• Court of Appeal Upholds Decision Awarding Section 8 Compensation Where Sales Related to “Unauthorized Indications”
  • March 28, 2014 | Authors: Adrian J. Howard; Beverley Moore; Chantal Saunders; Ryan Steeves
  • Law Firm: Borden Ladner Gervais LLP - Ottawa Office
  • Sanofi-Aventis Canada Inc. v. Teva Canada Limited, 2014 FCA 69
    Drug: ramipril

    This was an appeal by Sanofi-Aventis Canada Inc. and Sanofi-Aventis Deutschland GmbH (collectively “Sanofi”) from a judgment of the Federal Court which dismissed Sanofi’s submissions with respect to validity, applicability or operability of section 8 of the NOC Regulations. Sanofi appealed on the question of whether section 8 of the NOC Regulations can validly allow compensation to be paid to a generic drug manufacturer for lost sales attributable to so-called “unapproved” indications, such as “Heart Outcomes Prevention Evaluation” (“HOPE”) indications in this case.

    The initial Canadian patent for ramipril expired in 2002. It was found that, in an effort to extend patent protection for ramipril, Sanofi later obtained two further patents which concerned the use of ramipril for HOPE indications.

    The trial judge held that, in the hypothetical market constructed to determine the compensation owed under section 8, both Teva and Apotex would not have included in their product monographs for their respective versions of ramipril reference to anything other than hypertension, but that nevertheless, some sales of those generic drugs would have related to HOPE indications. The trial judge refused to discard these sales from the calculation of Teva’s and Apotex’s section 8 compensation.

    The Court of Appeal noted that, in the real market, Sanofi had taken no measure to enforce its patents covering the HOPE indications. As a result, the Court of Appeal found that there was no reason to find that the situation would be different in the hypothetical markets involving Teva and Apotex. Sanofi argued, however, that as a matter of jurisdiction, section 8 of the NOC Regulations cannot allow compensation to be paid to generic drug manufacturers with respect to sales for unauthorized indications such as the HOPE indications.

    The Court of Appeal agreed with the trial judge and held that “compensation under section 8 of the NOC Regulations for sales related to unauthorized indications may be precluded if the facts so justify.” However, in this case, the Court of Appeal found no such facts to support Sanofi’s position. The Court of Appeal referred to the decision in Merck Frosst Canada Ltd. v. Apotex Inc., 2009 FCA 187 where the validity of the NOC Regulations was confirmed. Sanofi’s appeal was dismissed with costs.