Pfizer permitted to amend defence in Pharmascience's pregabalin damages claim

The Federal Court’s decision in Pharmascience Inc. v. Pfizer Canada ULC, 2019 FC 1272 dealt with an appeal brought by Pfizer Canada ULC (“Pfizer”) of a decision denying Pfizer’s request to amend its Statement of Defence in a section 8 damages claim brought by Pharmascience Inc. (“Pharmascience”).

Background

In 2011, Pharmascience attempted to enter the pregabalin market, but was prevented from doing so because Pfizer sought an order prohibiting the Minister of Health from issuing a Notice of Compliance (“NOC”) to Pharmascience, which would have allowed Pharmascience to market a generic version of the drug. In 2013, Pharmascience received a NOC permitting the previously prohibited marketing, and initiated an action pursuant to section 8 of the Patented Medicines (Notice of Compliance) Regulations (the “Regulations”) against Pfizer for damages for the sales of pregabalin that it allegedly lost during the period that Pfizer kept Pharmascience off the market.

Pfizer moved to amend its statement of defence in respect of Pharmascience’s ability to supply the market with pregabalin during the alleged damages period. Pfizer argued that, as part of Pharmascience’s damages claim, the question of whether Pharmascience could obtain sufficient quantities of the active pharmaceutical ingredient (“API”) and get its product to the Canadian market during the relevant period had to be determined.

At first instance, Pfizer’s request was denied by the case management judge on the basis that the requested amendments amounted to an abuse of process: the question of whether there was a sufficient amount of API to supply the Canadian pregabalin market had already been decided affirmatively in Teva Canada Limited v Pfizer Canada Inc, 2017 FC 333, which was a section 8 damages claim by Teva in respect of pregabalin.

Federal Court’s Decision

The Federal Court held that the case management judge had erred in concluding that Pfizer’s proposed amendments would result in the re-litigation of already decided issues and thereby constitute an abuse of process. The Court allowed Pfizer’s appeal, with costs, and permitted Pfizer to amend its statement of defence.

The Court’s analysis centered on key differences that distinguish the Pharmascience action from the Teva action, such that “the [decision in] Teva cannot be superimposed on this case.”

In the Teva action, Teva bore the burden of proving its ability to come to market in a timely way and produced evidence and witnesses supporting its case. The court was persuaded by evidence from Teva’s personnel that the company’s supplier could deliver plenty of pregabalin API for the Canadian market, and preferred such evidence to the opinion of Pfizer’s expert.

In the Pharmascience action, Pharmascience instead bears the burden of proving its ability to come to market in a timely way and to produce evidence and witnesses supporting its case. Hence, despite similarities to the Teva action, and although the Court recognized that the case management judge’s decision was entitled to “considerable deference”, the Court determined that the Teva outcome and reasoning “cannot simply be imported into [the Pharmascience action]” because “Pharmascience’s but-for world likely differs in significant ways from Teva’s.”

In other words, there is no abuse of process in permitting the amendments because the Pharmascience action involves different parties and will involve different witnesses such that it will ultimately turn on its own particular evidentiary record.

Author: Jordyn Benattar, 2019/2020 Articling Student-at-law