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CRITICAL UPDATES: WHAT’S NEW IN 2016
ANITA NADOR
13TH FORUM ON PHARMA PATENTS,
OCTOBER 25, 2016
AGENDA
2
Litigation
Prosecution
Update
Patentable
Subject Matter:
DNA/Genes
Regulatory -
●PMPRB
● Health
Canada
Health Care
and Role of
Pharma
Patents On
Access
Prosecution
(Antibodies,
PPH, Future
Products)
Competition
Bureau
CETA
Patent Box
• Health Care for All
• Section 3 of the Canada Health Act (R.S.C., 1985,
c. C-6)
• It is hereby declared that the primary objective of Canadian
health care policy is to protect, promote and restore the
physical and mental well-being of residents of Canada and to
facilitate reasonable access to health services without financial
or other barriers.
CANADA THE GOOD
3
• WHO Ranks Canada 30th in the World. (just behind
Morocco, 8 behind Columbia, and 16 below
Greece.)
1. Access to Care – 2nd worst after –hours
access/longest wait times for specialists
2. Hospitals – Lack of acute care beds. 14% of beds are
taken up by “non-acute” patients.
• Costs – Canada is middle of pack of %GDP spent.
CHALLENGES
4
• Almost 70 per cent of people die in the hospital,
including some in high-tech intensive-care beds,
which cost about $1-million a year to operate.1
• Sudden death is the least costly at $10,223. (Does
not take into account other costs).
• 1. LISA PRIEST, The Globe and Mail, Published Monday, Nov. 28, 2011
http://www.theglobeandmail.com/life/health-and-fitness/how-much-does-dying-
cost-canadians/article554853/
•
CHALLENGES
5
Country # Medicines Launched # Reimbursed
JP 150 150
US 143 125/96/75
DE 115 114
UK 111 105
AT 108 108
CA 108 86/71/45
SE 102 86
PO 78 43
WE CAN DO BETTER.
6
ACCESS TO NEW MEDICINES IN PUBLIC DRUG PLANS: Canada and Comparable Countries:
2016 Annual Report, Innovative Medicines Canada
Pharma Patents
7
• One piece of the pie. An important piece.
• In order to improve health need access to new and
best treatments.
• Reduce hospital procedures/hospital stays. Look at
overall costs: overall health care costs and overall
societal costs.
PHARMA PATENTS
8
US IP’S SHAME LIST
9
Priority
Watch List:
Many of the
BRIC
countries,
Russia, India,
China
Regular Watch list
Canada:
● Lack of right of appeal in
regulatory approval process
● Ministry’s discretion in
disclosing confidential
business information.
[Especially FDA 21.1(3)(c)]
● Patent Utility Requirements
and the “promise” doctrine.
• CETA (subject to Wallonia)
• In June 2015, Bill C-59 – privilege to patent agents.
• In December 2014, Bill C-43, amendments to
harmonize with Patent Law Treaty.
• Antibody Decision by Patent Appeal Board
• Patent Prosecution Highway
THE GOOD
10
• CETA impacts on the protection of
pharmaceutical products include:
1. Innovator right of appeal: “equivalent
and effective rights of appeal” under
the PM(NOC) Regulations
2. Patent term restoration – “sui generis”
protection for pharmaceutical products
covered by eligible patents in Canada;
patentee may be able to apply for an
extension of patent protection for up to
two years.
CETA: OVERVIEW
11
• Current legislative scheme: unsuccessful generic
always has a right of appeal because any loss it
suffers means that its Notice of Compliance does
not issue.
• Where an innovator loses a PM(NOC) case, HC
grants the NOC, so its legal options are limited
to bringing an action for patent infringement.
• Innovator may be required to pay damages
where it never had the opportunity to challenge
the correctness of the decision giving rise to the
liability
CETA: INNOVATOR APPEALS
12
• Up to 2 year extension possible (possibly
longer if drug targets certain populations such
as children.
• Only applies to patents that pertain to new
drugs.
• Considerations for brand name manufacturers:
1. Ensure at least one patent includes a
claim (s) which makes a patent eligible
for restoration.
2. Avoid any "unjustified delay" when
pursuing market authorization so as not
to compromise the eligible period of a
patent term restoration.
CETA: PATENT TERM RESTORATION
13
• Critics argue that the deal lowers product
standards and protects big business, allowing
corporations to sue governments
• The European Council has been unable to
reach a consensus on approving the Canada-
EU deal because Belgium is unable to give its
assent
• Belgium requires the assent of five regional
governments
French-speaking Wallonia region has
opposed signing the deal
CETA: “NOT SO FAST” - BELGIUM
14
Litigation Review
15
• Aqua-Gem standard of review for the discretionary decisions of
prothonotaries abandoned and Housen v Nikolaisen (2002 SCC 33)
standard adopted. Standard of review now same as for judges.
Hospira Healthcare v Kennedy Institute of Rheumatology, 2016 FCA 215
16
Aqua-Gem (old) Housen (new)
De novo review if issue was vital
to case
The correctness standard will
apply to questions of law
Clearly wrong review for other
issues. (i.e., based upon a wrong
principle or upon a
misapprehension of the facts)
Palpable and overriding error
standard will apply to questions of
fact
Prosecution
Update
17
• Fast track examination if you have patent application with an “allowed” claim in a corresponding application with the same “earliest date” with one of Canada’s PPH partners (Office of Earlier Examination (OEE)).
• Claims presented before CIPO must “sufficiently correspond” with the allowed claim of the OEE.
• Request to CIPO must be made before first office action.
• Caution: Consider whether corresponding claims are allowable in Canada. Ensure, corresponding claims are all that client wants considering Canadian divisional practice.
Patent Prosecution Highway
18
19
*
OEE #of PPH Requests # of Filings
USA 1811 17941
EPO 161 10,010
JPO 154 1940
CIPO (as ISEA/IPEA) 149 4357
UK 27 1202
Germany 5 2221
Australia 76 426
Korea 75 370
Innovation ,Science and Economic Development Canada, 2016-17, Patent Branch-
Stats & Facts, Prepared by Patent Business and Strategic Affairs
• CIPO has routinely rejected claims relating to
humanized antibodies for insufficient disclosure
unless:
1. Humanized antibody was actually made
before the filing date, or
2. “Complementarity Determining Region”
(“CDR”) sequences defining the antibody
binding site have been disclosed in the
application.
• The Examiner did so again here, but the
Commissioner overturned it on appeal. Shows
the ability to evolve standards with evolving
knowledge.
Commissioner of Patent No. 1398 (CA 2,451,493)
20
• Application disclosed murine mAbs and methods for making
humanized Abs. No evidence that any were made and no CDRs were
disclosed.
• The Commissioner framed the issue:
• Would the recited humanized antibodies be correctly and fully described; and would the
specification enable the POSITA to practice the invention as claimed without displaying
inventive ingenuity or undertaking undue experimentation in circumstances where there is
no evidence that a humanized antibody had been made and sequence information
regarding the variable regions of an anti-glypican-3 antibody is not disclosed?
• Answer: Yes. CGK changed since a prior decision regarding an application filed 12 years prior. Antigen was fully characterized and
in this case did need to be limited to one in particular or to those
humanized antibodies having a special property other than the
expected property of reduced immunogenicity in humans.
Commissioner of Patent No. 1398
21
What Will The Future Bring?
22
• Biosimilars (subsequent entry biologics)
• Orphan Drugs - HC: not more than five in ten thousand persons in Canada. Estimated to be about 6 -8 000 WW with about 250 new ones per year.
• Issues:
1. approval, patent linkage and regular patent
litigation.
2. pricing and reimbursement.
The Future
23
• Global sales 2013: $150 billion
• Global sales projection for 2020: $290 billion
• Expected costs savings from switching to biosimilars (US) $40 -
$250 billion over the next 10 years. Issues: new starts vs. switching.
• Patent expiry (United States) = opportunities for manufacturers
1. Gleevec (2015); Neulasta (2015); Rituxan (2016); Humira (2016),
Avastin (2019) Herceptin (2019), Revlimid (2019)
2. Remicade (2018) – In Canada 2014 Inflectra (Hospira), Resima
(Celltron). In 2016 approved for Crohn’s and UC.
Enbrel (2022) – In Canada, Brenzys (Samsung Bioepis) approved in
2016. Amgen dropped its prohibition order
Biosimilars: Market Outlook
24
Orphan Drugs: Patient Access
25
Province Plan Patient Criteria Coverage Scheme
Ontario
(DRD)
Special Drugs Plan Outpatient drugs for
specific conditions
Covers full cost of outpatient
drugs for cystic fibrosis,
thalassaemia, HIV,
erythropoietin (renal disease),
cyclosporine for solid organ or
bone marrow
transplant, HGH for children with
growth failure, clozapine
(schizophrenia), alglucerase
(Gaucher's Disease)
Trillium Drug
Program
High prescription drug
cost relative to
household income
Income dependent
Exceptional Access
Program Non-listed products Case-by-case
Alberta
Rare diseases
(<50,000
Canadians or <50
Albertans)
Expert committee makes
guidelines on treatment
and coverage
Orphan Drugs: Regulation
26
USA Europe Canada
Administrator FDA EMEA Health Canada
Legislation Orphan drug act
(1983)
Regulation CE
N141/2000
Development of
regulatory
framework
ongoing
Incidence per
10,000
individuals
7.5 5 5
Market
exclusivity
7 years 10 years 8 years
(innovator)
Approved drugs 121 62 76
Orphan Drugs: Profit Control
27
• Blockbuster Drugs with Orphan Status:
Drug 2015 Sales ($B) Manufacturer
Humira 14.1 AbbVie
Rituxan 7.6 Roche
Avastin 7.2 Roche
Herceptin 6.6 Roche
Remicade 6 Johnson & Johnson
Revlimid 5.7 Celgene
Crestor 5.2 AstraZeneca
US designations. Many have orphan drug status for certain indications and not
for others. For instance, Remicade initially had status for Crohn’s but not for
rheumatoid arthritis.
http://www.cnbc.com/2015/12/01/an-obscure-fda-rule-adding-to-drug-
company-profits.html
Competition Law
28
• New guidelines released March 2016 reflecting priority of Bureau for
clarity on how it deals with IP matters.
• Guidelines provide practical guidance on the Bureau’s enforcement
approach to the interface between competition and intellectual property
(IP) laws:
1. Patent litigation settlements between brand and generic
pharmaceutical companies
2. Product switching (also known as product hopping)
3. Patent assertion entities (PAEs)
4. Collaborative standard setting and standard essential patents
(SEPs).
Competition Bureau
IP Enforcement Guidelines
29
IP owner’s use or non-use of the IP is usually not subject to
the general provisions of the Act.
Enforcement action may be warranted when there are
conspiracies, agreements or arrangements among
competitors or potential competitors; when anti-competitive
conduct creates, enhances or maintains market power or
when firms use deceptive marketing practices. Examples of
what may raise concerns:
“Hard switch” – original product withdrawn from market.
“Price Fixing” – agreements on minimal prices.
“Pay to Delay” Agreement.
Settlement goes beyond patent term.
Competition Bureau
IP Enforcement Guidelines
30
Emerging Issue –
Patent Box
31
• Allow corporate income related to the sale
of patented products to be taxed at rates
which are significantly lower than those
applied to ordinary business income
• Incentive to innovate and commercialize the
innovations in the local jurisdiction
• Exists in > 12 countries, including Canada
PATENT BOX: OVERVIEW
32
British Columbia: 2006
• Eligible classes of patents include life sciences, clean
power generation, waste water treatment and fuel cell
technology
• Refund of up to 75% of the B.C. corporate income tax
paid, up to a maximum of $8 million per year
Quebec: January 1, 2017
• Applies to: Quebec businesses that market a product
that includes a patent protecting an invention
developed in the province
• Benefit: tax rate will go from 11.8% to 4%
• Expected savings: $135 million over the next five
years, according to the government
PATENT BOX: CANADA
33
34
Jurisdiction Corporate
tax rate (%)
Adjusted
tax rate (%)
R&D must be carried
out in jurisdiction?
R&D costs must
be incurred in
jurisdiction?
IP must be
retained in
jurisdiction?
Belgium 33.99 6.8 No No Yes
France 33.43 15 No, but qualified
activity must occur
within EU
Yes No
Italy 27.45 15.7 Yes Yes No
UK 20 10 Yes Yes No
Canada
British
Columbia
11 2.75 No No No
Quebec
(2016 budget)
11.8 4 Yes According to
R&D tax credit
rules
No
PATENT BOX: COMPARING JURISDICTIONS
• “The patent box… is badly targeted and wide open to abuse. In an
interconnected innovation world, it is almost impossible to decide which
particular revenue flow comes from which particular patent; and such
patents might be developed abroad and then registered in the particular
country giving the tax break” [emphasis added]
Jonathan Haskel, Professor of Economics at Imperial College Business School.
• “The establishment of the patent box has transformed how we see the UK as
a place to invest . As a result, last year we announced we were building our
first new factory in the UK for 40 years... These new technologies could
significantly reduce costs, improve quality” [emphasis added]
Roger Connor, GlaxoSmithKline’s President of Global Manufacturing and Supply
PATENT BOX: INDUSTRY PERSPECTIVE
35
Questions For Thought
36
• What is the best way to recognize and promote
innovation of new pharmaceutical products while
keeping costs under control and ensuring access
to new technologies?
1. What is the connection between patent protection
and access to new technologies?
2. What is the impact on the healthcare industry?
3. What is the impact on Canadians (patients)?
4. What should be the role of government, their
agencies and our courts?
5. What is the right balance between “brand name” and
generics?
37
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CONTACT
Anita Nador
Partner
416-369-4643
Special Thanks to Donald Bocchinfuso!
