Date: 20040429
Docket: T-660-02
Citation: 2004 FC 647
Montréal, Quebec, April 29, 2004
Present: The Honourable Johanne Gauthier
BETWEEN:
ASTRAZENECA CANADA INC.
Applicant
and
APOTEX INC.,
TAKEDA CHEMICAL INDUSTRIES, LTD.
and THE MINISTER OF HEALTH
Respondents
REASONS FOR ORDER AND ORDER
[1] Astrazeneca Canada Inc. ("Astrazeneca") seeks an order prohibiting the Minister of Health (the "Minister") from issuing a Notice of Compliance ("NOC") to Apotex for its Apo-Omeprazole tablets until the expiration of Canadian patent No. 1, 338,377 (the " '377 Patent").
[2] Takeda Chemical Industries, Ltd., Japan ("Takeda") owns the '377 Patent and Astrazeneca is a licensee who listed this patent on the patent register in respect of two of its products, the 10, 20 and 40mg omeprazole capsules and omeprazole magnesium tablets sold under the brand name of Lozec®.
[3] Although the '377 Patent contains ten claims, claim 1 is the only independent claim. It covers a stabilized pharmaceutical composition for the inhibition of gastric acid secretion, comprising an effective amount of benzimidazole compound or salt thereof (including omeprazole and its salt, omeprazole magnesium), a basic inorganic salt stabilizing agent selected from the group consisting of potassium, sodium and aluminum salts and which is present in an amount effective to stabilize the composition, and an enteric coating for the composition.
[4] On March 4, 2002, Apotex sent a Notice of Allegation ("NOA") in respect of Apo-Omeprazole tablets for oral administration in strengths of 10, 20 and 40mg in which it alleged that no claim for the medicine itself and no claim for the use of the medicine in the '377 Patent would be infringed by the making, constructing, using or selling of those tablets. Apotex included in its NOA, a brief statement of the legal and factual basis for its allegation of non-infringement, more particularly, it stated:
[...]
The claims of this patent cover compositions comprising a medicine, a basic inorganic salt stabilizing agent selected from potassium, sodium and aluminium salts, and an enteric coating. Our tablets will not fall within the scope of any claim of this patent. More specifically, our tablets will not contain any such stabilizing agent. Even more specifically, our tablets will contain no potassium sodium or aluminium salt whatsoever.
[5] On April 23, 2002, Astrazeneca commenced the present application in which it raises four issues. But at the hearing, it confirmed that only three are still relevant. First, it says that Apotex' NOA is deficient because it fails to identify the active ingredient contained in its tablets (omeprazole magnesium). Second, the NOA constitutes an abuse of process because it is not separate and distinct from prior NOAs sent for the same product and which resulted in the filing of applications by Astrazeneca in Court files T-179-98 and T-180-98. Third, the allegation of non-infringement is not justified because, contrary to what is stated in the NOA, Apotex' product would contain a potassium, sodium or aluminum salt.
[6] The parties agree that the application, as it pertains to the Apo-Omeprazole 40mg tablets, is now moot on the basis that Apotex' submission for a NOC and its NOA for this strength are deemed to have been withdrawn.
[7] Astrazeneca filed two affidavits: one from Dr. Karen Burke, its Vice-President of Regulatory Affairs, which deals with Apotex' failure to identify the active ingredient in the Apo-Omeprazole tablets, the other from Mrs. Yoon Kang, a partner with Smart & Biggar, which supports the abuse of process argument. The applicant did not file any affidavit to support its allegation that the Apotex' product would contain one of the stabilizing agents listed in the '377 Patent.
[8] Apotex filed an affidavit from Dr. Bernard Sherman, its Chairman and chief operating officer. It deals mostly with the abuse of process argument and states that Apotex' prior NOAs with respect to the '377 Patent and its Apo-Omeprazole tablets were withdrawn and as a result the proceedings in Court files T-179-98 and T-180-98 discontinued by consent, because Apotex had difficulties meeting regulatory requirements; more particularly, it could not establish bioequivalence. However, Dr. Sherman also adds that Apotex' tablets "containing omeprazole in strengths of 10, 20 and 40mg" would not contain "any of the specified stabilizing agents, and even more particularly, that its tablets would contain no potassium, sodium or aluminium salts whatsoever".
[9] Mrs. Kang and Dr. Sherman were cross-examined.
[10] Apotex also presented a motion to dismiss the present application under paragraph 6(5)(b) of the Patented medicine Notice of Compliance Regulations, SOR/93-133 amended by SOR/98-166 and SOR/99-397 (the "Regulations"). It was dismissed by Prothonotary Lafrenière after indicating that "although the arguments respecting the other grounds are persuasive", he could not render a decision with respect to the allegation of abuse of process because it involved assessing the credibility of Apotex' main deponent, Dr. Sherman, which should be done by the judge hearing the merits. Layden-Stevenson J. dismissed the appeal of this decision (AstraZeneca Canada Inc. v. Apotex Inc., [2002] F.C.J. No. 1707 (QL)).
RELATED PROCEEDINGS
[11] At the hearing, the parties often referred to the previous NOAs sent by Apotex with respect to its tablets and capsules containing omeprazol and omeprazol magnesium and to various Court decisions involving those products. It is thus useful to briefly refer to them.
[12] On December 17, 1997, Apotex sent a NOA entitled "Omeprazole tablets" to Astrazeneca (or its predecessor, Astrapharma Inc). This letter refers to about nine different patents one on which was the '377 Patent. In respect of that patent, Apotex stated:
...The claims of this patent cover compositions comprising a medicine, a basic inorganic salt stabilizing agent selected from potassium, sodium and aluminium salts, and an enteric coating. Our tablets will not fall within the scope of any claim of this patent. More specifically, our tablets will not contain any such stabilizing agent. Even more specifically, our tablets will comprise cores containing omeprazole and an enteric coating applied to the cores, there being no such stabilizing agent either in the cores or in the coating.
[my emphasis]
[13] On December 18, 1997, Apotex sent a similar NOA entitled "Omeprazole Magnesium tablets", this time covering about ten patents which also included the '377 Patent. The statements relevant to the '377 Patent, were exactly the same as in the letter of December 17, 1997, except that the core of those tablets was said to contain omeprazole magnesium. In answer to those notices, Astrazeneca (or its predecessor) filed two applications (Court files T-179-98 and
T-180-98).
[14] At about the same time, Apotex also sent a NOA with respect to omeprazole capsules. Although a copy of this notice was not included in the exhibits produced in this file, its content is summarized in the decision of McKeown J. in Astra Pharma Inc. v. Canada (Minister of National Health and Welfare), [2000] F.C.J. No. 1426 (Court No. T-2026-99) (QL) (confirmed in [2001], F.C.J. No. 1051 (QL)), where the learned judge had to deal with a similar argument of abuse of process with respect to a new NOA dealing with those capsules. It appears that this notice was again based on the fact that the capsules did not include "any of the specified stabilizing agent, either in the core or in the coating" (at para. 14). After receiving it, Astrazeneca filed an application in Court file: T-178-98.
[15] These three Court files T-178-98, T-179-98 and T-180-98 were closed after Tremblay-Lamer J. issued orders in May 1999, stating that upon the consent of the parties, the NOAs are "deemed to be withdrawn and the applications deemed to be discontinued".
[16] At that time, Apotex and Astrazeneca also entered into a side agreement with respect to Apotex' omeprazole capsules pursuant to which Astrazeneca would not object to Apotex advancing the same allegation provided "it is premised on precisely the same legal and factual basis as in Court file: T-178-98 and provided that Apotex does not advance any evidence beyond that advanced in Court file: T-178-98". No such agreement was made or discussed with respect to the omeprazole or omeprazole magnesium tablets.
[17] As mentioned, Apotex did send a new NOA in respect of its capsules and it resulted in the filing of another application in Court file: T-2026-99 (see para. 14 above), which was dismissed when McKeown J. granted Apotex' motion to dismiss pursuant to paragraph 6(5)(b) of the Regulations. Apotex expressly refers to this decision in the NOA sent on March 2, 2002.
[18] In addition to the NOAs sent in the present file and in T-2026-99, Apotex sent separate notices with respect to the various other patents originally included in the notices it sent in December 1997 (paras. 12 and 13 above).
[19] The NOA in respect to the Apo-Omeprazole tablets and Canadian patent nos. 1,292,693, 1,302,891 and 2,166,483 resulted in the filing of an application in Court file: T-1747-00. In that file, Astrazeneca argued that Apotex had failed to refer to the active ingredient in its NOA and that it constituted an abuse of process on three occasions, first, before Prothonotary Giles, who granted Apotex' motion to dismiss Astrazeneca's application pursuant to paragraph 6(5)(b) of the Regulations. Then, on appeal from that decision, before Blais J. (AB Hassle v. Apotex Inc., [2001] F.C.J. No. 809 (QL)) who rejected both arguments but granted the appeal on other grounds. And finally, before Kelen J. (AB Hassle v. Apotex Inc., [2002] F.C.J. No. 1221 (QL)), who again rejected both arguments even thought he granted the application on other grounds. This last decision was confirmed by the Federal Court of Appeal ([2003] F.C.J. No. 257 (QL)).
[20] With respect to its Apo-Omeprazole tablets and Canadian patent No 2,166,784, Apotex sent another NOA which also resulted in the filing of an application (File T-148-02) in which Astrazeneca again raised the issue of abuse of process. It was recently dismissed by Russell J. (Astrazeneca Ab et al vs. Apotex Inc. et al, 2004 FC 44). A notice of appeal has been filed.
[21] Finally, Apotex sent a NOA again for its Apo-Omeprazole tablets but this time in relation to Canadian patent No. 1,264,751 (Court file: T-1914-01). Astrazeneca's application was granted by Campbell J. but the Court dismissed Astrazeneca's argument that the sending of this NOA constituted an abuse of process[1].
ANALYSIS
[22] At the hearing, Astrazeneca presented its arguments with respect to the credibility of Dr. Sherman as if it were a separate issue. I agree with Apotex that it is not. Nevertheless, I will make a few general comments before reviewing the three grounds set out in the application.
[23] I could not summarize these arguments better than my learned colleague, Layden-Stevenson J. in Astrazeneca, supra, where she said at paragraph 14:
Astrazeneca challenges the credibility of Dr. Sherman and argues that, to the extent that his evidence supports the Apotex position, it ought to be disregarded because: he has a personal interest in the outcome of this proceeding; he does not have the knowledge or expertise to construe the "salts" referred to in the '377 patent; his assertion that the tablets will not contain a salt specified in the '377 patent is not credible and was directly contradicted by Apotex' own product monograph; his present position that the presence of a stabilizing agent in the enteric coating is not relevant and is not consistent with the assertion made in the prior allegation; his evidence in another related proceeding regarding the absence of any reference to the concomitant administration of omeprazole and an antibiotic was directly contradicted by the contents of an Apotex document subsequently produced; he admitted that he could not confirm that all of his evidence is necessarily correct, and his evidence has been previously rejected as lacking credibility.[...]
[24] But, inasmuch as Astrazeneca argues that Dr. Sherman's evidence should be disregarded in so far as it supports Apotex' position, it says that it should be given its full weight when it supports the applicant's position. I take this to mean that the applicant challenges the weight to be given to this testimony rather than its admissibility.
[25] In that respect, it is important to note that Dr. Sherman, in his affidavit, testifies as an expert on certain technical matters but also as an ordinary witness with respect to certain facts such as the reasons why Apotex withdrew its previous NOAs. Thus, the fact that this witness may lack technical expertise to construe "salts" can have no impact on the weight of his testimony as to why he gave certain instructions to Apotex' counsel in Court files T-179-98 and T-180-98.
[26] Having reviewed the cases cited by Astrazeneca to support their argument that Dr. Sherman's evidence has been previously rejected because he was not a credible witness[2], I find that they can be of little assistance to me in evaluating this witness' credibility on the specific issues before the Court.
[27] I also cannot accept the argument that Dr. Sherman's testimony on a specific issue should be given no weight simply because he allegedly made a mistake in respect of an entirely unrelated issue in another proceeding. In any event, I note that O'Keefe J. rejected Astrazeneca's argument in his decision of March 3, 2004, in Court file: T-2311-01.
[28] However, I do agree with Astrazeneca that the personal interest of the witness in the matter at hand as well as his lack of expertise in certain areas which he addresses in his affidavit can affect and diminish the weight of his evidence. I have considered this in my assessment of the evidence produced by the parties.
i) insufficiency of the NOA
a) Subparagraph 5(3)(c)(ii)
[29] Astrazeneca submits that pursuant to subparagraph 5(3)(c)(ii) of the Regulations, Apotex must disclose in its NOA the active ingredient in its Apo-Omeprazole tablets. A reference to Apo-Omeprazole, the brand name of this drug product, is not sufficient to meet this regulatory requirement.
[30] In its application, Astrazeneca refers to the omeprazole magnesium and omeprazole as different "drugs" or "active ingredients". Dr. Burke, in her affidavit, simply states that Apotex did not disclose the "active ingredient" in its tablets and the Minister of Health considers omeprazole and omeprazole magnesium as two distinct "medicine" and treats them as such. Dr. Burke was not cross-examined on her affidavit. It remains unclear why in Apotex' product monogram for these tablets, the strengths of 10, 20 and 40mg refer to the exact quantity of omeprazole contained in the tablets. (Application Record at p. 347)
[31] In its memorandum of fact and law, Astrazeneca uses the words "active ingredient" and "drug" interchangeably (see paras. 8, 57 and 59) but as I said, it produced no evidence to establish that the "drug", for which Apotex is seeking a NOC, the "medicine" and the "active ingredient" are one and the same in this case.
[32] The words "drug" and "medicine" are not used in contradistinction in the Regulations (Hoffmann-La Roche Ltd. v. Canada (Minister of National Health and Welfare), [1995] F.C.J. No. 985 (QL)). Both words may refer to the active ingredient alone but not necessarily so and they do not necessarily refer to the same thing in each case[3]. (For example, in Eli Lilly Canada Inc. v. Canada (Minister of Health), [2003] F.C.J. No. 75 (QL), it appears that the drug was "tazidime" and the "medicine ceftazidime"). I am not convinced that the Court can simply assume that the "drug," the "medicine" and the "active ingredient" are one and the same in the present case.
[33] But this determination is not essential to my decision because for the reasons explained below, I find that subparagraph 5(3)(c)(ii) of the Regulations does not require the second person to identify either the "active ingredient" or the "drug" in its NOA.
[34] Subparagraph 5(3)(c)(ii) states:
| 5(3) Where a person makes an allegation pursuant to paragraph (1)(b) or (1.1)(b) or subsection (2), the person shall
[...]
(c) if the allegation is made under subparagraph (1)(b)(iv) or (1.1)(b)(iv),
[...] (ii) include in the notice of allegation a description of the dosage form, strength and route of administration of the drug in respect of which the submission has been filed; and [...]
[my emphasis]
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5.(3) Lorsqu'une personne fait une allégation visée aux alinéas (1)b) ou (1.1)b) ou au paragraphe (2), elle doit :
[...]
c) si l'allégation est faite aux termes des sous-alinéas (1)b)(iv) ou (1.1)b)(iv) :
[...]
(ii) insérer dans l'avis d'allégation une description de la forme posologique, de la concentration et de la voie d'administration de la drogue visée par la demande; [...]
[non souligné dans l'original] |
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[35] Astrazeneca submits that the emphasized words in subparagraph 5(3)(c)(ii) above should be construed in a manner consistent with the interpretation given to these words in ss. 4(2) and 4(7) of the Regulations and that their grammatical and ordinary sense must be read harmoniously with the scheme of the Act, the object of the Act and the intention of parliament. (Parke-Davis Division v. Canada (Minister of Health), [2003] F.C. No.514 (at paras. 30 to 33) (QL)).
[36] According to the applicant, the requirement to identify the "drug" itself or the "active ingredient" is explicit or at least implicit because the patent register could not function otherwise and because such information is necessary to enable Astrazeneca to properly assess its exposure with respect to the liability provided for at s. 8 of the Regulations. On that point, the applicant states that the legal and practical impediments to the making and selling of omeprazol tablets by Apotex may differ from those related to the making and selling of omeprazol magnesium tablets.
[37] The applicant further states that the intention of Parliament can be ascertained by considering the Regulatory Impact Analysis Statement (RIAS) published with the 1998 amendments to the Regulations, which clearly states that the "specific version of the medicine" must be disclosed in the allegation of non-infringement.
[38] Apotex disagrees with this interpretation and relies on the recent decision of the Federal Court of Appeal in Eli Lilly, supra. It also submits that even if this information was required, failure to provide it should not be construed as a fatal flaw because Astrazeneca knew that the Apo-Omeprazole tablets would contain omeprazole magnesium; this information had been disclosed to the applicant in the proceedings in Court file: T-1747-00. It relies on Hoffmann-La Roche Ltd. v. Canada (Minister of National Health and Welfare), [1999] F.C.J. No. 348 (QL) at para. 10, which dealt with a failure to describe the dosage form in the NOA.
[39] The Court agrees that it must adopt the approach to the interpretation of the Regulations summarized in Parke-Davis, supra, and applied in Eli Lilly, supra and that the decision of the Court of Appeal in Eli Lilly, supra, is very relevant to the particular interpretation of subparagraph 5(3)(c)(ii) of the Regulations.
[40] In that case, Elli Lilly had listed, in relation to its tazidime products, a patent covering compositions comprising ceftazidime stabilized by lactose.
[41] However, Eli Lilly had discovered a new way of using ceftazidime (the medicine) without the need to stabilize it with lactose. Thus, its tazidime products did not include the invention disclosed in the patent listed on the patent register. In that sense, the patent was not relevant to the drug (tazidime) per se, although the Minister agreed that it was relevant to the dosage form, strength or route of administration.
[42] The Minister had decided that the patent was not properly registered and Eli Lilly sought judicial review of that decision.
[43] To determine whether the Minister had properly exercised its authority under subsection 3(1) of the Regulations, the Court looked at the requirements set out in the Regulations, more particularly at subss. 3(3), 4(1), 4(2) and 4(7). It held that the only sections dealing with what patent could be included on the list were paras. 4(2)(b) and 4(7)(b) of the Regulations. The Minister had argued that the Regulations required a relationship (relevance) between the drug named in the NOC and the patent sought to be included in the patent register. To support this argument, he relied on the 1998 RIAS which stated:
"[...] patentees are required to certify that the patents submitted on the list for a drug are relevant to that particular version of the drug. This will ensure that patents that do not apply to the particular version of the drug will not impede the generic's market entry." [My emphasis]
[44] The Federal Court of Appeal found that this passage could only refer to paragraph 4(7)(b) of the Regulations and that the desired "product specific" patent list would be achieved by relevance to the dosage form, strength and route of administration. In discussing the impact of the RIAS, the Court specified that it could do no more than explain the general objective of the Regulations, it could not amend the Regulations.
[45] As is now argued by Astrazeneca, the Minister also argued that the wording of paragraph 4(7)(b) explicitly or implicitly required that the patent be relevant to the drug named in the NOC issued to the first person.
[46] Paragraph 4(7)(b) reads as follows:
| 4.(7)(b) the patents set out on the patent list or in the amendment are eligible for inclusion on the register and are relevant to the dosage form, strength and route of administration of the drug in respect of which the submission for a notice of compliance has been filed.
[My emphasis]
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4.(7)b) les brevets mentionnés dans la liste ou dans la modification sont admissibles à l'inscription au registre et sont pertinents quant à la forme posologique, la concentration et la voie d'administration de la drogue visée par la demande d'avis de conformité.
[Mes soulignés]
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[47] The Federal Court of Appeal held that the emphasized words in paragraph 4(7)(b) "do not describe any relationship between the drug named in the notice of compliance and the patents that may be included in the patent list" (Eli Lilly, supra at para. 34.)
[48] In addition to the passage of the RIAS relied upon by the Minister in Eli Lilly, supra, Astrazeneca refers the Court to the following passage:
[...]more specifically with NOA: When an allegation relating to non-infringement (NOA) is submitted, a generic manufacturer is required to indicate to the patentee the specific version of the medicine it intends to market. [My emphasis]
[49] Obviously, the drafter of the RIAS should have said "specific version of the drug" as this passage clearly refers to subparagraph 5(3)(c)(ii) of the Regulations and to the substance for which a new drug submission has been filed.
[50] That being said, this passage says no more than the first one which referred to subsection 4(7). Like the Federal Court of Appeal, I find that the desired specificity is achieved by reference to the dosage form, strength and route of administration.
[51] If I were to accept Astrazeneca's argument, I would have to give the words "of the drug in respect of which this submission has been filed" in subparagraph 5(3)(c)(ii), a meaning that differs from the one ascribed to them in subsection 4(7) by the Federal Court of Appeal in Eli Lilly, supra. I would obviously need a compelling reason to do so for this would be contrary to a basic rule of interpretation.
[52] The Court is not persuaded that it must depart from the ordinary and grammatical reading of subparagraph 5(3)(c)(ii) to ensure the proper functioning of the patent registry. As indicated in Eli Lilly, supra, the task of the Minister in that respect is facilitated by the form of the patent list itself. That form requires among other things, the name of the medicine in the drug, the brand name of the drug, the drug identification number, the intended use (human or veterinarian) in addition to the route of administration, the dosage form and the strength[4].
[53] Additionally, the Court is not convinced that it must depart from the ordinary and grammatical reading of this provision to enable Astrazeneca to better evaluate the risk of incurring liability under section 8. The prime purpose of the scheme provided for in the Regulations is to avoid infringement of valid patents. Thus, the decision to file an application pursuant to section 6 must be driven by the merits of the allegations in the NOA based on the facts and legal assertions disclosed pursuant to paragraph 5(3)(a). There is no doubt that if the name of the drug or of the active ingredient is relevant to the assessment of the merits of a specific allegation made by the generic manufacturer, it will have to be disclosed in the detailed statement.
[54] It was not the object of the Regulations or the goal of the legislator to promote the filing of applications that have little chance of success because patentees are able to assess that they have little risk of incurring any liability under s. 8 of the Regulations.
[55] The Court recognizes that there may indeed be cases where the chances of success of a given application are good but the final decision to seek or not an order of prohibition could vary depending on the exposure to damages. But this alone does not constitute a compelling reason to widen the scope of subsection 5(3)(c)(ii) and ascribe to it a meaning that differs from subsection 4(7).
[56] I therefore adopt the same interpretation as my colleagues Blais J. and Kelen J. in AB Hassle v. Apotex Inc., [2001] F.C.J. No. 809 (QL) and AB Hassle v. Apotex Inc., [2002] F.C.J. No. 1221 (QL) and conclude that Apotex did not fail to meet the requirements of subsection 5(3)(c)(ii).
b) Paragraph 5(3)(a)
[57] This brings me to the second argument put forth by Astrazeneca to support its view that the NOA is deficient. Astrazeneca says that if the Court accepts Dr. Sherman's interpretation of the NOA, the name of the active ingredient used in the Apo-Omeprazole tablets had to be disclosed pursuant to paragraph 5(3)(a) of the Regulations because Dr. Sherman says among other things, that Apotex does not use a sodium salt functioning as a stabilizing agent because omeprazole magnesium is an alkaline salt that does not require the use of a stabilizing agent.
[58] As will be explained in section iii) of my analysis, (at paras. 76 to 80 below), I do not accept Dr. Sherman's interpretation of the NOA and I find that the name of the active ingredient in the tablets was not relevant to the specific allegation put forth by Apotex on March 2, 2002. I read the NOA to mean that the allegation is justified by the fact that tablets would not contain any of the "specified stabilizing agents". This statement is sufficient and complete whatever active ingredient is used in Apotex' tablets (Hoffmann-La Roche Ltd. v. Canada (Minister of National Health and Welfare), [1996] F.C.J. No. 1333 (QL)).
[59] If I am wrong in my interpretation of the NOA, then, I find that the NOA was deficient because it did not include all the facts on which Apotex based its assertion that the sodium salts contained in its tablets, if any, do not function as stabilizing agent. In that respect, I do not accept Apotex' argument that because Astrazeneca knew the active ingredient in its tablets, that information having been disclosed to it in Court file: T-1747-00[5], it need not include this fact in its detailed statement.
[60] In AB Hassle v. Canada (Minister of National Health and Welfare), [2000] F.C.J. No. 855 (QL), the Federal Court of Appeal made it clear that the detailed statement represents a pivotal step in the process provided for in the Regulations. It has to be complete for it defines the issues between the parties. The second person cannot reveal the relevant facts in a piecemeal fashion when some need happens to arise in a section 6 proceeding. I believe that this is exactly what happened here, new facts became relevant when Dr. Sherman was confronted to the possibility that a substance used in the Apo-Omeprazole tablets could arguably be a sodium salt, contrary to the position taken until then by Apotex.. In the AB Hassle case, supra, the detailed statement was found deficient because it did not include all of the prior art relied upon by the second person. If prior knowledge was relevant to disclosure under subparagraph 5(3)(a), it could be argued that, for example, all the prior art referred to during the prosecution of a patent application would not need to be included in the detailed statement for it would be known to the patentee. This simply does not make any sense. Furthermore, it would completely change the nature of these summary proceedings if there was to be a debate as to what facts, other than the ones disclosed in the detailed statement, are relevant to the determination of the application because they were presumably known to the first person.
ii) Abuse of process
[61] Although Apotex has not admitted that its latest NOA is not separate and distinct from the previous NOAs it sent for these tablets, it has not argued that it is distinct. I shall assume for the moment that it is not so because this does not mean that this latest NOA must therefore automatically be characterized as an abuse of process. In effect, the Court must examine the facts underpinning the withdrawal of the previous NOAs to determine if indeed Apotex' behaviour constitutes an abuse. (Novartis AG v. Apotex Inc., [2001] F.C.J. No. 1546 (QL) (T.D.)).
[62] Astrazeneca submits that where the NOA is not separate and distinct from an earlier NOA, there is prima facie presumption that it is abusive. Be it as it may, Apotex did file evidence to explain the factual context of the withdrawals in Court files T-179-98 and T-180-98. This evidence is not contradicted by any evidence put forth by Astrazeneca.
[63] Instead, the applicant argues that the testimony of Dr. Sherman that Apotex withdrew its notices because of technical difficulties regarding compliance with the Food and Drug Regulations is not credible and Apotex has not provided satisfactory documentary evidence establishing how and when it overcame these alleged difficulties.[6]
[64] Particularly, Dr. Sherman's evidence should not be given any weight whatsoever because he has an interest in the outcome of the proceedings and he contradicted himself during his various cross-examinations on this subject in this file and in Court file: T-1747-00. Also, he could not give a satisfactory explanation as to why the alleged technical difficulties in achieving bioequivalence "necessitated" a withdrawal of the previous NOAs considering that: i) Apotex did proceed with the hearing on the merits in at least one other application filed pursuant to section 6(1) of the Regulations where it had not filed a new drug submission before the hearing and ii) it was always Apotex' intention not to use one of the listed stabilizing agents in its tablets whatever formulation it ended up using.
[65] Astrazeneca submits that there is indeed another plausible explanation for these withdrawals. It says that Apotex knew that it might win on those applications and this would be counterproductive because it was not ready technically to enter the market and might end up not being the "first to market". In effect, in the meantime, Astrazeneca could in a defensive move, license another friendlier generic manufacturer to capture this market.
[66] Finally, Astrazeneca states that Apotex seeks to improve its evidentiary record by the production of Dr. Sherman's affidavit, particularly, his statement with respect to the formulation of the tablets which would not contain a sodium, potassium or aluminium salt.
[67] Starting with this last point, it is difficult to see how this evidence of Dr. Sherman improves Apotex' position because, even in the absence of this affidavit, the Court has to presume that the factual assertions supporting the allegation of non-infringement are true. I am not convinced that Apotex has indeed improved its evidentiary record or that it was on that basis that it withdrew its previous NOAs.
[68] As to the other explanation advanced by Astrazeneca, I find that it is pure speculation. It is not based on any evidence; it was not even canvassed as a possibility during the cross-examination of Dr. Sherman.
[69] I agree with Astrazeneca that this Court cannot simply adopt the findings made on the issue of abuse of process in Court files T-1747-00 and T-1914-01. Each case must be decided on its own facts and the evidence put before the Court.
[70] However, these decisions stand for the proposition that withdrawals of NOAs due to technical problems in meeting regulatory requirements do not justify a finding of abuse of process. Thus, if I am satisfied, on a balance of probability, that Apotex withdrew its previous NOAs because, at that time, it could not establish that its tablets were bioequivalent to the Lozec® tablets. I will reject Astrazeneca's allegation of abuse of process.
[71] The Court reviewed carefully the transcripts of the cross-examinations of Dr. Sherman produced in the application record as well as the previous affidavits signed by this witness in 2000 (T-1747-00), the documentation produced with respect to various bioavailability studies done up to May 1999 and the documentation indicating that in May 1999, Apotex started an add-on study (OMEC-16) and finally established the bioequivalence of its 20mg omeprazol magnesium tablets in October 1999. I am satisfied that Apotex withdrew its previous NOAs because of technical difficulties and it has not been established that there has been an abuse of process.
iii) Allegation of non-infringement
[72] A proceeding under subsection 6(1) of the Regulations is not an action for infringement. In the present case, the Court does not have to determine whether or not the second person's product would infringe a valid patent. It only needs to determine whether the facts assumed or proven and the legal assertions made justify the specific allegation of non-infringement made by Apotex. (Hoffmann-La Roche Ltd. v. Canada (1996), 70 C.P.R (3d) 206 (F.C.A.) and Merck Frosst Canada Inc. v. Canada (Minister of National Health and Welfare) (1994), 55 C.P.R. (3d) 302 (F.C.A.) at p. 302).
[73] This means that Astrazeneca has the burden of convincing the Court that the specific allegation of non-infringement contained in the NOA is unjustified. It need not otherwise prove that Apotex' tablet would infringe the '377 Patent because it contains all the essential elements of a claim in the said patent.
[74] As I said, the Court is bound to assume that the factual statements supporting the allegation of non-infringement are true. Thus, Astrazeneca had to convince me that either i) those statements assumed to be true would not in law give rise to the conclusion that the patent would not infringe or ii) all or most of the facts relied upon by Apotex to justify its allegation of non-infringement are wrong (Hoffmann-La Roche Ltd. v. Canada (Minister of National Health), [1996] F.C.J. No. 1333 (FCA) (QL) and Merck Frosst Canada Inc. v. Canada (Minister of Health), [2001] F.C.J. No. 915 (FCA) (QL)).
[75] Astrazeneca did not argue that in law, there would still be infringement if the statements of facts in the NOA were true. Both parties agreed that for the purpose of this proceeding, the Court could assume that the presence of at least one of the stabilizing agents specified in the patent, that is a potassium, sodium or aluminium salt, is an essential element of Claim 1. In any event, the Court is satisfied that Claim 1, construed purposively, does not cover a composition which does not comprise a potassium, sodium or aluminium salt. (Whirpool Corp. v. Camco Inc., [2000] 2 S.C.R. 1067).
[76] Therefore, the only issue is whether Astrazeneca proved that the facts put forth by Apotex to justify its allegations are wrong. Obviously, to do so, the Court must first clarify what facts were put forth in the NOA because the parties disagree on this point.
[77] As mentioned in the NOA, Apotex stated that:
The claims of this patent cover composition comprising a medicine, a basic inorganic salt stabilizing agent selected from potassium, sodium and aluminium salts, and an enteric coating. Our tablets will not fall within the scope of any claim of this patent. More specifically, our tablets will not contain any such stabilizing agent. Even more specifically, our tablets will contain no potassium sodium or aluminium salt whatsoever.
[My emphasis]
[78] The sentence "our tablets will not fall within the scope of any claim of this patent" is simply the allegation of non-infringement of the detailed statement. It is justified by the statements contained in the last two sentences.
[79] Apotex does not refer at all to the specific language of Claim 1 which requires that the inorganic salt be present in an amount effective to stabilize the composition. Nor does it refer to the fact that a salt expressly listed in the patent as a stabilizing agent would be used in its tablets but that it would not "function as stabilizing agent" because the alkaline omeprazole salt it used does not require stabilization, or because of the quantity or location of this specified salt in the tablets.
[80] In his affidavit, Dr. Sherman does not discuss those issues either nor does he state that Apotex' tablets would not include a sodium salt functioning as a stabilizing agent. What he says is that the tablets would not include "any of the specified stabilizing agents". This appears to be in line with the wording that the tablets would not contain "any such stabilizing agent", the word "such" referring to those described before that is, "selected from potassium, sodium and aluminium salts".
[81] In the present circumstances, reading the NOA in its context[7], I conclude that Apotex' allegation of non-infringement was based on one factual assertion only: the absence of any of the listed stabilizing agents (potassium, sodium or aluminium salts) in Apotex' tablets.
[82] Thus, to establish that the allegation of non-infringement is not justified, Astrazeneca had only to convince me, on a balance of probability, that the tablets would include a potassium, sodium or aluminium salt. Astrazeneca argues that it has met this burden by establishing through the cross-examination of Dr. Sherman that the sodium carboxymethylcellulose and the sodium croscaremellose contained in Apotex' tablets are sodium salts.
[83] First, I will review the evidence concerning the nature of the sodium croscaremellose.
[84] Astrazeneca argues that Dr. Sherman failed to answer the four questions it asked in relation to this ingredient and that the Court is, therefore, entitled to make a negative inference that indeed, this substance found in the core of the Apo-Omeprazole tablets is a sodium salt.
[85] Apotex submits that Dr. Sherman was instructed by its counsel not to answer those questions because they were improperly put to him when he re-attended to answer proper questions arising from the answers provided by Apotex pursuant to the order of Prothonotary Lafrenière dated October 24, 2002. It argues that the four questions objected to could have been and should have been put to this witness during his cross-examination on July 9, 2002.
[86] Pursuant to the order of Prothonotary Lafrenière dated October 24, 2002, Apotex had to produce the latest version of its product monogram to confirm the ingredients in the tablets. Apotex argues that Astrazeneca could only ask questions on this document if the ingredients listed in the latest version of the product monogram were different from the ones described in the document it used to cross-examine Dr. Sherman on July 9, 2002.
[87] Astrazeneca chose not to have a ruling on those objections before the hearing of the application on the merits preferring to argue that the Court should draw a negative inference.
[88] The Court requested the applicant provide some authority to support its position. In its letter dated February 23, 2004, Astrazeneca indicates that the clearest reference it found was the decision of Kelen J. in AB Hassle, supra, who said at paragraph 44:
[...]The best evidence would have been samples of the Apotex tablets for testing. Apotex refused. The Court can infer that the results of this testing would be adverse to the position of Apotex or else Apotex would have conducted such an analysis and submitted the results.[...]
[89] I cannot accept this argument for two reasons. First and foremost, I find that the objections of Apotex were well-founded. In his cross-examination on July 9, 2002, Dr. Sherman confirmed that the ingredients listed in the one-page document entitled "Composition" (application record at p. 309) were present in the Apo-Omeprazole tablets referred to in the NOA of March 2, 2002 (application record at p. 238). Both sodium carboxymethylcellulose and sodium croscaremellose were listed in this document. As mentioned, Astrazeneca chose to ask questions only about carboxymethylcellulose. When it concluded its cross-examination, Astrazeneca confirmed that subject to outstanding matters (the objections and one undertaking), these were all its questions.
[90] The updated version of the page entitled "Composition" read exactly like the one used on July 9, 2002. Astrazeneca could not split its case and use the occasion of the production of an updated version of the product monogram to cross-examine a second time this witness on this issue.
[91] Also, in AB Hassle, supra, Kelen J. applied a presumption or inference against the second person because without those samples, the first person did not have any other means of gaining access to the information which was known only to the second person. This was not the case here. Even before July 9, 2002, Astrazeneca knew from the information provided in the context of Court file: T-1747-00, what ingredients would be used in these tablets.
[92] If the applicant was still not sure that this composition applied to the tablets referred to in the March 2, 2002, NOA, it could seek to confirm it by making a request pursuant to s. 6(7) of the Regulations. It did not do so but in any event, in June 2002, Dr. Sherman confirmed in his affidavit at para. 24 that the formulation provided to Astrazeneca in Court file T-1747-00 was relevant and applicable in the context of the present application.
[93] Astrazeneca also had the means to determine whether or not carboxymethylcellulose or sodium croscaremellose are sodium salts. Dr. Burke, who has a PhD in chemistry, could easily have testified to that effect. Astrazeneca did not attempt to file an additional affidavit after receiving Dr. Sherman's affidavit or after cross-examining Dr. Sherman. It is clear that the applicant decided to make its case out of the mouth of the respondent. Obviously, there are risks involved in doing so, especially, when an issue is at the core of one's case (para. 21 of the application).
[94] In the present circumstances, the Court is not willing to make any negative inference that would contradict the factual statements contained in the NOA presumed to be true.
[95] Turning now to sodium carboxymethylcellulose, Astrazeneca states that Dr. Sherman admitted that this substance was a sodium salt and that the NOA was incorrect.
[96] The cross-examination of Dr. Sherman indicates as follows:
[...]
38 Q. Are any of these ingredients part of or amongst ingredients that comprise the formulation for the omeprazole magnesium tablets or the Apo-Omeprazole tablets that you refer to in the NOA ?
A. Yes.
39 Q. Were those ingredients that are included in the Apo-Omeprazole tablets the subject of your NOA - include sodium carboxymethylcellulose
A. It may contain a smaller amount of sodium carboxymethylcellulose. It would contain, no - no, this is wrong.
[...]
43 Q. Am I correct that sodium carboxymethylcellulose is a sodium salt?
A. I don't know if you would characterize it as such. The amount of sodium would be so small, in terms of the molecular weight, and I don't know if you would characterize it as a salt or not.
44 Q. Is that because you're not enough of an expert in matters of chemistry to be able to answer that question?
A. I'm not sure that there's a clear answer to it. It's possible that it would be but I'm not sure. But in any event, it is not, clearly, used in the tablet. It's used in the coating and it must be, now that I think about it further -- it must be that we do have a small amount as a thickener in the coating suspension.
It's there simply to prevent settling in the colour during the time that the product is being coated. It would not be alkaline, and it would not be a stabilizing agent, and it would not be mixed in contact with the active drug, in any event.
45 Q. I'm not asking you questions about the sodium carboxymethylcellulose -- as to its other properties. I simply asked you whether it was a salt.
A. It's possible that it is, arguably, a salt. I'm not -- I can't be categorical on that but it is not alkaline and it is not a stabilizing agent and it is not mixed in with the active drug, in any event.
[...]
48 Q. And you seem to have acknowledged that your tablets, at least, contain sodium carboxymethylcellulose which you seem to acknowledge may be a salt.
A. Not really. It depends -- arguably, I'm saying, you could argue that they do. But they're not in the tablet core; they're in the coating around the tablet. They're clearly not capable -- not being and not capable of being a stabilizing agent.
So even if, arguably, you're correct, that if you define the tablet as including the enteric coating that surrounds it which does not contain the active drug, and if you consider it to be -- it to be a sodium salt, then this statement could arguably be incorrect.
But from what comes before it, clearly it is not incorrect.
49 Q. Well, these are your words.
A. Yes. I'm accepting that that sentence is arguably incorrect, but in an irrelevant -- but it's irrelevant. That's all I'm telling you.
If it's incorrect, I apologize. It was not intentional.
[...]
52 Q. -- that said the same thing at the end of you paragraph 10. You said that your tablets would contain no sodium salt, whatsoever.
A. I accept that and I'm telling you that I must accept, upon being confronted with that monograph, that it didn't occur to me to even think about the sodium carboxymethylcellulose because it's an irrelevancy.
53 Q. Well, naturally when confronted with facts that show that your factual assertion, naturally you're going to want to explain that --
A. No, that's not -- that's not fair. I don't purport to be perfect. I would agree with you that this last sentence is arguably incorrect.
[...]
147 Q. I apologize whether this overlaps with another question, but please confirm whether the formulation, the subject of the current NOA, will contain any sodium, potassium or aluminium salts, whatsoever.
A. Well, as I already told you, it's arguable that that last sentence is not correct but -- and if it is incorrect, I apologize. I think it's arguably incorrect -- the last sentence. But the previous sentences are certainly correct.
[My emphasis]
[97] In its memorandum, Astrazeneca states that it is apparent that Dr. Sherman does not have the knowledge or the expertise to construe the salts referred to in the '377 Patent, and that his assertion that Apo-Omeprazole tablets will not contain a salt specified in the '377 Patent is not credible. It further states that Dr. Sherman's suggestion that the presence of a sodium salt in the enteric coating is not relevant, is not consistent with the assertions made in Apotex' prior NOAs more particularly, the one dated December 17, 1997, where it stated that Apotex' tablets would contain no potassium, sodium or aluminium salt either in the core or the coating of the tablets. This wording was changed to "no salt whatsoever" in the current version of the NOA.
[98] I agree with Astrazeneca that the Court should give no weight at all to the statement in Dr. Sherman's affidavit to the effect that Apotex' tablets would not contain any of the stabilizing agents specified in the '377 Patent. He had clearly not turned his mind to all the ingredients in the tablets when he made that statement and could not definitely state that one of the ingredients was not a sodium salt.
[99] The Court also agrees that he tried to cover his failings in that respect by downplaying the importance of this ingredient. But I note, that he did not try to deny what he clearly did not know for sure. Dr. Sherman has no formal training in chemistry.
[100] Having said that, the Court is not willing to read into his testimony what is not there, that is, a definite confirmation that this substance is a sodium salt and that the NOA is incorrect. One cannot, on the one hand, say that a witness is clearly not an expert on salts, and on the other hand, say that the Court should hold that this witness' admission that something is arguably a sodium salt is conclusive evidence that this something is indeed such a salt. Need I say again that Astrazeneca presented no other expert evidence on this technical matter. Thus, after discarding Dr. Sherman's affidavit and weighing his evidence on cross-examination, the Court is not satisfied that Astrazeneca has rebutted the presumption of truth applicable to the factual statements in the NOA.
[101] In the circumstances, the Court concludes that Astrazeneca has not established that the allegation of non-infringement is not justified.
ORDER
THIS COURT ORDERS THAT:
The application is dismissed with costs.
"Johanne Gauthier"
J.F.C.
FEDERAL COURT
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-660-02
STYLE OF CAUSE: ASTRAZENECA CANADA INC.
Applicant
and
APOTEX INC.,
TAKEDA CHEMICAL INDUSTRIES, LTD.
and THE MINISTER OF HEALTH
Respondents
PLACE OF HEARING: Toronto, Ontario
DATE OF HEARING: February 17, 2004
REASONS FOR ORDER AND ORDER :
THE HONOURABLE JOHANNE GAUTHIER
DATED: April 29, 2004
APPEARANCES:
Mr. Gunars Gaikis
Mr. Scott Beeser FOR APPLICANT
Mr. Harry Radomski
Mr. Andrew Brodkin FOR RESPONDENTS
SOLICITORS OF RECORD:
Smart & Biggar FOR APPLICANT
Toronto, Ontario
Goodmans FOR RESPONDENTS
Toronto, Ontario
[1] Two decisions in other related proceedings were forwarded to me after the hearing: Lemieux J.'s Reasons for Order in AB Hassle v. Apotex Inc. in Court file: T-470-02 dated March 16, 2004 and O'Keefe J.'s Reasons for Order in Astrazeneca AB v. Apotex Inc. in Court file: T-2311-01 dated March 3, 2004. These decisions do not discuss the specific grounds raised in the present case and have no relevance except for O'Keefe J.'s findings with respect to Dr. Sherman's credibility (paras. 39 to 42).
[2] Zeneca Parma Inc. v. Canada (Minister of National Health and Welfare), 55 C.P.R. (3d) 10 at p.14-15
Hoffman-La Roche Limited v. Canada (Minister of National Health and Welfare), [1999] F.C.J. No. 540 (Court file: T-309-98)
Apotex Inc. v. Canada (Attorney General), [1987] F.C.J. No. 144
(Court file: T-218-86)
Merck v. Apotex Inc. (2000) 5 C.P.R. (4th) 1
[3] In Novopharm Ltd. v. Canada (Minister of National Health and Welfare), [1998] F.C.J. No. 130 (QL) at para. 20, Hugessen J. says "[...] Thus, the fact that the medicine claimed in listed patents may form part of or even be a drug for which an NDS is filed [...]"
[4] It is clear than even though this additional information is useful to the proper functioning of the patent register, it cannot be said that it must be included in the NOA pursuant to subparagraph 5(3)(c)(ii) of the Regulations.
[5] Paragraph 24 of Dr. Sherman's affidavit.
[6] I have already indicated that I do not accept that this witness is not credible because of findings made in other cases.
[7] This includes the wording of the previous NOAs in respect of Apotex' tablets and capsules and for example the '377 Patent, Apotex' position in Court file: T-2026-99 (paras. 5 and 14 of McKeown J.'s decision and on its motion to dismiss the application (paras. 3 and 10 of Layden-Stevenson J.'s decision) and para. 21 of the application.