Canada: Tribunal dismisses Eli Lilly’s NAFTA challenge

Managing IP is part of Legal Benchmarking Limited, 1-2 Paris Gardens, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Canada: Tribunal dismisses Eli Lilly’s NAFTA challenge

Following the invalidation of its patents for Strattera (atomoxetine) and Zyprexa (olanzapine), Eli Lilly and Company submitted claims to international arbitration under the North American Free Trade Agreement (NAFTA). On March 1, 2017, the Tribunal issued its final award dismissing Eli Lilly's claims.

Eli Lilly's patents were invalidated on the basis of the so-called "promise of the patent" doctrine; namely, that the claims of the patent failed to deliver utility promised by statements in the specification. Eli Lilly argued that Canadian courts had dramatically changed the application of the utility requirement through a series of cases that adopted the promise doctrine and that the retroactive application of this doctrine to Eli Lilly's patents resulted in a breach of Canada's obligations under NAFTA.

The Tribunal, however, found that Canada's utility requirement underwent incremental and evolutionary changes between the grant of the patents and their subsequent invalidation. Moreover, it found that the promise standard has a "strong foundation" in earlier jurisprudence of the Supreme Court of Canada. Further, the Tribunal found that the doctrine was neither arbitrary nor discriminatory. In summary, the government of Canada was not found to have violated its obligations under NAFTA.

The NAFTA decision further supports the application of the heightened utility requirement that may arise under Canadian law through application of the promise doctrine. Those interested in the issue, however, eagerly await a decision from the Supreme Court of Canada in the case of AstraZeneca Canada Inc v Apotex Inc. In that case, which was heard in November 2016, the promise doctrine was directly before the Supreme Court. A decision, which may bring some clarity on the issue, is expected soon.

Neil Padgett

Smart & Biggar/ Fetherstonhaugh

55 Metcalfe Street Suite 900

PO Box 2999 Station D

Ottawa ON  K1P 5Y6

Tel: 613 232 2486

Fax: 613 232 8440 

ottawa@smart-biggar.ca

www.smart-biggar.ca

more from across site and SHARED ros bottom lb

More from across our site

A ruling on confidentiality by the the England and Wales Court of Appeal and an intervention from the US government in the InterDigital v Disney litigation were also among top talking points
Moore & Van Allen hires former Teva counsel Larry Rickles to help expand the firm’s life sciences capabilities
Canadian law firms should avoid ‘tunnel vision’ as exclusive survey reveals client dissatisfaction with risk management advice and value-added services
In major recent developments, the CoA ruled on director liability for patent infringement, and Nokia targeted Paramount at the UPC and in Germany
Niri Shan, the newly appointed head of IP for UK, Ireland and the Middle East, explains why the firm’s international setup has brought UPC success, and addresses German partner departures
Vlad Stanese joins our ‘Five minutes with’ series to discuss potentially precedent-setting trademark and copyright cases and his love for aviation
Heath Hoglund, president of Via LA, discusses how it sets royalty rates and its plans to build on growth in China
Stobbs stands accused of interfering with the administration of justice after Brandsmiths’ client was subjected to an interim injunction for unjustified threats
The firm, known for its prosecution expertise, discusses its plans following the appointment of a UK-based patent litigation head and two new partners
Ed White at Clarivate provides an exclusive insight into the innovation power clusters reshaping Europe and the Middle East’s IP landscape, and why quality is the new currency of invention
Gift this article