Nu-Pharm Inc. v. Minister of Health et al. [Indexed as: Nu-Pharm Inc. v. Ontario (Minister of Health)] Court File No. 866/99 Ontario Superior Court of Justice, Divisional Court Southey J.
Heard: January 6, 2000 Judgment rendered: January 10, 2000
H. Radomski and D. Bassan, for applicant (moving party). Dennis W. Brown, Q.C., and Joanne Mitchell, for respondents.
The judgment of the court was endorsed on the record as follows:
Background
1SOUTHEY J.:—This motion is for interim relief pending determination by a panel of the Court of the application by Nu-Pharm Inc. (the "applicant") for a declaration that the Minister acted unlawfully in refusing to recommend that Nu-Enalapril, a new generic drug manufactured by the applicant, be included in the next update to the Drug Benefit Formulary/Comparative Drug Index (the "Formulary"). Inclusion in the Formulary was essential to the economic success of the new product.
2The applicant had been informed by letter from the Director of the Drug Programs Branch of the Ministry of Health in September last that the Ministry and the Drug Quality and the Therapeutic Committee (the "DQTC") had no further questions or concerns at that time regarding the proposed recommendation.
3By letter dated November 25th last, the Ministry informed the applicant that it would need to reconsider its recommendation for the listing of Nu-Enalapril because of a decision on November 23rd by the Federal Court of Canada. That decision was made by Madam Justice McGillis in a motion brought by a competitor of the appli-cant. McGillis J. quashed the decision of the Federal Minister of Health in issuing to the applicant a Notice of Compliance ("NOC") respecting Nu-Enalapril. An NOC is a necessary prerequisite to selling a drug in Canada. The NOC in question was quashed on grounds unrelated to the safety or effectiveness of the drug. [4] The applicant promptly appealed the decision respecting the NOC and that appeal is now scheduled to be heard in the Federal Court of Appeal on February 16 next. By Order dated the 6th ultimo, McGillis J. granted an order staying her Order pending determination of the appeal. The Ministry was informed of the stay by letter of the applicant dated the 6th ultimo. The submission of the applicant is that the relevant circumstances are now the same as those existing before the order of McGillis J. on November 23 last and that the Ministry and the DQTC are now under a duty to make the requested recommendation.
5Instead, the applicant was informed by letter dated the 9th ultimo from the Drug Programs Branch, that Nu-Enalapril would not be included in the forthcoming Formulary update. The letter read in part, as follows: Key decisions in relation to the Formulary update had to be made before receipt of your letter in order to meet the target effective date. As a result of the uncertainty in relation to your ability to supply this product both on a short-term basis and a long-term basis, your product has not been included in the Formulary update.
Although you have now advised that a stay has been granted as of December 6th, 1999, and that you are able to resume shipments, the issue of ongoing ability to supply will need to be considered carefully before we are able to proceed with a recommendation for listing. In order to assist the Ministry in making a recommendation on whether to have this product listed, we request an updated letter from your company confirming your current ability to sup-ply. We would also ask that you provide any information on when the actual appeal of the November 23rd, 1999 Order will be heard, along with information on any other anticipated court appearances on this matter.
[6] By letter dated the 9th ultimo and marked "MOST URGENT" the applicant reconfirmed its ability to supply the Ontario market with Nu-Enalapril and objected to the refusal to recommend as being exceedingly unfair and one that would cause the irreparable harm to the applicant that the stay ordered by McGillis J. was intended to prevent. [7] The evidence of Dr. Lesia Babiak, Associate Director of the Drug Programs Branch, was that, when a Formulary update is processed, there needs to be sufficient time for the marketplace and stakeholders to be notified after the regulations are filed and before the Update becomes effective. The effective date for the forthcoming Update of the Formulary was planned for January 17, 2000. In order to meet the proposed date, the regulations were considered by Management Board on December 2, 1999, and by the Statutory Business Committee on December 6, 1999. The regulations incorporate Formulary changes by reference and the changes must be finalized prior to those meetings in order for the regulations to be reviewed.
Analysis
8I am unable to accept the submission advanced ably by Mr. Radomski that the relevant circumstances were the same after the stay granted by McGillis J. as they were before she had made her order on November 23 last, quashing the decision to issue an NOC respecting Nu-Enalapril. The earlier decision has not been set aside
and it seems reasonable that its existence casts doubt on the ability of the applicant to supply the product. The weight from the standpoint of the public interest to be attached to the uncertainty of the applicant's ability to supply the product is a matter for the judgment of the appropriate officials in the Ministry in making their recommendations to Cabinet. The affidavit of Dr. Babiak, sworn on the 4th instant, contains the following: 18. Though the government would realize a cost avoidance for as long as Nu-Pharm is legally able to sell Nu-Enalapril, there are other "public interest" issues that can be considered by the Lieutenant Governor in Council, including the ongoing ability to supply.
- There are approximately 150,000 ODB eligible recipients taking the original product Vasotec. Once Nu-Enalapril is listed, patients taking Vasotec will automatically be switched as a result of ODB interchangeability rules. If a Court decision is made in the near future that prevents Nu-Pharm from supplying Nu-Enalapril, these patients will need to be switched back to Vasotec. Although safe from a clinical perspective, changing brands may raise concerns, especially amongst chronically ill patients.
9The Court should not substitute its judgment for that of the appropriate officials, and ultimately of the Cabinet in matters of this nature. [10] The applicant relies on the decision of the Supreme Court of Canada in RJR-Macdonald Inc. a Canada (Attorney General) (1994), 54C.P.R.(3d)114, in which the Court held in a Charter case that the principles to be applied in granting interim relief are the same as those to be applied when the remedy sought is an injunction or a stay. Those requirements are that there is a serious question to be tried, that the applicant would suffer irreparable harm and the balance of convenience. As to the third branch of the test, the Court said the following at p. 140: The third branch of the test, requiring an assessment of the balance of inconvenience, will often determine the result in applications involving Charter rights. In addition to the damage each party alleges it will suffer, the interest of the public must be taken into account. The effect a decision on the application will have upon the public interest may be relied upon by either party. These public interest considerations will carry less weight in exemption cases than in suspension cases. When the nature and declared purpose of legislation is to promote the public interest, a motions court should not be concerned whether the legislation actually has such an effect. It must be assumed to do so. In order to overcome the assumed benefit to the public interest
arising from the continued application of the legislation, the applicant who relies on the public interest must demonstrate that the suspension of the legislation would itself provide a public benefit.
[11] In the case at bar, the refusal of the respondents to make the desired recommendation was motivated by the desire to protect the public interest. In these circumstances, in my opinion, the applicant has failed to meet the third requirement for granting interim relief.
Disposition
12The motion for interim relief is dismissed. [13]I f the parties are unable to agree on the disposition and amount of costs, they may arrange to speak to me regarding the matter.
Motion dismissed.