Drugs In Canadian Patent Law
I. Goldsmith, LL.B. (Lond.)’
A. Introduction
In the second half of the twentieth century, drugs have assumed
a position in the social economy of the world which they have never
possessed in the long history of their existence. From the earliest
times, drugs in some form or another have been employed by man
to alleviate human suffering in the hands of the conscientious phy-
sician, and to confound the uninitiated in the hands of the charletan.
It is hardly surprising, therefore, that in an age in which techni-
cological advances in almost all branches of science have taken place
with almost unbelievable speed, progress in the field of drugs has
been no less startling and momentous. The major breakthrough in
the field of drugs can be said to have taken place with the discovery
of the sulpha drugs and, particularly, with the discovery of the
antibiotics. Since that time, the search for ever newer and better
drugs has been the principal occupation of the drug industry, and
their labours have been neither unsuccessful nor unrewarded. But,
as with every major advance in science, the coin has two sides. With
the undoubted benefits conferred by the perpetually growing number
of antibiotics, tranquilizers, antihistamines and similar drugs, there
have grown doubts and misgivings in the minds of many serious
students of the problems involved in the administration of drugs as
to the relative advantages flowing from this Pandora’s Box.1 The
industry has been suspected, and publicly accused, of making exorbi-
tant profits at the expense of the helpless consumer; and, in reply,
the industry has painted a sad picture of the crushing burden of
perpetually rising research costs. The larger firms of drug man-
ufacturers have prospered and become giants; many of the smaller
firms have perished in the struggle for survival. Not very long ago,
two of the biggest wholly Canadian firms were swallowed up by
two of the larger American drug houses.
Fortunately it is not within the scope of this paper to explain,
analyze or justify these events, or to pass judgment on them. But
for a proper appraisal of the position of drugs in the field of
Canadian patent law, they are facts which cannot be ignored.
* Of the Middle Temple and Osgoode Hall, Barrister-at-Law, F.P.T.I.C.
1 See, e.g., Drugs in Our Society, ed. Paul Talalay, The Johns Hopkins Press,
1964; The Therapeutic Nightmare, Morton Minz, Houghton Mifflin Co., 1965.
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DRUGS IN CANADIAN PATENT LAW
B. History
Ever since the year 1923, drugs have occupied a special position
in the field of Canadian patent law. In that year an amendment was
introduced 2 into the existing law which, with an important and far-
reaching change, incorporated into the Canadian patent law a pro-
vision which had been added to the English Patents and Designs
Act, 19073, by section 11 of the Patents and Designs Act, 1919.4 In
that year, shortly after the conclusion of the First World War, and
for reasons which may have been good or bad, the English patent
law was changed by providing that henceforth an inventor could no
longer obtain a claim to a product per se in respect of any invention
relating to substances prepared or produced by chemical processes
or intended for food or medicine. 5 Furthermore, it was also provided
that in the case of any patent for an invention intended for a capable
of being used for the preparation or production of food or medicine,
any person could apply for a compulsory licence on terms to be fixed,
if necessary, by the appropriate officer of the Patent Office.6 Having
deprived the patentee of the right to obtain a claim to the product
per se for the result of his invention, the sub-section contained a
proviso that in an action for infringement of a patent where the
invention relates to the production of a new substance, any substance
of the same chemical composition and constitution should be deemed
to have been produced by the patended process. 5 This proviso was
intended to alleviate the task of the patentee in discharging the onus
of proving infringement, which is always on the patentee in such
an action. As the product was now protected only when made by the
patented process, a patentee would have to prove not only that the
alleged infringer had the product, but also that the product in
question had been made by the patented process. As such proof is
generally extremely difficult, if not impossible, to adduce, the law
provided the patentee in such cases with the benefit of a statutory
presumption in his favour, leaving it to the infringer, if he could
do so, to prove that the otherwise infringing substance had not been
made by the infringing process, and thus escape the charge of in-
fringement.
When this provision was taken over into Canadian law in 1923,2
an apparently insignificant, but in fact a very important, change
was made in the wording of the English section. The word “or” in
2 Statutes of Canada, 1923, c. 23, s. 17.
3 7 Edw. 7, c. 29.
4 9 & 10 Geo. 5, c. 80.
5 Patents and Designs Act, 1907, s. 38A(1).
6 Ibid., s. 38A (2).
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sub-section (1) was changed into “and”. The result was that, whereas
in England the sub-section applied to substances that were either
intended for food or medicine on the one hand or prepared or pro-
duced by a chemical process on the other, in Canada the section has
always applied, and still applies, only to substances that are both
intended for food or medicine and prepared or produced by a chemical
process. In Canada, therefore, drugs were, and are, subject to the
restricted form of product-by-process claim only if they are prepared
or produced by a chemical process; and in respect of any drug not
so produced or prepared, e.g. drugs produced and prepared solely
by micro-biological processes, the patentee can generally obtain a
product claim without any restriction as to the method of manu-
facture. Similarly, chemical substances not intended for food or
medicine can be protected by unrestricted product claims.
Apart from this important distinction, the other provisions of
the English section were incorporated in the Canadian Patent Act
without any fundamental change. In 1935, when the Statutes of
Canada were revised,7 the relevant section became section 40, and
at that time the proviso in sub-section (1) relating to the statutory
presumption as to the method of manufacture, became a new sub-
section (2). At the present time the section is to be found as section
41 of the 1952 edition of the Revised Statutes of Canada,8 and is
identical with section 40 of the 1935 statute.
The additional restriction imposed on drug patents by the original
English section by providing for compulsory licences was also in-
corporated in the new section of the Canadian Act,9 and is now found
in section 41 (3) of the current Patent Act.”
There are, thus, two serious and far-reaching limitations to the
monopoly which can be obtained in Canada in respect of drug patents.
C. Section 41 (1)
In the case of inventions relating to substances prepared or produced by
chemical processes and intended for food or medicine, the specification shall
not include claims for the substance itself, except when prepared or produced
by the methods or processes of manufacture particularly described and
claimed or by their obvious chemical equivalents.
The sub-section applies only to drugs “prepared or produced by
chemical processes”, and in order to determine whether the restrictive
7R.S.C. 1935, c. 32. For a discussion of the historical development of the
English and Canadian sections, see Commissioner of Patents v. Winthrop
Chemical Co. (1948), 7 C.P.R. 58.
8R.S.C. 1952, c. 203.
9 $tatutes of Canada, 1923 s. 17; R.S.C. 1935, c. 32; s. 40,
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DRUGS IN CANADIAN PATENT LAW
235
provisions of a product-by-process claim are applicable, it is necessary
to establish in the first instance whether the drug in question has
been prepared or produced by a “chemical process”. In the case of
drugs produced by chemical synthesis, there is generally no problem,
since, whatever may be the precise meaning of the words “chemical
process”, there can be little doubt that such drugs are produced and
prepared by a chemical process. In the case of antibiotics, however,
the problem is a very real one. Most antibiotics are produced by the
fermentation of micro-organisms, and the view has been generally
taken that this is not a chemical process within the meaning of
section 41 (1). There are Canadian patents for such products which
contain unrestricted product claims, on the footing that the ferment-
ation process for their production is not chemical. The matter is
further complicated by the fact that in the case of some of these
drugs part of the “invention” relates to the step of isolating the
active substance from a crude culture medium, a process which in-
volves the use of, at any rate, chemical techniques.
In the earlier English cases it was held that the words “chemical
process” must be given their popular, and not a limited technical,
meaning.10 In Canada the question first came up in connection with
the production of a bleaching agent by the fermentation of an enzyme,
and it was held that this was not a chemical process.1 ” More recently,
the Canadian courts were concerned with the chloramphenicol patent.
The substance was claimed in an unrestricted product claim, but
the disclosure indicated that the substance was produced by ferment-
ation and then isolated by the use of chemical techniques. Puddicombe,
J. held 12 that the isolation was a chemical process, and that accord-
ingly the claim was invalid. With regard to the fermentation as
such, he expressed the view that this was not a chemical, but a
biological, process.
In view of the fact that the sub-section uses both the words
“produced” and “prepared”, it is reasonable to assume that different
meanings must be ascribed to each word. Although the “production”
of an active medical substance may be the result of a non-chemical
fermentation process, it is frequently impossible for such a substance
to be “prepared”, i.e. made ready for use, without the use of some
chemical techniques. The fact that the Patent Office may allow an
10 See e.g., Re S. Co’s Application (1921), 85 R.P.C. 399; Re H.E.P.’s Application
(1925), 43 R.P.C. 150. But see Re Levy and West’s Application (1945), 62
R.P.C. 97, where the earlier decisions were not followed.
S.C.R. 187.
11 Continental Soya Co. Ltd. v. J.R. Short Milling Co. (Canada) Ltd. [1942]
12 Parke, Davis & Co. v. Laboratoire Pentagone (1966), 46 C.P.R. 171.
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unrestricted product claim is no guarantee of its validity if it is
challenged in court, and the more prudent course, where there is
any element of doubt, would be to include a product-by-process
claim even if a bare product claim is allowed.
A further question may arise whether the drug in question is a
“substance” within the meaning of the sub-section. There can be
little doubt that a chemical compound is a “substance”; and it would
now appear that even a mixture is a “substance” within the meaning
of the sub-section. Thorson, P. had held that a mixture of a novel
compound with a carrier was a substance,13 and although the Su-
preme Court of Canada reversed his decision that such a mixture
was not prepared or produced by a chemical process, 14 Judson, J.,
delivering the judgment of the Court stated 15 that the mixing of a
patented chemical substance with a carrier is, “of course, a substance,
as the learned President has found, but it is still a substance identical
in all respects except dilution with a substance produced by a che-
mical process . .. “. It would appear, therefore, that if any significant
ingredient of the mixture has been prepared or produced by a che-
mical process, only a limited product claim can be obtained.
The next requirement of the sub-section is that the substance of
the invention must be “intended for . . . medicine”. In general, this
requirement does not give rise to serious problems, but there are
some drugs which also find application in agriculture or other than
strictly medical fields. The better view would appear to be that if
the invention discloses any medical use, it is intended for medicine,
irrespective of the fact that it may also have other non-medical uses.
The word “medicine” must be interpreted broadly, and has been
held to include the active ingredient in bulk form.0 Recently, an
inhalent, volatile anaesthetic was held to be a substance intended for
medicine in respect of which only a product-by-process claim could
be obtained.’7
If the sub-section applies, then there cannot be a claim for the
substance itself except when prepared or produced by the methods
or processes of manufacture particularly described and claimed or
13Farbwerke Hoechst A.G. v. Commissioner of Patents (1963), 39 C.P.R. 105.
14 Commissioner of Patents v. Farbwerke Hoechst A.G.
(1964), 41 C.P.R. 9.
V’ Loc. cit. at p. 14.
16 Parke, Davis & Co. v. Fine Chemicals (1959), 30 C.P.R. 59, per Martland, J.
‘T LC.I. Ltd. v. Commissioner of Patents (unreported, Exch. Ct., June 29th,
1966). A schedule to the Reasons for Judgment contains a comprehensive and
useful list of definitions of the words “Anaesthetic”, “Drug”, “Medicine”,
“Remedy” and “Therapy”.
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DRUGS IN CANADIAN PATENT LAW
by their obvious chemical equivalents. The operation of the sub-
section has recently been the subject of two decisions of the Supreme
Court of Canada,’8 and on the basis of these decisions the following
propositions would now appear to be established. In the first place,
the process claim which limits the product claim must be a valid
claim. If, for one reason or another, it is not, the product claim
cannot stand and falls with it. 18 Secondly, the process which is
claimed must be “particularly described” ;19 and, thirdly, the process
which has been particularly described must be claimed as such. It
would seem to be implicit in these decisions that a general process
claim for a class of compounds, even if valid, is insufficient to support
a section 41 (1) product claim for a specific compound, and that
even a specific process claim, even if valid as such, is not sufficient
to support a product-by-process claim, unless the specific process
claimed has been particularly described.
A particular problem in connection with chemical patents in
general, and drug patents in particular, is the practice of claiming
a whole group of analogous compounds on the basis of an invention
of one or a number of such compounds. In view of the recent decisions
of the Supreme Court of Canada referred to,18 it may well be that
the Patent Office will no longer allow such broad claims; but even
if it does, patentees will have to consider very seriously whether it
is worthwhile obtaining a monopoly which is so wide that it is un-
supportable. It is inherent in the philosophy of patents as a whole
that an inventor is entitled to protection only in respect of what
he has in fact invented; and there would appear to be no reason why
there should be any exception to this rule in the field of drugs. The
doctrine of chemical equivalency should be wide enough to prevent
others from stealing a meritorious invention by attempts at specious
circumvention. In fact, section 41 (1) expressly provides, insofar
as the process is concerned, that the ambit of any such claim extends
to processes which are “obvious chemical equivalents”. Insofar as
processes which are not chemical equivalents are concerned, it ap-
pears to be one of the purposes of the sub-section to encourage others
to find alternative processes for the production of useful drugs and
to prevent the patent monopoly from closing up other avenues of
research. What is and what is not an obvious chemical equivalent is
in every case a question of fact; but it should be remembered that
an alternative process may be a chemical equivalent and yet not be
18 See C.H. Boehringer Sohn v. Bell-Craig Ltd. (1964), 41 C.P.R. 1; Hoechst
Pharmaceuticals of Canada Ltd. v. Gilbert & Co. [1966] S.C.R. 189.
19 See per Thurlow, J. in C.H. Boehringer Sohn v. Bell-Craig Ltd. (1963),
39 C.P.R. 201 at p. 240.
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an “obvious” chemical equivalent. 20 In such case the process would
not fall within or infringe the product-by-process claim, but might
nevertheless infringe the process claim.
D. Section 41(2)
In an action for infringement of a patent where the invention relates to
the production of a new substance, any substance of the same chemical
composition and constitution shall, in the absence of proof to the contrary,
be deemed to have been produced by the patented process.
Although this sub-section is now a separate sub-section, it must
not be forgotten that it was originally a proviso to sub-section (1) ;
and it is clear that its purpose is to facilitate proof of infringement
by a patentee.21 In view of the limited claim permitted by sub-
section (1), it is not enough for a patentee to prove that the alleged
infringer has used the patented substance; he must also prove that
it was made by the patented process. But once proof has been
adduced that the infringer’s substance has the same chemical com-
position and constitution as the substance to which the invention
relates, the sub-section operates to shift the onus of proof to the
defendant, who may then produce evidence to the contrary to estab-
lish that the substance in question has not been made by the patented
process. It is not necessary for this purpose for a defendant to
prove how the substance was in fact made. It is conceivable that he
might be able to establish by expert evidence that, for one reason
or another, the substance could not in fact have been made by the
patented process.22
Although the purpose of the sub-section is comparatively simple
and straightforward, its wording can give rise to difficulties in
practice, particularly in the case of patents which, contrary to the
provisions of section 38, contain more than one invention. Many
chemical drug patents disclose in the specification not a single com-
pound, but a number of classes, sub-classes and preferred compounds,
each of which may be a different “invention”. 23 The first difficulty
in applying the sub-section in such a case is to determine what is
the invention to which the patent relates. By virtue of the Inter-
pretation Act 24 the singular includes the plural “unless the context
20 See per Thurlow, J. in C.H. Boehringer Sohn V. Bell-Craig Ltd., loo. cit.
at p. 255.
21 See per Thurlow, J. in Socijt6 des Usines Chimiques Rhdne-Pouleno V. Jules
R. Gilbert Ltd. [1966] Ex. C.R. 59.
22 Parke, Davis & Co. v. Allan & Hanburys (1953), 70 R.P.C. 123.
23 See per Thurlow, J. in Farbwerke Hoechst v. Commissioner of Patents
(1965) 31 Fox Pat. c. 64.
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DRUGS IN CANADIAN PATENT LAW
otherwise requires”; but it is difficult to see how the section can be
properly construed as applicable to several inventions in view of the
express prohibition against claiming more than one invention in
section 38. Similar problems arise in connection with the words
“the production of a new substance” and “the patented process”,
although section 41 (1) does refer to “methods or processes” in the
plural. Perhaps these problems have, at least to some extent, been
resolved by the recent decision of the Supreme Court of Canada in
SocigtM des Usines Chimiques Rh6ne-Poulenc v. Jules R. Gilbert Ltd. s5
In that case the patent contained a product-by-process claim involving
three alternative processes. In an infringement action the patentee
chose to rely in his pleadings on only one of the three process claims,
and Thurlow, J. dismissed the action on the narrow ground that in
those circumstances the section could not apply 21 On appeal, the
Supreme Court of Canada allowed the appeal and held that there was
no reason “why when the plaintiff frames its action in this way that
[sic] the presumption in section 41 (2) should not apply.”2 5 The Su-
preme Court also held that section 41 (2) did not require three sepa-
rate applications for the same substance, one by each process. It
would seem to follow from the decision that the presumption applies
a fortiori where the patentee in his pleadings relies on all processes
claimed in the alternative.
E. Section 41 (S)
In the case of any patent for an invention intended for or capable of
being used for the preparation or production of food or medicine, the
Commissioner shall, unless he sees good reason to the contrary, grant to
any person applying for the same, a licence limited to the use of the
invention for the purposes of the preparation or production of food or
medicine but not otherwise; and, in settling the terms of such licence
and fixing the amount of royalty or other consideration payable the
Commissioner shall have regard to the desirability of making the food
or medicine available to the public at the lowest possible price consistent
with giving to the inventor due reward for the research leading to the
invention.
This sub-section constitutes the second limitation imposed on the
monopoly granted to the owners of drug patents. It applies in the
case of any patent in respect of which the invention is either intended,
or capable of being used, for the preparation or production of medi-
cine; and accordingly the section is not limited to substances within
section 41 (1) ,26 or indeed to drugs at all, but extends to any kind
24 R.S.C. 1952, c. 158, s. 31(1) (j).
25 Unreported, October 24th, 1966.
26 Charles E. Frosst & Co. v. Carter Produots (1958), 29 C.P.R. 145.
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of invention capable of being used for the preparation or production
of medicine. There is no reason, for example, why it should not
apply to an invention for a machine for making tablets or pills.
“Any person” is entitled to apply for a compulsory licence, and
the Commissioner of Patents “shall” grant a licence limited to the
use of the invention for the purposes of the preparation or production
of a medicine but not otherwise. The Commissioner will not, however,
grant a licence to import.27
The obligation on the Commissioner to grant a licence is manda-
tory, and he can refuse a licence only if the patentee can show
“good reason to the contrary”. The onus is, therefore, on the patentee
to show why a licence should not be granted. Unlike in the case of
compulsory licences under section 68 of the Patent Act, there is no
procedure prescribed under the Patent Rules, and the Commissioner
is entitled to determine his own procedure. 28
As to what is “good reason to the contrary”, the matter is one
for the discretion of the Commissioner, and unless, on the evidence,
his decision is manifestly wrong, or he acts on a wrong principle of
law, his decision will not be reversed on appeal.29 Generally speaking,
if the applicant has a reasonably permanent organization, if he is
qualified to work the patent, the Canadian market is not already
over-supplied with the product and the public interest will benefit,
or at least will not suffer, the Commissioner must grant a licence.30
In recent years applications for compulsory licences have been bitter-
ly opposed by some of the larger drug manufacturers, principally
on the alleged ground that the smaller Canadian applicant companies
do not maintain strict quality controls as established by the larger
drug companies. This has been rejected as a good ground for
refusing a licence,31 although a recent Parliamentary Special Commit-
tee has suggested that there should be closer co-operation between the
Commissioner of Patents and the Food and Drug Directorate in the
granting of compulsory licences. 32 It would seem that however praise-
worthy and desirable a high degree of control in the manufacture
27 Gilbert Surgical Supply Co. v. Parke, Davis & Co. (1958), 30 C.P.R. 21, 55.
28 Parke, Davis & Co. v. Fine Chemicals of Canada Ltd. [1959] S.C.R. 219;
Hoffman-La Roche v. Delmar Chemicals Ltd. [1965] S.C.R. 575.
29 See cases cited in note 28, and Hoffmann-La Roche v. Bell-Craig (1966), 32
Fox Pat. c. 106. See also The King v. Irving Air Chute Inc. [1949] S.C.R. 613.
SOFrank W. Homer v. Sharp & Dohm (Canada) Ltd. (1952), 15 C.P.R. 68.
No exclusive licence can be granted; ibid.
31 See per Thurlow, J. in Hoffmann-La Roche V. Delmar Chemicals Ltd.
(1965), 27 Fox Pat. c. 178. See also J.R. Short Milling Co. (Canada) Ltd. V.
George Weston, [1941] Ex. C.R. 69 at p. 94 per Maclean, J.
32 Report of the Special Ad Hoc Committee Studying Matters Involving the
Patent Licensing of Drug Manufacturers; chairman, Dr. I.M. Hilliard.
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DRUGS IN CANADIAN PATENT LAW
of drugs might be, the recommendation is a confusion of the respec-
tive functions of the Patent Act and the Food and Drugs Act;33 nor
is there any reason why special considerations as to quality control
should apply to drugs which happen to be patented.
As a matter of pratice, an application for a compulsory licence
is answered by a counter-statement filed by
under section 41 (3)
the patentee, to which the applicant is entitled to file a reply. The
Commissioner then decides whether or not he requires a hearing;
but he is not obliged to hold one.28 If the Commissioner grants a
licence, and the parties cannot agree on the terms or the royalty,
the Commissioner will settle both. In this connection the second half
of the sub-section contains a direction that in so doing he shall have
regard to the desirability of making the medicine available to the
public at the lowest possible price consistent with giving the inventor
due reward for the research leading to the invention. Until recently,
the Commissioner had been fixing a royalty of something between
ten and fifteeen per cent calculated on the net price of the bulk raw
material, i.e. the bulk medicine before being tabletted or capsulated
and packaged. This method of arriving at the royalty was recently
challenged; and, although reversed by the President of the Exchequer
Court,34 the Commissioner’s practice of calculating the royalty on
the bulk ingredient was affirmed by the Supreme Court of Canada.3 5
Furthermore, the Supreme Court seems to have suggested that where
the actual inventor, as opposed to the patentee, would receive no
reward at all from the royalty, perhaps no royalty should be payable
at all.316
F. Section 41 (4)
Any decision of the Commissioner under this section is subject to appeal
to the Exchequer Court.
This sub-section provides for an appeal to the Exchequer Court
from any “decision” of the Commissioner under this section. It has
recently been held that where the Commissioner only grants a licence,
but does not fix the terms or the royalty, there is no “decision”,
and that therefore no appeal lies at that stage of the proceedings. 37
the decision both as to
the grant of the licence as well as the royalty and other terms is for
Under the provisions of section 41 (3)
33 See Statutes of Canada 1952-53, c. 38 and amendments, and Regulations
made thereunder.
M4 Hoffmann-La Roche Ltd. v. Bell-Craig (1965), 29 Fox Pat. c. 123.
35 (1966), 32 Fox Pat. c. 106.
36 Ibid. at p. 111.
37Hoffmann-La Roche Ltd. V. Delmar Chemicals Ltd. (unreported, Exch.
Ct., February 4th, 1966).
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the Commissioner to make, and an appellate court cannot interfere
with his decision unless he can be shown to be manifestly wrong on
the evidence or to have acted on a wrong principle.38
Pending an appeal, an applicant who has obtained a licence can
operate under it if he is willing to take the chance that he may
ultimately be held not to be entitled thereto. The Exchequer Court
has recently refused to grant a “stay” of such a licence pending an
appeal.89
G. The Future
For some years section 41 of the Patent Act has been subjected
to attacks from many sides. On the part of patentees, on the ground
that it constitutes an unjustifiable interference with monopoly rights
granted in other industrial areas, and that it tends to stifle research;
on the part of the so-called “copiers”, on the grounds that the proce-
dure for obtaining compulsory licences is unnecessarily cumbersome,
takes unduly long and can be utilized to embroil an applicant in
protracted and costly litigation by a patentee who wishes to avail
himself of every possible legal manoeuver to delay the grant of a fully
effective licence. Most recently, the views of various interested
groups and parties have been put forward with varying degrees of
vehemence before the Harley Committee inquiring into drug prices
in Canada.40 Perhaps the most legitimate and serious criticism of
the section is that, in the context of modern technology and modern
conditions, it is unnecessarily ambigous and unclear, and that it
leaves too many loose ends and too many opportunities for un-
necessary litigation. There may be legitimate disagreement as to
what, in the public interest, the law should be; but once Parliament
has made up its collective mind on that issue, the public and the
legal profession are entitled to expect that its intention be expressed
clearly and without ambiguity.
Several recommendations for changes to the section have been
made during the past few years by various bodies. Initially, the
Ilsley Commission 41 recommended that product claims unlimited as
to process of manufacture should be allowed in respect of substances
prepared or produced by chemical processes and substances intended
for food or medicine, but that compulsory licences under food or
medicine patents should be retained in a somewhat modified form,
8SHoffmann-La Roche Ltd. V. Bell Craig (1966), 32 Fox Pat. c. 106 at p. 108.
89Hoffmann-La Roche Ltd. v. L.D. Craig Ltd. (1966), 46 C.P.R. 30. Quaero
whether the court has any authority to grant a “stay” of the licence; ibid.
40 Standing Committee on Drug Costs and Prices, chairman, H.C. Harley.
41Royal Commission on Patents, Copyright and Industrial Design, Report
on Patents of Invention, Queen’s Printer, 1960, pp. 92-97.
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DRUGS IN CANADIAN PATENT LAW
.
.”. More recently, the Hall Report 4
but without any proof of misuse.42 Later, the Restrictive Trade
Practices Commission 43 advocated the complete abolition of drug
patents, on the ground that “the control over drugs exercised through
patents in Canada is disadvantageous to the users of drugs in this
country .
recommended a
modification of the existing system of compulsory licensing by per-
mitting compulsory licensing of imports, 4 streamlining generally
procedures as they relate to compulsory licensing,47 and establishing
a standard royalty.47 The Report also recommends a delay of five
years in any decision to implement the recommendations of the
Restrictive Trade Practices Commission 43 that drug patents be
abolished. 48 Finally, the recommendations of the Harley Committee 40
will be awaited with interest and anticipation by all interested
parties.
Prophecy has always been an unprofitable past-time; and if it
has been corerctly said that “there is no pre-vision in chemistry”,
it is equally fruitless to make predictions in the field of drug patents.
Assuming that it is in the public interest that drug prices should
be kept at a reasonable level, and that drugs, insofar as they constitute
a necessity of life rather than a luxury, occupy a position in the
community different from other commodities, it would seem that
the only effective solution is either the imposition of price control
by Government authority or the creation of free competition in the
market place. Assuming that the former alternative is not acceptable
in a free society, the only remaining alternative would appear to be
some degree of limitation on the monopoly otherwise afforded by
the Patent Act. Whether such limitation should be absolute or partial,
and, if so, how far it should extend, is a matter upon which opinions
may properly, and in fact, do, differ. The only hope which may
usefully –
be expressed
is that, whatever solution Parliament in its wisdom may ultimately
decide upon, it will give expression to its intention in clear and un-
ambigous language which will at least enable all concerned to know
where they stand.
even if perhaps somewhat optimistically –
42 This has been the position in England since 1949; see Patents Act, 1949,
(12, 13 & 14 Geo. 6, c. 87), s. 41.
43 Restrictive Trade Practices Commission, Report Concerning the Manufacture,
Distribution and Sale of Drugs, Queen’s Printer, 1963, pp. 516 –
44 Ibid. at p. 523.
45 Royal Commission on Health Services, Queen’s Printer, 1964, vol. 1,
524.
pp. 701 –
709.
46 Recommendation 67, ibid. p. 42.
47 Recommendation 69, ibid. p. 43.
48 Recommendation 68, ibid. p. 43.
