On May 26, 2017, the Federal Court held that Teva was entitled to section 8 damages, in a redetermination of its previous trial decision (Teva Canada Limited v Pfizer Canada Inc, 2017 FC 526). The key issue of the redetermination was whether in a hypothetical “but-for world” Teva would have and could have had access to sufficient quantities of venlafaxine to supply the generic market at the relevant time.

Section 8 of the Patented Medicines (Notice of Compliance) Regulations provides that an innovator is liable to a generic manufacturer for losses suffered as a result of an unsuccessful prohibition application commenced by the innovator.

At trial, Justice Zinn awarded the plaintiff, Teva Canada Limited, $105 million in section 8 damages and pre-judgment interest regarding its venlafaxine hydrochloride products (Decision on Liability: 2014 FC 248; Decision on Damages: 2014 FC 634). On appeal, the Federal Court of Appeal remitted the matter to the Federal Court for redetermination on the basis that the trial decision relied, in part, on inadmissible hearsay evidence, as previously reported in the E-TIPS® newsletter.

On redetermination, the Court held that it would not allow any new objection to admissibility proffered by the defendant, since no such objections had been made at first instance. According to the Court, in a redetermination based on an existing trial record, “the principle of fairness dictates that the Court deal with the record as it stands and not as one party might wish it to stand.”

The Court ultimately found that the supply agreement and the supplier’s ability to perform demonstrated that Teva would have and could have had sufficient quantities of venlafaxine to supply the Canadian generic market in the relevant period. This decision highlights that, absent evidence to the contrary, a section 8 plaintiff can prove its loss on a balance of probabilities by pointing to a supply agreement that provides for the supply of the pharmaceutical to satisfy the generic market in the but-for world.

Summary By: Michelle Noonan

E-TIPS® ISSUE

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