In September of 2014 the consolidated text of the Comprehensive Economic and Trade Agreement (“CETA”) was released to the public. [1]�� CETA is a landmark free trade agreement between Canada and the European Union that has been in negotiations since 2009. [2]�� CETA has been touted by the Canadian Government as its “most ambitious trade agreement to date” and the agreement looks to have far-reaching effects on the economy through provisions covering everything from dairy tariffs to investor-state disputes. [3]�� However, the issue that has attracted the most commentary and fierce debate throughout the CETA negotiations is the agreement’s potential impact on Canada’s pharmaceutical industry. This controversy was primarily due to the fact that the European Union had been putting pressure on the Canadian government during the CETA negotiations to allow for provisions that would strengthen its patent protection for pharmaceuticals,[4] despite the fact that according to some commentators, Canada already provides for some of the strongest amount of protection for pharmaceuticals in the world.[5]�� Irrespective of this debate, the official consolidated CETA text contains two provisions that increase patent protection for pharmaceuticals in Canada through (1) the availability of patent term restoration for time lost in pharmaceutical regulatory processes,[6] and (2) the implementation of “equivalent and effective right of appeal” for all litigants that engage in a “linkage” mechanism where the granting of market authorization for pharmaceuticals is linked with patent protection.[7]

Although the implementation of patent term restoration is a relatively straightforward exercise, the addition of an “equivalent and effective right of appeal” for all litigants under Canada’s pharmaceutical linkage mechanism is a more contentious point. These changes were sought by the European Union due to the unique nature of Canada’s pharmaceutical patent linkage mechanism, the Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations”),[8] which does not currently grant a brand manufacturer an effective right of appeal for adverse rulings. In addition, proceedings under the PM(NOC) Regulations are not a final determination of the issues of patent infringement or validity and therefore often lead to the dual litigation of these same issues under the Patent Act. The need to remedy this situation has also been recognized by the CETA agreement and it has been agreed that changes to Canada’s linkage mechanisms through the CETA agreement will “give scope for Canada to end the practice of dual litigation [of pharmaceutical patents]”.[9]�� Although Parliament has signaled that Canada’s linkage mechanism are here to stay,[10] there is no indication of how amendments to Canada’s PM(NOC) Regulations can lead to equivalent and effective rights of appeal being available to all litigants and an end to dual pharmaceutical litigation (“the CETA goals”). The complex nature of Canada’s pharmaceutical regulatory and patent framework makes changes to the system difficult, and it is apparent that there are no simple amendments that will be able to easily accomplish the CETA goals.

This paper suggests that Canada’s pharmaceutical linkage mechanism that is provided by the current PM(NOC) Regulations is in need of major reform, and the implementation of the CETA goals offers the perfect opportunity to enact changes that will allow the system to better achieve that balance between enforcing patent rights and ensuring that generic drug products enter the market as soon as possible that Parliament intended when enacting the PM(NOC) Regulations.[11]�� Two major changes to the PM(NOC) Regulations will be proposed in order to accomplish these objectives: (1) Changing the nature of proceedings under the PM(NOC) Regulations to a full adjudication of rights between the parties, and (2) Amending provisions that allow for generic manufacturers to be more fairly compensated for damages caused by being wrongly kept off the market due to the PM(NOC) Regulations. These amendments will remove some of the numerous inefficiencies and imbalances present in the current PM(NOC) Regulations and will allow for provisions that both disincentivize the abuse of the proceedings and provide rewards for the successful challenge of invalid or non-infringing patents which leads to the early market entry of generic drugs.

The purpose of this paper is two-fold. I will first present a critical analysis of Canada’s current pharmaceutical linkage mechanism in order to illustrate the necessity of its reform. I will then propose changes to the PM(NOC) Regulations that accomplish the CETA goals and at the same time lead to a more optimal pharmaceutical linkage system. In an effort to achieve these purposes, I will proceed in the following way: (i) first, I will provide a brief overview of Canada’s pharmaceutical regulatory and patent regime; (ii) second, I will set out the goals of a pharmaceutical linkage system and present a critical analysis Canada’s current system; (iii), finally, I will propose amendments which I believe incorporate the CETA goals and produce a more optimal patent linkage system in Canada.

Adam Falconi is a graduate of Osgoode Hall Law School.�� This paper was submitted by Adam as his major research paper assignment for Osgoode's Intellectual Property Law & Technology Intensive Program ("IP Intensive").���� Adam received the Barry D. Tomo Memorial Prize for his research paper.�� The prize was established in 1986 in memory of the late Barry D. Torno, who for many years was a leading practitioner in the field of entertainment law. The annual income from a fund contributed by his friends and associates is awarded to the student who submits the best research paper each year on a subject related to Industrial or Intellectual Property Law.

[1] Government of Canada, “Canada-European Union: Comprehensive Economic and Trade Agreement (CETA) Consolidated Text”, online: Foreign Affairs, Trade and Development Canada <> [CETA Text].

[2] Stephen Harper, Prime Minister of Canada, “Declaration by the Prime Minister of Canada and the Presidents of the European Council and European Commission – a new era in Canada/EU relations”, Office of the Prime Minister online: <> .

[3] Government of Canada, “Canada-European Union: Comprehensive Economic and Trade Agreement (CETA)”, online: Foreign Affairs, Trade and Development Canada < >.

[4] Paul Grootendorst & Aidan Hollis, “The Canada-European Union Comprehensive Economic & Trade Agreement, An Economic Impact Assessment of Proposed Pharmaceutical Intellectual Property Provisions” (February 7, 2011) online: Canadian Generics < >.

[5] Edward M Iacobucci, “Innovation for a Better Tomorrow: A Critique,” May 30, 2011, online: Canadian Generics
<-%20A%20Critique_FINAL.pdf> [Iacobucci].

[6] CETA Text, supra note 1 at Chapter 22 Article 9.2.

[7] Ibid at Chapter 22 Article 9 bis.

[8]�� SOR/93-133 [PM(NOC) Regulations].

[9] Government of Canada, "Technical Summary of Final Negotiated Outcomes, Canada-European Union Comprehensive Economic and Trade Agreement, Agreement-in-Principle", Canada Action Plan online: �� at page 19. [Agreement in Principle].

[10] Due to the fact that provisions addressing a pharmaceutical linkage system are contained in the CETA text and Canada is the only party to the agreement that currently has a pharmaceutical linkage system, it seems very unlikely that Parliament would dissolve its linkage system and make these extensively negotiated provisions moot.

[11] Regulatory Impact Analysis Statement, (1998) 132 C Gaz 7 II 923 at pg 1058 [RIAS 1998].

The post CETA: An Opportunity to Fix Canada's Broken Pharmaceutical Patent Linkage System appeared first on IPOsgoode.

The Work I did

As part of the Teva Legal Affairs department, I had a chance to participate in many aspects of pharmaceutical patent litigation that were important to the company. This involved drafting pre-litigation invalidity and non-infringement opinions, assessing molecules for entry into various world markets, and supporting current patent litigation that Teva is party to. The majority of the Canadian patent litigation involved proceedings under the , but the placement frequently required consideration of other jurisdictions due to the fact that my supervisor was responsible for Teva’s global patent litigation strategy.

The opportunity to assess pharmaceutical patent portfolios on a global scale was extremely interesting, as I was able to observe some of the nuances between Canadian patent law and the laws governing patents in the US and European Union (EU). This analysis involved tracking patent prosecution that is often much more extensive than their Canadian counterparts and analyzing EU patent opposition proceedings that do not have Canadian equivalents. This research made me appreciate the vast amount of attention that a global pharmaceutical patent portfolio attracts and allowed me to utilize my scientific background when analyzing the arguments in these proceedings. The research also made me more aware of the deep scientific issues that are at play in bio-pharmaceutical patent litigation and the importance of having a solid foundation of scientific knowledge in these areas.

In addition to my exposure to patent litigation I was able to gain some insight into other legal issues that Teva frequently encounters. I had the opportunity throughout my placement to help out on various corporate matters, allowing me to see how IP is treated when it is an auxiliary consideration in the business context. For example, IP issues are often present in employment contracts and supply agreements, and it was fascinating to learn about these important in-house matters from experienced counsel. Lastly, the opportunity to attend meetings with other departments of the company like government and regulatory affairs allowed me to broaden my understanding of the company as a whole and the role that intellectual property matters play in Teva’s business model.

The Benefit of my Experience

The experience that I gained through my semester at Teva gave me insight into a world of legal practice that most lawyers will not see until many years into their careers (if they see it at all). In addition, I had a chance to utilize my background in science and pharmaceutical chemistry which was not only exciting but also a reminder of why I choose to pursue a law degree. Most of all, the placement allowed me to build on my time at an intellectual property boutique law firm by providing me with insight into the needs of a pharmaceutical company client. I have no doubt that my experience at Teva has afforded me a stronger understanding of both the law and the needs of my future clients.

As I am sure you can tell, I truly enjoyed my time at Teva through Osgoode Hall Law School’s , and I would recommend the program to any student with an interest in intellectual property or technology law. Lastly, I wanted to give a special thank you to IP Osgoode’s Michelle Li and Professors Giuseppina D'Agostino and David Vaver for giving me the opportunity to participate in the program and to Dr. Kane Denike, Teva Canada’s Senior Director of Intellectual Property, who was my supervisor throughout the semester.

Adam Falconi is a JD Candidate at Osgoode Hall Law School and was enrolled in Osgoode’s Intellectual Property Law and Technology Intensive Program. As part of the program requirements, students were asked to write a reflective blog on their internship experience.

The post IP Intensive Program: A Semester at Teva Canada - An Insider's Look at the Pharmaceutical Industry appeared first on IPOsgoode.

Summary of the Preliminary Guidelines

The guidelines provide information to the pharmaceutical industry regarding when pharmaceutical patent litigation settlements will draw the scrutiny of either the criminal or civil enforcement provisions of the (“the Act”).

Criminal Enforcement Provisions

The guidelines state that the Bureau will likely “pursue” the settlement under the criminal enforcement provisions of the Act (s. 45) if any of the following conditions are met:

1. The settlement includes conduct that goes beyond the scope of the patent (eg. fixing a generic entry date beyond the patent term); or

2. The Bureau finds evidence that the settlement is a vehicle for “naked restraint” on competition or motivated by factors external to the litigation.

Notably, the Bureau also set out that even if a settlement agreement does not satisfy either of the above two criteria, it can still can be reviewed under the criminal enforcement provisions of the Act.

Civil Enforcement Provisions

If the Bureau decides not to review the settlement under the criminal enforcement provisions, the agreement can be examined under the “civil” enforcement provisions of the Act (s. 90.1 and 79). ��Generally, agreements that will draw scrutiny under these provisions must have the effect of causing a “substantial prevention or lessening of competition” (“SPLC”). An agreement may be found to be causing an SPLC if, but for the settlement, the parties would have been likely to compete through the exercise of market power in a way that would lead to lower cost alternatives for consumers. One particular factor that was highlighted by the Bureau as important was a determination if the value transfer given to a generic company as part of a settlement is larger than the patentee’s litigation costs and potential liability for “section 8 damages” under the . If this is found to be the case, the agreement is more likely to cause a SPLC and draw scrutiny under the Act.

The Bureau’s Guidelines – Are They Feasible in Canada?

Various commentators have put forth and regarding the Bureau’s apparent willingness to expansively consider these settlement agreements as per se criminal. This approach has to be very different than the more holistic “rule of reason” evaluation of pharmaceutical patent litigation settlement agreements that was established by the US Supreme Court in (). An unfairly harsh or uncertain competition law framework is certainly a valid concern and an undesirable output for the Bureau.

In addition, one could argue that the Bureau’s intention to evaluate section 8 damages as part of their consideration of settlement agreements is impractical given that the quantification of these damages is still a for even the most experienced Federal Courts. Therefore, it is a valid question if the Bureau would be able to appropriately evaluate settlement agreements on this metric, and it may even be the case that this exercise is simply beyond their competence as an administrative body. This is another valid concern that stems from the current form of the guidelines.

Although these concerns exist, their presence should not stop the Bureau’s commendable efforts to prevent anti-competitive practices in order to curb . However, it must be recognized that an impractical, unpredictable, or overzealous scrutiny of settlement agreements in this sector may lead to the discouragement of litigation settlement which has the . Although certainly having great intentions, the Bureau must continue to refine its approach to creating a feasible and effective competition law enforcement framework in this area. On this very complex issue, like many of its kind, it is certainly not the thought that counts.

��

The post Certainly Commendable but Perhaps not Practical – Canada’s Competition Bureau Releases Guidelines on Pharmaceutical Patent Litigation Settlements appeared first on IPOsgoode.

As the business world increasingly relies on an information-based economy, intellectual property (IP) will be more important than ever for entrepreneurs and lawyers alike. The Commercializing IP seminar course attempts to provide students with some insights��into the ramifications of IP in the��business world��by exploring the many ways in which a business can use their IP strategically to ensure successes and profitability.

Can you briefly give us some background on your current practices and how they relate to the commercialization of intellectual property?

EF: At my law firm , the intellectual property group is involved in practically all aspects of the IP field. My practice focuses on helping my clients accumulate, secure, and exploit their intellectual property rights. I also help my clients with other IP-related services, which can include technology transfer, patent maintenance, and portfolio management. I frequently work with clients to develop a strategy for commercializing their IP. These strategies involve different methods for leveraging IP in the marketplace, and can include licensing, selling IP or giving advice towards the acquisition of other IP portfolios. As an IP legal services provider, one of our fundamental tasks is to determine if the client has accumulated IP rights, and then make sure that they hold and maintain them in a way that they can have an advantageous use of it later on.

LG: At ,��we are commercializing a disruptive and game-changing remote pharmaceutical dispensing technology, initially in Europe and North America. As the General Counsel of a start-up company, I am heavily involved in the day-to-day business beyond the basic legal role. As a Business Lawyer in a “new economy” venture, IP issues abound, and are an important component of my practice. From the IP tasks associated with commercialization of our own technology, to the more strategic questions on offensive and defensive patenting strategies, IP issues figure heavily in our daily decision-making. IP issues become even more complex for a start-up business when multiple markets are considered – these include ensuring the business has freedom to operate in these new markets from a patent perspective, and deciding on what patent strategy works best in those markets (many of the issues are very different from one market to another). ��In the modern, digital world, IP commercialization is a critical component to many new ventures in the marketplace, and MedAvail is no exception.

How do you view the role of commercializing IP in both the business and legal world?

EF: My view is that, even in the sense of a legal practice, intellectual property really is a business asset. From a legal perspective, the work I do is to accumulate rights, whether that is patents, trade secrets etc., and then think; when the client gets to the marketplace with his product or service, how will they make money from it? Do you build the service yourself, or do you find partners though investments?

Whether it is better to secure good IP rights and then launch a product, or develop a good product and then build good IP around it, the legal rights are fundamentally intertwined with business affairs. If you think of commercializing IP in the business world, you might want to think about the fact that IP is a prime asset for some of the most valuable companies in the world. ��IP is important in these companies from both a balance sheet point of view and in being able to offer the best services and products to their customers.

LG: From a business perspective, most new ventures will involve some form of intellectual property.�� In the US marketplace in particular, patent issues associated with commercializing an IP-centric business are very complex – it is a very litigious environment and patent trolls abound.�� A business needs to be mindful of the many IP landmines that, if not careful, may derail a business on the eve of an important event such a financing, trade show or IPO. IP issues invariably involve a mix of business and legal decision-making, as IP strategies typically involve both a risk assessment, and a cost benefit analysis which, in a pre-revenue start-up with limited capital, are extremely important.�� As such, it is not uncommon to have a dedicated senior resource working inside these ventures, closely with management and the Board, to get in front of these issues and map out a plan that allows the business a chance to be successful commercially while avoiding a variety of IP traps.

��

How do you see Canada as a player in the commercializing IP space, and what do you think will be the effect of emerging multinational free-trade agreements like on this area?

EF: Canada is an interesting example of the marketplace. When you think of the commercializing IP space you fundamentally think about market size, and Canada certainly couldn’t be considered a large market globally. Yet, despite this, there are some very interesting and unique Canadian programs in the commercializing IP space. For example, there is the very important tax credit program to IP-based businesses that choose to do business in Canada. So there is certainly a lot of Canadian policy that is friendly to the development of IP, which supports businesses that otherwise have a hard time being successful in Canada due to our size in the marketplace.

Regarding multinational free-trade agreements like CETA, IP is not necessarily a large part of these very complex and intricate agreements. But if you think of Canada as a net-exporter of goods rather than a consumer, anytime you add the opportunity for free trade, this is good for the economy. Certainly the CETA agreement is probably going to be beneficial from this view point, and is probably the most important treaty in this area since NAFTA. Being beneficial on the export market, these agreements can help in the commercialization of products that are often based around IP rights.

LG: Canada has a rich history of innovation and IP commercialization – look at Nortel, Blackberry, Desire to Learn, and many other Canadian success stories.�� In recent years, we are seeing a re-emergence of technology businesses and the “knowledge economy” in Canada, with a growing culture of innovation.�� This is the result of a combination of factors – the availability of investment and venture funding (both foreign and domestic); a fertile ground of talent coming out of Canadian universities, and various government initiatives.�� Look at cities such as Toronto, Vancouver, Waterloo – many “clusters” are emerging in a variety of exciting futuristic technologies…. It is truly an exciting time to be a Canadian technology entrepreneur!�� Our company is in contact with investors and funding organizations globally, and many of them have had high praise for many Canadian ventures that have come on line in recent months/years.�� This is something Canadians should be very proud of.

On treaties, my view is that anything the government can do to promote Canadian businesses and talent globally should be encouraged.�� Canadian ventures have shown the world that we can compete on a global stage, and this is one of the reasons that Canadian venture funds have had to compete with many foreign investment sources in funding Canadian ventures in recent years.�� We have a reputation of excellence in technology and innovation, and it is great to see programs in place that facilitate exposure of our innovations on a worldwide stage.

��

What do you feel are the biggest misconceptions about the commercialization of IP?

EF: Although I probably wouldn’t consider this purely a misconception, I often see an undervaluing of what we can call the “sweat equity” IP. When we think of commercializing of IP, this is very far from IP rights in the abstract. The misconception is the sentiment that “I have a great idea, and I will get paid”. I am not sure that this is exactly true. There is a lot of sweat equity that goes into commercializing a product that may have some IP rights built around it. There is a tremendous amount of work that goes into securing and maintaining the IP rights themselves, and making a successful business from all of this is even more difficult. Thinking about the amount of work that is required is often lost in the early stages of brilliant ideas, and since commercializing IP is really about taking the idea into the marketplace, this consideration is something that should be at the forefront of any strategy.

LG: In Canada, while good progress has been made in promoting and cultivating innovation, the broader market place and related structures need to catch up with the rest of the world.�� A small yet important example is start-up funding.�� In the US, the JOBS Act was groundbreaking legislation that allowed up to a million dollars to be raised by start-ups from non-accredited investors.�� This enabled and fuelled the growth of such innovative funding programs like crowdfunding.�� By contrast, it took the Ontario regulators several additional years to bring forth something similar.�� In summary, the Canadian “business ecosystem” needs to do a better job of adapting to the new business realities, and the fact that much of the value and wealth to be created in the next 50 years will come from new technologies. We need to be more nimble in supporting these ventures and getting them off the ground.

��

What do you think is the most valuable piece of knowledge that students of the commercializing IP seminar can get out of the course? And why do you think this course is important for students?

EF: We view this course as a practical course, not a legal theory course. It is really looking at how the law impacts business enterprises, and more specifically, business enterprises that have significant IP. I think that this type of course is important for law students, as there is no shortage of legal theory courses that go over what the law is. For students, to understand how these laws affect the business world and the marketplace is something that is beneficial. This knowledge and perspective is something that can assist them in being good lawyers, if a legal career is what they are pursuing. Even if they are not��pursuing a career in law, understanding business concepts and the business reality that the law impacts can be a very valuable tool.�� The value for the student is applicable if they are from Osgoode Law, Schulich Business, or Lassonde Engineering. The value in this course is being able to see and understand business operation from the inception-stage forward, especially for a technology-driven business.

LG: Osgoode does an excellent job teaching students how to be good practitioners, understanding the rules, thinking outside the box, and being good technical lawyers. This IP Commercialization Course builds on those critical skill sets, providing students with a “cradle to grave” point of view on how to use IP legal and business skills in the business world.�� The course is cross-listed among Osgoode, the Schulich School of Business, and the Lassonde School of Engineering.�� Fortunately, in our inaugural year, we had representation from all 3 disciplines – Legal, Business and Engineering.�� I believe our class would agree that this multi-disciplined dynamic was a key element to the success of the course, as our discussions on current IP topics included the points of view from all 3 areas.

The course combined both traditional lecturing on core IP topics, and a thread of discussion and exchange that brought topical and current issues into the classroom.�� For example, students were asked to bring in a news article on a topic relevant to the commercialization of IP – throughout the Term, we discussed everything from the Apple/Samsung patent disputes, to Tesla’s patents on solar paneled car roofs, to the Duolingo language learning App, and a whole host of other current IP topics.�� During these presentations, the students were given an opportunity to understand how the commercialization of IP affects real world businesses every day.�� We had a very bright group of students this year, which was reflected in the caliber of the discussions…

Adam Falconi is an IPilogue Editor and a J.D. Candidate at Osgoode Hall Law School.

The post Getting Profits From Patents: An Interview with Ed Fan and Loreto Grimaldi appeared first on IPOsgoode.

The Ramifications of CETA on Pharmaceutical IP Laws: The Expected and The Unexpected

CETA has been in the making for many years, and the EU has made clear its desire for Canada to for pharmaceuticals - seen by many as . However, it was unknown how much Canada would end up changing��its intellectual property rights (IPR) regime in the��face of��intense pressure from both and resistant to strengthening IPR through CETA and other international trade deals.

In the end, although the full-text will not be available until it has been translated into all of the European languages, it has been widely accepted that the final agreement will have on pharmaceutical intellectual property laws in Canada:

1. Patent term restoration will provide innovative pharmaceutical companies the ability to restore up to two years of patent protection that have been lost by regulatory processes;
2. Innovative pharmaceutical companies will gain a “right of appeal” for decisions made under the -��a right��that is currently only available for patent challenges from a generic pharmaceutical company.

On its face, these changes are a boon to the innovative pharmaceutical industry in Canada and represent . These anticipated changes could be interpreted as Canada's unwillingness to fully compromise, as the EU ��up to 5 years of patent term restoration in addition to more extensive data protection provisions. Interestingly, the Canadian Generic Pharmaceutical Association (CGPA) has claimed to have from the Government of Canada that��the implementation of the “right of appeal” will serve to curb duplicative litigation from innovative pharmaceutical companies. Canada is currently the only country in which an innovative company can sue a generic producer more than once on the same patent.

Varied Reactions to the Report from Various Stakeholders

As expected, the reactions to the proposed changes to Canadian pharmaceutical intellectual property law have been mixed, with various organizations and stakeholders speaking for and against the CETA agreement.�� Canada's Research-Based Pharmaceutical Companies (Rx&D) applauding the agreement and��opining that��the agreement��will serve to increase pharmaceutical innovation and support the discovery of new medications. Interestingly enough, a Canadian patient group, The Mood Disorders Society of Canada, after the agreement was announced, which echoed the sentiments of Rx&D. The statement also��expressed the group’s belief that CETA will encourage more pharmaceutical research in Canada and��help develop effective interventions to improve the mental health of Canadians.

The CGPA also��, which��cites��its disappointment of the CETA agreement��and claims��the agreement's��potential to increase health care costs for provinces, health plans, and patients. The statement also outlined the CGPA's��concern that CETA will cause generic medications to be delayed on their way to the marketplace.���� The statement was not completely critical however, as the CGPA��commended the Canadian government’s efforts to limit the term of patent restoration to 2 years and allow for the potential for the new “right of appeal” regulations to curb litigation costs.�� The CGPA was also��appreciated that CETA will not impose any changes to the domestic data protection regime.

In my opinion, the biggest stakeholder that is likely to be affected by these proposed changes to��Canada's pharmaceutical IP law are the provinces, which bear most of Canada's health care costs. In anticipation of the agreement, many provinces, including Ontario (the largest medication provider in the country) cautioned the Canadian government that concessions to the EU on these points could greatly increase health care costs. ��that CETA could increase��its prescription drug expenses by $1.2 billion dollars annually. After the release of the agreement, however, provincial since the extent of the changes��is less drastic than predicted. In addition, the Federal Government has already announced that��it will , although no further details on this point have been released. The Ontario government responded to this statement quickly, and was the first province to make it known that��it�� for sectors that will be adversely affected by CETA. As provincial governments and the federal legislative branch����the changes CETA will bring, there are undoubtedly going to be further developments on this issue, and the ultimate acceptance and implementation of CETA will likely depend upon the details of the final agreement.

CETA: A Changing of the Guard?

Although CETA has only been agreed to “in principle” for now, it is clear that its ratification and implementation will have far-reaching consequences. It will undoubtedly have a significant impact��on Canada's health care and pharmaceutical sectors, and may change how Canada is . It seems clear to me that, at least in the intellectual property context, Canada is making the statement that it will not be left behind by its industrialized trading partners in the new knowledge-based economy.

Adam Falconi is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

The post CETA: A Very Reasonable Canadian-esque Compromise on Pharmaceutical Intellectual Property Law Changes appeared first on IPOsgoode.

A recent filed by Myriad Genetics involving the alleged infringement of their controversial breast cancer screening tool has included the prestigious Toronto SickKids hospital as a co-plaintiff. This lawsuit has been a source of criticism for the hospital and has reinvigorated the debate on the merits of public-private research collaborations in health care innovation.

Aftermath of SCOTUS Ruling - Myriad Genetics Sues Archrival

This , the US Supreme Court rendered a landmark , ruling out the patentability of some genetic sequences in patents developed by Myriad Genetics for their breast cancer screening tests. (You can view some of the IPilogue’s extensive coverage of the international litigation around this issue , and .) The results of this decision and the invalidation of the Myriad patents were seen by many as a development that of breast cancer screening methods due to the possibility of cheap alternatives being produced without being hindered by patent licensing. A sound prediction, as , companies started releasing breast cancer screening tools at a lower cost than the Myriad products. A few weeks after the ruling, however, Myriad in the Utah District Court against Ambry Genetics, claiming that the company owned or licensed to Myriad that had not been a part of the US Supreme Court case. In response to the lawsuit, Ambry has recently Myriad for antitrust violations.

This case is interesting from a Canadian point of view since some of the patents at issue involve ownership agreements between Myriad and various public health organizations, . In the , it is stated that the public health organizations will lose "significant amounts of revenue" from lost royalties, and that the revenue stream from their ownership to date has brought in around $57 million. Although listing SickKids as a plaintiff in the lawsuit due to their ownership agreement, the story has nevertheless garnered . This lawsuit has been seen by some as an attack on affordable breast cancer screening for patients, with SickKids seemingly in a position that is opposite its role as a health care provider. Patent arrangements like the one between SickKids and Myriad can be seen as paradoxical; preventing patients from being able to access the medical discoveries that have been made possible by .

Public-Private Research Collaboration: A Complex Issue

Discussions arising from situations such as this ultimately stem from the relationship between public institutions and profit-seeking entities in health research collaboration. Analyses of the merits of such collaboration has reached conclusions in different fields and , but a recent seemed to suggest a statistically significant increase in pharmaceutical industry innovation from publically-funded scientific research.

Critics of these joint research ventures frequently cite the through a “tragedy of the anticommons” effect, where other research entities choose not to enter a field of innovation due to the fear of their production ultimately getting blocked by existing patents. Luigi Palombi, an Australian lawyer that has written a book about the Myriad breast cancer screening saga, criticized the SickKids incident and that “[i]t is our outrageous for any publicly funded research institution to be put in this situation” and that “[o]nce you have publicly funded institutions getting into bed with these guys, well then that raises a whole series of other questions and issues”. Other commentators, such as McGill University law professor Richard Gold, that "[t]here's always been a relationship obviously between industry and hospitals and universities. And it's not all bad because, of course, universities do basic research." Professor Gold also went on to state that he hopes public institutions “will be wiser in the way they set up their agreements in order to have a choice to whether to be involved in ligation". Although the majority of commentators seem to agree that SickKids is currently occupying an unfavourable position from its public involvement in the lawsuit, the debate on the merits of these joint health-care research ventures is certainly an unresolved issue.

The Future of Public-Private Health Research Collaboration in Canada

The post SickKids in Court - Are Public-Private Research Collaborations a Hindrance or a Driver of the Innovative Process? appeared first on IPOsgoode.

Impending Free Trade Agreements Present an Immense Economic Opportunity

In , analysts at the Fraser Institute claim that enhanced pharmaceutical intellectual property (IP) protections can serve to strengthen the domestic innovative pharmaceutical industry while facilitating Canada’s ability to enter and negotiate free trade agreements. The report focused on the economic benefits of two prominent international agreements that are currently in the midst of negotiations, the (CETA) with the European Union, and the (TPP) which involves many nations across the globe.

The report also explains that a key unresolved issue in these discussions has been the status of Canada’s pharmaceutical IP protection, which is currently much lower than its and . By aligning their pharmaceutical policies with the EU and the USA in an effort to complete the CETA and TPP trade agreements, the report estimates that these two trade deals alone can create an annual economic benefit of nearly $22 billion, which would easily offset an estimated $367 - $903 million annual increase in domestic pharmaceutical expenditures.

Another Source of Pressure on Canada to Strengthen its Pharmaceutical IP Laws

In addition to the Fraser Institute report, there has been an abundance of pressure put on Canada to strengthen its pharmaceutical IP policy by its , the United States. A recent report by the United States Trade Representative (USTR) expressed serious concerns about Canada’s pharmaceutical IP laws, and US based organizations such as the Pharmaceutical Research and Manufacturers of America (PhRMA) have as posing a threat to the American innovative pharmaceutical industry and .


Another intriguing component of this issue is that the US itself recently over a free trade agreement similar to the CETA. This has led to that the CETA negotiations may be lost in the shuffle or negatively affected as the EU concentrates on the US agreement, in a situation similar to in 2007. Although the CETA is still expected to be completed eventually, this development has undoubtedly created some urgency in the ongoing negotiations and has increased the pressure to get a deal done promptly.

Concerns

Although there has been large support for the strengthening of Canadian pharmaceutical IP policy among many industry and diplomatic representatives, this view is not universally shared. One concern about the move is the disagreement regarding the resulting cost increases on domestic pharmaceutical expenditures, with . In addition, the distribution of the costs and the potential income from the agreements could be a , as they primarily administer the health care system in Canada and many of the benefits of the agreement may be realized primarily on a federal level.

There is, however, a more subtle issue beyond economics and one that is undoubtedly a consideration in this debate - Canada’s role in the global access to medications regime and as a global health care provider. A move towards stronger IP and the subsequent increased drug costs can be seen as a move away from these types of initiatives, which may not be compatible with Canada’s commitment to and its historical role as the first and only nation to utilize flexibilities under the Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement to export generics under a compulsory license to developing countries (). Associations like MSF (Doctors Without Borders) have come out and to speak out against a strengthening of pharmaceutical IP policy in the ongoing TPP negotiations. In an to Prime Minister Stephen Harper, they explained that this development they may have a deleterious effect on the available of cheap generic medications for millions of their patients around the Asia-Pacific region.

So What Should Canada do?

With Canada moving forward in the CETA and TPP negotiations and a recent cabinet shuffle instituting a new industry minister that is , all indications point towards an enhancement of pharmaceutical IP protection in these free trade agreements. Also, as , strengthening pharmaceutical IP will only bring Canada to the global norms among industrialized nations, which seems like a fair concession in an international free trade partnership of this sort.


On the other hand, as illustrated by the calls for Canada to act against these changes by associations like MSF, it is clear that Canada is distinctively seen as a nation at the forefront of supporting access to affordable medications for developing countries. A momentous policy change of this sort will undoubtedly alter the image that Canada retains in the global healthcare front. The question now remains: will Canada sacrifice an apparent illustrious economic benefit or continue with its seemingly Robin Hood-esque stance to pharmaceutical IP policy?

Adam Falconi is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

The post Time for a Change? Fraser Institute Urges Canada to Strengthen its Pharmaceutical IP Laws appeared first on IPOsgoode.

The “Promise of the Patent” Doctrine and its Latest Interpretation

The interpretation of what is considered “useful” as a requirement of patentability in the has been at issue over the last few years, with jurisprudence over the last decade seemingly taking us away from the “” benchmark that has been used historically. As set out in the landmark SCC decision in , in the context of pharmaceutical patents, there is frequently an estimation or “promise” at the time of filing that sets out the pharmaceutical’s clinical effectiveness before it has been (or can be) factually demonstrated.�� The jurisprudence has set out that, in order for the patent to subsequently be held valid, one must be able to factually establish this promise of utility or alternatively, establish it through the doctrine of sound prediction. The sometimes difficult and somewhat paradoxical requirement of demonstrating a “promise” of utility at the time of filing as set out in Wellcome has created a judicial environment that has seen many pharmaceutical patents recently being invalidated for lack of utility, much to the chagrin of the innovative pharmaceutical industry.

The case , revolves around Eli Lilly’s claim that Novopharm infringed their patent for the schizophrenia drug olanzapine. , the case was eventually remanded back to Federal Court where the . In the court’s judgment, it was held that the patent had a “promise” that olanzapine was “substantially better” in the treatment of schizophrenia than other known anti-psychotics, and that the individual advantages asserted in this comparison with other compounds “form the foundation for the overall promise of the patent”�� (paras 124-125). The court goes on to conclude that at the time of filing, “there is no sound and articulable line of reasoning, or a prima facie reasonable inference, that would have led the inventors from the evidence available at the relevant time to the explicit promise of the substantial advantage set out” (para 267), and subsequently found the patent invalid for lack of demonstrated utility. An appeal to the FCA of the decision was , and the most recent with no reasons given, even after the court granted leave to hear oral submissions on the application, a rare occurrence.

What is most interesting about the Canadian “promise of the patent” doctrine is that it is not explicitly found in the or in . In fact, both the and courts have come to contrasting decisions on the same olanzapine patent held by Eli Lilly, both courts choosing not to adopt the Canadian “promise of the patent” approach to utility. In doing so, these courts declined to invalidate the patent on these grounds. This judicial interpretation requires a higher standard in demonstrating utility for pharmaceutical patents from patent applicants in Canada than any of the country's largest trade and political partners

Criticism of the Doctrine at an Important Time

The extra hurdles that are presented by the “promise of a patent” utility requirement have been criticised by both the innovative pharmaceutical industry and Canada’s trading partners. The conflict has spilled out of the courtroom and into the political sphere when Eli Lilly served a under chapter 11 of the NAFTA agreement. Eli Lilly claims that the promise doctrine is non-statutory judicial law-making, violating Canada’s treaty obligations by invalidating useful pharmaceutical patents. In addition, a recent criticized the heightened utility requirements of Canadian pharmaceutical patents, putting pressure on a Canadian government that is in final negotiations for the landmark which .��

Choosing Not to Address the Issue: An Expression of Deference to the Executive Branch?

It is odd and perhaps disheartening that the SCC has not chosen to clarify the issue and lay out a clear judicial test for the contentious “promise of the patent” utility requirement. It is difficult to imagine that resolving this issue, one that has garnered so much scholastic and political attention, would not be in the public’s best interest. It could be that the SCC is trying to stay out of - what it views to be - an issue for the legislature, and is waiting for the outcome of political maneuvering before attempting to determine the issue according to its own reasoning. Although something like the NAFTA tribunal has limited powers and could not make direct amendments to legislation, the that Canada is currently facing means that any outcome of this issue is sure to have large diplomatic ramifications.

On the other hand, as this doctrine is seemingly one of judicial interpretation outside the explicit text of the - and is clearly a heightened utility requirement when compared to the US and the EU - one may feel that the SCC has an obligation to give a definitive justification and clarify the promise doctrine. If Canada is to be the “lone rebel” with this doctrine, the SCC must come out and address this issue. Delaying or avoiding this will only further the deleterious effects that uncertainty will have on all parties involved in these disputes.

Adam Falconi is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

The post Sitting This One Out: SCC Refuses to Clarify “Promise of a Patent” Doctrine appeared first on IPOsgoode.

To read the report’s section on Canada, click .

Results of the Report: A Commendation with Qualification

In the report, the USTR commends Canada for its recent legislative reform. The two initiatives cited in the report were Canada’s passage of the in June 2012 - legislation that represents Canada’s implementation of the WIPO Internet Treaties - and the introduction of the in March 2013 - which attempts to target commercial-scale trafficking of counterfeit products. Both of these initiatives were endorsed by the USTR, ��who went on to suggest in the report a further expansion of this type of legislation in order to give more power to border officials to seize goods in-transit.

The report was not universally complimentary, however, with the USTR expressing serious concerns regarding Canada’s pharmaceutical industry. One concern that was mentioned was the absence of a right of appeal in the administrative process of Canadian regulatory pharmaceutical approval. In addition, the USTR expressed apprehension regarding the impact of the heightened utility requirements for Canadian pharmaceutical patents. This statement likely refers to the that has taken place over the last decade regarding what constitutes the “utility” required for pharmaceutical patents in Canada; originating from the landmark SCC case .

Reaction to the Report

The movement of Canada from the “Priority Watch List’” to the ‘”Watch List” has been met with some criticism; with some American entities publicly voicing their displeasure with Canada’s new position. The most scathing reaction to the report comes from the Pharmaceutical Research and Manufacturers of America (PhRMA), who stating that they were very “disappointed” with Canada’s changing designation. In the report, PhRMA claims that “Canadian policies and judicial opinions continue to harm international innovators to the benefit of domestic industries” and that the “heightened standard for patentable utility for pharmaceutical patents is inconsistent with Canada’s trade treaty obligations.” The PhRMA statement also contains a critique of India’s pharmaceutical IPR regime - a country that is notorious for their pharmaceutical IP protection. Including these statements side-by-side might reflect the view that the American biopharmaceutical industry has of Canada's pharmaceutical intellectual property laws and policy.

A Precarious Political Climate

Although there have been concerns raised about the legitimacy of the USTR “Special 301 Report” from both and , an evaluation of Canada’s IP regime by its is undoubtedly an important diplomatic and economic concern. Indeed, Canada’s actions over the last few years seem to indicate their intention to conform to the wishes of their American counterparts, with the recent legislative reform that is responsible for Canada’s improvement on the watch list seemingly being a direct response to .

What makes the most recent report particularly interesting is the fact that it has been released at a complex political time period for Canada. The pharmaceutical company Eli Lilly recently launched a , and the (CETA), a free trade agreement between the Canada and the European Union (EU), is bound to be completed in the next few months. The recent legislative changes made by Canada could be viewed as political posturing for the impending CETA, which purportedly has the EU calling for increased . This agreement also allegedly includes an increase in patent protection for innovative pharmaceuticals in Canada at the request of the EU, which for its potential to greatly increase drug costs. However, with drug and health care costs being a sensitive political topic and being significantly in Canada over the next few decades, that the strengthening of IP pharmaceutical protection may not ultimately make it into the final draft of the CETA despite the EU's wishes.

It could be the case that the recent Canadian legislative reform is an effort by Canada to please its biggest trading partners without making drastic changes to its domestic pharmaceutical industry. The issue of rising health care costs is undoubtedly an important domestic political issue, and perhaps the seemingly “Jekyll and Hyde” approach to pharmaceutical and non-pharmaceutical IPR�� is a necessary compromise that Canada has to make in order to function diplomatically with its trading partners while maintaining what it views as a healthy domestic state. It would be hard to name many things that are more complex than trying to adequately fit domestic IP policies within international free trade agreements, but Canada must continue to strive to achieve that seemingly impossible balance. At the end of the day, like in most matters in life (and politics), you certainly can’t please everyone.

Adam Falconi is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

The post A Cautionary Kudos: Canada Moves Up on USTR IP Watch List appeared first on IPOsgoode.