CUSMA: Canadian patent applications to be eligible for patent term adjustment for unreasonable prosecution delays

According to the Canada-United States-Mexico Agreement (CUSMA)¹, Canadian patent applications filed on or after December 1, 2020², may be eligible for patent term adjustment (PTA) if they have been subjected to unreasonable prosecution delay by the Canadian Intellectual Property Office (CIPO)³. This is one of the changes resulting from the CUSMA, which entered into force on July 1, 2020⁴.

What you need to know

• Article 20.44 of the CUSMA requires the respective granting authorities of each signing country (i.e., CIPO for applicants in Canada) to process applications “in an efficient and timely manner, with a view to avoiding unreasonable and unnecessary delays”⁵. If an “unreasonable delay” occurs, a patentee may request a PTA to compensate for prosecution delays⁶.
• CUSMA defines an “unreasonable delay” as a delay in issuance of more than five years from the date of filing or more than three years from the request for examination, whichever is later⁷. Certain delays may be excluded from this calculation, including delays attributable to the patent applicant⁸ and delays that are not directly attributable to the granting authority (i.e., CIPO)⁹.
• While Canada has not yet amended its patent statute to provide for PTA for unreasonable prosecution delays, it is required to do so within 4.5 years of the CUSMA entering into force (i.e., no later than January 1, 2025)¹⁰. Until the patent statute is amended, the precise details of PTA for unreasonable prosecution delays in Canada remain unknown.

Distinct from Certificates of Supplementary Protection

Note that PTAs for unreasonable prosecution delays arising from the CUSMA are distinct from previously existing extensions available in the form of Certificates of Supplementary Protection (CSP). Since September 2017, Canada has provided up to two years of sui generis patent-like protection for pharmaceutical products containing a new medicinal ingredient or a new combination of medicinal ingredients, protected by an eligible patent¹¹. Unlike PTA for unreasonable prosecution delays, CSPs are intended to compensate for delays in obtaining regulatory approval for new drugs¹². Therefore, assuming Canada amends its patent statute to introduce PTA for unreasonable prosecution delays in compliance with its obligations under the CUSMA, there will be two distinct forms of patent term extension in Canada.

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¹ Agreement between Canada, the United States of America and the United Mexican States, 30 November 2018, Can TS 2020 No 5 (revised 10 December 2019, entered into force 1 July 2020) [CUSMA]. Also known as the United States-Mexico-Canada Agreement (USMCA) in the United States.

² Ibid, art 20.44.

³ Ibid.

⁴ CUSMA, supra note 1.

⁵ Ibid, art 20.44.

⁶ Ibid.

⁷ Ibid.

⁸ Ibid.

⁹ Ibid.

¹⁰ CUSMA, supra note 1, art 20.89.

¹¹ See Torys’ bulletins: “Finalizing Patent Term Extension in Canada” for additional information on patent term extensions in the form of CSPs. Also see Torys’ bulletins: “Federal Court instructs Health Canada to reconsider “medicinal ingredient” in the context of CSP” and “Health Canada instructed to reconsider scope of CSP protection for drug containing multiple active ingredients” for two examples of where the refusal to grant a CSP was sent back for redetermination upon judicial review.

¹² Note that article 20.46 of CUSMA requires its signatories also to provide PTA for pharmaceutical products subject to a patent and that have experienced “unreasonable curtailment of the effective patent term as a result of the marketing approval process.” However, Canada already meets the CUSMA obligation by way of its existing CSP regime.