Biologics have revolutionized treatments for numerous complicated diseases such as cancer and multiple sclerosis. Biologics are derived through living organisms and tend to be significantly more variable and structurally complex than traditional small molecule drugs. Blood and blood derivatives, insulin, antibodies, and certain hormones are all examples of biologics. In 2010, biologics comprised 14 percent of the Canadian pharmaceutical market and their market share continues to grow. This growth brings benefits to patients but also an increased burden to the health care system. For example, it can cost a patient up to $36,000 annually to receive biologic drugs for rheumatoid arthritis. It costs $30,000 annually to treat one patient with ulcerative colitis. Regulatory agencies in many countries have attempted to address the cost issue by allowing pharmaceutical companies to produce their own versions of previously approved biologics. These are known as “subsequent entry biologics” (“SEBs”) in Canada.
SEBs are biologics that are similar to, and would enter the market subsequent to, an approved brand name biologic. With the expiration of patents for major small molecule drugs and the impending expiration of patents for many biologics, pharmaceutical companies are diversifying their portfolios, which includes developing more biologics and SEBs. The rise in biologic and SEB development will probably be coupled with an increase in patent disputes over these products.
Unlike traditional generics, SEBs are not bioequivalent to the reference biologic drugs and thus are not interchangeable with the reference drugs. Two drugs are bioequivalent if they have the same rate and extent of absorption. To be considered a SEB, the drug must be well characterized by existing analytical methods and have similar quality attributes as the reference drug. When it comes to data protection and patent protection, the Patent Act, Patented Medicine (Notice of Compliance) Regulations and data protection provision under C.08.004.1 of the Food and Drug Regulations apply to traditional generics and SEBs the same way. As such, SEB manufacturers face a similar paradox as generic manufacturers do. On the one hand, they must create a drug that is similar to a reference biologic drug to obtain approval from Health Canada. On the other hand, the drug must not infringe the reference drug’s patent. Without the requirement for a SEB to be “bioequivalent”, Health Canada gives SEB manufacturers more latitude to stray from the precise form of the reference biologic drug. In other words, a product may be sufficiently similar to qualify as a SEB under Health Canada guidance but not squarely covered by a patent claim of its reference biologic drug.
In Canada, the scope of patent claims is determined by construing the claims under the rules set out by the jurisprudence. There is infringement if a generic drug falls within the scope of the patent claim of its reference drug. The current approach to claim construction, namely purposive construction, was introduced to improve predictability. However, in practice, the approach is still expected to bring subjective or discretionary elements into claim interpretation. Thus, the scope of a patent claim may be difficult to demark before the commencement of a trial. With the complex technical issues involved and a lack of decisions involving biologics, biologic and SEB manufacturers alike may have a hard time predicting how their products will be treated in courts.
Although biologics have been available in Canada since the 1970s, they have seldom been the subject of patent litigation. In the past 15 years, the only case on biologics patent litigated to a decision is Abbvie Corporation v. Janssen Inc., 2014 FC 55 (“Abbvie”). The Abbvie case involves a patent owned by Abbvie for a human antibody that binds interlukin-12 (“IL-12”) and a biologic sold by Janssen, Stelara (ustekinumab), for psoriasis. Abbvie alleged infringement and Janssen asserted that Abbvie’s patent was invalid on the grounds of obviousness, covetous claiming and lack of enablement. Justice Hughes upheld Abbvie’s patent and found Janssen infringed. In particular, on the issue involving claim construction – covetous claiming, Janssen alleged that Abbvie’s method for creating the human antibody J695, using a phage-displayed technique, could not support a claim for an antibody created by any method. The active ingredient of Janssen’s Stelara was derived using transgenic mouse technology, bound IL-12 at different places, and had a genetic make-up that was less than 50% similar to J695. Regardless of these differences between the two drugs, Justice Hughes rejected Janssen’s argument and construed the claims in question as to cover human antibody, however created, that binds IL-12 within a minimum specified affinity and potency as set out in the claims, for the treatment of psoriasis.
The decision was overturned by the Federal Court of Appeal and returned to the trial judge for a new decision. The basis for setting aside the FC decision was that Justice Hughes erred in not allowing Janssen to rely on certain prior art prior to trial. The FCA did not comment on the issue of covetous claiming detailed above. However, this matter has since been settled and all claims and counterclaims have been dismissed.
Although the FC decision has been set aside, it discussed issues of first impression for an antibody patent in Canada and may still be of some significance to future patent disputes involving SEBs. Justice Hughes in the FC decision allowed Abbvie to claim scope much broader than the specific embodiments disclosed in the specification. It is uncertain at this point whether courts will agree with Justice Hughes. How courts will apply the existing body of law to SEB infringement cases remains to be seen.
 Health Canada, Guidance for Sponsors: Information and Submission Requirements for SEBs, s. 1.4, March 5, 2010, available online: [SEB Guidance].
 “Biologic Drugs and the SEB”, Canadian Generic Pharmaceutical Association.
 Supra note 1, SEB Guidance.
 Supra note 3 SEB Guidance, s. 1.3.
 “Similarities and Differences between Brand Name and Generic Drugs” (July 17, 2015), Canadian Agency for Drugs and Technologies in Health, available online.
 Supra note 3 SEB Guidance, ss. 1.2 and 188.8.131.52.
 Health Canada, Guidance Document: Data Protection under C.08.004.1 of the Food and Drug Regulations, October 11, 2011, available online; Guidance Document: Patented Medicine (Notice of Compliance) Regulations, February 3, 2015, available online.
 Free World Trust v. Électro Santé Inc., 2000 SCC 66 at para 43.
 Supra note 1 Biologics.
 Abbvie Corporation v. Janssen Inc., 2014 FC 55.
 Ibid at para 85.
 Abbvie Corporation v. Janssen Inc., 2014 FCA 242.