Monday, February 13, 2012

A Purposive Interpretation of “Innovative Drug”

Celgene Inc. v. Canada (Health) / THALOMID 2012 FC 154 de Montigny J

In his decision in THALOMID de Montigny J has held that thalidomide is an “innovative drug” under the Data Protection Regulations, and so Celgene is entitled to have it listed on the Register of Innovative Drugs. While thalidomide has a very unusual history, and de Montigny J himself stated that “the present decision will have a limited impact in the foreseeable future” [47], the reasoning underpinning de Montigny J’s interpretation marks an important and welcome development in the interpretation of the Regulations.

Thalidomide was launched commercially by a German pharmaceutical company in October 1957, and two companies received regulatory approval to sell thalidomide in Canada in 1960 and 1961. In 1962, after its teratogenicity became known, the Department of Health ordered thalidomide's permanent withdrawal from the Canadian market. The withdrawal letters sent to the manufacturers stated in part that “[w]ith the withdrawal of this acceptance, thalidomide returns to the status of a new drug” [6]. Over the past 20 years Celgene has developed various applications of thalidomide. In May of 2009 Celgene filed an NDS seeking approval for thalidomide, which it markets as THALOMID, for use in the treatment of multiple myeloma. The NOC was issued in August of 2010 [12]. However, the Minister of Health advised Celgene that THALOMID was not eligible for data protection because an “innovative drug” is defined in C.08.004.1(1) to mean “a drug that contains a medicinal ingredient not previously approved in a drug by the Minister,” and thalidomide had been previously approved by the Minister in the 1960 and 1961 approvals.

An obvious rebuttal to the Minister’s position is that the previous approval was withdrawn and the Deaptment of Health had itself said that it was once again a new drug. While this argument was made by Epicept, this was not the primary basis for de Montigny J’s decision. He referred to it a “technical argument” [39], and while he accepted it, he considered it only as a supporting consideration [42].

Instead, his primary focus was a purposive interpretation of the definition of the Regulations. This analysis is what makes his decision of broader interest despite the unusual history of thalidomide. The Minister’s position was that protection should be limited to “new chemical entities” and “the intent of the data protection provisions is to reserve the special market exclusivity period for genuinely new and innovative medicinal ingredients, and not simply new uses of ingredients that have been previously approved for a different use” [32]. de Montigny J rejected this position. He emphasized that “the purpose of the DPR is clearly to encourage and reward innovation by protecting the data an innovator must generate to obtain approval for a drug” [36] (and see similarly[29]). He stressed that the Regulations were enacted to implement Article 1711 of the NAFTA and Article 39(3) of TRIPS which oblige Canada to provide protection to innovators in respect of "undisclosed test or other data" that they must provide to government entities in order to obtain approval for their new drugs [31]. In the case at bar

Celgene’s innovation was to take something that was banned as dangerous and which had not been found to be safe and efficacious and to show it to be a useful, lifesaving drug. To do so, Celgene did not and could not rely on old data, but had to produce the very data that had not ever been produced previously and which was required to obtain an NOC. In an uncontradicted affidavit, the Senior Director of Pharmacovigilence & Regulatory Affairs at Celgene Inc. testified that 108 volumes of data were filed with the NDS in seeking approval for THALOMID [35].

de Montigny J held that it would be “inconsistent with these treaties to refuse data protection when a chemical entity is put to an entirely new use, on the basis of extensive and genuinely new data ensuring its effectiveness and safety” [36].

de Montigny J’s statements of principle are very difficult to reconcile with the decision of Near J in Epicept / CEPLENE 2010 FC 956 (appeal dismissed for mootness 2011 FCA 209). The medicinal ingredient in CEPLENE is histamine dihydrochloride, which was an old compound that had previously been approved under the DIN process, without the submission of extensive clinical data. Epicept sought approval for a new use, in the treatment of leukemia. Health Canada deemed CEPLENE to be a new drug for this use, presumably under C.08.001(c), and required a full NDS, which Epicept provided in 2009. Epicept sought data protection because the only relevant patent expired in 2010. The Minister refused to add CEPLENE to the Register of Innovative Drugs on the basis that the active ingredient had been previously approved under the DIN process. Epicept argued that this was contrary to the purpose of Data Protection Regulations, which was “to protect the extensive clinical data performed to gain approval for a ‘new drug’” [63] – that is, the same purpose as accepted by de Montigny J in THALOMID. And indeed, Near J also apparently accepted this purpose, remarking that Epicept’s “interpretation and arguments are compelling” [62]. He nonetheless held that the argument failed, on the basis that “as set out in the relevant NAFTA and TRIPS provisions, the Regulations are to protect ‘new chemical entities’. Not all ‘new drugs’ are ‘new chemical entities’” [63]. This is exactly the argument rejected by de Montigny J in THALOMID.

CEPLENE and THALOMID can be formally reconciled, as the thalidomide approval had been withdrawn, but this was expressly not the primary basis of de Montigny J’s decision. There can be little doubt that the outcome of CEPLENE would have been different had it been heard by de Montigny J rather than Near J. My view is that de Montigny J’s approach is clearly preferable. The purpose of the Act is a central consideration in statutory interpretation, which must be respected if the text will reasonably bear that interpretation: Canada Trustco Mortgage Co. v. Canada, 2005 SCC 54, [10]. Near J’s decision is particularly problematic as he had to give two different meanings to the same word, “drug” in the same provision in order to arrive at the conclusion he did. In other words, he had to strain the text in order arrive at a result which was contrary to the purpose of the Act.

Thus while de Montigny J’s decision in THALOMID concerns a very unusual set of facts, his purposive interpretation of “innovative drug” is an important and welcome development in the law relating to the Data Protection Regulations.

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