Teva Canada Limited v. Pfizer Canada Inc.

Teva Canada Limited v. Pfizer Canada Inc.
Court (s) Database
Federal Court of Appeal Decisions
Date
2016-10-12
Neutral citation
2016 FCA 248
File numbers
A-143-15, A-172-15, A-27-15, A-28-15
Notes
A correction was made on June 9, 2017
Reported Decision
Decision Content
Date: 20161012
Dockets: A-27-15
A-28-15
A-143-15
A-172-15
Citation: 2016 FCA 248
CORAM:
DAWSON J.A.
WEBB J.A.
RENNIE J.A.
Docket: A-27-15
BETWEEN:
TEVA CANADA LIMITED
Appellant
and
PFIZER CANADA INC. and
THE MINISTER OF HEALTH and
THE ATTORNEY GENERAL OF CANADA
Respondents
Docket: A-28-15
AND BETWEEN:
THE ATTORNEY GENERAL OF CANADA
and THE MINISTER OF HEALTH
Appellants
and
PFIZER CANADA INC. and
TEVA CANADA LIMITED
Respondents
Docket: A-143-15
AND BETWEEN:
ATTORNEY GENERAL OF CANADA
and THE MINISTER OF HEALTH
Appellants
and
JANSSEN INC. and THE KENNEDY TRUST
FOR RHEUMATOLOGY RESEARCH and HOSPIRA HEALTHCARE CORPORATION
Respondents
Docket: A-172-15
AND BETWEEN:
HOSPIRA HEALTHCARE CORPORATION
Appellant / (Respondent)
and
JANSSEN INC. and THE KENNEDY TRUST FOR RHEUMATOLOGY RESEARCH
Respondents / (Applicants)
and
THE MINISTER OF HEALTH and
ATTORNEY GENERAL OF CANADA
Respondents / (Respondents)
Heard at Toronto, Ontario, on May 31, 2016.
Judgment delivered at Ottawa, Ontario, on October 12, 2016.
REASONS FOR JUDGMENT BY:
DAWSON J.A.
CONCURRED IN BY:
WEBB J.A.
RENNIE J.A.
Date: 20161012
Dockets: A-27-15
A-28-15
A-143-15
A-172-15
Citation: 2016 FCA 248
CORAM:
DAWSON J.A.
WEBB J.A.
RENNIE J.A.
Docket:A-27-15
BETWEEN:
TEVA CANADA LIMITED
Appellant
and
PFIZER CANADA INC. and
THE MINISTER OF HEALTH and
THE ATTORNEY GENERAL OF CANADA
Respondents
Docket:A-28-15
AND BETWEEN:
THE ATTORNEY GENERAL OF CANADA
and THE MINISTER OF HEALTH
Appellants
and
PFIZER CANADA INC. and
TEVA CANADA LIMITED
Respondents
Docket:A-143-15
AND BETWEEN:
ATTORNEY GENERAL OF CANADA
and THE MINISTER OF HEALTH
Appellants
and
JANSSEN INC. and THE KENNEDY TRUST
FOR RHEUMATOLOGY RESEARCH and HOSPIRA HEALTHCARE CORPORATION
Respondents
Docket:A-172-15
AND BETWEEN:
HOSPIRA HEALTHCARE CORPORATION
Appellant / (Respondent)
and
JANSSEN INC. and THE KENNEDY TRUST FOR RHEUMATOLOGY RESEARCH
Respondents / (Applicants)
and
THE MINISTER OF HEALTH and
ATTORNEY GENERAL OF CANADA
Respondents / (Respondents)
REASONS FOR JUDGMENT
DAWSON J.A.
[1] Each of the four appeals before the Court raise the following two issues. First, what is the standard of review to be applied to a decision of the Minister of Health to issue a Notice of Compliance to a generic manufacturer in circumstances when the Minister determines that the generic’s drug submission is administrative in nature so that it does not trigger the notice requirement found in section 5 of the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 (PMNOC Regulations or Regulations)? Second, did the Federal Court err when it decided that the Minister’s decisions should be set aside? This, in turn, requires consideration of whether the Minister erred in issuing two Notices of Compliance (NOC) without requiring each applicant to notify the affected patentee that the applicant was seeking a NOC.
[2] Briefly, two decisions made by the Minister are at issue on these appeals:
i. The decision of the Minister made on October 1, 2013, to issue a NOC to Teva Canada Limited for an exemestane tablet for oral administration in 25 mg strength. This is a generic version of exemestane tablets marketed by Pfizer Canada Inc. under the brand name AROMASIN.
ii. The decision of the Minister made on June 4, 2014, to issue a NOC to Hospira Healthcare Corporation for its 100 mg/vial infliximab powder for solution. This is a generic version of the 100 mg/vial infliximab powder marketed by Janssen Inc. under the brand name REMICADE.
[3] Pfizer challenged in the Federal Court the decision of the Minister to issue the NOC to Teva in respect of exemestane.
[4] For reasons cited as 2014 FC 1243, issued in the proceeding brought by Pfizer, a judge of the Federal Court found the standard of review of the Minister’s decision to be correctness. The Federal Court went on to find that the Minister’s interpretation of the PMNOC Regulations was incorrect (reasons, at paragraph 56). In consequence, the Minister’s decision to issue the NOC to Teva in respect of exemestane was set aside.
[5] Two of the appeals before the Court relate to this decision of the Federal Court: an appeal brought by Teva in Court Docket A-27-15 and an appeal brought by the Attorney General of Canada and the Minister of Health in Court Docket A-28-15. These appeals were consolidated. As a result, a copy of these reasons will be placed in each Court file.
[6] Janssen also challenged in the Federal Court the decision of the Minister to issue a NOC to Hospira in respect of infliximab. The Federal Court issued its judgment in respect of exemestane while Janssen’s application for judicial review of the Minister’s decision with respect to infliximab was pending. With the consent of the parties, the Federal Court set aside the decision of the Minister to issue the NOC to Hospira, without prejudice to any right to appeal from the judgment. This judgment was made to permit the parties to appeal the judgment and to ask that the appeals be heard together with the appeals brought against the judgment of the Federal Court with respect to exemestane.
[7] Two of the appeals before the Court relate to this judgment of the Federal Court: an appeal brought by the Attorney General of Canada and the Minister of Health in Court Docket A-143-15 and an appeal brought by Hospira in Court Docket A-172-15. These appeals were also consolidated, as a result a copy of these reasons will be placed in each Court file.
[8] The Court ordered that the consolidated appeals be heard together.
[9] For the reasons that follow, I have concluded that the Federal Court erred by reviewing the Minister’s decisions on the standard of correctness. Applying the standard of reasonableness, I have concluded that the Minister’s decisions were reasonable. It follows that I would allow each appeal with costs here and in the Federal Court, set aside the judgments of the Federal Court and dismiss the applications for judicial review brought in respect of the two decisions of the Minister.
[10] I begin my analysis by briefly reviewing the regulatory framework and then move to consider the drug submissions at issue in these appeals, the decision of the Federal Court and the appropriate standard of review of the Minister’s decisions. Finally, I apply the appropriate standard of review to the decisions at issue.
I. The Regulatory Framework [11] I begin with some background context to the current regulatory regime. In 1923, the Patent Act, R.S.C. 1923, c. 23 was amended to introduce compulsory licensing specific to the manufacture of food and medicine. A compulsory license is a license mandated by statute that gives a licensee the right to manufacture, use, or sell a patented invention prior to the expiration of the patent.
[12] In 1992, the government introduced Bill C-91, the Patent Act Amendment Act, 1992, in order to amend the Patent Act, R.S.C. 1985, c. P-4 (Act or Patent Act) to implement obligations Canada had accepted under the Agreement on Trade-Related Aspects of Intellectual Property Rights and the North American Free Trade Agreement. Bill C-91 eliminated compulsory licenses issued on or after December 20, 1991 for pharmaceutical products.
[13] In order to facilitate the early entry of generic drugs to the market following the expiration of patent protection, Bill C-91 created an exception to an action for patent infringement. What is known as the “early working” exception allows a person to use a patented invention while the relevant patent is in force for the sole purpose of obtaining regulatory approval to sell a product equivalent to the patented product on the expiry of the relevant patent. The early working exception eliminated the often lengthy regulatory lag after the expiration of a patent while a generic manufacturer took the required steps to obtain a NOC.
[14] The early working exception is found in subsection 55.2(1) of the Act:
55.2 (1) It is not an infringement of a patent for any person to make, construct, use or sell the patented invention solely for uses reasonably related to the development and submission of information required under any law of Canada, a province or a country other than Canada that regulates the manufacture, construction, use or sale of any product.
55.2 (1) Il n’y a pas contrefaçon de brevet lorsque l’utilisation, la fabrication, la construction ou la vente d’une invention brevetée se justifie dans la seule mesure nécessaire à la préparation et à la production du dossier d’information qu’oblige à fournir une loi fédérale, provinciale ou étrangère réglementant la fabrication, la construction, l’utilisation ou la vente d’un produit.
[15] The PMNOC Regulations were enacted in 1993 in conjunction with the amendments to the Patent Act that terminated compulsory licensing and created the early working exception. The Regulations were enacted in order to, among other things, prevent abuse of the early working exception. The linkage between the early working exception and the PMNOC Regulations is expressly reflected in subsection 55.2(4) of the Act. This is the provision which allows the Governor in Council to enact regulations. It authorizes the enactment of regulations considered necessary for preventing the infringement of a patent by any person who engages in the early working of the patented invention. More specifically:
55.2(4) The Governor in Council may make such regulations as the Governor in Council considers necessary for preventing the infringement of a patent by any person who makes, constructs, uses or sells a patented invention in accordance with subsection (1), including, without limiting the generality of the foregoing, regulations …
55.2 (4) Afin d’empêcher la contrefaçon d’un brevet d’invention par l’utilisateur, le fabricant, le constructeur ou le vendeur d’une invention brevetée au sens du paragraphe (1), le gouverneur en conseil peut prendre des règlements, notamment …
(emphasis added)
(soulignement ajouté)
[16] The protection provided to innovators in the PMNOC Regulations is in addition to the remedy for patent infringement under the Act.
[17] The salient features of the regulatory regime as it applies to pharmaceutical drugs such as exemestane may be briefly summarized as follows:
i. A drug manufacturer who wishes to advertise or sell a new drug in Canada must first obtain a NOC pursuant to Part C, Division 8 of the Food and Drug Regulations, C.R.C. c. 870. This is done by filing one of a number of types of drug submissions. A drug manufacturer is defined to include an entity who sells a drug “under their own name” (Food and Drug Regulations, section A.01.010).
ii. A drug approved to be marketed in Canada is assigned a unique Drug Identification Number which identifies the following characteristics of the drug: its brand name, manufacturer, medicinal ingredient or ingredients, the strength of the medicinal ingredient or ingredients, the pharmaceutical dosage form and the route of administration.
iii. Typically, an innovator drug manufacturer seeking authorization to advertise or sell a new drug in Canada files a new drug submission (NDS) pursuant to section C.08.002(1) of the Food and Drug Regulations. This type of drug submission generally requires substantial evidence of clinical trials and studies to demonstrate that the new drug is safe and effective.
iv. Another type of drug submission is an abbreviated new drug submission (ANDS), which is available under subsection C.08.002(1) of the Food and Drug Regulations. Typically, a generic drug manufacturer will file an ANDS in order to obtain a NOC. The generic manufacturer will make its own version of a previously approved brand-name drug. The brand-name drug is defined in section C.08.001.1 of the Food and Drug Regulations to be a “Canadian reference product”. The generic manufacturer tests its version of the Canadian reference product in order to demonstrate that the generic’s version is bioequivalent to the Canadian reference product. Thus, the safety and effectiveness of the generic drug is established by demonstrating its bioequivalence to a drug whose safety and effectiveness has previously been established.
v. The PMNOC Regulations provide a mechanism by which a patent holder may delay the entry of a generic version of its patented drug onto the market. Section 4 permits an innovator who has filed a NDS and obtained a NOC to submit a patent list to the Minister in respect of the drug. If the patent or patents on the list meet the requisite criteria, the Minister may add the patent or patents to the Patent Register maintained by the Minister. The patent holder who submits a patent list is referred to as a “first-person”.
vi. Thereafter, if a “second person”, usually a generic drug manufacturer, seeks a NOC based on demonstrating the bioequivalence of its drug to a Canadian reference product, the second person must address each patent listed on the Patent Register in association with the Canadian reference product. The second person may address a listed patent by stating that the second person accepts that the NOC will not issue until all relevant patents expire. Alternatively, the second person may allege that a listed patent is not valid or that a listed patent will not be infringed if the second person is permitted to make, use or sell the version of the drug for which the second person seeks the NOC (subsection 5(1) of the PMNOC Regulations).
vii. A second person who alleges patent invalidity or non-infringement must then serve the first person with particulars of its allegations in a “notice of allegation”, and must prove service of the notice of allegation on the first person to the Minister (subsection 5(3) of the PMNOC Regulations).
viii. A patentee served with a notice of allegation may apply to a court for an order prohibiting the Minister from issuing a NOC until after the expiration of a patent that is the subject of the notice of allegation (subsection 6(1) of the PMNOC Regulations).
ix. A patentee’s application for prohibition under subsection 6(1) automatically triggers a statutory stay (subsection 7 of the PMNOC Regulations). During the period of the statutory stay, the Minister may not issue a NOC until one of a number of prescribed events has occurred. For example, one event that terminates the statutory stay is when a court declares that an allegation that the patent is not valid or will not be infringed by the second person is justified. Another event is when a period of 24 months elapses after the Minister receives proof that a court application has been made under subsection 6(1). Additionally, the stay triggered by the service of a notice of allegation is terminated if 45 days expires from the date a notice of allegation is served on a patentee and the patentee fails to apply for an order of prohibition under subsection 6(1) of the PMNOC Regulations.
[18] Having briefly reviewed the regulatory framework as it applies to pharmaceutical drugs such as exemestane, it is necessary to note that infliximab is a biologic, not a pharmaceutical, drug. Biologic drugs are derived through the metabolic activity of living organisms; they are variable and structurally complex. Biologic drugs are typically manufactured from animals, microorganisms, or through the use of animals or microorganisms.
[19] The approval process for subsequent entry biologic (SEB) drugs differs in certain ways from the approval process for generic pharmaceutical drugs. The main differences may be summarized as follows:
i. The approval of a SEB is sought by filing a NDS pursuant to section C.08.002 of the Food and Drug Regulations. This is to be contrasted with the filing of an ANDS for the approval of a generic version of a pharmaceutical drug.
ii. In its NDS, the SEB sponsor seeks a NOC based on the demonstrated similarity of its product to a previously approved reference biologic drug. Therefore, the NDS will provide extensive data demonstrating the similarity of the subsequent entry biologic with the reference biologic drug. This reliance on the reference biologic drug reduces the required amount of clinical and non-clinical information required to demonstrate safety and efficacy.
[20] Having reviewed the regulatory framework, I now turn to review the drug submissions at issue in these appeals.
II. The Drug Submissions (1) Pfizer’s Supplemental New Drug Submission for AROMASIN [21] On March 17, 2005, Pfizer filed a supplemental NDS seeking approval to market tablets containing the medicinal ingredient exemestane in 25 mg strength under the trade name AROMASIN. A NOC issued in respect of this submission on May 12, 2006.
[22] On May 12, 2006, Pfizer filed a patent list in order to list Canadian Patent No. 2,409,059 (059 patent) on the Patent Register in respect of the AROMASIN tablets in 25 mg strength.
[23] On May 18, 2006, the 059 patent was listed on the Patent Register. It follows that Health Canada was satisfied that the patent complied with subsection 4(2) of the PMNOC Regulations. A patent complies with this provision if, for example, the patent contains a claim for a medicinal ingredient and the medicinal ingredient was approved through the issuance of a NOC in respect of a NDS (paragraph 4(2)(a) of PMNOC Regulations).
(2) Generic Medical Partners Inc.’s ANDS for MED-EXEMESTANE [24] Of limited relevance is an ANDS filed by Generic Medical Partners Inc. (GMP) that was not properly served on Pfizer. Through administrative error this led to a short-lived NOC issued to GMP and, later, a related NOC issued to Teva. The Federal Court discussed this at paragraphs 37 to 42 of its reasons. Of greater relevance is the drug submission made by GMP that led to the NOC at issue on these appeals.
[25] On May 22, 2012, GMP filed an ANDS seeking approval to market tablets containing the medicinal ingredient exemestane in 25 mg strength under the trade name MED-EXEMESTANE. Subsequently, on August 16, 2013, GMP served a notice of allegation on Pfizer in which it made allegations in respect of the 059 patent.
[26] Although properly served with the NOC, Pfizer did not commence an application seeking prohibition pursuant to subsection 6(1) of the PMNOC Regulations.
[27] In consequence, the Minister issued a NOC to GMP on October 1, 2013.
(3) Teva’s ANDS for TEVA-EXEMESTANE [28] On June 18, 2013, Teva filed an ANDS, which cross-referenced GMP’s ANDS, in which Teva sought approval to market tablets containing the medicinal ingredient exemestane in 25 mg strength under the trade name TEVA-EXEMESTANE.
[29] Teva’s ANDS did not contain any data. It included a certification in which Teva certified that all aspects of Teva’s drug product were identical to GMP’s cross-referenced drug product except for the names of the manufacturer and the product. Teva also certified that its drug product would be manufactured in the same location as GMP’s drug product, with identical specifications and procedures. Teva also included in its submission an authorization from GMP permitting the Minister to access GMP’s ANDS when processing Teva’s ANDS.
[30] On October 1, 2013, the Minister issued a NOC to Teva.
(4) Janssens’ NOC for REMICADE [31] On September 27, 2001, based on a NDS filed by Centocor Inc., a NOC issued to Centocor with respect to a 100 mg/vial infliximab powder for solution product marketed under the brand name REMICADE. At the same time, a Drug Identification Number was issued with respect to this medication: 02244016.
[32] On June 20, 2011, Janssen filed an administrative NDS to transfer the Drug Identification Number issued for REMICADE from Centocor to Janssen. On August 5, 2011, Janssen was issued a NOC in response to its administrative NDS and the Drug Identification Number was transferred to Janssen.
[33] With the consent of the patent owner, The Kennedy Trust for Rheumatology Research, Janssen filed a Patent List in order to list Canadian Patent No. 2,261,630 (630 patent) on the Patent Register in respect of REMICADE.
[34] On December 4, 2012, the 630 patent issued. It was listed on the Patent Register on December 6, 2012 in respect of REMICADE.
(5) Celltrion Healthcare Co. Ltd.’s NDS for INFLECTRA [35] On November 14, 2012, Celltrion Healthcare Co. Ltd. filed a NDS seeking approval to market its subsequent entry biologic INFLECTRA which contained the medicinal ingredient infliximab in 100 mg/vial strength in powder for solution dosage form. In its NDS Celltrion sought to demonstrate similarity between INFLECTRA and REMICADE.
[36] Celltrion’s NDS nominated Hospira to be a distributor for INFLECTRA (affidavit of Beryl Chan, the Regulatory Affairs Director of Hospira, at paragraph 16).
[37] As at November 14, 2012, the filing date of Celltrion’s NDS, no patent was listed on the Patent Register in respect of REMICADE. As a result, on January 15, 2014, the Minister issued a NOC to Celltrion in respect of INFLECTRA. The Minister assigned a Drug Identification Number to INFLECTRA: 02419475.
[38] Hospira was entitled to sell INFLECTRA under this NOC (affidavit of Beryl Chan, at paragraph 16).
(6) Hospira’s NDS for INFLECTRA [39] On April 7, 2014 Hospira filed a NDS cross-referencing Celltrion’s NDS seeking approval to market INFLECTRA.
[40] Hospira’s NDS did not contain any scientific data. It included its certification that Hospira and Celltrion had entered into a licensing agreement with respect to INFLECTRA and that pursuant to this agreement Celltrion would no longer be selling the product. In the certification Hospira certified that, except the manufacturer’s name, all aspects of its drug product were identical to the cross-referenced Celltrion drug product and that the product would be manufactured in the same location with identical specifications and procedures. As well, a letter of authorization was provided from Celltrion permitting the Minister to cross-reference its NDS when processing Hospira’s NDS.
[41] The Biologics and Genetic Therapies Directorate of Health Canada concluded that because there were no changes to the previously approved drug product itself, there were no patents that Hospira was required to address (Exhibit I to the affidavit of Pino DiFranco, a Patent Officer-Legal, employed by Health Canada).
[42] On June 4, 2014 the Minister issued a NOC to Hospira in respect of its NDS for INFLECTRA. The Minister assigned the same Drug Identification Number to Hospira’s INFLECTRA as had previously been assigned to Celltrion’s INFLECTRA.
III. The Decision of the Federal Court [43] As mentioned above, the Federal Court found the standard of review of the Minister’s decision to be correctness. It went on to find that the Minister’s interpretation of the PMNOC Regulations was incorrect.
[44] Central to the reasoning of the Federal Court were its conclusions that:
i. the prior jurisprudence had not satisfactorily settled the applicable standard of review (reasons, at paragraphs 70-72, 105-108);
ii. the reasonableness standard of review “is presumptively applicable whenever an administrative decision-maker interprets its constituent statute or a statute or regulation that is closely connected with its function” unless certain limited exceptions apply (reasons, at paragraphs 67, 109);
iii. notwithstanding the broad language employed by the Supreme Court in Canadian National Railway Co. v. Canada (Attorney General), 2014 SCC 40, [2014] 2 S.C.R. 135, at paragraphs 59-62, to describe the deference owed to the Governor in Council when interpreting legislation closely related to its economic regulatory review function, this decision did not establish a fixed rule that the presumption of reasonableness may only be rebutted if the decision at issue falls into one of four categories. Those categories are constitutional questions, true jurisdictional questions, questions of competing jurisdiction between administrative tribunals and questions of general importance to the legal system as a whole which are outside of the decision-maker’s expertise (reasons, at paragraph 88);
iv. the presumption of reasonableness may be rebutted if a contextual analysis demonstrates that Parliament did not intend the question to be left to the decision-maker to determine because the question falls more appropriately within the expertise of the reviewing court (reasons, at paragraph 104);
v. having regard to the purpose of the decision-maker, the nature of the question at issue and the expertise of the decision-maker, the presumption of reasonableness was rebutted (reasons, at paragraphs 111-120);
vi. more specifically, the Federal Court found that:
a. nothing in the PMNOC Regulations indicated that the Governor in Council intended the issue of whether an applicant has made a “submission for an NOC” that “directly or indirectly compares” its product to that of another innovator be left to the Minister or officials within Health Canada (reasons, at paragraph 113);
b. indeed, the regulatory and statutory context indicated that the issue is not to be left to Health Canada because the Minister enjoys no discretion as to whether to issue a NOC (reasons, at paragraph 114); and,
c. the Governor in Council left to the Court the ultimate determination of whether a NOC should issue under the PMNOC Regulations. The Court’s role is inconsistent with application of the reasonableness standard to the Minister’s decisions. Further, the case was similar to that in Takeda Canada Inc. v. Canada (Minister of Health), 2013 FCA 13, 440 N.R. 346 where the dissenting judge rebutted the presumptive application of the reasonableness standard on the basis that the question before the Minister was purely legal, the Minister had no experience in legal interpretation and nothing in the legislation suggested deference should be given to the Minister’s decision (reasons, at paragraphs 116-118);
vii. the Federal Court then turned to the application of the correctness standard to the decision of the Minister, recognizing that the applicable statutory and regulatory provisions were to be interpreted in a purposive manner (reasons, at paragraphs 121, 131);
viii. the Federal Court rejected the notion that the purpose of the PMNOC Regulations “is to allow the ‘early working’” of a patented drug by a generic drug manufacturer. These Regulations exist not only to allow early working but also to balance the interest in promoting early access to less expensive generic drugs with the interest of patentees in obtaining proper protection for their patented inventions. It is irrelevant to the objects of subsection 5(1) of the PMNOC Regulations that Teva did not take advantage of the early working exception. Once “the purpose of the PMNOC Regulations is properly understood, it supports the conclusion that a company in the position of Teva must comply with subsection 5(1) of the Regulations” (reasons, at paragraphs 133-136);
ix. the Federal Court rejected the argument that Teva’s administrative drug submission did not come within the scope of subsection 5(1) of the PMNOC Regulations. The Federal Court could not distinguish the decisions of this Court in Nu-Pharm Inc. v. Canada (Attorney General) (1998), 80 C.P.R. (3d) 74, [1998] F.C.J. No. 274 (Nu-Pharm 1); and Merck & Co., Inc. v. Canada (Attorney General) (2000), 179 F.T.R. 278, 5 C.P.R. (4th) 138 (Nu-Pharm 2) (together the Nu-Pharm decisions). The Federal Court viewed these cases to indicate that “subsection 5(1) of the PMNOC Regulations exists to require all generic companies who obtain their rights through a licence to address an innovator company’s patent on the Patent Register created by the Regulations, whether they make a direct or an indirect comparison to the innovator’s product”. Further, just as in the present cases, in the Nu-Pharm decisions the generic company had acquired the right to produce the drug in question under a license from another generic company and filed a submission that made a direct or indirect comparison to an innovator’s drug (reasons, at paragraphs 137, 141);
x. the Federal Court rejected the submission that the situation before the Court was identical to that before the Court in GlaxoSmithKlein Inc. v. Canada (Attorney General), 2004 FC 1302, 38 C.P.R. (4th) 27 (Glaxo) where the Federal Court held that the administrative new drug submissions filed in that case did not engage the PMNOC Regulations because such submissions were not “submissions” within the meaning of subsection 5(1) of the PMNOC Regulations. In the Federal Court’s view, the decision was distinguishable because in Glaxo the generic company had complied with subsection 5(1) of the PMNOC Regulations and had served a notice of allegation on the innovator company and the Judge’s comments relied upon by the Attorney General were obiter (reasons, at paragraph 142); and,
xi. finally, the Federal Court found that the cases interpreting the meaning of “submission” in the context of section 4 of the PMNOC Regulations for the purpose of listing a patent on the Patent Register are inapplicable to the issues in this case - the concerns about an innovator company extending its entitlements under the Regulations through administrative filings do not arise in this case (reasons, at paragraph 143).
IV. The Standard of Review to be applied to the Decision of the Federal Court [45] It is well-settled, and not in contention on these appeals, that when reviewing a decision of the Federal Court made in the context of an application for judicial review, this Court is required to determine whether the Federal Court identified the appropriate standard of review and then properly applied the standard (Agraira v. Canada (Public Safety and Emergency Preparedness), 2013 SCC 36, [2013] 2 S.C.R. 559, at paragraph 45).
V. Did the Federal Court err when it identified the appropriate standard of review to be correctness? [46] I agree with the Federal Court that the prior jurisprudence had not satisfactorily determined the standard of review to be applied to the decisions of the Minister. I reject the submissions of the respondents Pfizer, Janssen and The Kennedy Trust that decisions such as Bristol-Myers Squibb Co. v. Canada (Attorney General), 2005 SCC 26, [2005] 1 S.C.R. 533, at paragraph 36 (Biolyse) and AstraZeneca v. Canada (Minister of Health), 2006 SCC 49, [2006] 2 S.C.R. 560, at paragraph 25 selected the standard of review in a manner binding upon this Court and the Federal Court. As the Federal Court correctly noted, in Agraira, at paragraph 48, the Supreme Court instructed that the standard of review cannot be seen to be satisfactorily established “if the relevant precedents appear to be inconsistent with recent developments in the common law principles of judicial review”. In my view this is the case in the present appeals because both Biolyse and AstraZeneca were decided without regard to the presumption of reasonableness articulated in cases such as Alberta Teachers’ Association v. Alberta (Information and Privacy Commissioner), 2011 SCC 61, [2011] 3 S.C.R. 654, at paragraph 39.
[47] I also agree with the Federal Court that the presumption of reasonableness may be rebutted when a contextual analysis reveals Parliament’s intent “not to protect the tribunal’s jurisdiction in relation to certain matters; the existence of concurrent and non-exclusive jurisdiction on a given point of law is an important factor in this regard” (Mouvement laïque québécois v. Saguenay (City), 2015 SCC 16, [2015] 2 S.C.R. 3, at paragraph 46; citing, Tervita Corp. v. Canada (Commissioner of Competition), 2015 SCC 3, [2015] 1 S.C.R. 161, at paragraphs 35-36 and 38-39; McLean v. British Columbia (Securities Commission), 2013 SCC 67, [2013] 3 S.C.R. 895, at paragraph 22; Rogers Communications Inc. v. Society of Composers, Authors and Music Publishers of Canada, 2012 SCC 35, [2012] 2 S.C.R. 283, at paragraph 15).
[48] Where my analysis diverges from that of the Federal Court is that in my view a contextual analysis does not rebut the presumption of reasonableness.
[49] The Federal Court relied upon the following considerations to rebut the presumption of reasonableness:
i. the Minister has no discretion whether to issue a NOC. The Minister may not issue a NOC until the criteria in section 7 of the PMNOC Regulations are met (reasons, at paragraph 114);
ii. the Governor in Council left the ultimate decision of whether a NOC should issue under the PMNOC Regulations to the Court, because the Federal Court is required to adjudicate applications for prohibition. This role is inconsistent with reasonableness review (reasons, at paragraph 116); and,
iii. the question was purely legal, and nothing in the PMNOC Regulations suggests that deference should be given to the Minister’s interpretation of the Regulations (reasons, at paragraph 118).
[50] I begin my analysis by rejecting the respondents’ submission that the argument for reasonableness review rests on the incorrect characterization of the PMNOC Regulations as the Minister’s home statute. While I agree that these regulations are enacted pursuant to the Patent Act which falls under the Minister of Industry, not Health, this is too narrow a view of the prevailing jurisprudence. The presumption of reasonableness applies when an administrative decision-maker is interpreting not just its home statute, but also when the decision-maker is interpreting “statutes closely connected to its function” (Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, at paragraph 54). This applies equally to regulations such as the PMNOC Regulations that are closely connected to the function of the Minister of Health.
[51] Having concluded that it should be presumed that the decision of the Minister interpreting the PMNOC Regulations is reviewable on the standard of reasonableness, neither the fact that this raises a legal question nor the fact that the PMNOC Regulations do not suggest deference point away from the reasonableness standard.
[52] Since Dunsmuir, the Supreme Court has stated that the interpretation of unclear language in an administrative decision-maker’s home statute (or regulation) is usually best left to the administrative decision-maker (McLean, at paragraph 33). The proper inquiry is whether the PMNOC Regulations evidence Parliament’s intention that decisions of the Minister interpreting the Regulations be reviewed on a less deferential standard of review (Tervita, at paragraphs 38-39).
[53] I can find no indication of such intention in the PMNOC Regulations.
[54] I also disagree that the role of the Court in the PMNOC Regulations is inconsistent with reasonableness review, and disagree that this case is “somewhat similar to Rogers Communications Inc. in which Justice Rothstein for the majority applied the correctness standard to the review of the Copyright Board’s interpretation of its constituent Act on the basis that the Board and the courts shared concurrent jurisdiction under the statute…” (reasons, at paragraph 117).
[55] The Minister has exclusive jurisdiction to decide whether a drug submission filed by a second person makes a comparison with a Canadian reference product so as to require the second person to address a patent listed on the Patent Register. It is only if this question is answered by the Minister in the affirmative, a notice of allegation is served by the second person, and a prohibition application is commenced by the first person that the Minister is prohibited from issuing a NOC under paragraph 7(1)(e) of the Regulations (section 7 PMNOC Regulations).
[56] Aside from the Court’s potential role on an application for judicial review of a Ministerial decision made under section 5, the PMNOC Regulations provide a role for the Court as a first instance decision-maker only under section 6: where a first person has initiated an application for prohibition it is for the Court to determine whether the allegations contained in a second person’s notice of allegation are justified. On an application for prohibition, the Court does not consider whether section 5 ought to have been triggered in the first place. It follows that in a prohibition application there is no possibility of conflicting interpretations between the Minister and the Court with respect to whether section 5 was triggered.
[57] In my view, the question of whether a drug submission triggers section 5 of the PMNOC Regulations is a question of mixed fact and law. It is well-settled that reasonableness is the standard of review to be applied to such questions (see, for example, Tervita, at paragraph 40).
[58] In Dunsmuir, at paragraphs 55 and 68, the Supreme Court recognized that where there is a discrete or special administrative regime in which the decision-maker has special expertise, that decision-maker is entitled to deference. In my view Health Canada, and through it the Minister, are required on a regular basis to interpret section 5 of the Regulations. For example, the Minister is required to determine whether to issue a NOC or to place a drug submission on patent hold. In AstraZeneca, the Supreme Court required the Minister to conduct a patent-specific analysis when applying subsection 5(1) because a “generic manufacturer is only required to address the cluster of patents listed against submissions relevant to the NOC that gave rise to the comparator drug” (AstraZeneca, at paragraph 39).
[59] It follows from the nature of the question and the Minister’s expertise that the decisions at issue should be reviewed on the standard of reasonableness.
[60] I now turn to the second issue.
VI. Was it unreasonable for the Minister to conclude that section 5 of the PMNOC Regulations was not engaged by the drug submissions at issue such that NOCs should issue to Teva and Hospira? [61] Because the Federal Court did not apply the appropriate standard of review it is necessary for this Court to apply the appropriate standard of review, reasonableness, to the decisions of the Minister. This said, it is helpful to review the conclusions that led the Federal Court to its determination that the decisions of the Minister were incorrect.
[62] The pertinent conclusions of the Federal Court on this point were as follows:
i. the Federal Court rejected the notion that the purpose of the PMNOC Regulations “is to allow the ‘early working’” of a patented drug by a generic drug manufacturer. These Regulations exist not only to allow early working but also to balance the interest in promoting early access to less expensive generic drugs with the interest of patentees in obtaining proper protection for their patented inventions. Therefore it was irrelevant to the objects of subsection 5(1) of the PMNOC Regulations that Teva did not take advantage of the early working exception (reasons, at paragraphs 133-135);
ii. the Federal Court rejected the argument that Teva’s administrative drug submission did not come within the scope of subsection 5(1) of the PMNOC Regulations. The Federal Court could not distinguish the Nu-Pharm decisions of this Court. These cases held that “subsection 5(1) of the PMNOC Regulations exists to require all generic companies who obtain their rights through a licence to address an innovator company’s patent on the Patent Register created by the Regulations, whether they make a direct or an indirect comparison to the innovator’s product”. Just as in the Nu-Pharm decisions, Teva “filed a submission that makes a direct or indirect comparison” to a first person’s drug (reasons, at paragraphs 137, 141);
iii. the Federal Court rejected the submission that the situation before the Court was identical to that before the Court in Glaxo, where the Federal Court held that the administrative new drug submissions filed in that case did not engage the PMNOC