Canadian Lawyer InHouse

11 CANADIANLAWYERMAG.COM/INHOUSE MAY 2016 By Adrian Zahl and Andrew Kaikai, student-at-law Intellectual Property O n Oct. 5, 2015, 12 countries, including Canada, signed the fi nal draft of the Trans-Pacifi c Partnership Agreement. Ratifi cation must occur within two years. Intellectual property was a contentious issue during negotiations, in particular aspects relating to pharmaceuticals, such as patent term extensions, data protection, and patent/drug approval "linkage" mechanisms. However, most of these aspects are already enshrined in Canadian law, while others, such as patent term extensions for pharmaceuticals, are part of the recent Canada-European Union Comprehensive Economic and Trade Agreement, which is awaiting ratifi cation by the Canadian and European governments. As a result, most TPP provisions relevant to pharmaceuticals are largely redundant with existing or pending laws, with one important exception. PATENT PRE-APPROVAL The TPP requires parties to provide a "pre-approval" procedure for patented pharmaceuticals, with two options: 1) provide notice to a patent holder if a competitor applies to market an identical or similar drug during the patent term, along with an opportunity to seek a legal remedy such as a preliminary injunction before the generic drug is marketed; or 2) preclude marketing approval for a drug that is subject to another person's patent, unless the patent holder or original drug manufacturer consents. Canada's existing Patented Medicines (Notice of Compliance) Regulations currently establish a system similar to the Hatch-Waxman system in the United States, under which a drug manufacturer may list patents relevant to a drug on a patent list. A generic version of the drug will not be approved until the listed patents expire or a judicial procedure is concluded. This mechanism likely satisfi es the TPP's fi rst option, without requiring amendments to existing regulations. DATA PROTECTION The TPP mandates a minimum of fi ve years of data protection for newly approved drugs, commencing on the date a drug is fi rst approved for marketing. During this period, generic competitors are not entitled to rely on drug safety or effi cacy data submitted to the government by the originator. This is a non-patent form of market exclusivity that effectively prevents generic competition during the data protection period. Canada already complies with this provision, since it already provides eight years of data protection. The TPP also mandates an additional three years of data protection for new formulations and new methods of administration of previously approved pharmaceuticals, as well as fi ve years of data protection for combination drugs if at least one of the ingredients was previously subject to data protection. However, these requirements are waived for countries, like Canada, that provide eight years of data protection. Under Canada's existing Food and Drug Regulations, innovative drugs receive eight years of data protection. This protection also extends to biologics, although it does not provide additional data protection to new indications, dosage forms, or variants of previously approved drugs. No action appears to be required on Canada's part to comply with the TPP data protection requirements. The TPP also requires 10 years of data protection for agricultural products. This will provide additional protection in this area, which is currently protected by a weaker form of data protection. PATENT TERM EXTENSIONS — BENEFITS OF TPP The TPP requires countries to provide patent term ex- tensions (sometimes referred to as "patent term restora- tion") to compensate for delays arising in two scenarios: unreasonable delays in the marketing approval process and unreasonable delays in patent prosecution amount- ing to more than fi ve years from the application date or three years from the request for examination, which- ever is later, subject to certain exclusions. The TPP does not specify a maximum patent term extension. Under CETA, Canada has already agreed to a two- year patent term extension due to delays caused by the marketing approval process. This applies only to phar- maceuticals. As a result, Canada may need to provide an additional term extension for delays arising during patent prosecution. The impact of these provisions will take some time to determine, since in most cases pros- ecution proceeds reasonably quickly in Canada. Neither CETA nor the TPP has been ratifi ed and the government hasn't issued any formal proposals for changes to the Patent Act or Rules to implement patent term extensions. IH Much ado about nothing? Pharmaceuticals and the Trans-Pacific Partnership Agreement in Canada Adrian Zahl is a partner and Andrew Kaikai a student- at-law at Ridout & Maybee LLP.

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