The Federal Court has ordered that two additional generic defendants (Taro Pharmaceuticals Inc., Sandoz Canada Inc.) be added to a trial of common issues currently set for Bayer Inc.’s claims against Teva Canada Limited and Apotex Inc. concerning generic versions of XARELTO® (rivaroxaban) under the Patented Medicines (Notice of Compliance) Regulations (the Regulations).

All four proceedings are patent infringement actions brought by Bayer under the Regulations. The actions were launched in response to each defendant’s Notice of Allegation (NOA) for their respective generic versions of XARELTO® and one or more Bayer patents.

Earlier this year, the Court ordered a trial on the common issues of claims construction and invalidity in the Teva and Apotex actions. Those actions had been launched by Bayer within a month of each other, in November and December of 2018. Subsequently, Bayer launched actions against Taro and Sandoz in March and May of 2019. Under the Regulations, each action must be decided within 24 months of being filed. As a result of this most recent order, the common issues of claims construction and invalidity in all four actions will now be decided within the 24-month window of the first action.

Bayer, Taro, and Sandoz argued that the common issues in all four cases ought to be heard together. The Court agreed, rejecting Teva and Apotex’s submission that they should not lose the commercial advantage that they gained by serving their NOAs earlier than Taro and Sandoz. The Court accepted that “the balance of interests and commercial realities underlying the regime set out in the Regulations is a relevant background consideration”. However, the Court rejected the argument that it should protect any “first mover advantage” as a general principle. The Court reasoned that no party is guaranteed that its hearing and decision will proceed before any other. The Court agreed with the reasons in another recent case where the Court found that an earlier NOA did not guarantee an earlier judgment or an earlier market entry. The Court also noted that any “first mover advantage” may effectively disappear if Teva’s counterclaims of invalidity were successful.

The Court found that, in the circumstances, it was in the interests of justice to add Taro and Sandoz as defendants to the hearing of common issues. There were two primary considerations:

  • First, Taro and Sandoz were ready to proceed in accordance with the schedule previously established for Teva and Apotex.
  • Second, it was in the interests of justice for the Court to hear the evidence and submissions of all of the parties prior to determining the issues of claims construction and invalidity. This would avoid the risk of different rulings and provide the Court with all of the parties’ evidence and submissions before making a ruling that would impact each of them.

The Court further stated that separate hearings on infringement will follow the trial of the common issues and therefore it is likely that the separate hearings on infringement for each of Taro and Sandoz will not be scheduled until after the trials on all issues are completed for Teva and Apotex.

The Federal Court’s decision has been appealed (Court Files No. A-388-19/ A-389-19).

The case is: Bayer Inc v Teva Canada Limited, 2019 FC 1039