Split FCA Affirms That Enantiomers Are Per Se Ineligible for Data Protection

Takeda Canada Inc. v. Canada (Health) / DEXILANT 2013 FCA 13 Dawson JA: Pelletier JA; Stratas JA dissenting, aff’g 2011 FC 1444 Near J (blogged here)

            dexlansoprazole – DEXILANT

It is now trite law that legislation is to be interpreted “as a harmonious whole,” in light of its text, context and purpose: Canada Trustco 2005 SCC 54 [10]. But as Sullivan on the Construction of Statutes, points out (5th ed at 3):

In an easy case textual meaning, legislative intent and relevant norms all support a single interpretation. In hard cases, however, these dimensions are vague or obscure and point in different directions. In the hardest cases, the textual meaning seems plain, but cogent evidence of legislative intent (actual or presumed) makes the plain meaning unacceptable.

Takeda / DEXILANT presents a “hard case” in Sullivan’s sense, if perhaps not “the hardest case,” and the panel has split on the interpretation of the definition of “innovative drug” in the Data Protection Regulations. The majority held that enantiomers, along with salts, esters, solvates and polymorphs, are per se ineligible for protection under the Regulations, regardless of the effort necessary to originate the regulatory approval data.

Takeda applied to have DEXILANT listed on the Register of Innovative Drugs, so as to provide data protection in accordance with section C.08.004.1of the Food and Drug Regulations. Only an “innovative drug” is eligible for listing, and this is defined to mean

a drug that contains a medicinal ingredient not previously approved in a drug by the Minister and that is not a variation of a previously approved medicinal ingredient such as a salt, ester, enantiomer, solvate or polymorph.

The active ingredient in DEXILANT is dexlansoprazole, an enantiomer of lansoprazole, which had previously been marketed as PREVACID. Thus the question is whether dexlansoprazole is a “variation” of lansoprazole, and so ineligible for listing.

Text, context and purpose must all be considered in interpreting legislation. Dawson JA for the majority pointed out that the words “such as” normally indicate a list of examples falling within the specified class [122]. This implies that an enantiomer is necessarily a variation. In response, Stratas JA argued that “such as” could be interpreted as listing examples that were normally caught, not examples that were necessarily caught. So, he suggested as regulation relating to pollution that listed “vehicles such as cars, trucks and buses” might not include electric cars [52]. In my view the majority has the better argument on the text alone, though the text could reasonably bear Stratas JA’s interpretation if other considerations pointed in the same direction.

Turning to context, the RIAS accompanying the Data Protection Regulations specifically addressed this issue and made it clear that all enantiomers were excluded from the definition of “innovative drug” [124]-[128]. While Stratas JA adverted to the RIAS, he did not address the specific and clear statements relied on by the majority [56]. The RIAS therefore clearly supports the majority position.

Stratas JA focused on the purpose of the Regulations. As he noted, section C.08.004.1(2) of the Regulations states expressly that the purpose of the Regulations is to implement Canada’s obligations under TRIPS and NAFTA [89], and this is further acknowledged in the RIAS. NAFTA Art 1711(5) provides as follows:

If a Party requires, as a condition for approving the marketing of pharmaceutical or agricultural chemical products that utilize new chemical entities, the submission of undisclosed test or other data necessary to determine whether the use of such products is safe and effective, the Party shall protect against disclosure of the data of persons making such submissions, where the origination of such data involves considerable effort,

TRIPS Art 39(3) is essentially identical. TRIPS and NAFTA themselves provide no exceptions for enantiomers. Thus if the origination of data “involves considerable effort,” TRIPS and NAFTA require that that data be protected. Since the purpose of the Data Protection Regulations is to implement TRIPS and NAFTA, it follows that they should be interpreted as protecting data which required considerable effort to originate, even if that data relates to an enantiomer. The majority response to this is that TRIPS and NAFTA make such protection mandatory only for “new chemical entities” and it is open to the Governor in Council to decide that enantiomers are not “new chemical entities.” In other words, if there is a lacuna in the Data Protection Regulations, in that data requiring considerable effort to originate may not be protected, that lacuna originates with TRIPS and NAFTA themselves, which by clear implication acknowledges that it is not mandatory to protect data that is not related to a “new chemical entity,” even if that data that required considerable effort to originate. Stratas JA disagreed with this interpretation of TRIPS and NAFTA. He was of the view that “‘[n]ew chemical entity’ must mean that the medicinal ingredient in the drug is ‘new’ in the sense that it has qualities of safety and efficacy materially different from a previously approved medicinal ingredient” [84]. In other words, “new chemical entities” are any entities subject to a marketing approval regime requiring test data. So, the US Dept of Health has defined a “new drug product” as being “A pharmaceutical product type, for example, tablet, capsule, solution, cream, that has not previously been registered in a region or Member State, and which contains a drug ingredient generally, but not necessarily, in association with excipients” (Fed Reg Vol 62 No 227 at 62897, cited on this point by de Carvalho, The TRIPS Regime 2^nd ed at 397). That is a reasonable interpretation, and, as Stratas JA points out, other jurisdictions appear to have taken that approach [85], but it is not* clear that it is necessarily the correct interpretation of the TRIPS and NAFTA provisions. In other words, the purposive analysis of the interpretation of the Regulations has led to a meta-problem of the interpretation of TRIPS and NAFTA. The fact that other jurisdictions have implemented their TRIPS obligations in a way that does not exclude enantiomers, indicates not that our Regulations should be interpreted to include enantiomers, but rather that other jurisdictions have interpreted their TRIPS and NAFTA obligations differently.

On the whole, the purposive analysis supports Stratas JA’s position, but the majority is correct to point out that it is not ironclad, at least in the absence of a conclusive and binding interpretation TRIPS and NAFTA. Moreover, the purposive analysis is not conclusive of the interpretation of the Regulations in any event. Even given that the purpose of the regulations was to implement Canada’s TRIPS obligations, and if Stratas JA is correct as to what those are, if text and context are sufficiently clear, we may nonetheless conclude that the best interpretation does not actually implement that purpose. In this case, given the ambiguity as to the correct interpretation of TRIPS and NAFTA, the textual argument favouring the majority position, and more particularly the very strong argument based on the RIAS, I believe that the majority has the better of this debate. But as Stratas JA noted, this leaves open the question of whether the current provisions, with a per se exclusion of any salt, ester, enantiomer, solvate or polymorph enantiomers, is good policy and compliant with our TRIPS and NAFTA obligations [96].

As a final point, the Court was unanimous that the standard of review of the Minister’s interpretation of the Data Protection Regulations is correctness [34], [111], though they disagreed on some details of administrative law leading to this conclusion.

*After I have posted, it is my policy to only edit my posts for typographical and grammatical errors, and not to change the substantive argument. In this case, I have added the word "not" as indicated; I trust it was clear that it was always intended, and the omission was a typographical error. [24 July 2020]