The Patented Medicine (Notice of Compliance) Regulations (“PMNOC Regulations”) provide the rules that govern pharmaceutical litigation in Canada. Th e PMNOC Regulations came into effect in 1993 and then were amended in 1998. Further proposed amendments to the PMNOC Regulations were published in late 2004. The industry responded and as a result of the representations, the government is currently considering a framework for an alternate set of amendments that are expected to be published shortly.

The PMNOC Regulations provide for the listing of patents on a Patent Register when the patents relate to a drug for which a Notice of Compliance (“NOC”) has been issued in Canada. A generic company wishing to claim bio-equivalence to the approved drug must address any patents listed on the Register by way of a Notice of Allegation (“NOA”). The brand company reviews the NOA and may initiate litigation to prohibit the Minister from issuing an NOC allowing the generic company to enter the market. If the brand company initiates litigation, then there is an automatic two-year stay on the issuance of an NOC to the generic company while the courts assess the NOA. If the generic company receives its NOC then the brand company may initiate regular infringement proceedings.

The regulatory impact analysis accompanying the proposed amendments states that the existing regulations have enabled the brand company to delay the generic company's entry into the market by listing new and sometimes irrelevant patents on the Patent Register. This practice may inhibit generic companies from entering the market with a competing version of the original product even when the original patents have expired. The proposed amendments seek to restore a balanced policy of preventing patent infringement while also promoting the timely entry of generic drugs into the market.

The perceived problems with the PMNOC Regulations relate to “relevance” and “timing”. Based on the wording of the Regulations, the courts allowed patents to be listed on the Register even when they were related to an approved drug but were for medicines, formulations or uses not approved for marketing in Canada. Generic companies could be prohibited from obtaining an NOC by having to address a patent, for example, for an unapproved polymorph of the approved medicine. As for timing issues, patents could be added to the Register anytime before the generic company obtained its NOC. In some cases, this resulted in multiple two-year stays on the issuance of the NOC, as the generic company was required to address successively listed patents.

For a patent to be listed under the amendments, it must contain a claim for the medicine itself or, the medicine/formulation contained in the drug for which an NOC has been granted. The patent must also contain a claim for the use of the medicine that has been approved in respect of that submission. This change should ensure that only patents directly relevant to the approved drug and were applied for prior to the NOC for that drug, would be registered. As to timing, the proposed amendments also contemplate removing the requirement for a generic to amend its submission to address a newly listed patent in some circumstances so as to eliminate successive two-year stays. The alternative amendments have added a requirement that the NOA be “perfected” before the drug submission can be processed, adding another impediment to simplification of the PMNOC procedures. Brand companies will still have the right to initiate infringement proceedings against generic companies on both the listed and unlisted patents once an NOC has been granted.

Currently the PMNOC process can prohibit generic market entry in circumstances where a full enquiry could well lead to a different conclusion. Unless the PMNOC process is further amended significantly, it is unlikely that the amended regulations together with the alternate amendments will meet the stated government objectives of preventing infringement while facilitating generic entry into the Canadian market.