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Federal Court holds section 8.2 of the PMNOC Regulations does not impose a limitation period

On December 22, 2020, the Federal Court issued its decision holding that section 8.2 of the Patented Medicines (Notice of Compliance) Regulations (PMNOC Regulations) does not impose a limitation period either the same as or comparable to the 45-day limitation period for commencing an action under subsection 6(1): Merck v Sandoz and Pharmascience, 2020 FC 1180.

Background

Merck commenced actions pursuant to subsection 6(1) of the PMNOC Regulations against Sandoz and Pharmascience after each served a notice of allegation (NOA) in respect of the patents listed against Merck’s JANUVIA (sitagliptin). Three months later, Merck commenced an action against each defendant pursuant to section 8.2 of the PMNOC Regulations, asserting infringement of an unlisted patent. The defendants moved to strike the section 8.2 actions, arguing that section 8.2 imposes a 45-day limitation period running from the service of the NOA and that Merck commenced the actions after expiry of this period. Merck in turn moved for summary judgment dismissing the limitation period defence.

Section 8.2 provides:

8.2 On receipt of a notice of allegation relating to a submission or supplement, a first person or owner of a patent may, under subsection 54(1) or 124(1) of the Patent Act, bring an action for infringement of a patent or certificate of supplementary protection — other than one that is the subject of an allegation set out in that notice — that could result from the making, constructing, using or selling of the drug in accordance with the submission or supplement.

Decision

The decision mainly focused on the legislative purpose surrounding section 8.2. Justice Southcott agreed with Merck that specific features of the regulatory regime are applicable to subsection 6(1) actions but inapplicable to section 8.2 actions. This included that the 45-day limitation period and the statutory stay features of a subsection 6(1) action were linked, and the fact that the statutory stay applies only to subsection 6(1) actions favoured a finding that the purpose for the 45-day period does not apply to section 8.2 actions. Justice Southcott concluded that “[a]s the s 8.2 action proceeds outside the regulatory regime, the legislative purpose underlying the [PMNOC] Regulations does not require, or indeed favour, reading down s 8.2 to include a limitation period, either the same as or comparable to that of s 6(1).”

Justice Southcott also rejected the defendants’ argument that the legislative purpose of facilitating generic market entry requires section 8.2 actions to be commenced and concluded on the same timeline as subsection 6(1) actions to avoid serial ligation. Justice Southcott stated the legislative purpose of section 8.2 was the removal of previously existing barriers to quia timet actions to address uncertainty resulting from the risks associated with unlisted patents but does not require the elimination of such uncertainty within any particular timeframe, as no interpretation of section 8.2 can eliminate the potential for the first person to sue on an unlisted patent following market entry.

Justice Southcott therefore dismissed the defendants’ motion to strike the section 8.2 actions and granted summary judgment in favour of Merck, dismissing the defendants’ limitation period defence in the section 8.2 actions.

The decision has not been appealed.

Should you have any questions, please do not hesitate to contact a member of the Life Sciences Regulatory & Compliance Group.

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