Eli Lilly Canada Inc. v. Apotex Inc.

Eli Lilly Canada Inc. v. Apotex Inc.
Court (s) Database
Federal Court Decisions
Date
2020-09-10
Neutral citation
2020 FC 814
File numbers
T-1632-16
Decision Content
Date: 20200910
Docket: T-1632-16
Citation: 2020 FC 814
Ottawa, Ontario, September 10, 2020
PRESENT: The Honourable Madam Justice St-Louis
BETWEEN:
ELI LILLY CANADA INC., ELI LILLY AND COMPANY, LILLY DEL
CARIBE INC., LILLY, S.A. and ICOS CORPORATION INC.
Plaintiffs/Defendants by counterclaim
and
APOTEX INC.
Defendant/Plaintiff by counterclaim
PUBLIC JUDGMENT AND REASONS
(Confidential Judgment and Reasons issued on August 6, 2020)
I. Introduction 4
II. Procedural background 4
III. The pleadings and the results 7
IV. Tadalafil 11
V. The statutory scheme under which the matter proceeds 13
I. Burden of proof 14
A. Infringement 14
(1) General 14
(2) Statutory presumption 14
(3) Common law presumption 16
B. Invalidity 19
II. Facts witnesses 19
A. Lilly’s facts witnesses 19
(1) Dr. Michael Martinelli 19
(2) Mr. Joseph Matthew Pawlak 20
B. Apotex’s fact witness 21
(1) Mr. Ramandeen Singh Bagga 21
III. Expert witnesses 21
A. Lilly’s expert witness 21
(1) Dr. Trevor Laird 21
B. Apotex’s expert witnesses 22
(1) Dr. Neil George Anderson 22
(2) Dr. Robert Michael Williams 23
IV. The 540 Patent 23
A. Overview 23
B. The disclosure 24
C. The claims 27
V. Claim construction 28
A. Relevant date for claim construction 28
B. Law of claim construction 28
(1) Introduction 28
(2) One construction for all purposes 29
(3) Purposive construction: essential and non-essential elements 31
(4) Purposive construction: the patentee’s words 35
(5) Claim differentiation 38
C. Person skilled in the art 39
D. Prior art 39
(1) The 594 Application 41
(2) The 377 Patent 41
(3) The 008 Application 42
E. Common general knowledge 43
F. Claims needing construction 46
(1) Introduction 46
(2) Construction of Claims 1, 3-4 46
(a) The claim in dispute 46
(b) Claim 1 first paragraph: “a desired cis-diastereomer” versus “the desired cis-diastereomer” 47
(c) Claim 1 step b: solvents 50
(d) Claim 1 step c: phase separation vs separation from the mixture 51
(e) Essential elements of Claims 1, 3-4 56
(3) Construction of Claims 7, 8-10 57
(a) The claim in dispute 57
(b) Claim 7 step d 58
(c) Essential elements of Claims 7 and 8-10 60
(4) Construction of Claim 12 61
(a) The claim in dispute 61
(b) Claim 12 step a and step b: the variants 62
(c) Claim 12 step c 66
(d) Essential elements of Claim 12 67
VI. Apotex’s counterclaim of invalidity 68
A. Introduction 68
B. Anticipation 69
(1) The anticipation allegations 69
(2) The anticipation framework 72
(a) Section 28.2 of the Patent Act and the Sanofi test 72
(b) The disclosure requirement 73
(i) Claim 1 step a (referenced in Claims 3 and 4) 74
(ii) Claim 1 step b (referenced in Claims 3 and 4) 75
(iii) Claim 1 step c (referenced in Claims 3 and 4) 78
(iv) Conclusion on disclosure 79
(c) The enablement requirement 79
(3) Conclusion on anticipation 80
C. Obviousness 81
(1) The obviousness allegations 81
(2) The obviousness framework 83
(a) Section 28.3 of the Patent Act 83
(b) The Sanofi test on obviousness 83
(c) First step: identify the notional PSA and the relevant common general knowledge of that person 84
(d) Second step: identify the inventive concept of the claim in question or if that cannot readily be done, construe it 85
(i) Issues 85
(ii) 1986: the Beloit framework 85
(iii) Section 28.3 of the Patent Act 87
(iv) Sanofi in 2008 88
(v) Post-Sanofi 89
(vi) The meaning of the term inventive concept 95
(vii) The subject-matter defined by a claim of the 540 Patent 96
(e) Third step: Identify what, if any, differences exist between the matter cited as forming part of the “state of the art” and the inventive concept of the claim or the claim as construed; 98
(i) Claims 1, 3–4 98
(ii) Claims 7–10 100
(iii) Claim 12 101
(f) Fourth step: Viewed without any knowledge of the alleged invention as claimed, do those differences constitute steps which would have been obvious to the person skilled in the art or do they require any degree of invention? 102
(i) Introduction 102
(ii) Obvious to try 102
Claim 7 step d and Claims 8–10 105
Claim 12 step b 105
(iii) Fourth step conclusion 111
(3) Conclusion on obviousness 112
D. Inutility/Inoperability 112
E. Overbreadth 113
F. Conclusion on invalidity 116
VII. Lilly’s claim of infringement 116
A. Principles 116
B. Apotex process: |||||| 118
C. Apotex process: |||||||||||||||||||| 119
D. Apotex process : |||||||||||||||||||||||||||| 121
E. Apotex process: |||||||||||||||||| 122
F. Conclusion on infringement 123
VIII. Election between damages and accounting of profits 124
IX. Declaratory relief, injunction relief and/or delivery up. 124
X. Sealing Order 124
XI. Costs 124
I.
Introduction
[1] These additional reasons relate to an action by the Plaintiffs (hereinafter collectively referred to as “Lilly”) against Apotex Inc. (Apotex) and a related counterclaim by Apotex, in regards to Canadian Patent No. 2,492,540 Patent [the 540 Patent].
[2] The reasons relating to the Plaintiffs’ actions and related counterclaims, in regards to Canadian Patent No. 2,371,684 Patent [the 684 Patent] are exposed in case docket T-1627-16 and will be placed on this file (Eli Lilly Canada Inc. and als. v Mylan Pharmaceuticals ULC, 2020 FC 816).
[3] Hence, these additional reasons are concerned with the validity and infringement, at the liability phase, of the 540 Patent, entitled “Modified Pictet-Spengler Reaction and Products Prepared Therefrom”.
II. Procedural background
[4] Lilly initially sued Apotex, Mylan Pharmaceuticals ULC, Teva Canada Limited, and Pharmascience Inc.-Laboratoire Riva Inc. in independent actions for infringement of patents related to tadalafil. Each of the Defendants denied infringement and counterclaimed for a declaration of invalidity of the patents asserted against them. Over the course of these proceedings, Lilly has asserted four patents against the four Defendants: (1) the 684 Patent, which expired on April 26, 2020, and relates to a dosage form of tadalafil; (2) the 2,379,948 Patent, which expired on April 26, 2020, and relates to a formulation comprising tadalafil; (3) the 540 Patent, which will expire on July 14, 2023, and relates to a manufacture process for making tadalafil; and (4) the 2,226,784 Patent [the 784 Patent] which expired on July 11, 2016, and relates to the use of tadalafil to treat ED.
[5] On September 8, 2017, Prothonotary Tabib, at the request of the parties, bifurcated the actions as between liability and quantification phases. As per Prothonotary Tabib’s Order, this liability phase addresses the following issues: (i) whether the patents have been infringed by the Defendants; ii) whether the patents are valid; (iii) except for paragraphs 9, 28-36, 37-42 and 175 of Apotex’s Amended Statement of Defence and Counterclaim which shall be addressed in the quatification phase, whether Lilly are entitled to declaratory relief, injunctive relief, and delivery up; and (iv) Lilly’s entitlement, if any, to elect as between damages and an accounting of profits (except as it relates to paragraphs 28-36 of the Defence).
[6] On July 3, 2019, Prothonotary Tabib granted Lilly leave to amend their Statement of Claims, whereby only claims for infringement of the 684 Patent against all Defendants, and claims for infringement of the 540 Patent against Teva, which was subsequently withdrawn, and Apotex were maintained.
[7] Prothonotary Tabib also then granted Lilly leave to add, against all Defendants, claims for the infringement of the 784 Patent by reason of the manufacturing, importing and stockpiling of tadalafil for ED prior to the expiration of the 784 Patent, and springboard damages flowing for that infringement. As a condition for granting leave to amend, all issues of validity, infringement and quantification relating to the 784 Patent, were bifurcated and will be the subject of a separate trial after the determination of the liability issues for the 684 and 540 Patents.
[8] Although the actions have not been consolidated, they have been case managed together, and proceeded together to trial for the liability phase, with hearings conducted from December 5, 2019 to February 7, 2020. Although the actions regarding the two patents at issue have not been bifurcated, the parties all agreed to the trial being divided in two separate components, the first pertaining to the liability phase of the 684 Patent, which involves all four Defendants, and the other pertaining to the liability phase of the 540 Patent, which involves only Apotex as the Defendant.
[9] I am thus providing here additional reasons pertaining solely to the litigation between Lilly and Apotex in regards to the 540 Patent. Certain passages of the reasons pertaining to the 684 Patent are repeated in these additional reasons, with the risk of redundancy, in order to allow for a reading of these additional reasons on a stand-alone basis.
[10] The parties have not disputed that the law is the same in both components of the trial, although surprisingly, and as I will outline in the discussion regarding anticipation, Lilly presented different versions of the principle guiding the disclosure requirement of the anticipation analysis in each component of the trial.
III. The pleadings and the results
[11] The Plaintiffs in this action are Eli Lilly Canada Inc., Eli Lilly and Company, Lilly Del Caribe, Inc., Lilly, S.A. and ICOS Corporation Inc. Apotex Inc. is the lone Defendant.
[12] Eli Lilly Canada Inc. has a principal place of business in Toronto, Ontario. Eli Lilly and Company has a principal place of business in Indianapolis, Indiana. Lilly Del Caribe, Inc. has a principal place of business in Caroline, Puerto Rico, and is incorporated in the Cayman Islands. Lilly, S.A. has a principal place of business in Madrid, Spain. ICOS Corporation Inc. has a principal place of business in Indianapolis, Indiana. Apotex Inc. is a generic drug maker based in Toronto, Ontario.
[13] Apotex has four, still current, regulatory approved processes to make tadalafil via two main suppliers, both based in India: |||| and ||||||||||||||||||||||||. |||| procured the intermediaries from |||||||||||||||||||||||||||||||||||||||| in China, |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||| in India, and |||||||||||||||||||||| in China, which sourced it from |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||| | in China. ||||||||||||||||||||||||, on the other hand, made the whole of the tadalafil itself.
[14] Lilly assert that Apotex’s four regulatory approved processes to make tadalafil infringes Claims 1, 3–4, 7–10, 12 of the 540 Patent (the asserted Claims).
[15] Lilly rely upon the statutory presumption as set out in section 55.1 of the Patent Act, RSC 1985, c P-4 [the Patent Act], and on the common law presumption (Hoffmann-La Roche Ltd v Apotex Inc, 1983 CarswellOnt 871 at paras 23-25 (ONHC) [Hoffmann], aff’d 1984 CarswellOnt 1197 (ONCA)), for the |||||||||||||||||||||| process, to argue that Apotex bears the burden to prove that it did not infringe the asserted Claims.
[16] Lilly consequently seek a declaration that Apotex infringed or induced infringement of the asserted Claims of the 540 Patent, a declaration that they are entitled to elect between damages and an accounting of profits, an order that they are entitled to a declaratory relief, injunctive relief and/or delivery up, and costs.
[17] Apotex denies infringement and initially raised the Gillette defence (Free World Trust v Electro Santé Inc, 2000 SCC 66 [Free World Trust]). Against the statutory presumption raised by Lilly, Apotex answers that it is not applicable because tadalafil is not a “new product” since tadalafil and its intermediaries were subject to previous patents. Against the common law presumption raised by Lilly, Apotex answers that the presumption has never been applied, not even in Hoffmann where it was enunciated in obiter dictum, that the facts of the Hoffmann case are extreme, and should be distinguished primarily on the basis that Apotex duly cooperated to disclose all information it had on the processes.
[18] Apotex also responds that none of its processes infringed the 540 Patent. It argues that the |||||||||| process does not have a |||||||||||||||||||||||||||||||||||||||||| with acetic acid step, which involves the construction of Claim 7, nor does it use isopropyl alcohol as a solvent for the Pictet-Spengler reaction (PSR), using instead ||||||||||, which involves the construction of Claim 12. It adds that the |||||||||||||||||||||||| process does not have a |||||||||||||||||||||||||| step after the PSR, which involves the construction of Claim 1, does not have a |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||| || step, which involves the construction of Claim 7, and uses |||||||||||||| for the PSR rather than isopropyl alcohol, which involves the construction of Claim 12. The Court’s claims construction will essentially determine the issues for these two processes.
[19] Apotex argues that the |||||||||||||||||||||||||||||||| process turns on the issue of regulatory exemption to infringement of section 55.2 of the Patent Act, while the |||||||||||||||||||||| process turns on Lilly’s evidentiary burden to prove the processes described in the batch record and regulatory submissions are fabricated, as well as the applicability of the two presumptions of infringement.
[20] Apotex seeks a declaration that the 540 Patent or the asserted Claims are invalid, as well as costs.
[21] On January 6, 2020, the parties have jointly outlined the issues as follows:
a) Construction of Claims 1, 3–4, 7–10, 12 of the 540 Patent;
b) Whether any of the asserted Claims are infringed;
c) Whether the Gillette Defence applies;
d) Whether the asserted Claims are invalid by reason of :
i. Anticipation: does Canadian Patent Application No 2,412,594 (the 594 Application, known as the Gellibert Application) anticipate the subject-matter of Claims 1, 3-4 of the 540 Patent?
ii. Obviousness: would the subject-matter defined by the asserted Claims of the 540 Patent have been obvious on the Claim date to a person skilled in the art?
iii. Lack of sound prediction/no demonstration utility: have the requirements of either demonstration or sound prediction of utility as of the filing date of the 540 Patent met?
iv. Overbreadth: are the asserted Claims of the 540 Patent broader than either the invention made by the named inventor of the 540 Patent or the invention disclosed in the specification of the 540 Patent?
v. Inutility/inoperability: does the subject-matter defined by the asserted Claims of the 540 Patent in fact possess utility?
vi. Insufficiency: does the 540 Patent satisfy the requirements of subsection 27(3) of the Patent Act?
e) Whether the Plaintiffs are entitled to elect as between damages and an accounting of profits;
f) Whether the Plaintiffs are entitled to declaratory relief, injunctive relief and/or delivery up.
[22] At closing, Apotex did not assert the lack of sound prediction/no demonstrated utility, insufficiency, nor did it assert the Gillette Defence. Hence, the remaining grounds of invalidity raised by Apotex are those of anticipation, obviousness, overbreadth and inutility/inoperability.
[23] The Court must adjudicate the issues regarding the type and entitlement to reliefs if necessary.
[24] In brief, and for the reasons exposed below, I find Claims 1, 3–4, 7–10, 12 of the 540 Patent are invalid as Claims 1, 3–4 are anticipated, and all asserted Claims are obvious.
[25] However, if I were wrong and the asserted Claims were valid, I find Claims 1, 3–4 to be infringed by Apotex’s |||||||||| process, while Claims 7–10, 12 of the 540 Patent not to be infringed by Apotex.
IV. Tadalafil
[26] The drug substance at the heart of these proceedings is tadalafil, used, among other things, to treat male erectile dysfunction (MED). In this regard, tadalafil is the active pharmaceutical ingredient (API) of the drug product marketed by Lilly under the brand name CIALIS, and by Apotex under the brand name Apo-Tadalafil.
[27] Tadalafil is known as a phosphodiesterase (PDE) 5 inhibitor. The first approved PDE-5 inhibiter was sildenafil, commercialised by Pfizer under the brand name Viagra, and approved in Canada on March 9, 1999. Tadalafil is the second in class PDE-5 inhibiter drug product and both have had considerable commercial success.
[28] In brief, tadalafil works to promote the relaxation of the penis’ smooth muscle, which somewhat counterintuitively for a layperson, promotes penile erection. In brief, the penis’ smooth muscle, known as the corpora cavernosa, is in a contracted state when in normal resting state, and so restricts the arteries supplying blood to the penis. When an erection is triggered, the smooth muscle relaxes, no longer restricts the supply of arterial blood, which causes the penis to become tumescent. The smooth muscle relaxation results from a cascade of complex biochemical reactions within the body. Normally, sexual stimulation triggers the release of nitric oxide, which in turn leads to an increase in the production of a molecule called cyclic guanosine-3-5 monophosphate (cGMP). This cGMP molecule regulates the activity of other intracellular proteins and leads to the relaxation of the smooth muscle. Increasing cGMP promotes smooth muscle relaxation, which promotes penile erection. The intracellular breakdown of the cGMP is regulated by a class of enzymes known as cyclic nucleotide PDE, and in the penis, the most prevalent is the PDE-5 family. Inhibiting PDE-5 results in a slower breakdown of cGMP, which then accumulates, promotes the relaxation of the smooth muscle and, in turn, penile erection.
[29] Tadalafil was first claimed in the British patent GB no 9401090.7 (which Canadian equivalent is the 2,181,377 Patent (the 377 Patent)), filed on January 21, 1994 by Laboratoires Glaxo. A number of other patents were also granted in relation to tadalafil, now owned by Lilly as the results of successive commercial transactions.
[30] The 540 Patent relates to a commercial manufacturing process to synthesize tadalafil, and bears a particular focus on the synthesis of the key intermediate compound, a cis-diastereomer having the R,R absolute stereochemistry known as cis-1-(1,3-benzodioxol-5-yl)-2,3,4,9-tetrahydro-1H-pyrido[3,4-b]indole-3-carboxylic acid methyl ester. The synthesis of this key intermediate is achieved by carrying what is described as an improved PSR in which the desired cis-diastereomer is insoluble at reflux temperature or lower, and the undesired trans-diastereomer is soluble at reflux temperature or lower, resulting in concomitant crystallisation, and separation, of the desired cis-diastereomer product.
[31] The PSR reaction was discovered in 1911. Named after its discoverers, it is a chemical reaction in which a β-arylethylamine undergoes condensation with an aldehyde or ketone followed by a ring closure. In the patent at bar, it is a method of attaching a new six membered ring to an existing ring system. Another concept, the “crystallization-induced asymmetric transformation” (CIAT) relates here to the in situ transformation of trans-diastereomer to cis-diastereomer, driven by the crystallizations of the desired cis-diastereomer in the mixture (equilibration), resulting in high yield, high purity and faster processing times with fewer steps.
V. The statutory scheme under which the matter proceeds
[32] The parties agree that the law of patents is wholly statutory. The Supreme Court of Canada (SCC) has confirmed it again in 2008, in one of the landmark decision I will discuss later, Apotex v Sanofi-Synthelabo Canada 2008 CSC 61[Sanofi]. The SCC cited Justice Judson’s words in Commissionner of Patents v Farbwerke Hoechest Aktiengesellschaft Vormals Meister Lucius & Bruning, [1964] SCR 49 at 57 that “There is no inherent common law right to a patent. An inventor gets his patent according to the terms of the Patent Act, no more and no less” (Sanofi para 12). The SCC also cited Lord Walker’s words in Synthon B.V. v SmithKline Beecham plc, [2006] 1 All E.R. 685, [2005] UKHL 59, at paras 57-58:
57. The law of patents is wholly statutory, and has a surprisingly long history… In the interpretation and application of patent statutes judge-made doctrine has over the years done much to clarify the abstract generalities of the statutes and to secure uniformity in their application.
58. Nevertheless it is salutary to be reminded, from time to time, that the general concepts which are the common currency of patent lawyers are founded on a statutory text, and cannot have any other firm foundation (Sanofi at para12).
[33] As the patent in suit was filed after October 1, 1989, the current provisions of the Patent Act apply. The relevant sections of the Patent Act are reproduced in Annex II for ease of reading.
I. Burden of proof
A. Infringement
(1) General
[34] To establish infringement, Lilly must prove, on a balance of probabilities, that the processes used by Apotex’s suppliers include all of the essential elements of one or more claims of the 540 Patent. In fact, “there is no infringement if an essential element is different or omitted” but “there may still be infringement, however, if non-essential elements are substituted or omitted” (Free World Trust at para 31).
[35] However, the patentee’s burden of proof can shift on the alleged infringer under a statutory and a common law presumption. Lilly submit that both presumptions apply here.
(2) Statutory presumption
[36] The statutory presumption is stated at section 55.1 of the Patent Act: “In an action for infringement of a patent granted for a process for obtaining a new product, any product that is the same as the new product shall, in the absence of proof to the contrary, be considered to have been produced by the patented process” (my emphasis).
[37] Lilly urge the Court to interpret the term “new product” of section 55.1 in a way akin to the term “new drug”, defined in section C.08.001 of the Food and Drug Regulations, CRC c 870 [Food and Drug Regulations]. Lilly thus assert that CIALIS (and their other tadalafil product ADCIRCA) are “new products”, and that section 55.1 of the Patent Act therefore applies to reverse the burden on infringement. However, Lilly do not detail their position, accepting that the Court’s decision in Eli Lilly and Company v Apotex Inc, 2009 FC 991 [Cefaclor], aff’d 2010 FCA 240 may be subject to comity. They confirm merely seeking to preserve their rights on appeal in this regard.
[38] Apotex responds that section 55.1 of the Patent Act does not apply here because tadalafil is not a “new product”: processes to make tadalafil have been the subjects of prior patents, and tadalafil was known prior to the filing of the 540 Patent. Apotex stresses that Lilly’s proposed interpretation of “new product”, akin to the term “new drug” found in the Food and Drug Regulations — hence as any product that has not been sold on the market — was specifically rejected in Cefaclor at para 214. In Cefaclor, Lilly had argued that the word “product” (used in the current section 55.1 of the Patent Act), replaced the word “substance” (used in former subsection 39(2) of the Patent Act), as a result of an amendment in 1993 in order to give effect to para 1709(11)(a) of the North American Free Trade Agreement Between the Government of Canada, the Government of Mexico and the Government of the United States, 17 December 1992, Can TS 1994 No 2. They had submitted that it meant a “product that has not been sold on the market before”, but Justice Gauthier, now at the Federal Court of Appeal (FCA), did not accept this argument.
[39] Apotex also points to the decision of the Court in Merck & Co Inc v Apotex Inc, 2010 FC 1265 at paras 134-186, aff’d 2011 FCA 363, where Justice Snider interpreted the word “new” in the term “new substance” of former section 39(2) of the Patent Act, and found it to mean “not previously known”. The FCA neither condemned nor endorsed her interpretation.
[40] Despite Lilly not detailing their position on the interpretation of the term “new drug” from the Food and Drug Regulations, I note that these regulations (s C.08.001) define the term, in paragraph c, as a drug that “(…) has not been sold for that use or condition of use in Canada (..)”, precisely the interpretation rejected by Justice Gauthier in Cefaclor.
[41] Judicial comity requires that I follow an earlier decision unless I am persuaded that it was wrongly decided. However, rather than putting forth further arguments, Lilly accepted that the Court may be subject to comity, and confirmed that, before this Court, they merely sought to preserve their rights on appeal. They have therefore not convinced me that Cefaclor is wrong. Since Lilly have not demonstrated tadalafil is a “new product” in regards the statutory presumption of section 55.1 of the Patent Act, they retain the evidentiary burden to prove infringement.
(3) Common law presumption
[42] Lilly raise the common law presumption in regards to the |||||||||||||||||||||| process. They argue that the set of circumstances surrounding this process justifies applying the common law presumption enunciated in Hoffmann at para 23: “when the subject-matter of the allegation lies particularly within the knowledge of one of the parties, that party must prove it, whether it be an affirmative or negative character”. Lilly argue that the common law presumption applies to the |||||||||||||||||||||| process Apotex is using to make tadalafil for sale in Canada as it is uniquely within its purview.
[43] Lilly point to their expert witness, Dr. Trevor Laird’s uncontested testimony that he does not believe that high quality compound can be produced by the process described in the batch record of ||||||||||||||||||||||, thus suspecting the falsification of the batch record. For Lilly, the batch record should thus not be given any weight, and since Apotex has not produced any documents on this issue, the burden should shift from Lilly being required to prove infringement to Apotex being required to prove non-infringement, which it has not done. Since only Apotex can obtain proper records of the process, Lilly allege that this situation falls squarely within the ambits of the presumption. Insisting that Apotex’s situation is unique because it dealt with ||||, which dealt with ||||||||||||||||||||||, which sourced the intermediate from ||||, Lilly cite Eli Lilly & Co v Apotex Inc, 2000 CarswellNat 185 (FCTD), to argue that it is proper to require Apotex to make such a request for information. Lilly also argue that Apotex presented no evidence that it advised its suppliers not to infringe the 540 Patent. To counter Apotex’s argument that they have not taken enough steps to seek out additional information regarding the |||||||||||||||||||||| process, Lilly answer that they cannot trust Apotex to provide true documents when the batch record first provided is falsified, and that the discontinuance of ||||||||||||||||||||||’s business meant that it would not have been possible to obtain further records. As I will outline later in these reasons, Mr. Ramandeen Singh Bagga testified before the Court as a fact witness for Apotex, as its VP Global Direct Procurement. Lilly somewhat acknowledge not having further cross-examined Mr. Bagga on the |||||||||||||||||||||| process, but raise the fact that Mr. Bagga testified even Apotex was not able to obtain any further information from this company. Lilly therefore argue that it is unclear how Mr. Bagga could have given any testimony that was not impermissible hearsay.
[44] Apotex mainly argues the Hoffmann decision setting out the common law presumption has never been applied, and should be circumscribed to its facts, where the defendant was a licensee under the plaintiffs’ patent and had instructed its supplier not to divulge any information regarding its process to the plaintiffs or their lawyer. Apotex again points to the Cefaclor decision in which Justice Gauthier clarified the applicability of the Hoffmann common law presumption. Apotex essentially argues that (1) it diligently sought out the requested information by providing numerous documents regarding the |||||||||||||||||||||| process and seeking others, as Mr. Bagga testified; (2) Lilly did not even attempt to compel evidence from Apotex; and (3) Lilly put forward an extract of Apotex’s Abbreviated New Drug Submission (ANDS), a regulatory document, as a business record, without attempting to prove on a balance of probabilities this document is also falsified. This ANDS extract also outlines the |||||||||||||||||||| process.
[45] As Justice Gauthier did in Cefaclor at paras 219–223, I also find the evidence adduced in these proceedings does not allow me to conclude that Apotex did not diligently seek to provide the requested process documents, nor that Lilly diligently sought further information from Apotex. Lilly’s argument regarding precisions that could have been sought from Mr. Bagga in cross remains unconvincing. Furthermore, I note that Lilly did have information on the process through the extract of Apotex’s ANDS, and that Dr. Laird considered this document at paragraph 83 of his Infringement Expert Report. Lilly did not explain how this regulatory document could contain fabricated information despite not being flagged by the regulatory agency, and they have not met the burden to show that it contains a fabricated process. The presumption does not apply and the burden to prove infringement remains Lilly’s.
B. Invalidity
[46] Under subsection 43(2) of the Patent Act, after the patent is issued, it shall, in the absence of any evidence to the contrary, be valid. The statute thus creates a presumption of the patent’s validity, and the burden is on Apotex to prove, on a balance of probabilities, that the patent is invalid (Whirlpool Corp v Camco Inc 2000 SCC 67 [Whirlpool] at para 75)
II. Facts witnesses
A. Lilly’s facts witnesses
(1) Dr. Michael Martinelli
[47] Dr. Martinelli is one of the listed inventors of the 540 Patent. He holds a BSc from the State University of New-York, a PhD from Wesleyan University in natural product synthesis, and a Post-Doctorate fellowship from Harvard.
[48] Working at Lilly from 1987 until 2003, Dr. Martinelli was involved in the due diligence of ICOS, in anticipation of a joint venture between Lilly and ICOS in 1998. He testified regarding how he and Mr. Joseph Matthew Pawlak worked to find a better process to make tadalafil due to numerous shortcoming of the processes used at ||||, ||||||, and ||||||||. He remembered asking Mr. Pawlak, in August 1998, to replicate the processes at |||||| and ||||||||. ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||.
[49] Dr. Martinelli was a credible witness, although he had little recollection about the specific steps he executed some 20 years ago. He relied heavily on the still existing paper trail of documents and, at trial, adjusted some aspects of his testimony given on discovery, having read Mr. Pawlak’s notebook before testifying in Court. He testified having used 2–3 notebooks per year himself, although only a blank notebook was located by Lilly during discovery.
(2) Mr. Joseph Matthew Pawlak
[50] Mr. Pawlak is also a listed inventor of the 540 Patent. After obtaining a BSc in chemistry, he worked in a sub factory synthesizing intermediate compounds before joining Lilly in August 1997. He left the company in 2015. Working under Dr. Martinelli, he was the principal investigator of the tadalafil synthesis process at Lilly.
[51] Similar to Dr. Martinelli, Mr. Pawlak testified about Lilly’s invention story, albeit in greater details about notably the solvents, the acids, and the reaction conditions that were tried for the PSR.
[52] Mr. Pawlak’s was credible, and relied on his notebook.
B. Apotex’s fact witness
(1) Mr. Ramandeen Singh Bagga
[53] Mr. Bagga testified before the Court as the VP Global Direct Procurement of Apotex. After obtaining a BSc in Pharmacy and a MBA, he worked mainly in sales for multiple Indian pharmaceutical companies, including ||||||||||, before joining Apotex in January 2011 as the VP Business Development and Marketing and Sales. In 2015, he became the VP Global Supply Chain Management at Apotex.
[54] Mr. Bagga testified primarily on how and where Apotex sourced the APIs, on the general content of an open or closed part of a drug master file (DMF), on the content of an ANDS, and on the measures taken by Apotex to provide Lilly accurate process documents of its suppliers.
[55] Mr. Bagga was a credible witness, answering in a forthright manner.
III. Expert witnesses
A. Lilly’s expert witness
(1) Dr. Trevor Laird
[56] Dr. Laird holds a BSc (chemistry) degree from the Imperial College of London, and a PhD in organic chemistry from the London University. Before becoming a consultant, he was in charge of chemists for SmithKline. He was qualified as an expert in synthetic organic chemistry.
[57] Dr. Laird was Lilly’s lone expert witness, and he opined on claim construction, infringement, and validity. He signed a Construction Expert Report on August 30, 2019, an Infringement Expert Report on August 30, 2019, a Validity Expert Report on January 7, 2020, and a Reply Expert Report on January 7, 2020 (exhibits 116, 117, 118, and 119 respectively).
[58] Dr. Laird’s opinion should be approached with caution. I have no doubt as to his qualifications obviously, but he appeared result-oriented in his claim construction. There were inconsistencies in the ways he construed the claims, namely by suggesting equivalents for some elements but not for others, without providing proper justifications.
B. Apotex’s expert witnesses
(1) Dr. Neil George Anderson
[59] Dr. Anderson holds a BSc in biology and chemistry from the University of Illinois and a PhD in medicinal chemistry from the University of Michigan. He was qualified as an expert in synthetic organic chemistry and process chemistry. He notably held the position of Group Leader and Principal Scientist at E.R. Squibb & Sons, and wrote the book Practical Process Research & Development.
[60] At trial, Dr. Anderson opined about claim construction, anticipation, and obviousness. He signed an Expert Validity Report on August 28, 2019, a Responding Expert Report on November 9, 2019, and a Reply Expert Report on December 11, 2019 (exhibits 120, 121, and 122 respectively).
[61] Dr. Anderson was a calm, compelling, and credible witness. He answered questions in a forthright manner whether the answers were favorable or unfavorable to Apotex. I give his opinion considerable weight.
(2) Dr. Robert Michael Williams
[62] Dr. Williams holds a BSc in chemistry from Syracuse University, and a PhD from the MIT. He was qualified as an organic and medicinal chemist. He worked all his life in academia and was an Emeritus Distinguished Professor at the Colorado State University.
[63] Dr. Williams opined on the slate of issues before the Court. He signed an Expert Report on August 30, 2019, a Responding Expert Report on November 7, 2019 and a Reply Expert Report on December 11, 2019 (exhibits 126, 127, and 128 respectively).
[64] Dr. Williams was an argumentative witness who appeared familiar with US law, but not so with Canadian law. The legal instructions for obviousness, anticipation, overbreadth, and inutility were not attached to his reports, and it appeared in fact, that he was not instructed on Canadian legal concepts. I am thus uncomfortable retaining his opinions that involved Canadian legal concepts, and will accordingly give them very little weight. As ruled at trial, parts of his report relying upon inadmissible discovery evidence, not otherwise produced at trial, are given less or no weight.
IV. The 540 Patent
A. Overview
[65] The 540 Patent is titled “Modified Pictet-Spengler Reaction and Products Prepared Therefrom”. It was filed (PCT) on July 14, 2003, published (PCT) on February 5, 2004, and issued on May 4, 2010. It claims priorities from US 60/400,386 (July 31, 2002), and US 60/460,161 (April 3, 2003), and will expire July 14, 2023.
[66] LILLY ICOS, LLC, US is listed as the owner, and Mark W. Orme, Michael John Martinelli, Christopher William Doecke, Joseph Matthew Pawlak, and Erik Christopher Chelius are named as inventors.
[67] The patent’s specification starts with the disclosure and ends with the claims.
B. The disclosure
[68] The disclosure is divided in four sections: (1) Field of the invention; (2) Background of the invention; (3) Summary of the invention; and (4) Detailed description of the preferred embodiments.
[69] The Field of the invention section indicates that the invention relates to a modified PSR for introducing a second stereogenic center into a compound, and more particularly, to a modified PSR that provides a desired cis-or trans-diastereomer of a polycyclic compound having two stereogenic centers, in high yield and high purity.
[70] The Background of the invention section starts by outlining the fact that compounds that exhibit biological activity typically contain at least one asymmetric carbon atom, ie at least one chiral center, and the importance of synthesizing the biologically active stereoisomers while minimizing or eliminating synthesis of the less active one. The benefits of stereochemical and optical purity and of stereoselective synthesis are outlined. It also outlines that many compounds contain two stereogenic centers, whereby the non hydrogen substituents of the asymmetric carbon atoms can be in a cis or a trans configuration, and that a particular problem in the synthesis of such biologically active compounds is the high yield and high purity preparation of a particular stereoisomer, which is the desired stereoisomer. A synthetic pathway must be provided to obtain the correct stereochemistry, high yield of the desired diastereomer in as few steps as possible, with a minimum of diastereomer separation and purification, which implies that there would still be diastereomer separation and purification steps in an ideal synthetic pathway.
[71] The section goes on to refer to the US patent 5,859,006 (the 006 Patent) that discloses the synthesis of a compound I that has two asymmetric carbon atoms, each denoted by an asterisk, wherein the non-hydrogen substituents of the asymmetric carbon atoms are in the cis configuration. It details two pathways described in the 006 Patent wherein the key intermediate in the synthesis of compound I is compound II. It contains references, among other things, to a “step of separating” (at page 2 line 18), a “diastereomer separation” (at page 3 line 15). A “separation step” (at page 4 line 21), and a difficult “product separation” (at page 10 line 14).
[72] Pathway A has few steps but the yield is poor, requires a separation step from the trans stereoisomer and utilizes trifluoroacetic acid (TFA). Pathway B provides a better yield but requires numerous synthetic steps. A key step in the synthesis of compound I is the preparation of compound II by the shorter synthetic pathway A by utilizing a PSR using D Tryptophan methyl ester and piperonal in dichloromethane acid at 4 degrees Celsius, and by obtaining the cis isomer by fractional crystallisation in 42% yield.
[73] The Background of the invention section ends by indicating that it would be an important advance in the art to provide a modified PSR that substantially improves the diastereoselectivity of the reaction, so to ultimately overcome the disadvantages of the use of TFA, long reaction time and difficult product separation.
[74] The Summary of the invention is said to be directed to a method of preparing a desired diastereomer, ie cis or trans, of a polycyclic compound having two asymmetric ring