Recent Amendments to the Patented Medicines Regulations Declared Unconstitutional by Québec Superior Court

January 13, 2021
By Scott MacKendrick, Melanie Szweras and Alissa Hyppolite

There has been much controversy over the plan by the Federal Government of Canada to further reduce Canada’s drug prices. In light of this, the Patented Medicines Regulations (the Regulations) and sections of the Patent Act related to the Patented Medicines Regime have faced significant scrutiny. In the recent decision Merck et al, c. Le Procureur Général du Canada1 issued on December 18, 2020, the Québec Superior Court found that two recent amendments to the Regulations, new subsections 4(4)a) and 4(4)b), are unconstitutional and of no force or effect. The amendments to subsections 4(4)a) and 4(4)b) would require patentees to account for discounts and rebates provided to third parties when reporting medicine prices to the Patented Medicines Prices Review Board. The Court found the rest of the Regulations, including the other amendments, and the relevant sections of the Patent Act constitutionally valid.

The amendments made to the Regulations have also faced judicial scrutiny by the Federal Court in Innovative Medicines Canada v. Canada (Attorney General)2. In its decision issued on June 29, 2020, the Court found the amendments to subsections 4(4)a) and 4(4)b) to be ultra vires the Patent Act and, therefore, invalid and of no force or effect. The Court found the other amendments to the Regulations under review valid. The decision is currently under appeal. A requisition for hearing has been filed, but the appeal hearing has yet to be scheduled.

The amendments to the Regulations are now set to come into force on July 1, 2021.

1 Merck et al, c Le Procureur Général du Canada, Québec Superior Court File No. 500-17-109270-192.

2 Innovative Medicines Canada v Canada (Attorney General), 2020 FC 725.

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