Bayer Inc. v. Apotex Inc.

Bayer Inc. v. Apotex Inc.
Court (s) Database
Federal Court Decisions
Date
2016-09-07
Neutral citation
2016 FC 1013
File numbers
T-1368-14, T-1379-13, T-1468-13
Decision Content
Date: 20160907
Dockets: T-1379-13
T-1468-13
T-1368-14
Citation: 2016 FC 1013
Ottawa, Ontario, September 7, 2016
PRESENT: The Honourable Mr. Justice Fothergill
Docket: T-1379-13
BETWEEN:
BAYER INC. and BAYER PHARMA AKTIENGESELLSCHAFT
Plaintiffs
Defendants by Counterclaim
and
COBALT PHARMACEUTICALS COMPANY
Defendant
Plaintiff by Counterclaim
Dockets: T-1468-13
T-1368-14
AND BETWEEN:
BAYER INC. and BAYER PHARMA AKTIENGESELLSCHAFT
Plaintiffs
Defendants by Counterclaim
and
APOTEX INC.
Defendant
Plaintiff by Counterclaim
PUBLIC JUDGMENT AND REASONS
(Confidential version issued on September 7, 2016)
TABLE OF CONTENTS
I. Overview.. 3
II. Background. 6
A. The Products in Issue. 6
B. The ‘426 Patent Generally. 7
C. Previous Proceedings Involving the Parties. 8
(1) The Cobalt Proceedings. 8
(2) The Apotex Proceedings. 9
D. The Pleadings. 10
III. The ‘426 Patent in Detail 11
IV. The Claims in Issue. 16
V. Comity and Stare Decisis. 17
VI. Issues. 21
VII. Preliminary Observations Regarding the Evidence. 21
A. Objections to the Expert Evidence. 21
B. “Blinding” of Expert Witnesses. 23
VIII. Claim Construction and Validity. 24
A. Fact and Expert Witnesses. 24
B. General Observations Regarding the Evidence. 27
C. Governing Principles and Relevant Date. 28
D. Person of Ordinary Skill in the Art 29
E. Common General Knowledge of the POSITA.. 30
F. Claim Terms Needing Construction. 33
(1) “Drospirenone Particles”. 33
(2) “Upon Dissolution in the Gastric Environment”. 35
IX. Validity. 37
A. Burden. 37
B. Developments Leading to the ‘426 Patent 37
C. Obviousness. 40
(1) The POSITA and Common General Knowledge. 42
(2) The Inventive Concept 42
(3) The Differences Between the Prior Art and the Invention. 44
(4) Whether the Differences were Obvious or Required Invention. 46
D. Anticipation. 52
(1) Disclosure and Enablement 54
(2) The “Experimental Use” Exception. 58
E. Overbreadth. 60
F. Insufficiency of the Specification. 63
G. Utility. 65
H. Conclusion on Validity. 68
X. Infringement – Apotex. 68
A. Burden and Legal Principles. 68
B. The Evidence – Expert Witnesses. 69
C. The Evidence – Experimental Testing. 71
(1) Experiments Conducted by Bayer 71
(2) Experiments conducted by Apotex. 75
D. General Observations Regarding the Evidence. 77
E. Analysis. 78
(1) Bayer’s Confocal Raman Spectroscopy Experiments. 78
(2) Bayer’s FT Raman Spectroscopy Experiments. 84
(3) Apotex’s ATR Microscopy Experiments. 91
(4) Apotex’s Confocal Raman Experiments. 96
(5) Development of the Zamine and Mya Tablets. 97
F. Conclusion. 101
XI. Infringement – Cobalt 101
A. Preliminary Issue – Cobalt’s “Admission”. 101
B. The Evidence – Expert Witnesses. 105
C. The Evidence – Experimental Testing. 107
(1) Experiments conducted by Bayer 107
(2) Experiments conducted by Cobalt 107
D. General Observations Regarding the Evidence. 108
E. Further Observations Regarding Construction of the Claims. 108
F. Analysis. 110
(1) Cobalt’s Manufacturing Process. 110
(2) Bayer’s Confocal Raman Spectroscopy Experiments. 112
(3) Cobalt’s Confocal Raman Spectroscopy Experiments. 113
G. Conclusion. 115
XII. Remedies. 115
XIII. Costs. 118
I. Overview [1] The plaintiffs are related companies. Bayer Pharma Aktiengesellschaft [Bayer Pharma] is a German corporation that discovers and develops pharmaceuticals for commercial purposes. Bayer Inc. is a Canadian corporation with its head office in Toronto.
[2] The defendant and counter-claimant Apotex Inc. [Apotex] is a generic pharmaceutical corporation with its head office in Toronto.
[3] The defendant and counter-claimant Cobalt Pharmaceuticals Company [Cobalt], now Actavis Pharma Company, is a generic pharmaceutical corporation with its head office in Mississauga.
[4] Schering Aktiengesellschaft [Schering], predecessor in title to Bayer Pharma, was a pharmaceutical company in Germany. On August 31, 2000, Schering filed an application for Canadian Letters Patent No. 2,382,426 [the ‘426 patent]. The title of the ‘426 patent is “Pharmaceutical Combination of Ethinylestradiol and Drospirenone for Use as a Contraceptive”. The application claimed priority from both a United States and a European patent application filed on August 31, 1999. Bayer Pharma is now the registered owner of the ‘426 patent.
[5] Ethinylestradiol functions as an estrogen, while drospirenone functions as a progestogen. Together, they inhibit ovulation in the human female. When Schering applied for the ‘426 patent, it was known that ethinylestradiol and drospirenone could be used in the formulation of an effective oral contraceptive. However, no drug manufacturer had offered the precise formulation disclosed and claimed in the ‘426 patent for sale to the public.
[6] Based on laboratory tests conducted in vitro, drospirenone was known to be acid-labile at a pH of 1.0, meaning it would isomerize into an inactive compound when exposed to an acidic solution of pH 1. The normal pH range of the stomach is 1.0 to 3.0.
[7] Drospirenone is a steroid and is therefore poorly soluble in water. Poorly soluble compounds can be micronized (i.e., ground into very small pieces) to increase their rate of dissolution. However, improving the dissolution rate of an acid-labile drug may cause it to degrade even more quickly in the gastric environment.
[8] A drug’s rate of dissolution in the stomach depends in part on its formulation. An enteric coat may be used to protect the active pharmaceutical ingredients in a tablet from the gastric environment, ensuring that the drug is released in the less acidic environment of the small intestine. An immediate release formulation, which has no enteric coat, will rapidly disintegrate in the stomach.
[9] Schering initially developed an oral contraceptive comprising ethinylestradiol and drospirenone as an enterically-coated tablet. One difficulty with an enteric coat, however, is that it may cause variability in the drug’s effectiveness in different people. Based on further experiments, including tests conducted in vivo, Schering discovered that it was possible to administer a low dose of ethinylestradiol and drospirenone in a micronized or other rapidly dissolving form without using an enteric coat, while still achieving good bioavailability as a contraceptive. Schering considered this to be a novel invention, and therefore sought to protect it by applying for a patent.
[10] Apotex and Cobalt also sell oral contraceptive pills with ethinylestradiol and drospirenone as the active pharmaceutical ingredients. The dosages are similar to those used in the plaintiffs’ products. The tablets are also rapidly dissolving and do not have an enteric coat.
[11] The plaintiffs say that Apotex’s and Cobalt’s products infringe claims 31, 48 and 49 of the ‘426 patent. Apotex and Cobalt reply that their products are formulated in a manner that brings them outside the scope of the asserted claims. They also maintain that the claims are invalid.
[12] As is common in patent trials, the parties presented voluminous evidence and extensive arguments in support of their respective positions. In the reasons that follow, I have endeavoured to address all those that, in my view, have a potential bearing on the outcome of this dispute. Some aspects of the evidence and argument may not be fully canvassed below, but I have considered it all.
[13] I find that claims 31, 48 and 49 of the ‘426 patent are not invalid based on any of the asserted grounds of: (i) obviousness; (ii) anticipation; (iii) overbreadth; (iv) insufficiency or ambiguity of the specification; or (v) inutility. I also find that Apotex’s and Cobalt’s products are formulated in a manner that falls within the scope of claims 31, 48 and 49 of the ‘426 patent. Apotex’s and Cobalt’s products therefore infringe claims 31, 48 and 49 of the ‘426 patent.
II. Background A. The Products in Issue [14] Bayer Pharma is the registered owner of the ‘426 patent and is also the patentee. Bayer Inc. is a licensee of the ‘426 patent and sells oral contraceptive tablets under the names “Yaz” and “Yasmin” with the consent of Bayer Pharma. Both entities are persons claiming under the patentee Bayer Pharma pursuant to s 55(1) of the Patent Act, RSC 1985 c P-4 [the Act]. I will refer to the plaintiffs collectively as Bayer.
[15] Apotex obtained from the Minister of Health a Notice of Compliance to sell generic versions of Bayer’s Yasmin tablets under the names “Zamine 21” and “Zamine 28” [Zamine] on August 15, 2013, and a generic version of Bayer’s Yaz tablets under the name “Mya” [Mya] on May 8, 2014. The Zamine tablets contain 3 mg of drospirenone and 0.03 mg of ethinylestradiol. The Mya tablets contain 3 mg of drospirenone and 0.02 mg of ethinylestradiol.
[16] Cobalt manufactures and sells generic versions of Bayer’s Yasmin tablets under the names “Zarah 21” and “Zarah 28” [Zarah]. The Zarah tablets contain 3 mg of drospirenone and 0.03 mg of ethinylestradiol. Cobalt received regulatory approval to begin marketing the Zarah tablets in Canada on May 31, 2013.
B. The ‘426 Patent Generally [17] The title of the ‘426 patent is “Pharmaceutical Combination of Ethinylestradiol and Drospirenone for Use as a Contraceptive”. The patent names Wolfgang Heil, Jurgen Hilman, Ralph Lipp and Renate Heithecker as the inventors.
[18] The application for the patent was filed under the provisions of the Patent Cooperation Treaty, 19 June 1970, Can TS 1990 No 22 (entered into force 24 January 1978), with an effective filing date in Canada of August 31, 2000. It claimed priority from both a United States and a European patent application, the international precursors to the ‘426 patent. Both patents were filed on August 31, 1999. The date of publication is March 8, 2001.
[19] The ‘426 patent was issued to Schering on February 28, 2006. Bayer Pharma became the registered owner of the patent on October 6, 2011. Bayer Inc. is a licensee.
[20] The application for the ‘426 patent was filed with the Canadian Patent Office after October 1, 1989. The provisions of the “new” Patent Act, which applies to all patent applications filed after that date, are therefore relevant to this action. Unless found to be invalid, the term of the ‘426 patent will expire on August 31, 2020.
C. Previous Proceedings Involving the Parties (1) The Cobalt Proceedings [21] In December 2011, Cobalt sought regulatory approval to sell a generic version of Bayer’s Yaz tablets. The proposed composition was similar to Cobalt’s Zarah tablets, but contained 3 mg of drospirenone and 0.02 mg of ethinylestradiol. Cobalt applied to the Minister of Health [the Minister] for a Notice of Compliance, alleging that the process by which its drug would be manufactured would not infringe claim 31, and dependent claims 48 and 49, of the ‘426 patent, and that all claims of the patent asserted by Bayer were invalid.
[22] In response, Bayer commenced an application under the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 [NOC Regulations] to prohibit the Minister from issuing a Notice of Compliance to Cobalt until the expiry of the ‘426 patent. On October 22, 2013, in Bayer Inc v Cobalt Pharmaceuticals Company, 2013 FC 1061 [Bayer v Cobalt], Justice Hughes granted Bayer’s application for prohibition.
[23] One argument advanced by Cobalt before Justice Hughes was that claim 31 of the ‘426 patent was limited to micronized drospirenone particles. Justice Hughes found that claim 31 was not so limited, as it encompassed all drospirenone particles that dissolve rapidly in the manner specified in the claim. Justice Hughes held that none of Cobalt’s allegations of non-infringement and invalidity were justified. Specifically, Justice Hughes found that claim 31 was not obvious, and was not invalid on the grounds of inutility, lack of sound prediction, overbreadth, insufficiency or ambiguity. It does not appear that Cobalt challenged the ‘426 patent on the ground of anticipation.
[24] Cobalt’s appeal of Justice Hughes’ decision was dismissed by the Federal Court of Appeal on May 4, 2015 (Cobalt Pharmaceuticals Company v Bayer Inc, 2015 FCA 116 [Cobalt v Bayer FCA]). The Court of Appeal upheld Justice Hughes’ construction of the patent and confirmed that Cobalt’s allegations of non-infringement and invalidity were not justified. As a result, Cobalt is currently unable to offer its generic version of Bayer’s Yaz product for sale until the ‘426 patent expires.
(2) The Apotex Proceedings [25] Similar proceedings under the NOC Regulations were commenced by Apotex against Bayer in July 2012. Apotex sought regulatory approval for its generic version of Bayer’s Yaz tablets on the basis of non-infringement of claim 1 and dependent claims 2 and 8; claim 30; and claim 31 and dependent claims 36, 37, 39 to 42 and 47 to 50. In response, Bayer brought an application to prohibit the Minister from issuing a Notice of Compliance to Apotex.
[26] In a decision dated May 7, 2014, Justice Hughes dismissed Bayer’s application (Bayer Inc v Apotex Inc, 2014 FC 436 [Bayer v Apotex]). He found that none of the allegations made by Apotex regarding the invalidity of the ‘426 patent on the grounds of anticipation, ambiguity and insufficiency were justified. However, he also concluded that Bayer had not met its burden of proving, on a balance of probabilities, that Apotex’s allegations of non-infringement were unjustified. He ruled that Apotex’s product did not fall within the claims in issue, and Apotex was therefore able to bring its generic version of Bayer’s Yaz tablets to market.
D. The Pleadings [27] Bayer commenced an action against Cobalt on August 14, 2013 (T-1379-13), after Cobalt began marketing its Zarah tablets in Canada. In its statement of claim, Bayer alleges that Cobalt has infringed claims 1, 2, 4-7, 30, 31, 48, 49 and 52 of the ‘426 patent. Cobalt denies the allegation of infringement and, by counterclaim, alleges that the claims are invalid.
[28] Bayer commenced an action against Apotex on August 30, 2013 (T-1468-13), alleging that Apotex has infringed claims 1, 2, 4-7, 30, 31, 48, 49 and 52 of the ‘426 patent by manufacturing and selling its Zamine tablets in Canada. Apotex denies the allegation of infringement and, by counterclaim, alleges that the claims are invalid.
[29] Bayer commenced a second action against Apotex on June 4, 2014 (T-1368-14), with respect to its Mya tablets. Bayer alleges that Apotex has infringed claims 1, 2, 4-7, 30, 31, 48 and 49 of the ‘426 patent by manufacturing and selling its Mya tablets in Canada. Apotex denies the allegation of infringement and, by counterclaim, alleges that the claims are invalid.
[30] The three actions were consolidated by order of this Court dated October 2, 2014. In these proceedings, Cobalt has agreed to be bound by this Court’s determination respecting the validity of the ‘426 patent in the Apotex case and any appeals that may follow. Cobalt therefore relies on Apotex’s evidence and submissions regarding validity.
[31] On January 11, 2016, the first day of trial, Bayer informed the Court that it is seeking a declaration of infringement against Apotex and Cobalt only in respect of claim 31 of the ‘426 patent and its dependent claims, claims 48 and 49. The proceedings have been bifurcated, and this decision concerns only the questions of validity and infringement.
III. The ‘426 Patent in Detail [32] The field of the invention is described at page 1 of the ‘426 patent:
FIELD OF THE INVENTION
The present invention relates to a pharmaceutical composition comprising drospirenone and ethinylestradiol, a method of providing dissolution of drospirenone, methods of inhibiting ovulation by administration of drospirenone and the use of drospirenone and ethinylestradiol for inhibiting ovulation.
[33] This is followed by the “Background of the Invention”, which acknowledges that oral contraceptives containing a combination of a gestagen and an estrogen have been common since the 1960s. The gestagen component provides contraceptive reliability. The patent recognizes that one such gestagen, drospirenone, is known to be useful in treating several disorders. It is acknowledged that a combination of drospirenone and ethinylestradiol has been suggested as a possible, but not a preferred, combination for an oral contraceptive.
[34] The next section is titled “Summary of the Invention”, and states that a minimum and a maximum dosage level of drospirenone have been determined.
SUMMARY OF THE INVENTION
In the course of research leading to the present invention, it has surprisingly been found that a hitherto undisclosed minimum dosage level of drospirenone is required for reliable contraceptive activity. Similarly, a preferred maximum dosage has been identified at which unpleasant side effects, in particular excessive diuresis, may substantially be avoided.
[35] Page 4 sets out a “Detailed Disclosure of the Invention”. The patent states that to ensure good bioavailability of drospirenone, it should be provided in a form that promotes rapid dissolution. It then discusses micronization and provides the parameters of particle size and particle distribution, as well as dissolution parameters. The patent states that it is possible to provide the product in micronized form or by spraying it from a solution on to an inert carrier.
DETAILED DISCLOSURE OF THE INVENTION
Drospirenone, which may be prepared substantially as described in, e.g., US 4,129,564 or WO 98/06738, is a sparingly soluble substance in water and aqueous buffers at various pH values. Furthermore, drospirenone is rearranged to an inactive isomer under acid conditions and hydrolysed under alkaline conditions. To ensure good bioavailability of the compound, it is therefore advantageously provided in a form that promotes rapid dissolution thereof.
It has surprisingly been found that when drospirenone is provided in micronized form (so that particles of the active substance have a surface area of more than 10,000 cm2/g, and the following particle size distribution as determined under the microscope: not more than 2 particles in a given batch with a diameter of more than 30 µm, and preferably ≤ 20 particles with a diameter of ≥ 10 µm and ≤ 30 µm) in a pharmaceutical composition, rapid dissolution of the active compound from the composition occurs in vitro (“rapid dissolution” is defined as the dissolution of at least 70% over about 30 minutes, in particular at least 80% over about 20 minutes, of drospirenone from a tablet preparation containing 3 mg of drospirenone in 900 ml of water at 37°C determined by the USP XXIII Paddle Method using a USP dissolution test apparatus 2 at 50 rpm). Instead of providing the drospirenone in micronized form, it is possible to dissolve it in a suitable solvent, e.g. methanol or ethyl acetate, and spray it onto the surface of inert carrier particles followed by incorporation of the particles containing drospirenone on their surface in the composition.
Without wishing to be limited to any particular theory, it appears that the in vitro dissolution rate of drospirenone is connected to the dissolution rate in vivo resulting in rapid absorption of drospirenone in vivo on oral administration of the compound. This is an advantage because isomerization of the compound in the gastric environment and/or hydrolysis in the intestine is substantially reduced, leading to a high bioavailability of the compound.
With respect to ethinylestradiol which is also a sparingly soluble substance, though less sensitive to degradation than drospirenone under conditions prevailing in the gastrointestinal tract, it is also an advantage to provide it in micronized form or sprayed from a solution, e.g. in ethanol, onto the surface of inert carrier particles. This has the added advantage of facilitating a more homogenous distribution of the ethinylestradiol throughout the composition which might otherwise be difficult to obtain because ethinylestradiol is incorporated in extremely small amounts. When ethinylestradiol is provided in micronized form, it preferably has the following particle size distribution as determined under the microscope: 100% of the particles have a diameter of ≤ 15.0 µm, 99% of the particles have a diameter of ≤ 12.5µm, 95% of the particles have a diameter of ≤ 10.0 µm, and 50% of the particles have a diameter of ≤ 3.0 µm. Furthermore, no particle is larger than 20 µm, and ≤ 10 particles have a diameter of ≥ 15 µm and ≤ 20 µm.
To obtain a more rapid rate of dissolution, it is preferred to include carriers or excipients which act to promote dissolution of both active substances. Examples of such carriers and excipients include substances that are readily soluble in water such as cellulose derivatives, carboxymethylcellulose, hydroxypropyl cellulose, hydroxypropylmethyl cellulose, gelled starch, gelatin or polyvinylpyrrolidone. In particular, it appears as though polyvinylpyrrolidone might be particularly helpful to promote dissolution.
The composition of the invention preferably comprises drospirenone in an amount corresponding to a daily dosage of from about 2.5 mg to about 3.5 mg, in particular about 3 mg. The amount of ethinylestradiol preferably corresponds to a daily dosage of from about 0.015 mg to about 0.04 mg, in particular from about 0.015 mg to about 0.03 mg. More particularly, the present composition comprises an amount of drospirenone corresponding to a daily dosage of from about 3.0 to about 3.5 mg and ethinylestradiol in an amount corresponding to from about 0.015 to about 0.03 mg.
Apart from its ability to inhibit ovulation, the composition of the invention has been found to possess pronounced anti-androgenic properties and may therefore be used in the prevention or treatment of androgen-induced disorders, in particular acne. Such use may be independent from or concomitant with the use as a contraceptive disclosed above. Furthermore, since drospirenone is an aldosterone antagonist, it has diuretic properties and is therefore suitable for counteracting the water-retentive properties of ethinylestradiol.
In a particular embodiment, the invention relates to a pharmaceutical preparation consisting of a number of separately packaged and individually removable daily dosage units placed in a packaging unit and intended for oral administration for a period of at least 21 consecutive days, wherein each of said daily dosage units comprises a combination of drospirenone in an amount of from about 2 mg to about 4 mg and ethinylestradiol in an amount from about 0.01 to about 0.05 mg.
[36] The detailed disclosure describes carriers and excipients, particular dosages, other uses, dosage packaging, daily dosages, and rest periods.
[37] The patent states at page 9 that the composition of the invention may be formulated in any manner known in the pharmaceutical art:
The composition of the invention may be formulated in any manner known in the pharmaceutical art. In particular, as indicated above, the composition may be formulated by a method comprising providing drospirenone and, if desired, ethinylestradiol in micronized form in said unit dosage form, or sprayed from a solution onto particles of an inert carrier in admixture with one or more pharmaceutically acceptable excipients that promote dissolution of the drospirenone and ethinylestradiol so as to promote rapid dissolution of drospirenone and preferably ethinylestradiol on oral administration.
[38] There follows a list of examples of suitable excipients, together with the observation that the tablets may be film-coated and that the composition may be in liquid form. Packaging units, parenteral formulation and transdermal formulations are also discussed.
[39] Beginning at page 11, the patent provides five examples of tests conducted by the named inventors. Example 1 deals with the preparation of tablets containing drospirenone and ethinylestradiol, both micronized. Example 2 deals with the dissolution rate of the drospirenone in such tablets. Example 3 deals with the dissolution rate of ethinylestradiol. Example 4 addresses the bioavailability of drospirenone and ethinylestradiol. Example 5 deals with the contraceptive efficacy of formulations containing those components.
[40] The Claims of the patent, 53 in total, then follow.
IV. The Claims in Issue [41] Claim 31 is the only independent claim in issue. It reads as follows:
A pharmaceutical composition comprising:
from about 2 mg to about 4 mg of drospirenone particles, wherein the drospirenone is in a form, which when provided in a tablet containing 3 mg of drospirenone, has a dissolution such that at least 70% of said drospirenone is dissolved in 900 ml of water at 37° C. (±0.5° C) within 30 minutes, as determined by USP XXIII Paddle Method using a USP dissolution test apparatus 2 at a stirring rate of 50 rpm, including 6 covered glass vessels and 6 paddles;
about [sic] 0.01 mg to about 0.05 mg of 17α-ethinylestradiol; and one or more pharmaceutically acceptable carriers; the composition being in an oral dose form, and the composition being effective for oral contraception in a human female.
[42] Claims 48 and 49 are also in issue, but only as they depend from claim 31.
[43] Claim 48, as it depends from claim 31, reads as follows:
A composition or kit according to claim 31, wherein the amount of drospirenone is from 2.5 mg to 3.5 mg, and the amount of 17α-ethinylestradiol is from 0.015 mg to 0.04 mg.
[44] Claim 49, as it depends from claim 31, reads as follows:
A composition or kit according to claim 31, wherein the 17α-ethinylestradiol is provided in an amount of from about 0.01 to about 0.04 mg and the drospirenone is provided in a form whereby the drospirenone is exposed to the gastric environment upon dissolution.
V. Comity and Stare Decisis [45] The parties disagree on the extent to which this Court is bound by the findings of fact and law made by the Federal Court of Appeal and by Justice Hughes in the related NOC proceedings. The parties accept the general proposition that pronouncements of law made by higher courts are binding pursuant to the doctrine of stare decisis. However, they differ on whether this Court is bound to follow prior findings of law that are heavily dependent on expert evidence, such as claim construction. They also disagree over the extent to which I should abide by Justice Hughes’ conclusions pursuant to the doctrine of comity.
[46] Bayer submits that this Court should adhere to the Federal Court of Appeal’s construction of the ‘426 patent unless the evidence demonstrates the prior construction was wrong, or if different evidence compels a different result. Bayer relies on the Federal Court of Appeal’s decisions in Allergan Inc v Canada (Minister of Health), 2012 FCA 308 at paragraphs 50-51 [Allergan] and Pfizer Canada Inc v Apotex Inc, 2014 FCA 250 at paragraph 59 [Pfizer Canada]. Bayer also urges this Court to adopt additional conclusions reached by the Federal Court of Appeal and by Justice Hughes in the NOC context, including that the ‘426 patent is not invalid on the grounds of obviousness, insufficiency or overbreadth.
[47] Cobalt says that findings made in a NOC proceeding do not, as a matter of law, constitute a final determination of the validity or infringement of a patent, citing the Supreme Court of Canada’s decision in Eli Lilly & Co v Novopharm Ltd, [1998] 2 SCR 129 at paragraphs 95-96, [1998] ACS No 59. Cobalt submits that the scope of the evidence adduced in an action for infringement is much broader than in a NOC proceeding, and this Court is therefore free to depart from the conclusions reached by the Federal Court of Appeal and by Justice Hughes.
[48] Cobalt also says that a court’s construction of a claim in the NOC context is not binding in a subsequent action for infringement, but may carry persuasive weight where the claim was construed without the need for specialized knowledge (citing AstraZeneca Canada Inc v Apotex Inc, 2015 FC 322 at paras 175-79). Cobalt cautions that, given the different evidentiary record in an action for infringement, relying on the conclusions of the judge who heard the NOC proceeding may constitute a grave error (citing AstraZeneca Canada Inc v Apotex Inc, 2014 FC 638 at paras 34, 36, 42, aff’d on other grounds 2015 FCA 158, leave to appeal to SCC granted [AstraZeneca]).
[49] Apotex says that findings made in the NOC context should have no bearing on this action (citing Eli Lilly Canada Inc v Novopharm Ltd, 2007 FCA 359 at para 41). Apotex takes the position that the Federal Court of Appeal’s findings, even on questions of law, are not strictly binding, but acknowledges they may be “very persuasive”. With respect to comity, Apotex says that individual judges may determine how the doctrine is to be applied having regard to the particular jurisdiction that is being exercised (citing Allergan at para 48). Apotex, like Cobalt, cautions that it would be an error for this Court to defer to findings made in the NOC proceedings because different jurisdictions are being exercised and the evidence is not the same.
[50] It appears that the law on this point is not entirely settled. It is clear the principles of stare decisis and comity apply within the NOC context, where the courts are exercising the same jurisdiction (Allergan at paras 50-51). However, it is less clear whether these principles apply with the same force, or in the same manner, between NOC proceedings and a subsequent action for infringement and impeachment. While the legal principles may be the same, the evidentiary context is markedly different.
[51] Claim construction is a question of law for the judge (Whirlpool Corp v Camco Inc, 2000 SCC 67 at para 61 [Whirlpool]). Through the operation of stare decisis, pronouncements of law made by higher courts are binding on lower courts. However, as noted by Cobalt and Apotex, this Court has also held that NOC proceedings cannot result in a final determination of the validity or infringement of a patent because they are summary in nature, they address different issues than those that arise in trials, and they are decided on the basis of affidavit evidence (AstraZeneca at para 27).
[52] In this case, the principle of stare decisis is relevant only to the question of claim construction. The Federal Court of Appeal construed claim 31 as embracing all rapidly dissolving drospirenone particles which, when formulated in a tablet, meet the required dissolution properties (Cobalt v Bayer FCA at paras 33, 76). This is a finding of law. However, in the Cobalt proceedings, Justice Stratas remarked in obiter that claim construction should not be viewed as a “pure question of law” because the court does not construe a patent in a factual vacuum. He remarked that it is difficult to “cleave off” those aspects of claim construction that flow from an appreciation of the expert evidence and the words of the patent (Cobalt v Bayer FCA at paras 17-20). Justice Stratas nevertheless acknowledged that binding jurisprudence treats claim construction as a pure question of law. I agree with this conclusion.
[53] To the extent that this Court may have discretion to follow or depart from the previous construction adopted in the NOC proceedings, I consider the Federal Court of Appeal’s prior construction to be prima facie binding, but acknowledge that it may be revisited if warranted by the evidence. In other words, I will adhere to the construction given to the ‘426 patent by Justice Hughes and by the Federal Court of Appeal unless a party provides good reason not to. The same holds true when defining the “inventive concept” of the patent and determining the “promise” of the patent, both of which are aspects of claim construction and are therefore questions of law (Sanofi-Synthelabo Canada Inc v Apotex Inc, 2008 SCC 61 at para 67 [Sanofi-Synthelabo]; Weatherford Canada Ltd v Corlac Inc, 2011 FCA 228 at para 24, leave to appeal to SCC refused [Weatherford]; Astrazeneca Canada Inc v Mylan Pharmaceuticals ULC, 2011 FC 1023 at para 87, aff’d on other grounds 2012 FCA 109 [Astrazeneca Canada]).
[54] Previous findings of fact or mixed fact and law made in the NOC context are potentially persuasive, but they must be approached with caution. For example, Justice Hughes previously defined the “person of ordinary skill in the art” [POSITA, skilled person or person skilled in the art] in the NOC proceedings, but this is a question of mixed fact and law. It must therefore be determined anew based upon the evidence adduced in these proceedings. Obviousness is generally considered to be a question of fact or mixed fact and law, to which the principle of comity does not apply (Wenzel Downhole Tools Ltd v National-Oilwell Canada Ltd, 2012 FCA 333 at para 44 [Wenzel]; Allergan at para 44). The same holds true for the issues of ambiguity, overbreadth, utility, and insufficiency.
VI. Issues [55] Bayer maintains that claims 31, 48 and 49 of the ‘426 patent are valid and have been infringed by Apotex and Cobalt. Apotex and Cobalt deny the allegations of infringement and, by counterclaim, allege that the claims in issue should be declared invalid.
[56] Apotex asserts invalidity on five grounds: (i) obviousness; (ii) anticipation; (iii) overbreadth; (iv) insufficiency or ambiguity of the specification; and (v) inutility.
VII. Preliminary Observations Regarding the Evidence A. Objections to the Expert Evidence [57] All parties submitted objections in writing to the expert reports filed by opposing parties. None of the parties devoted any significant time to addressing these objections in their oral submissions, although many were raised in the course of the trial and were ruled on accordingly.
[58] Bayer submitted three documents titled “Particulars of Objection to Expert Witnesses”, one dated November 16, 2015, and a further two dated January 4, 2016. Bayer indicated that it would object at trial to any reference to documents that were not included in the defendants’ pleadings, and to any expert opinions that were based on those documents. Bayer also stated that it would object to the admissibility of certain reply statements filed by Apotex’s experts on the ground that they were outside the scope of the pleadings. In addition, Bayer asserted that the evidence strayed beyond the mandate of the experts, the experts were not granted leave to file replies, and the reports relied on inadmissible testing because they did not comply with the Notice to the Parties and Profession re: Experimental Testing dated February 27, 2014 [Notice].
[59] Bayer made similar objections with respect to the admissibility of expert reports filed on behalf of Cobalt, and also to testimony regarding these matters. Bayer alleged that Cobalt had failed to abide by the deadlines contained in the Notice, failed to abide by the Code of Conduct for Expert Witnesses [Code of Conduct] pursuant to Rule 52.2 of the Federal Courts Rules, SOR/98-106 [Federal Courts Rules], relied on undisclosed materials, attempted to present evidence contrary to an admission made in its pleadings, and offered information that strayed beyond the experts’ mandates.
[60] Apotex submitted extensive written objections to the expert reports submitted on behalf of Bayer. Cobalt largely adopted the objections made by Apotex, and submitted a document that cross-referenced the expert reports prepared by Bayer’s experts for the Apotex case with those they prepared for the Cobalt case.
[61] Apotex raised the fundamental objection that Bayer had not produced all relevant documents related to the testing that was carried out by their experts. Apotex also objected to specific paragraphs of Bayer’s expert reports on a wide range of grounds, including non-compliance with the Code of Conduct. Apotex expressed concern about the adequacy of the experts’ qualifications to offer certain opinions, inconsistency in testing methods, novelty of testing methods, and unwarranted speculation.
[62] I am satisfied that all parties disclosed sufficient information to ensure that opposing parties were not taken by surprise and were given an adequate opportunity to challenge the expert evidence that they considered to be unhelpful to their respective cases. Cross-examination did not reveal any shortcomings in disclosure or lack of notice that may have caused unfairness to any party. Bayer abandoned its reliance on K-means cluster analysis, which was one of the novel testing methods to which Apotex objected. Limitations in the qualifications of all expert witnesses to offer certain opinions were explored in cross-examination, as were any conclusions that might be considered speculative.
[63] The parties had ample opportunity in the course of cross-examination to challenge expert witnesses on their opinions, and they did so. I have based my conclusions on evidence that I found to be both admissible and probative. I have disregarded evidence that in my view exceeded an expert witness’ qualifications, and I have placed no weight on viewpoints that were unsupported by the evidence or unduly speculative. My reasons for accepting some evidence and opinions, and rejecting others, may be found in the analysis that follows.
B. “Blinding” of Expert Witnesses [64] Apotex argues that the evidence of its expert witnesses should be preferred to those who testified on behalf of Bayer, because they reached their conclusions without knowing the nature and content of the patent in issue or the legal positions of the parties. In contrast, Apotex notes that Bayer’s expert witnesses have testified in support of this and similar patents on many occasions, and are intimately familiar with its subject-matter.
[65] Although the “blinding” of experts has recently found some favour in this Court, it is not a principle of law that applies in all cases (Shire Canada Inc v Apotex Inc, 2016 FC 382 at para 45 [Shire]; Eli Lilly Canada Inc v Apotex Inc, 2015 FC 875 at para 166 [Eli Lilly]; AstraZeneca at para 322). The fact that expert witnesses were blinded may be persuasive and helpful in weighing their evidence where credibility concerns arise (Shire at para 45; Eli Lilly at paras 163-66). However, the Court’s principal concern remains the substance of the expert’s opinion and the reasoning that led to that opinion.
[66] As Justice Locke has observed, if an expert’s opinion is well supported, then there may be no reason to place less weight on the expert’s evidence merely because he or she was not blinded to certain facts when forming that opinion (Shire at para 45). Moreover, the blinding of an expert witness is “no guarantee” that the expert’s evidence is reliable. There is always a possibility that an unscrupulous party may seek opinions from a number of blinded experts, and retain only those whose opinions the party considers favourable to its legal position (Shire at para 46). I have not found the blinding of expert witnesses to be a significant factor in deciding the legal and factual issues raised by this case.
VIII. Claim Construction and Validity A. Fact and Expert Witnesses [67] Apotex, the plaintiff by counterclaim on the issue of validity, submitted the evidence of the following expert witnesses to address patent construction and validity:
a) Dr. Kenneth Morris of Brooklyn, New York. He is a professor and Director of the Lachman Institute for Pharmaceutical Analysis at Long Island University. He was qualified as an expert in pharmaceutics and pharmaceutical materials science. Dr. Morris provided his opinion on whether the ‘426 patent is invalid based on obviousness, ambiguity, insufficiency, overbreadth, and inutility.
b) Dr. Alan F. Parr of Cary, North Carolina. He is an independent consultant on biopharmaceutics and pharmaceuticals. He was qualified as an expert in the biopharmaceutics of pharmaceuticals and transport and f