Effective Consent Made Easier Under the NOC Regulations

By Jamal Hakimi, December 8th, 2020

Case introduction:

The Patented Medicines (Notice of Compliance) Regulations (“NOC Regulations”) permit the Minister of Health (“Minister”) to issue a notice of compliance (“NOC”) to a generic company where a patentee’s effective consent is obtained. Effective consent under the NOC Regulations requires the patentee’s consent for the making, constructing, using or selling of a drug in Canada (“Activities”). This was at issue in Fresenius Kabi Canada Ltd. v. Canada (Health), 2020 FC 1013 in which the Federal Court of Canada (“Court”) determined that effective consent under the NOC Regulations requires the patentee’s consent for only one of the Activities and not all Activities.

Case background:

Fresenius Kabi Canada Ltd. (“the Applicant”) brought an application for judicial review of the Minister’s refusal to issue a NOC. The Applicant had sought an NOC for its drug adalimumab, IDACIO, which is a biosimilar of the drug, HUMIRA, owned by AbbVie Biotechnology Ltd. (“AbbVie”). AbbVie also owns a number of patents (“Patents”) in respect of HUMIRA. In seeking an NOC, the Applicant had relied on AbbVie’s consent to comply with the NOC Regulations. AbbVie had provided immediate consent to the making and constructing of IDACIO, and a delayed consent, until after February 15, 2021, to the using and selling of IDACIO. The Minister refused to issue a NOC because AbbVie’s consent was only effective after February 15, 2021, when consent to all Activities had been provided.

The Court decision:

The Court found the Minister’s refusal unreasonable partly because the Minister erred in interpreting the word “or” as conjunctive “and” in the NOC Regulations, which recites “consent to the making, constructing, using or selling of the drug in Canada.” The Court reasoned that “the word ‘or’ is presumed to be disjunctive, but inclusive, such that, as in this case, a patent owner could consent to each or a combination of the activities listed - making, constructing, using or selling - to meet the [consent] requirements” of the NOC Regulations. The Court found AbbVie’s consent as unequivocal to all Activities, despite the temporal nature of the consent. The Court overturned the Minister’s decision and ordered the Minister to issue the NOC.

The Court based its reading of the word “or” on the NOC Regulations’ dual purpose, “to balance effective patent enforcement over new and innovative drugs with the timely market entry of their lower-priced generic competitors.” The Court noted that an NOC is essential for the timely launch of a biosimilar product, which is critical for biosimilars to remain competitive and establish their market position.

Key takeaway:

The Court’s interpretation of the word “or”, as disjunctive, but inclusive, clarifies that requirements of consent, under the NOC Regulations, are met so long as the patent owner consents to at least one of the Activities.

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