Date: 20250303

Docket: T‑2593‑24

Citation: 2025 FC 389

St. John’s, Newfoundland and Labrador, March 3, 2025

PRESENT: Associate Judge Trent Horne

BETWEEN:

JANSSEN INC. AND ACTELION PHARMACEUTICALS LTD

Plaintiffs

and

PHARMASCIENCE INC.

Defendant

ORDER AND REASONS

I. Background

[1] In this action brought pursuant to section 6 of the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 (“PM(NOC) Regulations”), the plaintiffs (“Janssen”) have brought a motion for sanctions on the basis that the affidavit of documents served by the defendant (“PMS”) is deficient.

[2] Two patents are in issue. Canadian patent 2,659,770 (the “770 Patent”) is directed to the use of a pharmaceutical product, macitentan, in combination with a PDE-5 inhibitor. Canadian patent 2,621,273 (the “273 Patent”) claims a pharmaceutical composition comprising macitentan and certain other ingredients, and also the use of those compositions for preparing a medicament for treatment of pulmonary arterial hypertension.

[3] The validity of the asserted patents has not been challenged. In broad terms, PMS describes the infringement issues for the 770 Patent as “skinny labelling” – that its macitentan product will not be sold for use in combination with a PDE-5 inhibitor, and that PMS will not induce others to use its macitentan product in combination with a PDE-5 inhibitor. As for the 273 Patent, PMS says that its product lacks an essential element of the claims. That essential element was identified to Janssen by way of confidential particulars, but those particulars were not included in the motion materials.

[4] A scheduling order was issued on December 10, 2024. The order required the parties to finalize a discovery plan by January 22, 2025, and exchange affidavits of documents and schedule 1 productions by January 31, 2025.

[5] Janssen sent a request for production to PMS on January 22, 2025. The request was expansive. The document included, among many other things, a request for product monographs, labels and package inserts, marketing plans, portions of the abbreviated new drug submission (“ANDS”), and market evaluations. The request included documents in draft and final form, and used phrases such as “including, but not limited to.”

[6] Schedule 1 of PMS’ affidavit of documents includes two documents: a draft product monograph, and excerpts from a “description and composition of drug product” taken from its ANDS. The latter document, identified as PMS production 25, sets out the raw materials in the proposed PMS macitentan product and their function. The document was redacted to remove the identity of a third-party supplier. The two documents that were produced were the same two documents that PMS attached to its notice of allegation that was served in August 2024.

[7] Janssen brings this motion for production of further documents, or in the alternative, leave to cross-examine on PMS’ affidavit of documents. Janssen also moves for production of an unredacted copy of the ANDS document. The requested documents are set out in a schedule to the notice of motion. The schedule closely resembles the January 22, 2025 request for production.

[8] In its responding motion materials, PMS agreed to provide four documents or categories of documents. It was not conceded that these documents are relevant or should have been produced in the first instance, rather PMS asserts that the documents were produced in an effort to be cooperative and narrow the issues on the motion.

[9] Janssen wrote to the Court the day before the hearing and advised that the motion would be restricted to a request for the following documents:

1. 3.2.P.4.1 Specification section from the PMS ANDS;

2. 3.2.P.4.4 Justification of Specification section from the PMS ANDS;

3. A copy of the Pharmascience business case for a proposed macitentan 10 mg product, including marketing and sales forecasts, as it existed at or around the time Pharmascience determined it would proceed to develop and seek to bring a 10 mg macitentan product to market in Canada (in other words, Pharmascience’s business case used to decide that Pharmascience would pursue what ultimately became the PMS Product); and

4. An unredacted copy of the document beginning with Bates number PMS000025 in Pharmascience’s affidavit of documents.

[10] The motion is granted in part. The business case is ordered produced, as is an unredacted copy of production 25. I am not satisfied that Janssen has demonstrated the relevance of sections 3.2.P.4.1 and 3.2.P.4.4 of the ANDS. PMS is required to serve a complete affidavit of documents, and may not refuse discovery questions on the basis that it constitutes cross-examination on the affidavit of documents.

II. Affidavits of Documents and Relevance

[11] An affidavit of documents is in a standard form, Form 223. To complete it, the affiant must swear or affirm the following to be true:

2. I have conducted a diligent search of my/(name of party's) records and have made appropriate inquiries of others to inform myself in order to make this affidavit.

3. This affidavit discloses, to the full extent of my knowledge, information and belief, all of the documents relevant to any matter in issue in the action that are in my/(name of party's) possession, power or control, that were but are no longer in my/(name of party's) possession, power or control or that I believe are in the possession, power or control of a person who is not a party to the action.

[12] “Relevance” is defined in subrule 222(2) of the Federal Courts Rules, SOR/98-106 (“Rules”) – a document is relevant if “the party intends to rely on it or if the document tends to adversely affect the party’s case or to support another party’s case.” In general terms, for a document to be relevant, it must be fairly shown that it is reasonable to suppose that the document contains information that will directly or indirectly enable a party to advance its own case or to damage that of the other party. Jurisprudence in this area refers to a “train of inquiry” test – i.e. that a document might fairly lead to a train of inquiry that may either advance the questioning party’s case or damage the case of its adversary. There are limits on how far that train is expected to go. Train of inquiry does not open the door to almost limitless discovery (AstraZeneca Canada Inc v Apotex Inc, 2008 FC 1301 at para 12).

[13] Relevance in discovery is based upon the issues and the unadmitted allegations of fact in the pleadings. Relevance for documentary discovery is not a matter for discretion (Adeia Guides Inc v BCE Inc, 2024 FC 927 at para 6).

[14] What separates the relevant from the irrelevant is not always a bright line. There is often room for good faith debate as to whether certain documents or categories of documents fit within the definition of relevance and should be disclosed in an affidavit of documents. It is routine for additional documents to be disclosed in response to discovery questions, or when they are subsequently located. The standard of initial disclosure is not perfection, however, this does not diminish the positive obligation on every party to put its best foot forward in the initial collection, review, and production of documents and strive for complete production in the first instance. Efficiency in the discovery process depends on all relevant documents being produced before oral examinations for discovery.

[15] This is a long-standing principle. In Havana House Cigar & Tobacco Merchants Ltd v Naeini, 1998 CanLII 7605, aff’d 1998 CanLII 7619 (“Havana House”), prothonotary Hargrave rejected the argument that the issue of further documents could be handled during the examinations for discovery. It was only fair for the defendant to have a full set of documents to consider in preparing for discoveries. If the defendants were successful in “ferreting out” documents on discovery, that would likely lead to additional examinations, adding delay and expense (para 23).

[16] Havana House was decided in March 1998, shortly before the Rules were substantially amended. In the years that followed, there has been a consistent push by the Court and litigants to make the discovery process more efficient for everyone both in terms of time and money.

[17] Expectations of efficiency are reflected in the Court’s Case and Trial Management Guidelines for Complex Proceedings and Proceedings under the PM(NOC) Regulations. In particular, the Guidelines state that examinations for discovery shall be conducted by way of a single comprehensive examination. This cannot be achieved without complete production in the first instance.

[18] The need for efficiency is particularly felt in PM(NOC) proceedings, which proceed on an expedited timetable.

III. Rule 227

[19] If a party is of the view that an affidavit of documents is inaccurate or deficient, a motion for sanctions may be brought under Rule 227.

[20] Motions under this rule are infrequent. In the vast majority of cases, parties make adequate disclosure at the outset. Disputes as to sufficiency of production are often resolved or significantly narrowed by counsel without need for the Court’s intervention.

[21] If a Rule 227 motion is brought, a remedy is not easy to obtain. When a witness states, under oath, that a diligent search for documents has been undertaken, and that all relevant documents have been produced, those statements are given significant weight. An affidavit of documents is a very solemn document. It is an affidavit and, unless and until the contrary is shown, it is to be taken as setting out what it alleges accurately and fairly. That is why provision is made in the Rules for a solicitor to instruct and advise the person preparing the affidavit as to his or her obligations (Poitras v Twinn, 2001 FCT 456 at para 4).

[22] A party moving for sanctions relating to an affidavit of documents under Rule 227 has the burden of showing that the affidavit of documents, as delivered, is inadequate or deficient. The moving party must show that further documents likely exist, that these documents would either advance its own case or hurt its opponent’s, and that the opposing party either has them in its power, possession or control, or is aware that they are in some other third party’s power, possession or control (Apotex Inc v Sanofi-Aventis, 2010 FC 77 at para 11).

[23] The requirement on the moving party to provide persuasive evidence that relevant documents exist should not be taken to require some elevated standard of proof. The persuasive evidence must merely establish that further relevant documents likely exist (Paid Search Engine Tools, LLC v Google Canada Corp, 2021 FC 515 at para 15).

IV. Analysis

A. The Unadmitted Allegations

[24] In this action, the unadmitted allegations include those relating to infringement of the 770 Patent. The pleadings, including the confidential particulars served by both sides, show that inducement to infringe is a significant issue. More particularly, Janssen alleges that PMS will induce patients and physicians in Canada to directly infringe the asserted claims of the 770 Patent. It is alleged that the completion of acts of direct infringement will be knowingly influenced by PMS such that without PMS’s influence, the direct infringement would not take place. It is claimed that the vast majority of patients administered macitentan for the treatment of pulmonary arterial hypertension will also be administered at least one compound having PDE-5 inhibitory properties. Janssen’s plea for an order requiring PMS to deliver up or destroy materials includes product packaging, product labels, product monographs, and other educational or promotional materials. These allegations are denied. PMS says that will not induce others to manufacture, make, construct, use or sell its macitentan product in an infringing manner, and that the product will not be indicated for combination use with PDE-5 inhibitors.

[25] For the 273 Patent, whether the proposed PMS macitentan product will have a composition that includes all of the essential elements in claim 1 is disputed.

[26] Every case is different. There is no standard or minimum number of documents that are expected to be produced. It is not appropriate to look at the number of documents in schedule 1 and conclude on that basis alone that the scope of production is sufficient or insufficient.

[27] That said, it is difficult to accept at face value that a diligent search of PMS’s records for relevant documents in a case involving allegations of infringement of two patents resulted in a schedule 1 that only includes two documents, and that this diligent search did not disclose anything beyond what was included with the notice of allegation.

B. Planning Documents/Business Case

[28] Janssen refers to evidence given publicly by a PMS employee in another proceeding involving another drug, T-815-17, where PMS’s former Senior Director of Portfolio and Project Management described the processes and reviews undertaken at PMS in evaluating and developing its proposed generic products. In that proceeding, the witness described PMS’s general internal processes for selecting products to bring to market, monitoring the progress of product development, and tracking of its development and launch of generic pharmaceuticals in Canada. Janssen submits this evidence is relevant because it believes PMS knows or ought to know that the vast majority of patients in Canada that are administered macitentan for the treatment of pulmonary arterial hypertension will also be administered with a PDE-5 inhibitor, and this would have been considered in the product selection process.

[29] In response to the motion, PMS agreed to produce a copy of the current business case for its macitentan product, which includes marketing and sales forecasts.

[30] Janssen narrowed the request set out in its notice of motion, and asks for further production of the business case as it existed at or around the time PMS determined it would proceed to develop and seek to bring a 10 mg macitentan product to market in Canada (in other words, PMS’s business case used to decide that PMS would pursue what ultimately became the PMS Product).

[31] I do not know if PMS created more than one business case for macitentan, or if one was created at or around the time it decided to develop and seek approval to bring a macitentan product to market in Canada. However, the undertaking to produce the current business case, not the business case, implies that more than one was created. The trial evidence in T-815-17, which was given in late 2021, was not directed to macitentan, but that evidence combined with the acknowledgement that a current business case exists takes the request for this document beyond speculation and guesswork. I am satisfied that this information is relevant. If this document exists, it should be produced.

[32] I am also satisfied, based on the absence of any planning/business case documents in PMS’s affidavit of documents, that its affidavit of documents is deficient.

C. Sections of the PMS ANDS

[33] Janssen’s notice of motion requests production of 15 sections of PMS’s ANDS. This was narrowed to a request for production of sections 3.2.P.4.1 Specification and 3.2.P.4.4 Justification of Specification.

[34] The evidence in support of Janssen’s motion is an affidavit of a law clerk which attaches, among other things, a Health Canada guidance document “Quality (chemistry and manufacturing) guidance: New Drug Submissions and Abbreviated New Drug Submissions.” The affidavit simply attaches the document.

[35] For 3.2.P.4.1 Specification, Janssen recites the following portion of the guidance document:

Specifications for all excipients, including processing aids that do not appear in the final drug product (e.g. solvents, nitrogen, silicone for stoppers) are to be included in the submission. For excipients that are mixtures provided by third party manufacturers (e.g., flavours, colourants, capsules, coatings), a list of ingredients should be provided along with compositions and grades of materials used for capsules and coatings.

[36] For 3.2.P.4.4 Justification of Specification, Janssen recites the following portion of the guidance document:

For the proposed excipient specifications, justification should be included where appropriate.

[37] I agree with PMS that a decision relied on by Janssen, Janssen Inc v Apotex Inc, 2018 FC 407 (“Janssen”), does not stand for a general proposition that some or all of the ANDS is presumptively relevant and subject to production. I also do not read Janssen as requiring expert evidence on pre-discovery motions under Rule 227.

[38] Even if I assume that the two requested sections of the ANDS exist, I am not satisfied that Janssen has established their relevance.

[39] Details of the defence to infringement for the 273 Patent are set out in confidential particulars. Some of these details were disclosed during the hearing, but the document containing those particulars was not included in the motion materials. All I have by way of evidence is a clerk’s affidavit attaching a Health Canada guidance document. Janssen’s written representations repeat part of what is stated in that guidance document.

[40] I am not satisfied that it is self-evident that the guidance document, combined with argument on the nature of the infringement defence, can lead to a conclusion that these sections of the ANDS would contain information that would tend to support or defeat the infringement defence. Expert evidence in this respect may not be necessary, but what is necessary is some kind of explanation that connects the two things. For the two sections, I have no context beyond the guidance document as to what kind of information would typically be included in these sections of the ANDS, and more importantly, how that information would assist in the determination of the infringement issues. The relevance of these documents, for the purposes of a Rule 227 motion, is not established on the basis that excipients will be part of the infringement defence, and these two sections contain some kind of information about excipients. The motion in this respect is dismissed.

[41] To be clear, the motion in this respect is dismissed because Janssen has not met its burden on the materials I have. This is not a final determination of the relevance of ANDS sections 3.2.P.4.1 and 3.2.P.4.4, or any other section of the ANDS in the schedule to the notice of motion. Janssen is not precluded from asking proper questions about the ANDS or the composition of the proposed PMS macitentan product on discovery, as well as making proper requests for production of documents.

D. Labels and Packaging

[42] Janssen’s narrowed request for relief did not include labels and packaging, however there was a discussion at the hearing as to whether documents beyond the product monograph are relevant in a proceeding involving allegations of induced infringement. I will touch on this briefly since PMS is ordered to serve a complete affidavit of documents.

[43] The product monograph is an important document in the inducement analysis, but is not the only document to consider; it is one of many potentially key documents in a section 6 action (Genentech, Inc v Amgen Canada Inc, 2018 FC 694 at para 40). PMS did not file an affidavit on the motion, and it was not required to do so. I do not know if PMS has product packaging, labels, or other educational or promotional materials for its proposed macitentan product. But if such documents exist, they certainly appear to be relevant.

[44] The 770 Patent was also litigated against Apotex in Janssen Inc v Apotex Inc, 2022 FC 996, aff’d 2023 FCA 220, leave to SCC dismissed 2024 CanLII 50580. The trial reasons only appear to refer to Apotex’s product monograph, however I am not satisfied that the product monograph is the only relevant document in a case involving allegations of induced infringement of the 770 Patent specifically, or “skinny label” cases generally. Further, for the purposes of discovery, relevance is a broader notion than relevance for the purposes of trial (Eli Lilly and Co v Apotex Inc, 2006 FC 282 at para 19).

E. Redactions

[45] The sole issue here is whether the third party supplier information in PMS production 25 should be revealed.

[46] I discussed the propriety of redactions in Boehringer Ingelheim (Canada) Ltd v Pharmascience Inc, 2023 FC 584 (“Boehringer”). The starting point to any documentary discovery is that a party is obligated to produce relevant documents in their entirety (para 12). Redactions are very much the exception and not the norm.

[47] Generally speaking, the person asserting something has the burden of proving it. While it is Janssen’s motion, it is PMS that redacted the document and asserts that the redactions are proper. The onus is on PMS to justify its incomplete disclosure of production 25.

[48] PMS does not raise issues of confidentiality, or harm that would arise in the event an unredacted version of the document is produced to Janssen. The document was designated as solicitors eyes’ only under the protective order. The only issue is whether the identity of the supplier meets the clearly irrelevant standard.

[49] Clearly irrelevant is a high standard. It must be plain and obvious that the information sought to be redacted is unrelated to the issues to be decided at trial. Put another way, clearly irrelevant information has nothing to do with the unadmitted allegations in the pleadings.

[50] I am not satisfied that third party supplier information meets this standard. The relevance of the supplier may be limited, particularly since the 770 Patent does not claim a manufacturing process. PMS makes a fair point that Janssen’s withdrawal of the parts of its motion seeking manufacturer information from the ANDS casts a shadow on the necessity of obtaining the supplier information, however I cannot conclude that the identity of the supplier has nothing to do with the unadmitted allegations of infringement of the asserted claims of the 273 Patent, particularly when Janssen alleges in the statement of claim that PMS will direct third parties to engage in the manufacture of what is defined as the “PMS Product.”

[51] Having discrete redaction issues before the Court in advance of examinations for discovery is discouraged. Boehringer, and the cases before and after it, strongly discourage redactions in the first place, particularly when parts of a page, as opposed to discrete sections of a large document, are blacked out. At the same time, an issue like this can be canvassed during the examination for discovery. Here, the redaction issue was not brought on its own, and it is not clear if would have been brought as a stand-alone motion had PMS served a complete affidavit of documents in the first instance.

F. Cross-Examination on the Affidavit of Documents

[52] Janssen’s motion sought, as alternative relief, an order granting leave to cross-examine on PMS’s affidavit of documents. Since certain documents are ordered produced, that relief will not be granted. However, to avoid further pre-discovery motions, and to ensure that the discoveries proceed efficiently, I will order that no question put to PMS’s representative may be refused on the basis that it constitutes cross-examination on the affidavit of documents.

V. Costs

[53] During the hearing, both sides requested the opportunity to make submissions on costs after the result was known. The parties are encouraged to reach an agreement on costs. If no agreement can be reached, the order sets a schedule for costs submissions.

ORDER in T-2593-24

THIS COURT ORDERS that:

1. Within five days of the date of this order, the defendant shall serve an unredacted copy of its production 25.

2. Within 20 days of the date of this order, the defendant shall serve a complete affidavit of documents, together with copies of all schedule 1 productions.

3. To the extent they exist, the defendant’s affidavit of documents shall include, but not be limited to, a copy of the defendant’s business case for a proposed macitentan 10 mg product, including marketing and sales forecasts, as it existed at or around the time the defendant determined it would proceed to develop and seek to bring a 10 mg macitentan product to market in Canada.

4. No question put to the defendant’s representative during examination for discovery may be refused on the basis that it constitutes cross-examination on an affidavit of documents.

5. If the parties are unable to agree on the issue of costs, the plaintiffs may serve and file submissions on costs within 20 days of the date of this order. The defendant may serve and file submissions in reply within 30 days of the date of this order. Submissions shall not exceed five pages, excluding any attachments.

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"Trent Horne"

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Associate Judge

FEDERAL COURT

SOLICITORS OF RECORD

DOCKET:

T-2593-24

STYLE OF CAUSE:

JANSSEN INC. ET AL v PHARMASCIENCE INC.

PLACE OF HEARING:

Toronto, Ontario

DATE OF HEARING:

February 27, 2025

ORDER and REASONS:

HORNE A.J.

DATED:

march 3, 2025

APPEARANCES:

Amy Grenon

Melanie Baird

For The Plaintiffs

Kavita Ramamoorthy

Kerry Andrusiak

For The Defendant

SOLICITORS OF RECORD:

TYR LLP

Barristers and Solicitors

Toronto, Ontario

For The Plaintiffs

Fineberg Ramamoorthy LLP

Barristers and Solicitors

Toronto, Ontario

For The Defendant