On March 24, 2022, the Supreme Court of Canada (SCC) dismissed an application, filed by the Attorney General of Canada, for leave to appeal the Federal Court of Appeal (FCA) decision in Alexion Pharmaceuticals v. Canada (Attorney General), 2021 FCA 157 relating to the pricing of the orphan drug Soliris. This means that the matter will be remitted back to the Patented Medicine Prices Review Board (PMPRB) to reassess whether the price of Soliris is “excessive” following the decision of the FCA, which is the law on the issues the FCA considered.
For more information on the FCA decision, please see our previous bulletin1.
What you need to know
Alexion Pharmaceuticals Inc. markets the patented medicine Soliris, an orphan drug. In 2017, the PMPRB concluded that the price of Soliris in Canada was excessive and ordered Alexion to reduce its price and make a payment to the Crown in order to offset past excess revenues. Alexion initiated judicial review proceedings and the Federal Court upheld the PMPRB’s decision. However, on appeal, the FCA reversed, finding four key errors that rendered the PMPRB’s decision unreasonable.
The SCC, having declined to grant leave, will not hear any further appeal of this matter, so the issue of whether Soliris had been sold at an excessive price will be sent back to the PMPRB for redetermination.
The FCA decision in Alexion is the law. Allegations of the Attorney General of Canada challenging the FCA in Alexion were unsuccessful. The FCA in Alexion determined:
Celgene Corp. v. Canada did not give the PMPRB a consumer protection mandate to prevent the mischief of excessively priced patented medicines,
the PMPRB has limits on the information it may consider when reviewing the price of patented medicines in other countries, constrained by section 85 of the Patent Act, and
the PMPRB must explain any departure from its guidelines as required by the SCC’s instructions in Canadav.Vavilov.
The FCA decision confined the PMPRB’s jurisdiction to regulating “excessive” pricing and preventing patent abuse, and made strong statements on the need for the PMPRB to provide clear reasons to justify its decisions.
The PMPRB had departed from its own guidelines when assessing the price of Soliris; the FCA held that the PMPRB failed to provide sufficient reasons to justify a departure from its ordinary practice, and therefore did not meet the standard for reasonableness.
We will continue to monitor for the PMPRB’s redetermination and provide updates as available. Please reach out to any of the authors if you have any questions on the SCC leave decision or any aspect of PMPRB regulation.
Torys has written extensively on PMPRB developments, including with respect to this particular case; see below for a selection:
“This Court does not sign blank cheques”: Federal Court of Appeal reverses Canada’s Patented Medicine Prices Review Board, restricting Board’s price control mandate, available here.
Déjà vu: Another delay in implementation of Canada’s PMPRB Regulations, available here.
The wait is over: Canada’s PMPRB releases final Guidelines, available here.
PMPRB decision stands: Soliris priced excessively, available here.
Alexion Pharmaceuticals v Canada FCA Dismisses Appeal Aimed at Constitutionality of PMPRB Provisions, available here.
Alexion Ordered to Significantly Reduce Cost of Soliris, available here.
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.
For permission to republish this or any other publication, contact Janelle Weed.