The Supreme Court of Canada has rejected the promise doctrine, which lawyers say will have significant repercussions for patent law.
|John Norman says the SCC ruling on patent law will help foster innovation in Canada.|
The case — AstraZeneca Canada Inc. et al. v. Apotex Inc. et al. — pitted two drug companies against each other over a patent.
The patent related to the “optically pure salts of esomeprazole,” which helps people with issues like gastric acid.
In the ruling released last Friday, the SCC said the promise doctrine is “unsound.”
“The precedential value [of the decision] is huge. The Supreme Court of Canada decisively swept a lot of bad, conflicting case law from lower courts into the legal dustbin of history. We have a lot more certainty now that technical legal attacks on utility of a patent generally cannot invalidate the patent,” says Noel Courage, partner at Bereskin & Parr LLP in Toronto.
Courage says the ruling is important because it now means that companies looking to invalidate patents, like some who manufacture generic drugs, will not be able to do so by arguing that a company that manufactures brand name drugs over-promised its intended uses in its initial patent application.
“This is a sensible result, since, in the real world, the patent covers a drug that is clearly very useful and valuable, or else a generic company would not be trying to copy it,” he says. Courage says the promise doctrine is now “effectively dead.”
“All types of patents are a little bit safer today. . .,” says Courage.
“This decision goes a long way toward realigning Canada’s law on patent utility with other major industrialized nations.”
The legal battle began after AstraZeneca filed a patent related to the drug, but generic pharmaceutical producer Apotex applied to the federal Minister of Health to be able to sell its generic version.
AstraZeneca failed in its attempt to stop the minister from giving a notice of compliance to Apotex to sell the generic version of the drug, which then led to AstraZeneca going after Apotex for patent infringement.
Apotex responded by trying to have the patent impeached.
The Federal Court agreed with Apotex, saying the patent was invalid because “applying the promise of the patent doctrine (‘Promise Doctrine’), it promised more than it could provide.” This finding was upheld by the Federal Court of Appeal.
However, the SCC said the promise doctrine was not the right way of determining “whether the utility requirement of s.2 of the Patent Act is met.”
The SCC ultimately ruled that AstraZeneca’s appeal is allowed and the patent is valid.
“The effect of the Promise Doctrine to deprive such an invention of patent protection if even one ‘promised’ use is not soundly predicted or demonstrated is punitive and has no basis in the Act. Furthermore, such a consequence is antagonistic to the bargain on which patent law is based wherein we ask inventors to give fulsome disclosure in exchange for a limited monopoly. . .,” said the ruling.
“To invalidate a patent solely on the basis of an unintentional overstatement of even a single use will discourage a patentee from disclosing fully, whereas such disclosure is to the advantage of the public.”
John Norman, head of the life sciences group and a patent litigator at Gowling WLG (Canada) LLP in Ottawa, says the SCC ruling is important because “many patent challenges allege that the patent [in] question is invalid for failing to meet the promise of the patent.”
“Now that the Supreme Court of Canada has rejected this doctrine these challenges are not legally valid,” says Norman.
“Moreover, many patents in the past have failed for failing to meet the promise of the patent. Moving forward it will be interesting to see how companies will seek to address previous rulings that were based on an invalid doctrine.”
Norman says the ruling is a favourable development for innovation in the country.
“Right now, a lot of innovators are nervous about Canada and especially when it comes to patents, there’s a certain degree of uncertainty about whether some patents that have been upheld around the entire world have been invalidated in Canada. Everywhere else they’ve been just fine,” he says.
“So, the innovators are looking at Canada, saying, well, you know, this is a country that we invest research money in, we invest time and energy in, and they’re invalidating our patents, so do we want to be part of that bio-tech ecosystem?”
Norman says the ruling will help address uncertainty.
“If the patent system is like the rest of the world, it gives you certainty. With certainty comes inventions, and with inventions comes . . . investments in research and development, and that then causes pharmaceutical companies to look at small Canadian companies, and say, ‘Oh look, this is a new company that’s doing some neat things, we’re going to invest in Canada.’”
He says there are other patents that have failed based upon the promise doctrine.
“The court looked at it, and said, ‘You know what? This just doesn’t make sense. There’s no basis in Canadian law for this promise doctrine, it’s inconsistent with the Patent Act, we’re getting rid of it,’” says Norman.
“If Canada is being viewed as being a fair country . . . then big pharmaceutical companies will invest time, money and research into this country. If Canada is viewed as an unfair patent country, then they’re going to bring their research dollars elsewhere to a jurisdiction that is more comfortable,” he says.