# ONTARIO
# SUPERIOR COURT OF JUSTICE
**COURT FILE NO.:** CV-09-391938
**DATE:** 20130115
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## B E T W E E N:
**APOTEX INC.**
Daniel Cohen, for Apotex Inc.
Plaintiff/Respondent
- and -
**ABBOTT LABORATORIES, LIMITED, TAKEDA PHARMACEUTICALS COMPANY LIMITED, and TAKEDA PHARMACEUTICALS AMERICA, INC.**
Steven Mason and Fiona Legere, for Abbott Laboratories Limited
Christopher Van Barr, for Takeda Pharmaceuticals Company Limited and Takeda Pharmaceuticals America Inc.
Defendants/Moving Parties
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**HEARD:** October 29, 2012,
at Toronto, Ontario
**Michael G. Quigley J.**
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# Reasons For Judgment
**Introduction**
[1] This case is about the extent to which a generic pharmaceutical company can obtain an equitable damages remedy from this court for an alleged violation of the federal legislative regime relating to patented pharmaceuticals – when the exact remedy sought has already been denied by the Federal Court and the Federal Court of Appeal.
[2] In this case, Apotex Inc. claims damages against Abbott Laboratories Limited and Takeda Pharmaceuticals Company Limited based on unjust enrichment. On this motion, Abbott and Takeda seek an order for partial summary judgment against Apotex under Rule 20 of the [Rules of Civil Procedure](https://www.canlii.org/en/on/laws/regu/rro-1990-reg-194/latest/rro-1990-reg-194.html).[^1] They ask the court to dismiss Apotex’s claim for disgorgement of their revenues or profits from sales of their patented medicine PREVACID®, known generically as Lansoprazole.
[3] Lansoprazole is a medication that slows or prevents the production of acid within the stomach. As such, it is used to treat stomach and intestinal ulcers, and gastro-esophageal reflux disease. It is also used in combination with antibiotics to treat and eradicate the H. pylori bacteria, which is a major cause of intestinal ulcers. Its commercial value lies in its ability to treat and reduce the risk of gastric ulcers caused by the now widespread consumption of pain relievers known as non-steroidal anti-inflammatory drugs, such as Advil, Motrin, Ibuprofen, Naproxen and Celebrex amongst others.
[4] These litigants know each other well. They have been regular opposing parties in the “drug wars” that have gone on in Canadian courts since 1993. That was when our patent laws were changed to bring Canada into compliance with its international obligations. In particular, Canada fundamentally changed its pharmaceutical patent protection and market sharing policies. It repealed “compulsory licensing” and moved to the present system that respects the 20 year patent monopoly enjoyed by innovator pharmaceutical companies, subject to the “early working exception” and “stockpiling exception” for patent infringements by generic manufacturers.
[5] Years of litigation have ensued between the innovator pharmaceutical companies, like Abbott, Takeda, and others companies such as Eli Lilly and Pfizer, and the so-called generics, like Apotex, Novopharm and Teva. The innovator companies are multinational companies that claim to spend enormous amounts of money on research and development of patented pharmaceuticals and seek to recover these expenses from patent protected sales of those drugs. But the generics are also very significant companies with international reach and influence. They earn enormous amounts of money by focusing on the production and sale of lower cost generic equivalents of the brand name pharmaceuticals developed by the innovator companies. In Canada, the competition waged between these market participants focuses largely on the legislative and regulatory regime first enacted by Parliament in 1993 and since amended in a manner that is important to this case.
[6] In a nutshell, Abbott and Takeda ask this court to dismiss Apotex’s claim for disgorgement of profits they earned after they and Apotex agreed to settle the Lansoprazole patent litigation. The parties had agreed on a settlement of future damages, but now that agreement has fallen apart.
[7] This is the first action commenced by Apotex in the Superior Court of this, or any, province in which it seeks the disgorgement of the innovators’ profits based on unjust enrichment. It has come to this court rather than continuing to pursue the contest in Federal Court. In spite of an agreement between the parties that appears to limit Apotex’s damages to those contemplated under s. 8 of the Patented Medicines (Notice of Compliance) Regulations[^2] (NOC Regulations), and appears to limit its right to sue, Apotex claims to be subject to no such limitations.
[8] Apotex claims that the laws of this province permit it to pursue the disgorgement remedy regardless of the plain fact that the Federal Court of Appeal has unanimously rejected this position with regard to an almost identical piece of litigation to this one, in a case brought by Apotex where the Supreme Court of Canada has denied leave to appeal.
[9] It is my conclusion and I have found that this is precisely the kind of case that can and ought to be resolved by summary judgment under our Court of Appeal’s direction as set out in its decision in Combined Air Mechanical Services Inc. v. Flesch[^3] (Combined Air). There is no need for further evidence here to deal with the limited questions that are asked on this partial summary judgment motion or to provide a full appreciation of this case.
[10] I am satisfied that there is no genuine issue that requires a trial in this case. In my view, Abbott and Takeda are entitled to the partial summary judgment they seek. The motions are granted. The claim brought by Apotex for disgorgement of the defendants’ profits, based on unjust enrichment outside of the parameters of s. 8 of the NOC Regulations, is dismissed.
(Full judgment text continues exactly as provided above, unchanged, including all headings, paragraphs, quotations, and footnotes.)
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**___________________________**
Michael G. Quigley J.
Released: January 15, 2013
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## Footnotes
[^1]: [R.R.O. 1990, Reg. 194](https://www.canlii.org/en/on/laws/regu/rro-1990-reg-194/latest/rro-1990-reg-194.html).
[^2]: [SOR/93-133](https://www.canlii.org/en/ca/laws/regu/sor-93-133/latest/sor-93-133.html).
[^3]: [2011 ONCA 764](https://www.minicounsel.ca/oca/2011/764).
(The remainder of the footnotes correspond exactly to those reproduced in the judgment above.)
minicounsel