On January 13, 2023, the Federal Court (per Tabib A.J.) issued its judgement denying Takeda’s motion for consolidation of two PM(NOC) actions on the basis that granting consolidation would result in an adjournment of the trial in the first action, and prejudice Apotex. It seems that by delivering successive NOAs that challenge different register patents protecting the same medicine, generics can force innovators to suffer multiple trials with little hope of consolidation.

Both actions involve the same parties, drug product (Dexilant), and generic drug submission. However, the actions were separately commenced because Apotex initially challenged only three of the eight register patents. Some eight months later, Apotex challenged the other five resulting in Takeda commencing a second PM(NOC) action.

The Court determined that Rule 105(a) of the Federal Courts Rules governs the consolidation of such proceedings, finding that the purpose of consolidation is “the avoidance of a multiplicity of proceedings and the promotion of expeditious and inexpensive determination of those proceedings”.[1] The Court noted that proceedings should not be consolidated if one of the parties would be prejudiced.[2]

In seeking to consolidate the two proceedings, Takeda argued that it would be prejudiced by having to litigate two different actions, some eight months apart, with overlapping deadlines. Takeda further argued that the contradictory positions adopted by Apotex in the two actions may lead to inconsistent decisions. The Court noted that Takeda is a sophisticated litigant and it did not establish that its resources would be unduly strained by separate trials. The Court also found that Takeda’s contention that it would be prejudiced by inconsistent pleadings and the risk of contradictory judgments was unpersuasive. The principles of issue estoppel would govern. As such the findings of fact in the first action will be binding on both parties in the second, thus eliminating the likelihood of contradictory judgments.

The Court found that “[d]elaying the determination of the issues raised in the First Action to accommodate a consolidated trial would either force Apotex to assume the risk of entering the market ‘at risk’ or delay its potential entry by five months, with the attending risk of losing first-mover advantage”.[3] That is, if Apotex is successful in the first action, with trial in September of 2023, then Apotex could possibly enter the market before the trial of the second action, as the second action-patent expires in October of 2023. Though speculative, the Court held “[b]oth of these scenarios are prejudicial to Apotex”.[4]

Takeda argued that any potential prejudice to Apotex is entirely of its own making. Apotex could have delivered all NOAs at the same time. The Court was not persuaded. Serving all NOAs at the same time is not an obligation under the PM(NOC) Regulations:

“The Federal Court of Appeal has consistently held that a second person has no obligation regarding the timing of the delivery of an NOA, and that it is free to deliver as many NOAs as there are patents listed on the Register, even if that leads to a separate proceeding for each patent”.[5]

The Court did caution that decisions generics might take in respect of the timing of NOAs can be questioned or lead to some sort of procedural sanctions. However, Apotex’s conduct in this matter was not deserving of sanctions.

[1]Takeda Canada Inc. v Apotex Inc., 2023 FC 63 at para 22.

[2]Takeda Canada Inc. v Apotex Inc., 2023 FC 63 at para 23, citing to Eli Lilly and Co. v Apotex Inc. (1994) 55 CPR

(3d) 429.

[3]Takeda Canada Inc. v Apotex Inc., 2023 FC 63 at para 34.

[4]Takeda Canada Inc. v Apotex Inc., 2023 FC 63 at para 34.

[5]Takeda Canada Inc. v Apotex Inc., 2023 FC 63 at para 41.