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Sandoz granted leave to add new allegations on condition of trial adjournment and extension of 24-month stay

In a decision rendered on August 17, 2022, the Federal Court granted Sandoz Canada Inc (Sandoz) leave to amend its Statement of Defence to add new allegations, contingent on an adjournment of the trial and an extension of a 24-month stay under the Patented Medicines (Notice of Compliance) Regulations (the Regulations): Bayer Inc v Sandoz Canada Inc2022 FC 1187.

Background

The underlying action was brought by Bayer Inc and Adverio Pharma GmbH (collectively, Bayer) against Sandoz pursuant to subsection 6(1) of the Regulations. A trial is scheduled to begin in September 2023.

Sandoz’s Notice of Allegations (NOA) alleged non-infringement and did not raise any invalidity issue other than the Gillette defence. Its Statement of Defence filed in February 2022 asserts only the defences set out in the NOA.

In June 2022, following the exchange of affidavits of documents and oral discovery plans, Sandoz changed its Solicitors of record and proposed to add new invalidity defences and to plead allegations that the patent at issue is ineligible for listing. Bayer consented to some amendments but objected to most, on the basis that there is insufficient time left before trial to adequately defend against the new allegations.

Decision granting leave to amend

Case Management Judge Tabib concluded that Sandoz did not meet its burden of demonstrating that Bayer will not be prejudiced. She found that the contested amendments are lengthy and raise complex and multifaceted arguments. Moreover, adding an entirely new defence of invalidity to a case previously focused on infringement can be expected to bring significant strain on Bayer and its litigation team. While Sandoz offered to defer the production of invention documents and limit its discovery on the new invalidity issues, the proposed compromise is unrealistic.

The Court declined to dismiss the motion, however, as any procedural or substantive prejudice can be alleviated by the adjournment of the trial and a commensurate extension of the 24-month period. Sandoz was therefore granted leave to make the proposed amendments on such conditions.

In the Court’s view, the order will allow Sandoz to choose whether it wishes to make the disputed amendments or to forgo the same in favour of keeping the trial dates.

Should you have any questions, please do not hesitate to contact a member of the Pharmaceutical Litigation Group.

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