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Federal Court of Appeal Reviews PMPRB's decision regarding Galderma's Differin® and Differin XP®

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Galderma Canada Inc. (“Galderma”) is a pharmaceutical company that manufactures and sells dermatological treatment medication. Two of its products, Differin and Differin XP, rely on adapalene as their single medicinal ingredient.

In January 2016, the Patented Medicines Prices Review Board (the “Board”) sought pricing and marketing information related to Differin through the original, expired patents covering adapalene. However, the Board was barred from accessing the information, because subsection 80(3) of the Patent Act R.S.C. 1985, c. P-4 (the “Act”) excuses Galderma from disclosure obligations relating to patents that have expired more than 3 years prior to such a request. The original patents for adapalene had expired at least seven years before the Board requested the information.

The Decision Under Review

In December 2016, the Board ordered Galderma to produce pricing and marketing information regarding Differin based on a different patent: Canadian Letters Patent No. 2,478,237 (the “237 patent”), which was recent enough to bypass subsection 80(3) of the Act.

Galderma argued that the 237 patent dealt exclusively with a 0.3% concentration of adapalene, as used in Differin XP, and thus did not pertain to Differin because Differin contained only a 0.1% concentration. Upon reviewing the abstract and an introductory paragraph of the patent, the Board found that the 237 patent did not, on its face, exclusively deal with adapalene at a 0.3% concentration, and therefore had a sufficient connection to Differin to allow it to order the disclosure.

The Board’s order was judicially reviewed by the Federal Court. The Federal Court's decision was then appealed to the Federal Court of Appeal (“FCA”) by the Attorney General on behalf of Board staff.

The Federal Court of Appeal’s Decision

In Canada v. Galderma Canada, 2019 FCA 196, the issues on appeal were as follows:

  1. Did the Board act unreasonably in limiting its review of the 237 patent to selected portions of the patent?
  2. What is the invention of the 237 patent?
  3. Does the invention of the 237 patent pertain to Differin?

Did the Board act unreasonably in limiting its review of the 237 patent to selected portions of the patent?

Because the Board was interpreting its home statute, the FCA held that the Board’s decision was entitled to deference and that a standard of reasonableness should apply when reviewing its order. The FCA nevertheless found that the Board had acted unreasonably by failing to review the patent as a whole.

The Board focused its analysis on the abstract and an introductory paragraph of the patent, citing previous case law that said it was not required to go “beyond the face of the patent” to construe the claims of the 237 patent. However, the FCA clarified that “the face of the patent” meant that the Board was not required to look beyond the text of the patent to find implied additions or limitations. Put differently, the Board could take the language of the patent at face value, but was still required to consider the whole patent, including its claims, and not merely selected portions that describe it in general terms.

What is the invention of the 237 patent?

The FCA also found that the Board had failed to make a determination of what in fact was the invention of the 237 Patent. Subsection 79(2) of the Act requires that such a determination be made in order to identify whether the invention is intended or capable of being used for medicine:

79(2) For the purposes of subsection (1) and sections 80 to 101, an invention pertains to a medicine if the invention is intended or capable of being used for medicine or for the preparation or production of medicine.

Normally the matter would be returned to the Board for determination because the Board had failed to complete its inquiry. However, the FCA found that the words of the 237 patent offered only one reasonable interpretation, and so it decided to supply that interpretation on its own, rather than refer the question back to the Board.

Upon reviewing the whole patent, the FCA determined the invention is “a pharmaceutical composition having a concentration of 0.3% adapalene to be used in the treatment of dermatological conditions with an inflammatory or proliferative component, such as common acne”. The FCA further concluded that the “medicine” in question was Differin, not adapalene. That finding was largely based on a review of the language used in the Board’s decision and the fact that Differin was the product directly available to the market.

Does the invention of the 237 patent pertain to Differin?

Lastly, the FCA considered whether the invention actually pertained to Differin such that the Board could order the sought-after disclosure.

The Board had found that there was a “rational connection or nexus” or at least a connection of the “merest slender thread” between the invention and Differin, drawing on language from the FCA’s decision in ICN Pharmaceuticals, Inc. v. Canada (Staff of the Patented Medicine Prices Review Board), [1997] 1 FC 32 (FCA).

The FCA agreed that there must be “a rational connection or nexus” between the invention and the medicine, but noted:

[64] It does not add much to our understanding of the relationship between an invention and a medicine to say that there must be a rational connection between the two. One could hardly argue the contrary. The issue is the nature of that connection. The expression “merest slender thread” is a metaphor designed to express the idea that the connection may be tenuous.
[66] It goes without saying that the metaphor which describes the relationship expressed by “pertains to” cannot supplant the statutory definition of that expression. This is not to say that the metaphor is not a useful way of expressing the possibility that the relationship between the invention and a medicine may be tenuous but, at the end of the day, the question is whether the invention is intended or capable of being used for medicine, and not whether there is the merest slender thread of a connection.

[67] All of this is to say that the Board must be guided by the statutory definition of “pertains to” and must not substitute “the merest slender thread” for the words Parliament has chosen.

The FCA ultimately decided to send the question of whether the invention of the 237 patent pertains to Differin back to the Board, citing the fact that the question involves policy considerations that the legislature intended the administrative decision maker (i.e., the Board) to weigh.

In light of the FCA’s decision on the two preceding questions, the Board will be required to complete its inquiry on the basis of a proper understanding of the invention of the 237 patent – that is, on the basis that the invention of the 237 patent is the use of a 0.3% concentration of adapalene for the treatment of dermatological conditions.

Authors: Larissa Fulop and Sasha Seeber

Photo Credit: https://unsplash.com/@simonevdk

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