Apotex Inc v Astrazeneca Canada Inc, 2017 FCA 9

Patents that are subject to the old Patent Act may have provincial limitation periods applicable to them if all elements of the cause of action are within a province.

In this case, the Federal Court of Appeal (“FCA”) affirmed the Federal Court’s (“FC”) decision that AstraZeneca Canada Inc.’s (“AstraZeneca”) patent, Canadian Patent No. 1,292,693 (“the ‘693 Patent”), was valid and infringed, accepted Apotex Inc.’s (“Apotex”) appeal with respects to limitation periods, and rejected AstraZeneca’s cross-appeal regarding punitive damages. [6]

Background

The ‘693 Patent pertains to pharmaceutical preparations containing omeprazole, a drug that is used in the treatment of gastrointestinal diseases and was commercialized by AstraZeneca under the brand name LOSEC. [3, 13] Apotex thought it had succeeded in finding a way to work around the ‘693 Patent by using a different process than was covered in the claims and obtained a Notice of Compliance (“NOC”) allowing it to sell its own omeprazole product. [13, 16] The issues to be decided in this case were (1) whether the FC erred in construing the ‘693 Patent, and if so, then erred in finding infringement, (2) whether the FC erred in finding the ‘693 Patent was valid, (3) whether the FC erred in concluding that a six-year limitation period applied to all of the infringing activities, and (4) whether the FC erred in declining to award punitive damages to AstraZeneca. [25, 26]

FC Claims Construction Found to be Correct

Apotex alleged that the FC adopted a fettered, results-oriented construction. [31] The FCA noted that the issue of construction of the patent is to be reviewed on the correctness standard and therefore performed its own analysis. [41] The FCA then stated that it is trite law that a court will consider disclosure when it construes the claims, however, the disclosure cannot be use to enlarge or contract the scope of the claim as written and thus understood. [48] The FCA concluded that the FC was correct in its construction and therefore its finding of infringement should stand. [65]

Invalidity Allegations Rejected

The FCA rejected Apotex’s overlapping allegations of insufficiency of disclosure, overbreadth and ambiguity, all of which pertained to a preparation including a layer made in situ. [76, 79, 92] In regards to sufficiency, the FCA found that an inventor is only required to disclose one method or process for making the invention. [79] While the process disclosed in the ‘693 Patent does not involve a layer made in situ, it nonetheless enables a person skilled in the art to practice the invention as described. [78] The FCA also rejected Apotex’s allegations of inutility, finding that a formulation meeting the essential elements of the claims would be expected to provide good gastric acid resistance and long-term storage stability. [98]

Limitation Period

Apotex alleged that the FC was incorrect in applying a six-year limitation period to all acts of infringement. [105] The FCA found that the FC erred in precluding the possibility that provincial limitation periods might apply to specific acts of infringement where all elements of the cause of action occurred within that province. [114, 118] The FCA highlighted that as the six-year limitation period applicable to all acts of infringement has now been included in the Patent Act for over 20 years, the issue of provincial limitation periods only applies in cases involving patents subject to the old Patent Act. [123]

Cross-Appeal: Punitive Damages Not Awarded

AstraZeneca sought punitive damages or solicitor/client costs, or both, on the basis that Apotex had been deceptive in the context of the settlement obtained in earlier NOC proceedings involving the ‘693 Patent. [127] The FCA was not persuaded that the FC misconstrued the law or made a palpable and overriding error in assessing the facts, and therefore rejected AstraZeneca’s cross-appeal. [136]