Per the Federal Court’s decision in , the Promise Doctrine holds that if a patent application promised a particular utility, it was necessary to prove that function in order to acquire the patent. Furthermore, in the absence of any promised utility, proving even a miniscule amount of utility is enough to be found patentable. Since patents are deemed invalid if there is an insufficiency of utility under s. 2 of the patent act's definition of 'invention' and per paragraph 46 of , the effect of the Promise Doctrine was to substantially raise the bar for applicants that alleged benefits to their inventions by denying patent protections for those who failed to meet the stated promises.

In court, the series of decisions and appeals in the AstraZeneca Canada Inc v Apotex Inc suit focused on whether the Promise Doctrine should be used to find AstraZeneca’s ‘653 patent – pertaining to optically pure salts of the (-) enantiomer of omeprazole, esomeprazole – invalid because the patent promised more utility than it could deliver.

At the , Justice Rennie found two alleged utilities: using esomeprazole as a proton-pump inhibitor (effectively reducing stomach acidity) and having superior pharmokinetic and metabolic characteristics so that its therapeutic profile in clients would be more stable. By applying the Promise Doctrine, the ‘653 patent was found invalid for not meeting the utility requirement of of the Patent Act for the alleged superior therapeutic profile, despite the utility of esomeprazole being proven as a proton pump inhibitor. At the , the judgment of the lower court and the applicability of the Promise Doctrine were affirmed.

However, the decision from the SCC demonstrated that the Promise Doctrine and the analyses of the lower courts run contrary to the form of the Patent Act by conflating the requirements set out in s. 2 and s. 27.3. demands there be some useful aspect of a creation for it to be regarded as an invention at law. If some usefulness is present, the invention must be disclosed as specified in of the Act in its patent application. In , Dickson J clarified that the usefulness standard set out in s. 2 of the Patent Act acts as a “condition precedent to an invention” whereas s. 27.3 merely sets out disclosure requirements that are to be interpreted independently of s. 2. So, the Promise Doctrine goes against the independent interpretation of these two sections of the Act by demanding that the utility requirement set out in s. 2 be fulfilled or predicted at the time of filing, or otherwise find the invention pre-condition for patentability vitiated.

The SCC noted that the Promise Doctrine is also at odds with the Act where multiple utility promises are made. Under the Doctrine, all utility promises would have to be satisfied for the usefulness threshold in s. 2 to be met. However, the opinion of the SCC is that any single use “that is demonstrated or soundly predicted by the filing date” would be adequate to satisfy the demands of s. 2. Requiring all utility promises to be met, would be “unfair” and can lead to “otherwise useful invention[s] to be deprived of patent protection” simply because some promises were not demonstrated or predicted.

Given the highly experimental and sometimes tangential nature of innovation, a lack of protection for inventions that have managed to achieve some, but not all, of the promised utilities highlights the the Promise Doctrine appears to have on research and development. Citing the work of , and , , the SCC found that “inventions are like a many-faceted prism: multiple claims… covering all facets are allowed in the same patent if a single general inventive concept links them.”

Considering a multiplicity of promises is especially important in pharmaceutical development and organic syntheses where broad, overarching concepts like an improved therapeutic profile may be anticipated, but not proven in full. The possibility of off-target therapeutic effects or side-effects can make an exacting prediction of utility difficult and, under the Promise Doctrine, may bar legal protection. After all, as the SCC established in ., “the patent regime has a dual purpose – to incentivise [creation] and to encourage inventors to publicly disclose [their knowledge] for society’s benefit.” If the bar for acquiring a patent is set too high, some inventors may get cold feet.

Dominic Cerilli is the IPilogue content editor and social media coordinator as well as a JD candidate at Osgoode Hall Law School.

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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.

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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.

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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.

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