Date: 20040512
Docket: T-1878-02
Citation: 2004 FC 694
Toronto, Ontario, May 12th, 2004
Present: Roger R. Lafrenière, Esquire
Prothonotary
BETWEEN:
AB HASSLE, ASTRAZENECA AB and
ASTRAZENECA CANADA INC.
Applicants
and
APOTEX INC. and THE MINISTER OF HEALTH
Respondents
Docket: T-766-03
AND BETWEEN:
ASTRAZENECA AB and
ASTRAZENECA CANADA INC.
Applicants
and
APOTEX INC. and THE MINISTER OF HEALTH
Respondents
REASONS FOR ORDER AND ORDER
Overview
[1] This is a motion by AB Hassle, Astrazeneca AB and Astrazeneca Canada Inc., the Applicants in Court No. 1878-02, and Astrazeneca AB and Astrazeneca Canada Inc., the Applicants in Court No. T-766-03 (hereafter jointly referred to as "the Applicants"), for leave to file reply affidavit evidence of Dr. Jörgen Lindquist sworn April 15, 2004 (the "Lindquist Affidavit"), and for an Order providing for the subsequent procedural steps in these proceedings.
[2] The Lindquist Affidavit contains evidence of test results that, according to the Applicants, indicate that the proposed tablets of the Respondent, Apotex Inc. ("Apotex"), infringe the Applicants' patents, which are the subject of the two proceedings brought by the Applicants pursuant to thePatented Medicines (Notice of Compliance) Regulations ("Regulations").
[3] Apotex submits that it is simply too late in the prosecution of the two proceedings for the Applicants to seek to file new evidence, and that leave ought accordingly be denied. The Applicants maintain that the Lindquist Affidavit could not have been presented earlier in light of Apotex's continued refusal to produce samples of its tablets for testing. Out of an abundance of caution, Apotex has brought a separate motion seeking an Order permitting it to file evidence in response to the Lindquist Affidavit in the event leave is granted.
[4] The Applicants submit that leave to file the Lindquist Affidavit should be granted because: (1) it will not cause unreasonable delay; (2) it will serve the interests of justice; (3) it will greatly assist the Court; and (4) it will not cause serious prejudice to the opposing party. For the reasons that follow, I conclude that the motion must be dismissed.
Background to the two proceedings
[5] These are not the first proceedings involving the parties under the Regulations. In Court File T-1747-00, the Applicants commenced a proceeding on September 19, 2000 for an Order prohibiting the Minister of Health from issuing a Notice of Compliance ("NOC") to Apotex in respect of the pharmaceutical products omeprazole and/or omeprazole magnesium tablets. The Applicants sought disclosure of information from Apotex, including the production of sample tablets relevant to Apotex's allegation of non-infringement. Apotex refused to produce any tablets.
[6] The Applicants moved for production of portions of Apotex's regulatory submission ("NDS") and requested samples of Apotex's tablets which may have been in the possession of the Minister. By Order dated July 16, 2001, Prothonotary Aronovitch directed Apotex to produce portions of its NDS. Since Apotex had not submitted samples of its omeprazole magnesium tablets to the Minister, samples were not produced.
[7] By Order dated September 4, 2002, Kelen J. allowed the Applicants' application and prohibited the Minister from issuing a NOC to Apotex in respect of omeprazole magnesium tablets 10, 20 and 40 mg, until after the expiration of the patents at issue based on the following conclusions:
[51] Based upon the evidence, I conclude:
1. There will be a reactive material or "interface" spontaneously generated when the enteric coating, which consists of polymers, is sprayed on the core which contains omeprazole and alkaline materials;
2. The nature of the reactive material or interface cannot be known without analytical testing of the tablets themselves;
3. The experts disagree whether the reactive material or interface can be considered a "subcoating" within the meaning of the patents or whether the reactive material would form a continuous layer around the core and what its thickness might be;
4. The reactive material would insulate the core from dissolving and would serve the same purpose to an unknown extent as the subcoating described in claim No. 1 of the Patent;
5. It is not possible to assess conflicting expert evidence in terms of credibility without the benefit of viva voce evidence in this case;
6. It is not possible to determine whether the allegation of non-infringement is justified based on speculation and conjecture by the experts. This is particularly frustrating when the best evidence, and probably the conclusive evidence, would be the results of analytical testing of the Apotex tablets themselves;
7. The overwhelming conclusion of the Court from the expert evidence is that the Apo-omeprazole tablets could have been analytically tested to identify the existence of the reactive layer or reactive material or spontaneous subcoating, and to obtain key technical information about its characteristics. Without this information, the experts are speculating, guessing, and "shadow-boxing"; and
8. In a case of patent infringement it is highly discomforting for the Court to rely upon expert witnesses who are "shadow-boxing", and determine which expert witness won the "shadow-boxing" match.
[8] Kelen J. referred to the case of AB Hassle v. Canada (Minister of National Health and Welfare) (2000), 10 C.P.R. (4th) 38 ("RhoxalPharma"), in which the Court considered a similar generic omeprazole tablet, a similar NOA and two of the same patents. Kelen J. noted that the trial Judge, Tremblay-Lamer J., held that the evidence established on the balance of probabilities that the generic tablets will have an "inert subcoating" which is spontaneously generated by a chemical reaction between the ingredients in the core and the enteric coating, and will therefore infringe patent '693. In RhoxalPharma, samples of the generic's tablets were ultimately produced to the Applicants, and analyzed to confirm that there was a subcoating and, hence, infringement. The Applicants had been allowed to file further evidence on test results in RhoxalPharma.
[9] Kelen J., observed that the RhoxalPharma case is important because it demonstrated that the proper detailed information necessary for the patentee to test the allegation of non-infringement was actual samples for testing to determine if there was an "inert subcoating". Citing Apotex' refusal to provide sample tablets to the Applicants, Kelen J. granted the relief requested by the Applicants and prohibited the Minister from issuing a NOC to Apotex.
Court File T-1878-02
[10] By Notice of Application dated November 8, 2002, the Applicants commenced another proceeding pursuant to the Regulations in Court File T-1878-02 for an Order prohibiting the Minister of Health from issuing a NOC to Apotex in respect of omeprazole magnesium tablets 10 and 20 mg until the expiration of Canadian Patent No. 1,292,693, Patent No. 1,302,891, and Patent No. 2,166,483.
[11] The proceeding in Court File T-1878-02 was commenced in response to a Notice of Allegation ("NOA") sent by Apotex to the Applicants on September 26, 2002, in which Apotex alleged that all of the relevant claims of the patents at issue would not be infringed by Apotex's omeprazole magnesium tablets, and that the relevant claims of the Patents are invalid. Apotex did not provide samples of its omeprazole magnesium tablets with its NOA.
[12] In their Notice of Application, the Applicants stated, that the NOA was deficient in the absence of sample tablets from Apotex. AstraZeneca also stated as follows:
31. Further, and in the alternative, the Applicants submit that Apotex must disclose samples, formulation particulars and process information relating to the NDS for Apotex' omeprazole magnesium presently before the Minister. Such disclosure is necessary in order to allow the Applicants to assess whether a subcoat is present and/or whether the allegation of non-infringement is justified on any of the other alternative bases asserted by Apotex.
32. The Applicants have no knowledge or access to knowledge regarding the existence, contents or date of filing of any new drug submission or the formulation particulars or process information for magnesium omeprazole product referred to in the letter. Further, the Applicants have no access to samples of Apotex' product.
[13] The Applicants' evidence was served and filed on January 10, 2003. That evidence explained that the Applicants did not have access to samples of Apotex's tablets, and that testing of such tablets was necessary in order to allow the Applicants to evaluate Apotex's allegation of non-infringement.
[14] Following service of the Applicants' affidavit evidence, Apotex sought and obtained an extension of time, to April 25, 2003, to file its affidavit evidence. Apotex filed its responding evidence on April 2, 2003, which did not include production of Apotex's sample tablets for testing, but disclosed that Apotex had arranged to have samples of its tablets tested. The test results were included in Apotex's evidence. By correspondence dated April 9, 2003, the Applicants requested that Apotex provide samples of its tablets for testing. Counsel for the Applicants advised that, in the event that Apotex did not produce such samples, the Applicants would "have little choice but to apply to the Court". On April 18, 2003, Apotex refused to produce such samples.
[15] The Applicants brought a motion to strike portions of Apotex's evidence on May 7, 2003. The Applicants also requested, as alternative relief, leave to file an affidavit of Dr. Lindquist in reply to some of Apotex's evidence. (This affidavit is not the subject of this motion). By Order dated August 21, 2003, I granted the Applicants leave to file the Lindquist affidavit sworn May 6, 2003.
[16] Apotex subsequently brought a motion on September 2, 2003, for leave to file the further affidavit of Dr. Cima sworn August 27, 2003. By Order dated November 24, 2003, Prothonotary Tabib dismissed Apotex's motion, however her decision was overturned by von Finckenstein J. on December 24, 2003. The Applicants have appealed the Order of von Finckenstein J. to the Court of Appeal.
[17] Court File No. T-1878-02 is set down for a three-day hearing commencing August 17, 2004.
Court File T-766-03
[18] By Notice of Application dated May 13, 2003, the Applicants commenced a further proceeding pursuant to the Regulations in Court File T-766-03 for an Order prohibiting the Minister of Health from issuing a NOC to Apotex in respect of omeprazole magnesium tablets 10 and 20 mg until expiration of Canadian Patent No. 2,186,037. The proceeding in Court File T-766-03 was commenced in response to a NOA sent by Apotex to the Applicants on March 25, 2003. Apotex alleged that no claim for the medicine itself and no claim for the use of a medicine would be infringed by the making, constructing, using or selling by Apotex of its omeprazole magnesium tablets.
[19] The Applicants filed their evidence in Court File No. T-766-03 on June 27, 2003. That evidence indicated that the Applicants did not have access to samples of Apotex's omeprazole magnesium tablets, and that such access was necessary in order for the Applicants to be able to evaluate the Apotex's allegation of non-infringement of the patent at issue.
[20] Apotex's evidence on the merits was delivered on August 25, 2003, and included evidence of testing of Apotex's proposed tablets.
Cross-examinations in both proceedings
[21] Given that many witnesses on behalf of both parties were common in Court Files T-766-03 and T-1878-02, the parties agreed to conduct joint cross-examinations. As a result of the delay in proceeding with cross-examinations in T-1878-02, cross-examinations in T-766-03 were also delayed.
[22] Dr. Sherman, one of Apotex's affiants, was eventually produced for cross-examination on January 6, 2004. At that cross-examination, counsel for the Applicants asked Dr. Sherman to produce samples of Apotex's tablets for testing. The request was taken under advisement by counsel for Apotex. By letter dated January 21, 2004, counsel for the Applicants reminded counsel for Apotex of the outstanding matters arising for the cross-examination of Dr. Sherman, including the request for sample tablets.
[23] By letter dated February 19, 2004, counsel for Apotex produced samples of Apotex's omeprazole magnesium tablets in both T-1878-02 and T-766-03.
[24] Counsel for the Applicants was subsequently instructed by his client to forward the sample tablets to Sweden. The sample tablets were sent by courier on March 4, 2004.
[25] By e-mail sent March 18, 2004, counsel for Apotex advised counsel for the Applicants that Apotex had not made a decision whether Apotex would oppose any attempt by the Applicants to file further evidence with respect to the sample tablets produced by Apotex.
[26] Testing of the samples was completed on April 8, 2004. That same day, counsel for the Applicants responded to counsel for Apotex, advising that testing of Apotex's sample tablets had been completed, and that the results showed the presence of a continuous subcoating layer within the subject patents. Counsel for the Applicants indicated that he assumed that Apotex would agree to the filing of the Applicants' further evidence with respect to sample testing, and requested confirmation in that regard.
[27] By letter dated April 12, 2004, counsel for Apotex advised counsel for the Applicants that Apotex would oppose any motion for leave to file further evidence on sample testing.
Position of the Applicants
[28] The Applicants submit that the grant of leave to file the further Lindquist Affidavit will not cause unreasonable delay since numerous cross-examinations remain to be completed. In addition, a hearing date on the merits of the application in T-1878-02 has already been fixed. Consequently, granting leave to file the further Lindquist Affidavit will not delay the hearing of either proceeding on its merits.
[29] The Applicants also submit that the grant of leave will serve the interests of justice. They maintain that the further Lindquist Affidavit was not previously available as a result of Apotex's failure to produce its sample tablets for testing. Apotex has taken considerable time to evaluate and have its own tablets tested. Currently, it is only Apotex that has evidence which addresses whether its sample tablets will infringe the relevant patents. The Applicants maintain that the interests of justice support the Applicants having corresponding evidence in the Record.
[30] The Applicants further submit that the Lindquist Affidavit will greatly assist the Court. As Kelen J. previously observed in Court File T-1747-00, testing is determinative of infringement in respect of the relevant patents.
[31] Lastly, the Applicants submit that the grant of leave will not cause serious prejudice to Apotex. Apotex will have an opportunity to cross-examine on the Lindquist Affidavit. In addition, the hearing of the present applications will not be delayed.
Analysis
[32] As stated earlier in these reasons, I have concluded that the motion must be dismissed. Although I am satisfied that the proposed evidence of Dr. Lindquist would assist the Court in its final determination of the application, the Applicants have not established that granting leave in the particular circumstances of this case, will not cause unreasonable delay, or that Apotex would not be seriously prejudiced. I do not consider it, therefore, in the interests of justice to grant the relief requested.
[33] In judicial review applications, supplemental affidavits will only be allowed in very limited circumstances, and must be brought promptly. Otherwise, proceedings which are intended to be summary and expeditious will be prolonged: Fogal v. Canada (1999), 161 F.T.R. 121 at 124-125 (F.C.T.D.); Wayzhushk Onigum Nation v. Kakeway (2000), 182 F.T.R. 100 at 101 (F.C.T.D.)
[34] Celerity is particularly important in proceedings commenced pursuant to section 6 of the Regulations. This section provides patentees of pharmaceutical patents with what the Federal Court of Appeal and the Supreme Court of Canada have described as an "extraordinary" and "draconian" remedy. By merely commencing a prohibition application in response to a Notice of Allegation, the patentee obtains a remedy which is tantamount to a presumptive interlocutory injunction not available to any other class of patentees: Apotex Inc. v. Merck Frosst Canada Inc. (1998), 80 C.P.R. (3d) 368 at para.33 (S.C.C.); Apotex Inc. v. Bristol-Myers Squibb Canada Inc. (2001), 11 C.P.R. (4th) 539 at para. 5 (F.C.A.); Pfizer Canada Inc. v. Apotex Inc. (2001), 11 C.P.R. (4th) 245 at paras. 18-19 (F.C.A.); Apotex Inc. v. Canada (2000), 6 C.P.R. (4th) 165 at para. 4 (F.C.A.); Merck Frosst Canada Inc. v. Apotex Inc. (1997), 72 C.P.R. (3d) 170 at 175 (F.C.A.).
[35] By reason of the presumptive injunction, while proceeding brought pursuant to the Regulations is before the Court, a patentee continues to enjoy a monopoly in respect of its product notwithstanding that it has not, in the context of that proceeding, justified the continuation of that monopoly. Accordingly, this Court and Honourable Court of Appeal have insisted that proceedings brought pursuant to the Regulations be prosecuted expeditiously: Bayer AG v. Canada (1993), 51 C.P.R. (3d) 329 at 337 (F.C.A.); AB Hassle v. Canada (2000), 7 C.P.R. (4th) 272 at para 27 (F.C.A.); Pharmacia Inc. v. Canada (1994), 58 C.P.R. (3d) 209 at 215 (F.C.A.).
[36] Since proceedings under the Regulations are meant to be dealt with expeditiously, this Court has not hesitated to dismiss motions brought by applicants where such motions are not brought on a timely basis: Biovial Corp. v. Canada (Minister of National Health and Welfare), (2002), 22 C.P.R. (4th) 503 at 515 (F.C.T.D.); aff'd (2003), 29 C.P.R. (4th) 129 (F.C.A.); Orders of Prothonotary Lafrenière in Court File Nos. T-2169-01 and T-2052-01 dated July 26, 2002, aff'd by Order of Justice Rouleau, (2002) 21 C.P.R. (4th) 248 (F.C.T.D.; Orders of Prothonotary Lafrenière in Court File Nos. T-2169-01, T-2052-01 and T-877-02 dated July 16, 2003; Order of Prothonotary Lafrenière in Court File No. T-1800-02, dated October 6, 2003; aff'd by Order of Justice Pinard, [2003] F.C.J. No. 1666 (F.C.T.D.).
[37] The Applicants are seeking leave to file further affidavit evidence eighteen months after the commencement of the proceeding in Court File No. T-1878-02, and almost one year after of the commencement of the proceeding in Court File No. T-766-03. Although the period of delay between the commencement of the proceeding and the filing of the Apotex's evidence has been satisfactorily explained, I am not satisfied that the Applicants have accounted for their subsequent inaction and, in particular, their failure to bring a timely motion to compel production of samples for testing.
[38] In their Notice of Application in Court File No. T-1878-02, the Applicants complained that Apotex had not disclosed samples of its omeprazole magnesium tablets and stated that "such disclosure is necessary in order to allow the Applicants to assess whether a subcoat is present and/or whether the allegation of non-infringement is justified on any of the alternative bases asserted by Apotex". Similarly, in their Notice of Application in Court File No. T-766-03, the Applicants complained that Apotex had not disclosed samples of its omeprazole magnesium tablets and stated that "such disclosure is necessary for the Applicants to assess,inter alia, whether a separating layer formed in situ is present and whether the allegation of non-infringement is justified on any of the bases asserted by Apotex".
[39] Yet, even though the Applicants raised, from the very start of both proceedings, the issue of whether or not a sub-coat is present in Apotex's tablets, and their need for samples in order to assess the issue, they took no action to compel production of Apotex's product, and simply elected to await the cross-examination of Dr. Sherman. This strategy is rather perplexing in light of the affidavit evidence filed by Apotex in April and August 2003 showing that samples had been tested.
[40] Rule 84 of the Federal Court Rules, 1998 establishes the sequence of cross-examinations on affidavits. A party may not cross-examine on its opponents' affidavits until the party has served its own affidavits. Had the Applicants intended to adduce their own evidence of testing of the samples, they should have taken steps to compel production of the samples, conducted their testing, and then move for leave to file additional affidavit evidence prior to scheduling cross-examinations. To allow the Applicants to use the cross-examination of Dr. Sherman as a trigger to reopen the evidentiary record on a issue that was live between the parties from the start would in my view be inappropriate and unjust. It would necessarily result in further delay in the proceeding, and could potentially jeopardize the hearing of the application in Court File T-1878-02.
[41] Even if the Applicants were entitled to wait until the cross-examination of Dr. Sherman to request samples, their subsequent delay in bringing this motion militates against granting the relief requested. On January 6, 2004, counsel for Apotex took under advisement the question of whether or not it would produce samples of Apotex's omeprazole magnesium tablets. Although Apotex clearly procrastinated in providing an answer to the rather straightforward request, the onus was on the Applicants to bring a motion to compel Apotex to produce the requested samples, and the right to adduce further evidence in respect thereof, in the absence of a timely response. The six week delay from the date of cross-examination to the date of production of the samples is simply unacceptable, even if Apotex is partly to blame.
[42] The Applicants and their counsel were aware for the start, and have maintained the position that the testing of samples of Apotex's omeprazole magnesium tablets was of paramount importance to the determination of whether the allegation of non-infringement was justified. Notwithstanding this awareness, the Applicants took insufficient steps from the time of receipt of Apotex's Notices of Allegation to ensure the timely testing of such samples, and the provision of timely evidence.
[43] Finally, Apotex complains that the Applicants chose to delay an additional two months after Apotex voluntarily produced its samples prior to bringing the within motion. Were it not for the substantial delay from the time Apotex filed its responding affidavit evidence to the date of cross-examination of Dr. Sherman, I would have been inclined to excuse this period of delay in light of the explanation provided, and the assistance the Lindquist Affidavit would give the Court in reaching its determination on the merits of the application.
[44] In conclusion, the Applicants have unreasonably delayed in seeking to compel samples. Since Apotex would be prejudiced by any further delay in this proceeding, I do not consider it is in the interests of justice to grant the relief requested.
ORDER
THIS COURT ORDERS that:
1. The motion for leave to serve and file the Lindquist affidavit is dismissed.
2. The schedule for the completion of remaining interlocutory steps is amended as follows in Court File T-1878-02:
(a) cross-examinations shall be completed by June 30, 2004;
(b) The Applicants' Application Record shall be served and filed by July 20, 2004 or within 20 days of the completion of cross-examinations, whichever is earlier; and
(c) The Respondents' Application Records shall be served and filed by August 9, 2004, or within 20 days of service of Applicants' Record, whichever is earlier.
3. The cross-examinations in T-766-03 shall be completed by June 30, 2004. The parties shall apply to the Court in writing within 10 days thereof for a schedule governing the completion of the remaining steps in Court File T-766-03.
4. Costs of these motions and Apotex's motions to file evidence in response to the Lindquist affidavit are fixed at a total $3,250.00, inclusive of disbursements, for all four motions, payable to Apotex in any event of the cause, but not payable forthwith.
"Roger R. Lafrenière"
Prothonotary
FEDERAL COURT
Names of Counsel and Solicitors of Record
DOCKETS: T-1878-02
T-766-03
STYLE OF CAUSE: AB HASSLE, ASTRAZENECA AB and
ASTRAZENECA CANADA INC.
Applicants
and
APOTEX INC. and THE MINISTER OF HEALTH
Respondents
AND BETWEEN:
ASTRAZENECA AB and
ASTRAZENECA CANADA INC.
Applicants
and
APOTEX INC. and THE MINISTER OF HEALTH
Respondents
PLACE OF HEARING: TORONTO, ONTARIO
DATE OF HEARING: MAY 3, 2004
REASONS FOR ORDER
AND ORDER BY: PROTHONOTARY LAFRENIÈRE
DATED: MAY 12, 2004
APPEARANCES BY:
Mr. J. Sheldon Hamilton
Mr. Gunars A. Gaikus
FOR THE APPLICANTS
Mr. Andrew R. Brodkin
Ms. Nathalie Butterfield
FOR THE RESPONDENTS
SOLICITORS OF RECORD:
SMART & BIGGAR
Toronto, Ontario
FOR THE APPLICANTS
GOODMANS LLP
Toronto, Ontario
FOR THE RESPONDENTS
FEDERAL COURT
Date: 20040512
Dockets: T-1878-02
T-766-03
BETWEEN:
AB HASSLE, ASTRAZENECA AB and
ASTRAZENECA CANADA INC.
Applicants
and
APOTEX INC. and THE MINISTER OF
HEALTH
Respondents
AND BETWEEN:
ASTRAZENECA AB and ASTRAZENECA
CANADA INC.
Applicants
and
APOTEX INC. and THE MINISTER OF
HEALTH
Respondents
REASONS FOR ORDER
AND ORDER