Canada’s Intellectual Property Firm

Rx IP - Feature Article| Rx IP - Market Access / Pricing

Innovators commence Court challenges regarding recent amendments to Patented Medicines Regulations

Authored byDaphne Lainson and Nancy Pei

UPDATE: See July 15, 2020 article here describing the June 29, 2020 Federal Court decision. 

The amendments to the Patented Medicines Regulations (Regulations) published on August 21, 2019 (see our articles here and here) have been the subject of two court challenges launched by groups of innovative pharmaceutical companies (22 companies in total) —one in the Quebec Superior Court and the other in the Federal Court.

Quebec Superior Court Judicial Review

On August 22, 2019, Merck, Janssen, Servier, Boehringer, Bayer and Theratechnologies (collectively, QC Applicants) brought a constitutional challenge to the Patented Medicine Prices Review Board (PMPRB) provisions of the Patent Act and the Regulations. The QC Applicants argue that the amendments encroach on provincial authority over drug price control and that the federal jurisdiction over patents granted by the Constitution Act, 1867 does not permit the federal government to set a maximum sales price for patented goods. They assert that the intended purpose of sections 79-103 of the Patent Act is to prevent patentees from abusing their statutory monopoly through “excessive” pricing, while the amendments show that the real nature and objective of these provisions is price control, not patent abuse.

The QC Applicants are seeking declarations that the following are ultra vires, invalid, and of no force and effect:

i. Sections 79-103 of the Patent Act;

ii. The entirety of the Regulations and the Recent Amendments; and

iii. Any PMPRB Compendium of Policies, Guidelines and Procedures published pursuant to Sections 79-103 of the Patent Act and the Regulations.

Federal Court Judicial Review

On September 6, 2019, Innovative Medicines Canada, AbbVie, Amgen, Astellas, AstraZeneca, Bristol-Myers Squibb, Eli Lilly, Hoffmann-La Roche, Ipsen, Leo Pharma, Lundbeck, Novartis, Novo Nordisk, Otsuka, Pfizer, Sanofi and Takeda (collectively, FC Applicants) challenged the validity of the amending Regulations relating to the new mandatory economic factors, the changes to the list of the price comparator countries, and the new price calculation requirements in sections 3(4), 4, 6, and the Schedule of the amending Regulations (collectively the Impugned Amendments). The FC Applicants assert that the PMPRB has a consumer protection mandate that is limited to protecting consumers from excessive pricing of patented medicines and its jurisdiction is limited to factory-gate pricing. They argue that the Impugned Amendments impermissibly expand the PMPRB’s statutory mandate and jurisdiction, which the Governor in Council does not have authority to do by way of regulation. Further, the FC Applicants argue that the Impugned Amendments are ultra vires in that their purpose is inconsistent with the purpose of the Patent Act and that each of the Impugned Amendments exceeds the regulation-making authority conferred by the Patent Act and is inconsistent with the Patent Act.

The FC Applicants are seeking:

i. A declaration that sections 3(4), 4, 6 and the Schedule of the amending Regulations are invalid, void and of no force and effect as ultra vires the Patent Act; and

ii. An order quashing sections 3(4), 4, 6 and the Schedule of the amending Regulations for being ultra vires the Patent Act.

Key resources related to the amendments:

The preceding is intended as a timely update on Canadian intellectual property and technology law. The content is informational only and does not constitute legal or professional advice. To obtain such advice, please communicate with our offices directly.