The Federal Court Upholds PMPRB Decision

On June 12, 2019, in Alexion Pharmaceuticals Inc. v. The Attorney General of Canada, 2019 FC 734, the Federal Court (the Court) dismissed an application by Alexion Pharmaceuticals Inc. (Alexion) for judicial review of a decision of a panel (the Panel) of the Patented Medicine Prices Review Board (PMPRB), as previously reported by the E-TIPS® Newsletter here.  In that decision, the Panel concluded that the price of the drug Soliris in Canada was excessive and ordered Alexion to both lower the price of the drug and make a payment to offset past excess revenues.  In reaching this conclusion, the Panel adopted a new Lowest International Price Comparison (LIPC) test, which is not one of the tests described in the PMPRB’s guidelines.  The Panel also refused to consider rebates Alexion gave to the provinces under Product Listing Agreements (PLAs). 

The Court held that in deciding whether a medicine is sold at an excessive price, the PMPRB is not required to apply any defined test.  Additionally, the PMPRB’s guidelines are not binding.  The Court was satisfied that in considering the benchmark against which to assess the issue of excessive pricing, the Panel gave due consideration to the guidelines and provided substantial and compelling reasons in support of its decision to depart from them. 

Furthermore, the Court held that it was reasonable for the Panel to conclude that rebates given to the provinces under PLAs were not to be taken into account in determining the average transaction price, as the provinces were not customers.  The Panel therefore did not err in excluding these discounts in assessing the amount of the excess revenue.

Summary By: Vanessa Komarnicki