Canadian patent law would benefit if the Supreme Court of Canada agrees to hear an appeal about a drug called Zyprexa (or Olanzapine), developed by Eli Lilly & Co., and intended for schizophrenia patients, in which the seemingly straightforward concept of utility is in dispute.
A Supreme Court hearing would be preferable to the NAFTA arbitration proceeding against the Canadian government that Lilly has initiated (arising from a dispute about an ADHD drug, but raising a similar issue); it would keep the whole matter inside a quite specific point of Canadian patent law, and could avoid an unwieldy, sprawling comparison of the impacts of the various aspects of U.S. and Canadian patent law upon pharmaceutical corporations.
Generic drug companies sometimes challenge the usefulness of a patented drug – paradoxically, because they want to sell the useful drug themselves.
This whole controversy arose from a natural eagerness to facilitate and expedite the treatment of patients who have HIV/AIDS with a drug called AZT, which had not yet been tested in human beings or animals. In 2002, the Supreme Court of Canada may have stretched a point by helping get AZT to market more quickly, relying on the “promises of the patent.”
By an unintended consequence, such promises have somehow metamorphosed into a new requirement that is needed in order to prove a drug’s usefulness in the first place.
Lilly and other similar companies want patent protection before they are ready to publish their clinical trials on the Internet, when they have to disclose their work to competitors. They are not in the business of making and selling off-patent drugs.
The Supreme Court ought to re-establish a sensible balance between prima-facie evidence of usefulness and all-but-proven promise. Even better, the federal government could introduce a bill to clarify the utility criterion in the Patent Act.
Overall, firms such as Lilly do very well in Canada. Nonetheless, Canadian law should not subject companies to irresolvable paradoxes.
An earlier version of this editorial incorrectly said that the patent period for medications is longer in Canada than in the United States.