Date: 20021202
Docket: T-148-02
Neutral citation: 2002 FCT 1249
BETWEEN:
ASTRAZENECA AB and
ASTRAZENECA CANADA INC.,
Applicants,
- and -
APOTEX INC. and
THE MINISTER OF HEALTH,
Respondents
[1] The respondent Apotex Inc. (Apotex) brings this motion for an order setting aside the order of a prothonotary dated August 28, 2002 dismissing the motion of Apotex to dismiss the application of the applicant Astrazeneca AB and Astrazeneca Canada Inc. (Astrazeneca). Apotex asks that the Court, pursuant to paragraph 6(5) of the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 amended by SOR/98-166 and SOR/99-397 (the Regulations), dismiss Astrazeneca's application on the ground that the application is frivolous, vexatious and an abuse of process.
[2] Astrazeneca's application is for an order prohibiting the Minister of Health (the Minister) from issuing a Notice of Compliance (NOC) to Apotex regarding its Apo-Omeprazole product for the full term of Canadian Patent No. 2,166,794 (the '794 patent).
[3] The '794 patent claims magnesium omeprazole having a certain degree of crystallinity and formulations, including tablets containing such magnesium omeprazole. Apotex, on December 12, 2001, provided a Notice of Allegation (NOA) in respect of tablets for oral administration containing omeprazole strengths of 10, 20 and 40 mg and alleged that no claim for the medicine itself and no claim for the use of the medicine in the '794 patent would be infringed by the making, constructing, using or selling by Apotex of its omeprazole tablets. More specifically, Apotex asserted that claims of the '794 patent relate only to magnesium omeprazole having a degree of crystallinity higher than 70% as determined by x-ray powder diffraction, as well as processes for making, compositions containing, and use of the substance. Apotex asserted that its tablets would not infringe the claims of the '794 patent by reason of the fact that Apotex' tablets will contain only amorphous magnesium.
[4] Astrazeneca commenced its application seeking an order of prohibition on January 31, 2002 and amended it on April 19, 2002. Astrazeneca asserted four grounds in support of its request: first, that Apotex is precluded from relying upon the NOA by reason of the doctrines of res judicata, abuse of process and estoppel; second, that Apotex did not have a New Drug Submission (NDS) pending with the Minister at the relevant material time, as required by the Regulations; third that the NOA is insufficient to establish non-infringement because the legal and factual basis asserted is inadequate to support the allegation of non-infringement, and fourth, that the Apotex product would contain omeprazole that falls within the claims of the '794 patent. Astrazeneca filed four affidavits in support of its application.
[5] Apotex, in response, filed an affidavit attaching documents providing details of the ingredients of the Apotex' tablets that were the subject of the NOA, including details of the characteristics of its bulk omeprazole. By notice of motion dated July 3, 2002, Apotex sought summary dismissal of the Astrazeneca application. The motion was heard by the prothonotary on August 16, 2002. The prothonotary determined that the motion could not succeed. The crux of his decision is contained in the following paragraphs:
I need not deal with all of the extensive arguments advanced by counsel on each separate ground to dispose of this motion, as I am satisfied that the motion should be dismissed based solely on what I consider to be an arguable issue raised by the Applicants regarding the sufficiency of the allegation of non-infringement. The Notice of Allegation asserts that the Apotex's tablets will not infringe "by reason of the fact that the tablets will contain only amorphous magnesium omeprazole". The allegation, which must be taken to be true, is insufficient, according to the Applicants, since there is no assertion regarding the crystallinity of magnesium omeprazole used to make the tablets. Apotex points out that its evidence, filed in the main proceeding and in support of this motion, "clearly and unequivocally" established that Apotex uses only amorphous magnesium omeprazole to make its tablets and that the Applicant's argument, therefore, has no merit. I disagree.
First, the Applicants have raised serious questions regarding the credibility of Apotex's deponent, who addresses the issue of infringement in his affidavit. Second, there is an arguable case that Apotex cannot, at this stage, correct the deficiency in the Notice of Allegation alleged by the Applicants through its evidence on this application. In the circumstances, I am not satisfied that Apotex has met the fairly stringent test set out in ss. 6(5) of the Regulations.
[6] The parties agree that the decision of a prothonotary to dismiss, or not to dismiss, a proceeding pursuant to paragraph 6(5)(b) of the Regulations is vital to the final issue in the proceeding, as such a decision has the potential to finally determine the proceeding. Accordingly, the standard of review is that of correctness and the reviewing judge ought to assess the issues on the appeal de novo: Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425 (C.A.).
[7] A notice of application will be struck out only in very exceptional circumstances when the application is so clearly improper as to be bereft of any possibility of success: David Bull Laboratories (Canada) Inc. v. Pharmacia Inc. et al., [1995] 1 F.C. 588 (C.A.). Apotex must therefore demonstrate that each of the grounds advanced by Astrazeneca is futile.
[8] I propose to examine first, the ground upon which the prothonotary based his decision, i.e., the sufficiency of the NOA. Apotex argues that its NOA is not deficient because it states that its tablets will contain only amorphous magnesium omeprazole. Relying on Merck Frosst Canada Inc. v. Canada (Minister of National Health & Welfare) (1994), 55 C.P.R. (3d) 302 (F.C.A.), it submits that the facts contained in the NOA are deemed to be true unless the contrary can be shown by the applicant In addition, Apotex contends that it has provided clear unequivocal uncontradicted evidence, through the affidavit of Dr. Bernard Sherman, the chair of Apotex, that its tablets will contain only amorphous magnesium omeprazole. Additionally, Apotex has provided the details of the bulk magnesium omeprazole used to make its tablets, as well as test results which clearly prove that the bulk is amorphous. The evidence of Dr. Sherman, says Apotex, is unimpeached in every respect such that there are, in fact, no credibility issues.
[9] Apotex further argues that any assertion by the applicants that the NOA is not sufficient is directly contrary to binding jurisprudence of the Federal Court of Appeal in SmithKline Beecham Pharma Inc. v. Apotex Inc. (2001), 10 C.P.R. (4th) 338 (F.C.A.) wherein it was held that the purpose of a NOA is to make a patentee aware of the grounds upon which it is claimed that the patent will not be infringed. There, the patentee was well aware of the grounds of the allegation and was not left to guess. That the patentee was sufficiently alerted to the basis of non-infringement was indicated by the fact that the patentee had been able to raise and address its speculative theory in its evidence. Similarly, submits Apotex, Astrazeneca was well aware of the grounds upon which non-infringement was alleged, and was not left to guess. This is clear from the evidence that Astrazeneca filed and the position it took with respect to Apotex' bulk magnesium omeprazole. Accordingly, Apotex argues that the NOA is not deficient and that Astrazeneca's argument in this regard is entirely without merit. Its application cannot possibly succeed on this basis.
[10] Astrazeneca submits that the NOA asserts only that Apotex' tablets will contain amorphous magnesium omeprazole. There is no assertion regarding the crystallinity of magnesium omeprazole used to make the tablets. Therefore, says Astrazeneca, the allegation addresses at best, the formulation claims of the '794 patent and does not address the main claim (claim 1) to magnesium omeprazole per se (i.e., raw material). As such, the basis asserted in the NOA, even if assumed to be true, does not lead to the conclusion that the '794 patent will not be infringed. In this regard. Astrazeneca relies on the evidence of Dr. Ymen, an expert in x-ray powder diffraction (xrpd) analysis who was not cross-examined and whose evidence in this respect stands uncontroverted. Astrazeneca also contends that while the NOA asserts that its tablets will contain only amorphous magnesium omeprazole, Apotex has not conducted any analysis on its tablets to determine the crystallinity of the magnesium omeprazole present in the tablets. In this respect, Astrazeneca refers to the cross-examination of Dr. Sherman. In further reliance on the cross-examination of Dr. Sherman, Astrazeneca submits that while Dr. Sherman states that the magnesium omeprazole used to make the Apotex tablets will be amorphous, Dr. Sherman does not have any expertise in xrpd analysis. He himself has never conducted any xrpd analysis and he was not aware how the tests were conducted to make that determination or whether anyone might have conducted such tests. Moreover, argues Astrazeneca, the Sherman evidence is suspect because the affiant has an interest in the outcome of this proceeding.
[11] A motion to dismiss on the basis that the proceeding is frivolous, vexatious or an abuse of process is not a forum for a determination of the merits of an application. Here, Astrazeneca has submitted evidence that the NOA lacks an assertion regarding the crystallinity of magnesium omeprazole used to make its tablets. The result may or may not be that the factual basis of the detailed statement addresses the formulation claims of the patent but fails to address the claim to the raw material and is therefore not sufficient to support an allegation of non-infringement. That is not for me to determine since it goes to the merits of the application. I must determine whether this ground is so clearly improper as to be bereft of any possibility of success. I am mindful of Apotex' position that its evidence establishes non-infringement. However, I am also mindful that there exists authority, binding upon me, that a second person cannot rely on facts that exceed those laid out in its detailed statement: Merck Frosst Canada Inc. v. Canada (Minister of Health) (2002), 12 C.P.R. (4th) 447 (F.C.A.); Procter & Gamble Pharmaceuticals Canada, Inc. v. Canada (Minister of Health) (2002), 20 C.P.R. (4th) 1 (F.C.A.). Moreover, in my view, Astrazeneca has raised sufficient issues regarding the credibility of Apotex' witness such that the issue should be addressed by the judge assigned to hear the application.
[12] I am not persuaded, on the basis of the material before me, that the issue of the sufficiency of the NOA is so clearly improper as to be bereft of any possibility of success. Having so concluded, I need not address the other grounds argued.
[13] The motion is dismissed. Costs will be costs in the cause.
____________________________________
Judge
Ottawa, Ontario
December 2, 2002
FEDERAL COURT OF CANADA
Names of Counsel and Solicitors of Record
DOCKET: T-148-02
STYLE OF CAUSE: ASTRAZENECA AB
and ASTRAZENECA CANADA INC.,
Applicants
- and -
APOTEX INC. and
THE MINISTER OF HEALTH,
Respondents
PLACE OF HEARING: TORONTO, ONTARIO
DATE OF HEARING: OCTOBER 28, 2002
REASONS FOR ORDER
BY: LAYDEN-STEVENSON J.
DATED: DECEMBER 2, 2002
APPEARANCES BY: Ms. Y. Kang
For the Applicant
Mr. Brodkin
For the Respondent
SOLICITORS OF RECORD: Ms. Y. Kang
Smart and Biggar
Toronto, Ontario
For the Applicant
Andrew Brodkin
Goodmans LLP
Toronto, Ontario
For the Respondent