Déjà vu: PMPRB asserts jurisdiction over Galderma’s drug, Differin

After the Federal Court of Appeal (FCA) returned a case to it for redetermination, the Patented Medicine Prices Review Board (PMPRB) confirmed, again, that it has jurisdiction over Differin (adapalene, 0.1% concentration), a medicine marketed by Galderma Canada Inc. (Galderma). The PMPRB arrived at this conclusion after the FCA invited it to reconsider the issue based on factors not addressed by the Board at first instance1.

What you need to know

  • The sole issue for the PMPRB on redetermination was whether the invention of the 237 patent—which claims use of 0.3% adapalene and a pharmaceutical composition comprising 0.3% adapalene—pertains to the medicine, Differin which contains a formulation of 0.1% adapalene. By the time the case left the Federal Court of Appeal, it was clear that the 237 patent claims the formulation of 0.3% adapalene marketed as Differin XP. So, the thrust of the Board’s decision was to explain if, and how, the 237 patent pertained to Differin.
  • The PMPRB’s assessment considered the clinical similarities between Differin and Differin XP, and concluded that the invention of the 237 patent pertains to Differin. PMPRB ordered that Galderma file sales and financial information for Differin for the period from January 1, 2010 to March 14, 2016 (the date that the 237 patent lapsed).
  • The PMPRB continues to assert that the phrase “pertains to a medicine” as used in section 79(2) of the Patent Act (Act) is to be given a broad interpretation, consistent with the PMPRB’s consumer protection mandate. Yet, within this broad framework, the PMPRB’s re-assessment did not provide a robust consideration of the clinical differences between Differin and Differin XP.
  • This decision expands the scope of patented inventions that pertain to medicines sold in Canada as the PMPRB will consider clinical similarities between two different commercial products to assert that a patent to a formulation of one of the products will “pertain” to the other.
  • Galderma may bring an application in Federal Court for judicial review of this decision. Because of COVID-19 suspensions, the deadline to bring this application has been extended to August 12, 2020.

Analysis

The sole issue for the PMPRB on redetermination was whether the invention of the 237 patent pertains to the medicine, Differin. The FCA determined that the invention of the patent in question, i.e., the 237 patent, is the use and composition of 0.3% concentration of adapalene for the treatment of dermatological disorders, and sent the matter back to PMPRB for an assessment based on the proper understanding of this patent2. Differin is a formulation of 0.1% adapalene and is not covered by the claims of the 237 patent. In returning the matter to the PMPRB, the FCA invited the PMPRB to consider what clinical similarities between Differin and Differin XP would support a finding that a patented invention was intended or capable of being used for that medicine.

The phrase “pertains to” must be interpreted broadly

Following the FCA’s guidance, the PMPRB concluded that the meaning of the phrase “pertains to a medicine” as used in section 79(2) of the Act is to be given a broad interpretation, consistent with the ordinary meaning of the words and the PMPRB’s mandate to protect Canadian consumers from excessive prices. The PMPRB rejected Galderma’s argument that the invention must “encompass” the medicine that a patentee is selling in Canada. In the PMPRB’s view, that interpretation is inconsistent with both the wording of section 79(2) of the Act and the FCA’s decision in this proceeding. The PMPRB confirmed that the appropriate test is whether the invention of the patent is intended to or capable of being used for the medicine. In rejecting Galderma’s “restrictive interpretation,” the PMPRB referred to the FCA’s comment that “clinical similarities” could support a finding that the invention of a patent was intended or capable of being used for a medicine.

Reliance on clinical similarities to find that an invention “pertains to” a medicine

Because the FCA opened the door for the PMPRB to reconsider its decision based on factors not considered at first instance, namely, the clinical similarities between Differin and Differin XP3, the question at the centre of the PMPRB’s analysis was whether the clinical similarities between these two products could support a finding that the invention of the 237 patent was intended or capable of being used for Differin. The PMPRB concluded that it did.

In arriving at this conclusion, the PMPRB considered three main factors. First, Differin and Differin XP are different concentrations of the same active therapeutic ingredient (i.e., adapalene). The two products have the same indication (namely, the treatment of common acne) and they employ an identical mechanism of action. Second, Differin and Differin XP are the subjects of a single product monograph, which confirms that they “use the same medicinal ingredient, are indicated for the same dermatological disorder, and work in the same way4.” Third, the adverse reactions for both Differin and Differin XP are of the same type and of average intensity, and the occurrence of undesirable side effects is statistically the same for both products. Although adverse reactions typically occur sooner with Differin XP, the adverse reactions generally subside, indicating that both products are well tolerated. Finally, clinicians view both Differin and Differin XP as appropriate treatment for certain forms of acne.

Despite the higher concentration of adapalene in Differin XP, and the resultant differences in effectiveness, tolerance, and side effects, the PMPRB concluded that the invention of the 237 patent pertains to Differin because the products work in the same way, using the same mechanism of action to treat the same disorder. The differences in concentration, efficacy, and adverse reactions were not significant enough to outweigh the significant clinical similarities5.

The result of the PMPRB’s conclusion is that Galderma must file the prescribed sales and financial information for Differin for the period, roughly speaking from the time that Differin went off-patent until the 237 patent lapses.

Implication

The decision broadens the scope of analysis when determining whether an invention pertains to a medicine. Even if a patent did not encompass the medicine (a curious result because, if it could, the patent would be invalid), and even if the invention cannot strictly be used for a medicine, the clinical similarities between two products may be enough to support a finding that the invention of a patent was intended or capable of being used for a medicine.

Recall that, in its review of the PMPRB’s initial decision, the Federal Court accepted the parties’ agreement that Differin and Differin XP are different medicines with separate and distinct formulations and uses6. However, when redetermining the matter in the context of clinical similarities, the PMPRB concluded that “Differin and Differin XP are the same medicine, albeit in different concentrations”7. The PMPRB has asserted in the past that a patent could “pertain” to a product that falls outside the claimed formulation8. The door left open by the FCA has again expanded the scope of patented inventions that may pertain to medicines sold in Canada.

This raises the spectre of the PMPRB asserting jurisdiction over a product over which is never had jurisdiction because of the arrival of a later-coming patent. If a manufacturer obtains a patent for a new dosage form, new formulation, new indication, or new combination medicine based on an active ingredient used in an older off-patent medicine, the PMPRB may re-assert jurisdiction over the off-patent medicine.

Given that this case has already been the subject of a judicial review application and an appeal, it would not be surprising if Galderma were to “appeal” this decision by bringing an application for judicial review in Federal Court, which would give the opportunity to consider the reasonableness of this decision in the post-Vavilov world. The deadline for Galderma to bring an application for judicial review of this decision is August 12, 2020.

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1 For background, please read our report and discussion on the rulings of the Federal Court and Federal Court of Appeal.

2 Canada (Attorney General) v Galderma Canada Inc, 2019 FCA 196 at para. 75

3 Canada (Attorney General) v Galderma Canada Inc, 2019 FCA 196 at para. 73

4 Reasons for Decision on Redetermination Ordered by the Federal Court of Appeal on June 28, 2019 at para. 31

5 Reasons for Decision on Redetermination Ordered by the Federal Court of Appeal on June 28, 2019 at para. 59

6 Galderma Canada Inc. v Canada (Attorney General), 2017 FC 1023 at para. 6

7 Reasons for Decision on Redetermination Ordered by the Federal Court of Appeal on June 28, 2019 at para. 60

8 In guidance, the PMPRB has asserted that “patentees should be aware of the fact that any patents that pertain to modified release formulations of a medicine may also pertain to regular formulations of the same medicine.” See: http://www.pmprb-cepmb.gc.ca/cmfiles/Ref%20Docs%20Patentees/scopeofjurisdiction-e38MLR-8182006-4914.pdf

To discuss these issues, please contact the author(s).

This publication is a general discussion of certain legal and related developments and should not be relied upon as legal advice. If you require legal advice, we would be pleased to discuss the issues in this publication with you, in the context of your particular circumstances.

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