Canada’s Intellectual Property Firm

Section 8 cases: Supreme Court dismisses sanofi-aventis’ ramipril appeal; Ontario Court of Appeal dismisses Apotex’s atomoxetine unjust enrichment appeal

Section 8 of the Patented Medicines (Notice of Compliance) Regulations (“Regulations”) in broad terms provides for damages to a generic manufacturer if the innovator is unsuccessful in a prohibition proceeding.

As reported previously, sanofi-aventis was granted leave to appeal from the Federal Court of Appeal’s decision which addressed quantification of damages under section 8 of the Regulations relating to ramipril (sanofi-aventis’ ALTACE). On April 20, 2015, the Supreme Court, in a unanimous ruling, dismissed sanofi-aventis’ appeal from the Bench: Sanofi-Aventis, et al v Apotex Inc, et al, 2015 SCC 20. In dismissing the appeal, the Supreme Court held that the justices “are all of the view to dismiss the appeal substantially for the reasons of the majority of the Court of Appeal.” Issues considered by the Court of Appeal included the methodology to be applied in determining the hypothetical market during the section 8 liability period. See our previous article for a summary of the Court of Appeal’s decision (2014 FCA 68, rev’g in part 2012 FC 553).

On May 5, 2015, the Ontario Court of Appeal dismissed Apotex’s appeal from a Divisional Court decision that struck Apotex’s claim for unjust enrichment relating to atomoxetine (Eli Lilly’s STRATTERA): Apotex Inc v Eli Lilly and Company, 2015 ONCA 305. As reported previously, the Divisional Court (2013 ONSC 5937) held that Apotex’s unjust enrichment allegations “arise from the Patent Regulations which are a part of a complete statutory code governing patent law.” The Divisional Court thus held that it was plain and obvious that the claim disclosed no cause of action and struck the claim. On appeal, the Court reviewed the bases on which other courts (Ontario and Federal courts) have decided claims for unjust enrichment; namely, (i) whether section 8 of the Regulations is a “complete code” and (ii) whether the Regulations provide a juristic reason for a patentee to retain its monopolistic prices. In dismissing Apotex’s appeal, the Court held that “Regardless of any potential merit of the “complete code” and “juristic reason” arguments … Apotex’s claim for unjust enrichment … [is] unavailable to Apotex” as there was no corresponding deprivation to Apotex (one of the components required to establish a claim for unjust enrichment). According to the Court, “Apotex was never deprived of the portion of Lilly’s revenues represented by its monopolistic profits because Apotex would never have earned those profits.” Relying on Apotex Inc v Sanofi-Aventis, 2014 FCA 68 (aff’d 2015 SCC 20, as noted above), the Court also noted that the line of reasoning adopted by other courts “not only suggests that adequate compensation can be achieved by s. 8, but also that overcompensation should be avoided in this regulatory context.”

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