News Releases

President Bush ends abuse of automatic injunction under U.S. drug patent law. Now it's Canada's turn, says CGPA
U.S. making major changes to special rules that automatically block generic competitors

Toronto, June 16, 2003 – It’s time for Canada to join United States President George Bush in stopping brand-name drug companies’ abuse of automatic injunctions against lower-cost generic drugs, Jim Keon, President of the Canadian Generic Pharmaceutical Association (CGPA) said today.

“Canada is now the only country in the world that allows brand drug companies to block generic competitors with repeated automatic injunctions. President Bush is standing up for consumers and the health-care system, and it is time for the Canadian government to do the same,” Keon said.

Late last week, Bush announced changes to the automatic injunction provisions under U.S. drug patent law that brand-name drug companies have manipulated to unfairly delay generic competitors. The new rules will take effect on August 18, 2003.

In his June 12 speech announcing the changes, Bush said: “At my direction, today, the Federal Drug Administration, the FDA, is taking action to close loopholes that slow the movement of generic drugs to the marketplace. First, we are limiting the amount of time that a drug company can delay the marketing of a generic competitor. Instead of letting them file one delay after another, the government will allow a single 30-month stay while legal complexities are sorted out. In other words, the initial manufacturer of a drug will not be allowed to use the legal process for endless delay, which hurts our consumers in America.”

Bush’s description of the problem mirrors testimony given by generic drug makers before the House of Commons Industry Committee on June 3, during hearings on the automatic injunction provisions of the Patented Medicines (Notice of Compliance) Regulations of Canada’s Patent Act. Four days of hearings wrapped up last week but with the House of Commons adjourned for the summer, the Committee is not expected to reach a decision on possible reforms until the fall.

The Canadian Regulations are modeled after the Hatch-Waxman Act, passed by the U.S. Congress in 1984. On both sides of the border, brand companies have employed strategies to trigger multiple automatic injunctions to stifle competition and prolong market monopolies.

A common strategy is the listing and litigating additional patents after the main patent on the active ingredient of the drug product has expired. This is done to trigger additional automatic injunctions, and delay the process of patent expiration. As a result, generic products that are not infringing any patents are kept off the market, sometimes for years.

At the Industry Committee hearings, the CGPA tabled a list of nearly 40 generic drugs that have been delayed by the automatic injunction of the Regulations since 1993, and figures showing these delays have cost Canadians more than $1 billion.

About the Canadian Generic Pharmaceutical Association

The Canadian Generic Pharmaceutical Association represents Canada’s generic drug industry – a dynamic group of companies that specialize in the production of high quality, affordable generic drugs and fine chemicals and in conducting the clinical trials required for government approval of generic drugs. It plays an important role in helping control overall healthcare costs by keeping the cost of medications down: generic drugs are priced, on average, 45% less than their brand-name equivalents.

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