Canada: Court Maintains Health Canada's Decision Extending Data Protection to Combination Drugs

Federal Court of Canada maintains Health Canada's decision extending data protection to combination drugs even when these drugs are not themselves innovative drugs

The Federal Court of Canada`s recent decision in Natco Pharma (Canada) Inc. v. Gilead Sciences Canada Inc. et al., 2020 FC 788 explores the reach of Canada's data protection regime.

In Canada, a generic drug manufacturer can seek approval for its own subsequent-entry version of a drug previously marketed in Canada by an originator of that drug. The generic's new drug submission is permitted to be "abbreviated" insofar as it may incorporate-by-reference the clinical information the originator provided to Health Canada when the originator first sought approval for the drug.

However, there are data protections for the originator. Canada's Food and Drug Regulations (C.08.004.1) provide the originator with a six-year period in which no drug submission that references the originator's data may be accepted for filing, and an additional two years before any approval can issue. An additional six months of protection is also available where there is pediatric information. These time periods are triggered if a manufacturer seeks a notice of compliance for a new drug “on the basis of a direct or indirect comparison between the new drug and an innovative drug”.

In this case, Gilead Sciences Canada Inc. ("Gilead") is the originator of GENVOYA, a drug that contains tenofovir alafenamide ("TAF"), emtricitabine and two other antiretroviral agents useful in treating HIV/AIDS. Health Canada considers GENVOYA to be an “innovative drug” under the data protection provisions.

Gilead also markets DESCOVY whose active ingredients are only TAF and emtricitabine. Health Canada does not consider DESCOVY to be an “innovative drug” as it was approved subsequent to GENVOYA.

Natco Pharma (Canada) Inc. (“Natco”) sought to file an abbreviated new drug submission (“ANDS”) that compared its own TAF/emtricitabine drug to DESCOVY. Health Canada rejected the application, citing the data protection applicable to GENVOYA, even though Natco`s comparison was to DESCOVY. Health Canada concluded that, as GENVOYA was an “innovative drug” that was properly granted data protection for TAF, “consistent with the intent of section C.08.004.1 to protect new chemical entities, other drugs containing [TAF], such as DECOVY, also benefit from the same period of data protection”. To Health Canada, “DESCOVY was protected under the data protection term for GENVOYA with respect to [TAF] because DESCOVY also contains this medicinal ingredient.” Health Canada’s conclusion was further supported by the fact that there was reliance on the data from GENVOYA in the approval of DESCOVY.

Natco sought to overturn this decision through judicial review in the Federal Court. To succeed, Natco would have had to demonstrate to the Federal Court that not only was the decision of Health Canada incorrect, but it was also unreasonable. This is generally a difficult standard to overcome.

For the Federal Court, the key question for Health Canada was whether Natco sought the notice of compliance “on the basis of a direct or indirect comparison” between its new drug and an “innovative drug”. With reference to the North American Free Trade Agreement (NAFTA) and the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS), the Federal Court found that data protection should apply to pharmaceutical products that “utilize new chemical entities” and require the submission of “undisclosed test or other data” that is the product of “considerable effort”.

The Federal Court accepted Natco’s argument that Health Canada had “skip[ped] a step” by not assessing whether there was a direct or indirect comparison to an innovative drug, but rejected Natco’s argument that Health Canada had effectively broadened the definition of “innovative drug” to include other drugs with the same medicinal ingredient. The Court found that, had Health Canada based its conclusion solely on the fact that DESCOVY contained TAF without assessing whether Natco’s submission directly or indirectly compared its drug to the innovative drug GENVOYA, then the decision would have been unreasonable. However, the Court was satisfied that Health Canada considered the issue of reliance on the data for GENVOYA in the approval of DESCOVY. Natco’s submission, which compared its drug to DESCOVY, thus made a “direct or indirect comparison” to GENVOYA, an innovative drug.

In the end, the Federal Court was of the view that Health Canada’s decision, including its consideration of the intent of the regulations and obligations under the trade agreements, to be reasonable and thus dismissed Natco's application.


Jordan Scopa, Jaclyn Tilak, Richard Naiberg and Harry Radomski