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.
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:
- Proposed Regulations Amending the Patented Medicines Regulations: December 2, 2017 (published in Canada Gazette, Part I)
- Dodge Report: August 23, 2018 (Independent Assessment of Health Canada’s Cost-Benefit Analysis of the Impact of Proposed Amendments to the Patented Medicines Regulations (CG1) authored by Dr. David Dodge and Dr. Åke Blomqvist)
- Working Group to Inform the PMPRB Steering Committee on Modernization of Price Review Process Guidelines - Final Report: March 2019 (summary of the Working Group’s deliberations and recommendations to the Steering Committee on key technical and operational modalities of the draft Guidelines)
- Cost-Benefit Analysis (CBA): May 6, 2019 (Health Canada’s CBA of the amendments to the Regulations)
- PMPRB Steering Committee on Modernization of Price Review Process Guidelines - Final Report: July 2, 2019 (summary of the deliberations of the Steering Committee in providing stakeholder feedback on the new regime)
- Questions and Answers: August 9, 2019 (PMPRB’s answers addressing potential concerns and questions regarding the amendments to the Regulations)
- Statement by PMPRB Chairperson: August 9, 2019
- Final Regulations Amending the Patented Medicines Regulations: August 21, 2019 (published in Canada Gazette, Part II)
- Unofficial consolidated version of the Regulations: August 21, 2019 (consolidated version of the Regulations showing the proposed amendments prepared by Smart & Biggar)
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