Federal Court Of Appeal Sets Aside Order For Common Trial Across Multiple Actions Under PMNOC Regulations

• Published date: 10 June 2020
• Author: Ms Urszula Wojtyra
• Subject Matter: Intellectual Property, Litigation, Mediation & Arbitration, Patent, Trials & Appeals & Compensation
• Law Firm: Smart & Biggar

An interesting procedural question under the amended Patented Medicines (Notice of Compliance) Regulations (PMNOC Regulations) is the extent to which separate actions against multiple generic manufacturers can proceed together, including at trial. While the Federal Court has ordered a few cases to be tried together (see for example our brief here regarding the fampridine trial decision involving Taro and Pharmascience), on May 14, 2020, the Federal Court of Appeal (FCA) considered this procedural question for the first time. The FCA overturned the Federal Court's order that patent validity issues common to four separate actions be heard in a concurrent trial: Apotex Inc and Teva Canada Limited v Bayer Inc, 2020 FCA 86, rev'g 2019 FC 1039. The FCA held that the decision below was inconsistent with the prohibition against joinder of actions under section 6.02 of the PMNOC Regulations.

Decision below

As previously reported, in actions relating to Bayer's XARELTO (rivaroxaban), the Federal Court ordered common validity issues in actions against Apotex and Teva to be heard concurrently (Bayer v Apotex; Bayer v Teva, 2019 FC 191; see brief here). Actions against Taro and Sandoz were commenced respectively four and six months later, and the Federal Court subsequently ordered these actions to be added to the Teva/Apotex trial (Bayer v Teva, 2019 FC 1039). This Order was appealed.

On appeal, Apotex and Teva argued that the decision failed to appropriately consider Rule 105 of the Federal Courts Rules, and the prejudice that flowed, including the loss of the 'first mover' advantage in the generic rivaroxaban market. The appellants also argued that the decision was contrary to section 6.02 of the PMNOC Regulations, which prohibits joinder of actions except in limited circumstances.

No protection for "first mover" advantage

Rule 105 provides that the Court may, in its discretion, order that two or more proceedings be "consolidated, heard together, or heard one immediately after the other." The FCA agreed that Rule 105 applied and the Court was required to consider whether prejudice will result from the order, but disagreed that Apotex and Teva would be prejudiced by the concurrent trial. In contrast to the Hatch-Waxman Act in the United States, which grants an advantage to the generic first-mover, nothing in the PMNOC Regulations supports any protection of the individual commercial interests of the first generic(s) to serve a notice of allegation.

Unnecessary to...