Update: On July 29, 2021, the Federal Court of Appeal set aside the Federal Court’s decision and remitted the matter to the Patented Medicine Prices Review Board for redetermination: Alexion Pharmaceuticals Inc. v Canada (Attorney General), 2021 FCA 157 (see article here).
On June 12, 2019, Justice Gleeson dismissed Alexion’s application for judicial review of a Panel of the Patented Medicines Price Review Board (PMPRB)’s (i) decision that SOLIRIS (eculizumab) was sold at an excessive price and (ii) Order fixing the amount of the payment to offset excess revenues ($4.2 million): Alexion Pharmaceuticals Inc. v Canada (Attorney General), 2019 FC 734. As described in our previous article on the PMPRB decision, the PMPRB found that the Guidelines were appropriate in assessing increases, but not appropriate in assessing the appropriate benchmark (instead, the Lowest International Price Comparison (LIPC) test was applied). The PMPRB rejected Alexion’s argument that the Guidelines were not appropriate regarding permitted increases as the fluctuations in the exchange rates and the appreciation of the Canadian dollar resulted in the Canadian price appearing higher than the international comparators, while the Canadian price remained unchanged, and in fact, decreased based on changes in the Consumer Price Index.
The Federal Court reviewed the PMPRB’s decision on a reasonableness standard and dismissed the application on the grounds that the PMPRB:
(1) gave due consideration to the Guidelines before departing from the test, and the test adopted (LIPC) was not contrary to the Patent Act and Regulations “which cannot be read as excluding a particular test”;
(2) acknowledged that the price of SOLIRIS after inflation did not increase and undertook a serious analysis with respect to this factor;
(3) reasonably concluded that provincial rebates should not be taken into account in determining the average transaction price of SOLIRIS (as provinces are not customers) and did not err in declining to take them into account in determining excess revenue for the same reason;
(4) was not unreasonable in ordering payment of excess revenues based on the highest international price comparison, including as it was a more conservative test that it might otherwise be entitled to pursue.
Alexion has appealed (Court File No. A-237-19).
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