v. Canada 2005 FC 1552 (Federal Court).
The PMPRB was also recently in the headlines after The Globe and Mail reported on June 19, 2006, that the Bristol-Myers Squibb Canada (“BMS”) colorectal cancer drug ERBTIUX, which was approved by Health Canada in September 2005, would not be launched in Canada due to a disagreement between BMS and the PMPRB. BMS could not agree on a price with the federal Patented Medicine Prices Review Board and decided not to launch the drug.
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Sound Predictions at Filing Date Support Patent Claims
Sound prediction is determined as of the Canadian filing date, not the priority date according to the Federal Court of Appeal. In an Aventis v. Apotex case, Apotex argued that the patent claims were invalid because sound prediction concerning utility should be determined as of the earliest of the priority dates for the Canadian patent application (October 23, 1980) when there was less experimental data. Aventis argued that sound prediction should be assessed as of the Canadian filing date (October 20, 1981) when the application included additional experimental data to prove utility. Since the Canadian filing date was the relevant date to assess sound prediction, Aventis got the benefit of the additional data. Despite this advantage, Apotex's allegation that there was no basis for soundly predicting utility using either date was held to be reasonably justified.
Inventors can still take an aggressive approach by filing priority applications early to establish a priority date ahead of competitors. The priority application filing strategy should be prepared keeping Canadian, US and other countries' requirements in mind. Whenever possible, additional data should be generated after the priority date to further demonstrate that the prediction was sound. This data should be generated no later than the Canadian filing date.
Aventis Pharma Inc. v. Apotex Inc. et al., [2006] FCA 64 (Federal Court of Appeal).
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Health Canada Continues to Resist
Listing Patents Not Clearly for Medicine
The Federal Court of Appeal affirmed a lower court decision finding that a Biovail patent was not eligible for listing on the Health Canada Patent Register because it was directed to a delivery system and not the medicine itself. The patent was construed as a claim for use of polymers to achieve slow release of active ingredients.
Biovail v. The Minister of Health, [2006] FCA 105 (Federal Court of Appeal).
The Federal Court also refused to list two Procter & Gamble patents pertaining to a film-coated rapid release risedronate sodium tablet. One patent was found to be for a delayed-release enteric coating for modulating active medicine release, rather than pertaining to the medicine itself. It was also not considered relevant to the approved dosage form. The other patent was for a film coated tablet dosage that was considered to be a delivery system.
Procter & Gamble Pharmaceuticals v. The Minister of Health, [2006] FC 411 (Federal Court).
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Patentable Diagnostic Method or Unpatentable Basic Scientific Relationship?
After hearing arguments about the validity of a diagnostic method claim involving correlation of test results to mineral deficiency, the US Supreme Court, in a rare but not unprecedented move, dismissed the appeal after taking a second vote on whether the appeal should be heard. The Court was split with the majority deciding that the appeal had been improvidently granted and the lower court decision finding the patent valid would stand. The dissenting judges, however, not only stated that the appeal should be heard but also provided reasons for finding the patent invalid.
The case revolves around U.S. Patent No. 4,940,658, which claims a method for detecting cobalamin or folate deficiency by measuring homocysteine levels. The claim in question is a claim to a method involving two steps, (i) assaying a body fluid to measure total homocysteine and (ii) correlating an elevated level of homocysteine with a deficiency of cobalamin or folate.
Laboratory Corporation initially sublicensed the patent from Metabolite Laboratories but then switched to a total homocysteine assay sold by another company. Metabolite won a $1 million patent infringement judgment, which was doubled because of 'willful infringement'. The court also issued an injunction against LabCorp.
LabCorp appealed the decision on the basis that the claim gives a monopoly over basic scientific facts, which are not eligible for a patent. LabCorp also argued that the claim does not describe what a practitioner must do to perform the active 'correlating' step. Metabolite countered that the appeal should be dismissed since patent ineligibility was not argued in the lower courts and maintained that the patent was valid.
The patent is actually quite similar to many other diagnostic method patents, so the Supreme Court review of validity issues has attracted attention in the medical diagnostics industry. Diagnostic method patents appear to have been handed a reprieve, however the language of the dissent will encourage future challenges to similar patents.
Lab Corp v. Metabolite (2006), Supreme Court No.04-607.
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The Diagnosis is Good in Europe
Narrow Interpretation of Diagnostic Methods Ban From EPO Enlarged Board of Appeal
In December 2005, the European Patent Office Enlarged Board of Appeal issued its decision on the patentability of diagnostic methods in Europe (G01/04). To the relief of many patent owners, the Board held that a narrow interpretation of the statutory restriction on patenting diagnostic methods should apply.
This decision provides guidance to patent applicants on how they may obtain claims directed to methods of diagnosing human or animal diseases in Europe. To be classified under the unpatentable heading of “diagnostic method practiced on the human body”, the method must contain 4 essential steps, including: (1) data collection; (2) data comparison with standards; (3) analysis of deviations; and (4) correlation of deviations to a particular clinical status. Further, at least the first three of these steps must be “practiced on the human body”. For most diagnostic inventions, patent agents can draft claims in a style that does not require practicing on the human body. For example, in a 'data collection' step, claims can be written without explicitly referring to a step of taking a blood sample from a patient.
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Canada's Exceptions to Patent Infringement
A recent Federal Court case provided a brief interpretation of Canada's common law and statutory “Safe Harbour” exemptions from patent infringement. The decision was provided in the context of generic drug development, so it remains unclear whether a similar interpretation would be given in the context of innovative drug development. The Safe Harbour, s. 55.2(1) of the Patent Act, provides a patent infringement exemption for activities reasonably related to generation of information for a regulatory agency, such as the U.S. FDA.
The Court held that the evidence showed that Apotex prepared and tested the patented lisinopril for the purposes of filing abbreviated new drug submissions necessary to sell lisinopril in Canada and the United States. Not all linsinopril data was referenced in Apotex's submissions, but all data was directed to that purpose. Apotex also had stored samples in the event that they were required for future reference by the government. The Court concluded that section 55.2(1) was sufficiently broad to exempt these activities from infringement. The court also added that since such samples were never sold and were ultimately destroyed, it was difficult to imagine what damage the patent owner suffered.
The Court also found that Apotex's use of lisinopril in ongoing research and development of alternate formulae, alternate techniques for tablet-making and the like fell within the common law exemption to infringement.
Merck et al. v. Apotex, April 26, 2006 (Federal Court).
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Composition Claim Cannot Encompass Medical Treatment
The Federal Court recently decided that an allegation of invalidity directed against a composition claim during an NOC Proceeding was reasonably justified. The claim was directed to a pharmaceutical composition for treating cirrhosis, the composition including ursodiol and the “composition being processed in a form allowing for said treatment of primary biliary cirrhosis based on a dosage of 13 to 15 mg/kg/day.”
The Court considered the dosage to be an essential part of the patent claim and that it was directed to a method of medical treatment, which is not patentable. It was up to the physician based on his or her knowledge of the patient's rate of metabolism and other factors to determine the appropriate daily dosage. The Court drew a distinction between the dosage in a capsule and a dosage range based on the patient's weight. There was an emphasis on the dosage range and a dosage range is not a vendable product.
Axcan v. Pharmascience, [2006] FC 527 (Federal Court).
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Documents in Publicly-Available Patent File History are Prior Art Against US Patents
Two US patents were recently invalidated on the basis of obviousness in view of a Canadian patent file history that included two figures that were cancelled during prosecution. The Canadian patent was an older patent that was never published as an application. It was confidential until it issued as a patent. The US Court of Appeals found that the Canadian application cancelled figures were a prior art “printed publication” because the Canadian file history was available to the public following patent issuance, which was more than a year before the US patent filing dates. The Canadian application could be located in a reasonably diligent search by a person of ordinary skill in the art. The cancelled application figures were found to be prior art even though there was no evidence that they were ever disseminated beyond the patent application file history.
Bruckelmyer v. Ground Heaters (2006), 455 F.3d 1374 (Federal Circuit).
Edited by Noel Courage. Please send feedback and suggestions to Noel at ncourage@bereskinparr.com.
The contents of this update are informational only, and do not constitute legal or professional advice.
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