Alex Gloor

The Court of Appeal for Ontario dismissed Apotex Inc.'s appeal regarding its claim for damages under section 8 of the Patented Medicines (Notice of Compliance) Regulations.

Apotex sought damages for delayed market entry of its generic drug due to Eli Lilly's prohibition application.

The trial judge found that Apotex was not entitled to damages, as the prohibition application was dismissed as moot, not on the merits, and that Apotex would not have entered the market earlier in a hypothetical world without the prohibition application due to risk aversion and potential patent infringement liability.

The Court of Appeal upheld these findings, concluding that Apotex failed to demonstrate any actual entitlement to damages.

The plaintiff, a generic drug manufacturer, brought an action for damages against the defendants under s. 8 of the Patented Medicines (Notice of Compliance) Regulations for delayed market entry of its generic drug.

The plaintiff argued it was entitled to damages because the defendants' prohibition proceeding was dismissed for mootness after the underlying patent was invalidated in a separate proceeding.

The court dismissed the claim, finding that the plaintiff's allegations in the prohibition proceeding had failed on the merits, and s. 8 does not provide redress where the innovator prevailed on the merits but the patent was later invalidated by a third party.

The court also found that, even if liability existed, the plaintiff would not have entered the market any sooner in the hypothetical world due to its risk-averse nature.

Following the dismissal of the plaintiffs' action on a summary judgment motion, the successful defendants sought costs on an elevated or substantial indemnity basis of over $850,000, or alternatively partial indemnity costs of over $730,000.

The plaintiffs argued for an award of $150,000.

The court declined to award elevated costs, finding the plaintiffs' conduct did not rise to the level of being reprehensible or outrageous, despite making unfounded allegations of fraud and conspiracy.

Recognizing the high stakes and complexity of the litigation between two well-resourced pharmaceutical companies, the court awarded the defendants partial indemnity costs fixed at $700,000 inclusive of disbursements and taxes.

The defendants (Lilly) brought a motion for summary judgment to dismiss the plaintiffs' (Apotex) action for damages arising from Lilly's use of the PM(NOC) Regulations to delay Apotex's generic drug from entering the market.

Apotex claimed damages under the Statutes of Monopolies, the Trademarks Act, and common law conspiracy after Lilly's patent was later declared invalid.

The court found that while the action was not barred by the Limitations Act, 2002, the claims failed because the Patent Act and PM(NOC) Regulations constitute a complete code.

Lilly's actions in listing its presumptively valid patent and pursuing prohibition proceedings were authorized by law.

The motion for summary judgment was granted and the action was dismissed.

The defendants brought a motion for summary judgment.

Prior to the hearing, the plaintiffs objected to proceeding with the motion virtually via Zoom and requested an adjournment until an in-person hearing could be held.

The court denied the adjournment request, finding no prejudice to the parties in proceeding virtually.

The court noted that the Zoom platform is effective, the documentary record is easily accessible electronically, and an adjournment would cause unnecessary delay.

The motion was ordered to proceed virtually as scheduled.