Federal Court Rules on Patent Infringement Case

On December 22, 2010, Justice Judith Snider of the Federal Court rendered her judgment in the patent infringement suit Merck & Co. Inc. et al. v. Apotex Inc. et al., 2010 FC 1265.

The action, which was launched in June of 1997, concerned the Canadian patent for cholesterol-lowering drug lovastatin, sold by Merck & Co. Inc. and Merck Frosst Canada Ltd.(collectively “Merck”), under the brand name Mevacor.

The court found that the patent was valid and infringed by the defendants, Apotex (“Apotex”) and Apotex Fermentation Inc. (“AFI”), with regard to select lots through the manufacture of lovastatin by AFI, and through the importation of lovastatin produced by Guangdong Blue Treasure Pharmaceuticals Co. Ltd. (“Blue Treasure”), a joint-venture manufacturer in southern China.

Justice Snider, on review of extensive circumstantial evidence, found that Blue Treasure had used an infringing process to manufacture lovastatin, which was then delivered to AFI and ultimately sold into the Canadian market. She also found, on examination of direct DNA evidence, that the defendants infringed on the patent with the manufacture and sale of any product from a specific batch of lovastatin made by AFI.

Based on the court's finding, Merck was found to be entitled to its damages for certain lots of lovastatin manufactured in China after a given date. However, due to factors including the time that the matter took to come to trial and the complexity of the commercial arrangements involving third party producers, Justice Snider declined to exercise her discretion and permit the plaintiffs to elect an accounting of profits. A separate hearing will be conducted to determine Merck's damages.

Apotex and AFI have appealed the court's decision.

A team led by Andrew Reddon, that included David Tait and Glynnis Burt of McCarthy Tétrault LLP acted for the plaintiffs Merck Frosst Canada Ltd. and Merck & Co. Inc.

A team led by Harry Radomski, that included David Scrimger, Jerry Topolski and Ben Hackett of Goodmans LLP acted for the defendant Apotex Inc.

A team led by Patrick Riley, that included John Myers, Nicole Merrick and Rod Roy of Taylor McCaffrey LLP acted for the defendant Apotex Fermentation Inc.