APOTEX INC. Applicant v. MINISTER OF HEALTH AND ATTORNEY GENERAL OF CANADA, 2017 FC 315

Date: 20170327 Docket: T-1915-15 Citation: 2017 FC 315 Ottawa, Ontario, March 27, 2017 PRESENT: The Honourable Mr. Justice Russell BETWEEN: APOTEX INC. Applicant and MINISTER OF HEALTH AND ATTORNEY GENERAL OF CANADA Respondents JUDGMENT AND REASONS I.

INTRODUCTION [ 1 ] This is an application under s 18.1 of the Federal Courts Act , RSC 1985, c F-7 [Act] for judicial review of a decision of the Therapeutic Products Directorate of Health Canada [TPD] made in the Fall of 2015 [Decision], to continue an earlier decision of November 17, 2014, which required Apotex Inc. [Apotex] to provide certain additional information to TPD prior to TPD completing its review of Notice of Compliance [NOC] submissions for approval of certain new products that were manufactured or tested at two of Apotex’s manufacturing facilities in India, Apotex Pharachem India Pvt.

Ltd. [APIPL] and Apotex Research Private Limited [ARPL]. At this time, Apotex is seeking an order from the Court: (

a) quashing the decision of the Minister of Health [Minister] to refuse to end her prohibition on granting a NOC for products manufactured at ARPL or having active pharmaceutical ingredients sourced from APIPL; (

b) in the nature of mandamus that all other submissions for products manufactured at ARPL or having active pharmaceutical ingredients sourced from APIPL be reviewed without requiring Apotex to provide further evidence to refute the same purported data integrity concerns upon which the Minister relied to ground her decision to impose the Import Ban that Justice Manson quashed in his decision of August 14, 2015; and (

c) awarding Apotex its costs of the within application. II. BACKGROUND A. Regulatory Regime [ 2 ] The Food and Drugs Act , RSC 1985, c F-27 [ FD Act ] and the Food and Drugs Regulations , CRC, c 870 [ Regulations ] govern the manufacture, import, and sale of all drug products in Canada. Various guidelines and policies of Health Canada also help to interpret the FD Act and Regulations . Pursuant to the FD Act and Regulations , a manufacturer must obtain a NOC to sell or market a new drug in Canada.

The Minister issues a NOC when satisfied that the manufacturer’s abbreviated new drug submission [ANDS] is in compliance with the Regulations , which requires the manufacturing process to adhere to mandatory standards and the new drug to be safe, effective, and adequately labelled as per the Regulations . [ 3 ] In reviewing an ANDS, TPD relies on data generated by the drug manufacturer that sponsors the submission. In the event that an ANDS is deficient or lacks sufficient information, TPD may elect to issue a Clarifax, Notice of Non-Compliance, or Notice of Deficiency.

All three issuances request additional information from the sponsor and provide an opportunity to respond to concerns. Additionally, when a new generic drug is awaiting the expiry of a patent or data protection period, it may be put on intellectual property hold [IP Hold]. B. The Parties [ 4 ] The Applicant, Apotex, is the largest pharmaceutical manufacturer in Canada and is affiliated with the Indian companies APIPL and ARPL.

APIPL produces active pharmaceutical ingredients [APIs] and ARPL produces finished dosage form [FDF] pharmaceutical products, both of which are purchased and imported by Apotex into Canada. [ 5 ] The Respondent Minister is responsible for administering the FD Act and Regulations .

Health Canada is the delegate responsible for regulating drug products in Canada and consists of various branches, including: the Minister and Minister’s Office; the Health Products and Food Branch, which includes the Inspectorate, the branch responsible for compliance and enforcement activities and oversight of establishment licensing for health products [Establishment Licence]; the Regions and Programs Bureau [RAPB], which inspects domestic and foreign facilities to evaluate Good Manufacturing Practices [GMP] compliance; and TPD, which issues NOCs.

C. The Facts [ 6 ] In January 2014, the United States Food and Drug Administration [FDA] found issues concerning data integrity at APIPL during an inspection. The FDA found similar issues at ARPL during a later inspection in June 2014, although a joint inspection conducted by Health Canada and the United Kingdom’s Medicines and Health Regulatory Agency in February 2014 did not yield any data integrity issues.

The issues identified by the FDA involved problematic laboratory practices; namely, investigating or reporting out-of- specification results, including re-testing a failing product until a passing result was achieved without addressing why initial test results had failed. [ 7 ] Apotex acknowledged the data integrity issues and provided the Inspectorate with the FDA’s report of the ARPL inspection, referred to as a “Form 483”. The observations in the Form 483 gave rise to concerns about the reliability of test results.

In response, Apotex advised the Inspectorate it would conduct a complete data review and assessment of the laboratory practices at ARPL, including retrospective reviews and unannounced internal audits. [ 8 ] After discussions with Apotex, Health Canada concluded that all finished products containing APIs from APIPL should be re-tested in Canada to ensure health and safety. Subsequent on-site inspections in August 2014 also did not yield critical deficiencies that required immediate corrective actions.

Meanwhile, TPD continued to issue NOCs for products that incorporated APIs made at APIPL, including a NOC for Apo-Linezolid issued August 18, 2014. [ 9 ] On September 11, 2014, the Canadian media criticized APIPL and ARPL and suggested that Health Canada’s failure to implement measures against the companies put the health of Canadians at risk.

As the negative publicity grew, the Minister demanded that action be taken against Apotex by relevant branches of Health Canada. [ 10 ] TPD says it became aware of the data integrity issues at APIPL and ARPL on September 23 or 24, 2014 when the then-Director General of TPD, Barbara Sabourin, received a telephone call and an electronic copy of the Form 483 from a colleague at the Inspectorate. Shortly after, on September 30, 2014, the Inspectorate modified Apotex’s Establishment Licence to include a restriction against the importation of finished commercial drug products from APIPL and ARPL [Import Ban].

However, Apotex’s ANDSs were not initially affected, as TPD continued to review Apotex’s submissions, including those incorporating data from APIPL and ARPL. [ 11 ] Subsequently, a draft NOC for Apotex’s Apo-Rasagiline was delivered to Ms. Sabourin. Since the ANDS for Apo-Rasagiline indicated that APIPL and ARPL would be responsible for manufacturing the drug product and release testing the substance, Ms. Sabourin declined to sign the draft NOC and telephoned the CEO and President of Apotex, Dr.

Jeremy Desai, to discuss her concerns regarding the potential compromised reliability of the data in the Apo-Rasagiline ANDS on November 17, 2014. During this conversation, Ms. Sabourin informed Dr. Desai that NOCs would not be issued for submissions containing data from APIPL and ARPL until further notice [November 2014 Decision].

Further discussions took place and TPD continued to work through its reviews of ANDSs containing data from APIPL and ARPL, as indicated by a letter dated December 9, 2014 sent by TPD to Apotex that requested additional information. [ 12 ] Meanwhile, Apotex implemented corrective and preventative action [CAPA] to address the concerns regarding data integrity at APIPL and ARPL. In May 2015, Apotex reported that it would recall 8 batches of finished commercial products as a result of unreported deviations and withdraw or amend 9 ANDSs made to the FDA due to unreported tests.

Furthermore, the report acknowledged that 5 ANDSs submitted to Health Canada were affected by unreported tests. Apotex also committed to a retrospective data integrity review on its Empower 3 computer system, which contains data generated from September 2013 onwards. A review of the preceding computer system, Empower 2, has not yet been completed.

The data on Empower 2 was used in two of Apotex’s ANDSs for Varenicline and Sitagliptin, which have not yet received NOCs because their submissions contained data from 2013. [ 13 ] In June 2015, TPD conducted further inspections of the APIPL and ARPL facilities for the purpose of assessing the extent to which Apotex had successfully carried out its proposed CAPA.

These inspections resulted in reports indicating that although the system controls and modified procedures satisfactorily addressed the data integrity concerns, additional supervision would be necessary to demonstrate sustainability and effectiveness at times of increased production. Additionally, the reports found that oversight was required because Apotex’s retrospective review of data generated before the conclusion of the June 2015 inspections were still ongoing.

Overall, TPD’s recommendation conveyed that the inspection did not identify any instances of data integrity violations that had been observed during the June 2014 FDA inspection. [ 14 ] Throughout 2015, TPD continued to send individual requests to Apotex for additional information for ANDSs containing data from APIPL and ARPL. However, in January 2015, TPD had developed an overarching policy regarding its approach to managing submissions containing data from sites where the integrity of data had been called into question.

All drug manufacturers were eventually formally notified of this policy on May 22, 2015. [ 15 ] Following the sufficient progress of Apotex’s CAPA, the Inspectorate advised Apotex by letter dated August 31, 2015 that it had amended the terms and conditions of Apotex’s Establishment Licences [August 2015 Decision]. This amendment removed the additional information requirement for ANDSs using data performed at the two sites after the June 2015 inspection, but continued to require additional information for any data from the sites prior to June 2015 which had not been reviewed.

This date was later rolled back to January 2015. [ 16 ] In the midst of these events, Apotex sought judicial review of two decisions rendered by the Inspectorate: the Import Ban and the August 2015 Decision. In a decision dated October 14, 2015, Justice Manson found that the Import Ban was motivated by the Minister’s improper purpose of quelling criticism in the media and in the House of Commons, rather than a legitimate concern for protecting Canadians’ health and safety, and that it was imposed without affording the procedural fairness required in the circumstances.

Consequently, the Court quashed the Minister’s decision to impose the Import Ban. See Apotex Inc v Canada (Minister of Health) , 2015 FC 1161 at paras 95-121 [ Apotex 2015 ]. [ 17 ] Similarly, the August 2015 Decision was quashed by Justice Manson in a judgment issued June 15, 2016: see Apotex Inc v Canada

(Minister of Health) , 2016 FC 673 [ Apotex 2016 ]. Justice Manson found that the decision could not stand as lawful when the close interconnection between the Import Ban and the August 2015 Decision was coupled with a dearth of evidence before the Minister that supported any reasonable belief that further restrictions on Apotex’s Establishment Licences were necessary in August 2015.

The August 2015 Decision was determined to be tainted by the improper purpose that led to the quashing of the Import Ban. [ 18 ] However, TPD’s additional information requirements for ANDSs involving APIPL and ARPL’s 2013 data did not change in the face of the aforementioned judicial review decisions or the Inspectorate’s decision to lift the restrictions on Apotex’s Establishment Licences on March 14, 2016.

TPD took the position that since the decisions did not address the reliability of submission data generated at APIPL or ARPL prior to the implementation of Apotex’s CAPA, a change of policy was not required, which was communicated by Ms. Sabourin to Apotex at some point in the fall of 2015 [Fall 2015 Decision]. Instead, a fresh review conducted by TPD’s new Director General, Marion Law, found that additional information on a case-by-case basis was still necessary. Ms. Law outlined these reasons in a letter to Dr. Desai dated July 8, 2016 [July 2016 Decision]. III.

DECISION UNDER REVIEW [ 19 ] The Decision under review is the decision of the Minister of Health made in the Fall of 2015, and continued by Ms. Law in July 2016, to refuse to end her prohibition on granting a NOC for certain products manufactured at ARPL or having active pharmaceutical ingredients sourced from APIPL. Apotex says that the Decision continues an earlier decision made in November 2014 by TPD that was improperly made as a consequence of the Import Ban that Justice Manson struck down in Apotex 2015 , above. [ 20 ] In a telephone call between Ms. Sabourin and Dr.

Desai on November 17, 2014, TPD informed Apotex that TPD would not be issuing NOCs for submissions containing products from APIPL or ARPL until further notice due to the data integrity concerns perceived by inspectors from the FDA. Ms. Sabourin advised Dr.

Desai that TPD would work through the reviews of Apotex’s ANDSs and communicate any specific questions through the normal procedure. [ 21 ] In effect, then, the subject of this judicial review comprises of three related decisions rendered by TPD that comprise a continuous course of conduct: the November 2014 Decision, the Fall 2015 Decision, and the July 2016 Decision. [ 22 ] The November 2014 Decision consists of communications conducted via a telephone call and a face-to-face meeting. On November 17, 2014, in a telephone call between Ms. Sabourin and Dr.

Desai, TPD informed Apotex that TPD would not be issuing NOCs for submissions containing products from APIPL or ARPL until further notice due to the data integrity concerns perceived by inspectors from the FDA. Ms. Sabourin advised Dr. Desai that TPD would work through the reviews of Apotex’s ANDSs and communicate any specific questions through the normal procedure.

In a face-to-face meeting on November 27, 2014, TPD informed Apotex that TPD would not be issuing NOCs for submissions containing products from APIPL or ARPL unless additional information was provided to satisfy the data integrity concerns. [ 23 ] The Fall 2015 Decision consists of two communications conducted via email and letter. In an email dated October 15, 2015, Ms. Sabourin informed Apotex that TPD would need to perform an analysis and understand the implications of Apotex 2015 prior to moving forward. A few months later, in a letter stamped December 17, 2015, Ms.

Sabourin informed Apotex that TPD would continue to require additional information for products from APIPL and ARPL manufactured prior to June 10, 2015. [ 24 ] The July 2016 Decision refers to a letter dated July 8, 2016, in which TPD took the position that, following a fresh review, additional information on a case-by-case basis was still necessary for submissions containing data generated at APIPL or ARPL prior to Apotex’s corrective and preventative actions, which was in accordance with the general policy communicated by TPD to all drug manufacturers in January 2015. In the letter, Ms.

Law explained that the reason additional information would continue to be required was based on the fact that approximately 30 of Apotex’s other submissions containing data from APIPL or ARPL prior to January 2015 required additional information to address data integrity concerns. As a result, retrospective data analysis for submissions containing data from APIPL or ARPL prior to January 2015 would continue to be needed. IV. ISSUES [ 25 ] Apotex submits that the following are at issue in this application: 1 .

Did the Minister act unlawfully in the fall of 2015 in refusing to end the prohibition on granting NOCs for products manufactured or tested at APIPL or ARPL unless and until Apotex provided further evidence respecting data integrity at those two facilities? 2 . Is the Minister continuing to act unlawfully in refusing to grant NOCs for products manufactured or tested at APIPL or ARPL unless and until Apotex provides further evidence respecting data integrity at those two facilities? 3 .

If the Minister’s continued requirement of further evidence respecting data integrity generated at APIPL and ARPL prior to January 2015 is not sufficiently related to the Import Ban and August 2015 decisions that were quashed or the November 14 Decision, is it reasonable? [ 26 ] The Respondent submits the following are at issue in this application: 1 . What is the nature of the administrative action under review? 2 . What is the appropriate standard of review? 3 . Is TPD’s policy of requiring additional information to confirm the reliability of data from APIPL and ARPL reasonable?

4 . Is Apotex entitled to orders in the nature of mandamus compelling the Minister to return certain drugs to IP Hold? V. STANDARD OF REVIEW [ 27 ] The Supreme Court of Canada in Dunsmuir v New Brunswick , 2008 SCC 9 [ Dunsmuir ] held that a standard of review analysis need not be conducted in every instance. Instead, where the standard of review applicable to a particular question before the court is settled in a satisfactory manner by past jurisprudence, the reviewing court may adopt that standard of review.

Only where this search proves fruitless, or where the relevant precedents appear to be inconsistent with new developments in the common law principles of judicial review, must the reviewing court undertake a consideration of the four factors comprising the standard of review analysis: Agraira v Canada (Public Safety and Emergency Preparedness) , 2013 SCC 36 at para 48 . [ 28 ] Apotex submits that the November 2014 communications between Ms. Sabourin and Dr. Desai constituted a decision that is not sufficiently independent from the Import Ban, which was quashed on October 14, 2015.

An assessment of whether a decision is unlawful on the basis of its close connection to a prior decision that has been quashed is subject to the standard of correctness: Apotex Inc v Canada (Minister of Health) , 2016 FC 673 . Alternatively, if the November 2014 Decision is sufficiently independent, Apotex submits that the November 2014 Decision and its continued enforcement is subject to the standard of reasonableness.

Similarly, if TPD’s current policy of additional requirements imposed on submissions containing data generated from APIPL and ARPL before January 2015 is sufficiently independent from the November 2014 Decision, Apotex submits that it is subject to the standard of reasonableness. [ 29 ] The Respondent submits that the standard of review is reasonableness because the matter at issue is TPD’s policy for submissions with data integrity concerns, which is part of the regulatory scheme governing the issue of NOCs.

This is an exercise of the Minister’s broad discretion under s C.08.002.1(3) of the Regulations and must be accorded considerable deference : Apotex Inc v Canada (Minister of Health) , 2009 FC 452 at para 23 ; Pharmascience Inc v Canada (Attorney General) , 2008 FCA 258 at para 4 . [ 30 ] In my view, the assessment of whether a decision under review should be unlawful based on its proximity to a quashed decision is a legal question and should be reviewed using a correctness standard, particularly if the facts demonstrate the decision under review amends, carries forward, and maintains a decision that was quashed on the basis of unfair implementation and improper purpose: see Apotex 2016 at para 45. [ 31 ] If the decisions at issue are not tainted by the quashed decision, then the Minister’s continuing requests for additional data should be reviewed on a reasonableness standard. [ 32 ] When reviewing a decision on the standard of reasonableness, the analysis will be concerned with " “the existence of justification, transparency and intelligibility within the decision-making process [and also with] whether the decision falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and law.” " See Dunsmuir , above, at para 47 , and Canada (Minister of Citizenship and Immigration) v Khosa , 2009 SCC 12 at para 59 .

Put another way, the Court should intervene only if the Decision was unreasonable in the sense that it falls outside the " “range of possible, acceptable outcomes which are defensible in respect of the facts and law.” " VI. STATUTORY PROVISIONS [ 33 ] The following provisions from the Regulations are relevant in this proceeding: New Drugs Drogues nouvelles C.08.002.1

(1) A manufacturer of a new drug may file an abbreviated new drug submission or an abbreviated extraordinary use new drug submission for the new drug where, in comparison with a Canadian reference product, C.08.002.1

(1) Le fabricant d’une drogue nouvelle peut déposer à l’égard de celle-ci une présentation abrégée de drogue nouvelle ou une présentation abrégée de drogue nouvelle pour usage exceptionnel si, par comparaison à un produit de référence canadien : (

a) the new drug is the pharmaceutical equivalent of the Canadian reference product;

a) la drogue nouvelle est un équivalent pharmaceutique du produit de référence canadien; (

b) the new drug is bioequivalent with the Canadian reference product, based on the pharmaceutical and, where the Minister considers it necessary, bioavailability characteristics;

b) elle est bioéquivalente au produit de référence canadien d’après les caractéristiques pharmaceutiques et, si le ministre l’estime nécessaire, d’après les caractéristiques en matière de biodisponibilité;

(

c) the route of administration of the new drug is the same as that of the Canadian reference product; and

c) la voie d’administration de la drogue nouvelle est identique à celle du produit de référence canadien; (

d) the conditions of use for the new drug fall within the conditions of use for the Canadian reference product.

d) les conditions thérapeutiques relatives à la drogue nouvelle figurent parmi celles qui s’appliquent au produit de référence canadien.

(2) An abbreviated new drug submission or an abbreviated extraordinary use new drug submission shall contain sufficient information and material to enable the Minister to assess the safety and effectiveness of the new drug, including the following:

(2) La présentation abrégée de drogue nouvelle ou la présentation abrégée de drogue nouvelle pour usage exceptionnel doit contenir suffisamment de renseignements et de matériel pour permettre au ministre d’évaluer l’innocuité et l’efficacité de la drogue nouvelle, notamment : (

a) the information and material described in

a) les renseignements et le matériel visés : (

i) paragraphs C.08.002(2)(

a) to (f), (

j) to (

l) and (o), in the case of an abbreviated new drug submission, and (

i) aux alinéas C.08.002(2)

a) à f),

j) à

l) et o), dans le cas d’une présentation abrégée de drogue nouvelle, (ii) paragraphs C.08.002(2)(

a) to (f), (

j) to (

l) and (o), and subparagraphs C.08.002.01(2)(b) (ix) and (x), in the case of an abbreviated extraordinary use new drug submission; (ii) aux alinéas C.08.002(2)

a) à f),

j) à

l) et

o) et aux sous-alinéas C.08.002.01(2)b)(ix) et (x), dans le cas d’une présentation abrégée de drogue nouvelle pour usage exceptionnel; (

b) information identifying the Canadian reference product used in any comparative studies conducted in connection with the submission;

b) les renseignements permettant d’identifier le produit de référence canadien utilisé pour les études comparatives menées dans le cadre de la présentation; (

c) evidence from the comparative studies conducted in connection with the submission that the new drug is

c) les éléments de preuve, provenant des études comparatives menées dans le cadre de la présentation, établissant que la drogue nouvelle : (

i) the pharmaceutical equivalent of the Canadian reference product, and (

i) d’une part, est un équivalent pharmaceutique du produit de référence canadien, (ii) where the Minister considers it necessary on the basis of the pharmaceutical and, where applicable, bioavailability characteristics of the new drug, bioequivalent with the Canadian reference product as demonstrated using bioavailability studies, pharmacodynamic studies or clinical studies; (ii) d’autre part, si le ministre l’estime nécessaire d’après les caractéristiques pharmaceutiques et, le cas échéant, d’après les caractéristiques en matière de biodisponibilité de celle-ci, est bioéquivalente au produit de référence canadien selon les résultats des études en matière de biodisponibilité, des études pharmacodynamiques ou des études cliniques;

(

d) evidence that all test batches of the new drug used in any studies conducted in connection with the submission were manufactured and controlled in a manner that is representative of market production; and

d) les éléments de preuve établissant que les lots d’essai de la drogue nouvelle ayant servi aux études menées dans le cadre de la présentation ont été fabriqués et contrôlés d’une manière représentative de la production destinée au commerce; (

e) for a drug intended for administration to food producing animals, sufficient information to confirm that the withdrawal period is identical to that of the Canadian reference product.

e) dans le cas d’une drogue destinée à être administrée à des animaux producteurs de denrées alimentaires, les renseignements permettant de confirmer que le délai d’attente est identique à celui du produit de référence canadien.

(3) The manufacturer of a new drug shall, at the request of the Minister, provide the Minister, where for the purposes of an abbreviated new drug submission or an abbreviated extraordinary use new drug submission the Minister considers it necessary to assess the safety and effectiveness of the new drug, with the following information and material:

(3) Le fabricant de la drogue nouvelle doit, à la demande du ministre, lui fournir, selon ce que celui-ci estime nécessaire pour évaluer l’innocuité et l’efficacité de la drogue dans le cadre de la présentation abrégée de drogue nouvelle ou de la présentation abrégée de drogue nouvelle pour usage exceptionnel, les renseignements et le matériel suivants : (

a) the names and addresses of the manufacturers of each of the ingredients of the new drug and the names and addresses of the manufacturers of the new drug in the dosage form in which it is proposed that the new drug be sold;

a) les nom et adresse des fabricants de chaque ingrédient de la drogue nouvelle et les nom et adresse des fabricants de la drogue nouvelle sous sa forme posologique proposée pour la vente; (

b) samples of the ingredients of the new drug;

b) des échantillons des ingrédients de la drogue nouvelle; (

c) samples of the new drug in the dosage form in which it is proposed that the new drug be sold; and

c) des échantillons de la drogue nouvelle sous sa forme posologique proposée pour la vente; (

d) any additional information or material respecting the safety and effectiveness of the new drug.

d) tout renseignement ou matériel supplémentaire se rapportant à l’innocuité et à l’efficacité de la drogue nouvelle. VII. ARGUMENTS A. Applicant

(1) Connection between the November 2014 Decision and the Import Ban (

a) Initial Submissions from November 2016 [ 34 ] Apotex submits that the November 2014 Decision (the effects of which have been continued by TPD in its refusal to end its prohibition on granting NOCs for products manufactured or tested at APIPL or ARPL) was not sufficiently independent of the unlawful Import Ban. While Ms. Sabourin asserts that the November 2014 Decision was solely connected to significant data integrity concerns and was not attributable to the Import Ban, this evidence is not credible for several reasons and should be rejected.

[ 35 ] First, all communications between Ms. Sabourin and Apotex regarding the November 2014 Decision began with a reference to the Import Ban. [ 36 ] Second, TPD’s regulatory stance remained aligned with that of the Inspectorate’s until March 14, 2016, when the Inspectorate lifted all terms and conditions, while TPD continued to enforce the additional information requirement. [ 37 ] Third, although Ms.

Sabourin claims the November 2014 Decision was based solely upon concerns in the FDA’s Form 483s, other facts contradict the assertion that those concerns were serious enough to warrant a refusal to issue NOCs: TPD was aware of the FDA’s Form 483s, yet did not take any regulatory action for at least six months; Ms. Sabourin’s affidavit and cross-examination contradict when she first learned about the data integrity concerns; and TPD continued to grant NOCs for products manufactured at APIPL despite having knowledge of the Form 483s. [ 38 ] Fourth, Ms.

Sabourin’s testimony contains further inconsistencies that cast doubt on the Respondent’s position, including purporting to give evidence as to the reasons for the Import Ban when she had no involvement in the decision to impose the Import Ban. [ 39 ] Fifth, Ms. Sabourin could not remember details and appeared to reconstruct events during her cross-examination. [ 40 ] Sixth, despite a limited recollection of the facts and events at issue, Ms.

Sabourin did not try to refresh her recollection by speaking with other TPD officials or by reviewing notes and other material related to the facts and events. [ 41 ] Seventh, the complete lack of documentation evidencing deliberations for the November 2014 Decision indicates that Ms. Sabourin was merely following the Minister’s directive to take " “stronger measures” " against APIPL and ARPL. [ 42 ] As the credibility of Ms. Sabourin’s evidence is disputed for the foregoing reasons, Apotex says that her assertion that the November 2014 Decision is unconnected to the Import Ban is not credible.

The evidence suggests that the two decisions are linked and, since administrative decisions founded upon underlying decisions that are quashed cannot stand, neither can the Minister’s refusal to rescind the November 2014 Decision: Thambithurai v Canada (Minister of Citizenship and Immigration) , 2006 FC 751 at paras 17 and 18 . (

b) Further Submissions in February 2017 [ 43 ] Following the November 2016 hearing of this matter, additional evidence was produced and Apotex made further submissions regarding the connection between the November 2014 Decision and the Import Ban as well as the credibility of Ms. Sabourin’s evidence. [ 44 ] The additional evidence is as follows: Ms. Sabourin recalled two telephone calls immediately preceding the November 2014 Decision. The first call involved a conference between TPD and officials from the Assistant Deputy Minister’s Office [November 10 Call], most notably Dr.

Supriya Sharma, who was primarily responsible for the Import Ban. The second call involved only Ms. Sabourin and Dr. Sharma [November 14 Call]. Additionally, emails regarding this time period were also discovered. [ 45 ] Apotex submits that the additional evidence supports a connection between the November 2014 Decision and the Import Ban. With regards to the decision-maker, Apotex contends that Dr. Sharma is responsible for both decisions. First, Dr. Sharma was significantly involved in both decisions, even though it is unusual for her to be involved in TPD’s NOC deliberations. Second, an email from one of Ms.

Sabourin’s senior advisors confirmed that on the day of the November 2014 Decision, " “Barb talked to Supriya and was told she couldn’t sign it.” " Third, the reasons underlying both decisions are premised on the same data integrity concerns. [ 46 ] As for the motivation underlying the decisions, Apotex submits they are also the same. First, an analysis of the issues facing TPD with regards to the Import Ban identified adverse media reports as a potential risk; this is notable because it constitutes the improper purpose that led the Import Ban to be quashed.

Second, in the same analysis, the risk to public health and safety was not considered to be a matter of serious concern. This parallels the Import Ban since this Court found that the decision-makers did not consider health and safety to necessitate the Import Ban. Third, communications between TPD officials demonstrate that there were concerns regarding the prohibition of products from sites that retained GMP-compliant ratings, which was one of the key concerns of the Import Ban. [ 47 ] Returning to the matter of Ms.

Sabourin’s credibility, Apotex submits that the additional evidence further demonstrates the unreliability of the testimony that Ms. Sabourin provided. In her testimony regarding the November 2014 Decision, Ms. Sabourin did not recall either telephone call or Dr. Sharma’s involvement. Apotex contends that such a material omission from evidence going to a central issue of the case should give serious doubts about the reliability of the witness’ evidence. Additionally, Ms. Sabourin also did not recall other relevant conversations or events that were the subject of the new emails.

(2) Reasonableness of the November 2014 Decision [ 48 ] Alternatively, Apotex submits that the November 2014 Decision was unreasonable. [ 49 ] The decision was made with an overwhelmingly narrow focus and should not be considered reasonable. Despite the existence of a vast quantity of relevant evidence such as emails, memos, and letters exchanged between Apotex and Health Canada, Ms. Sabourin only reviewed the FDA’s Form 483 and Health Canada’s draft exit notice prior to rendering the November 2014 Decision. Ms. Sabourin also did not consult with the officials at RAPB who had conducted the inspections at APIPL and ARPL, or the officials at the Inspectorate that imposed the Import Ban.

(3) Reasonableness of the Continued Application of the 2014 Decision [ 50 ] The Minister has not adduced any evidence as to why data integrity packages continue to be required for new products manufactured at ARPL or having active pharmaceutical ingredients sourced from APIPL. Ms. Sabourin is unable to provide insight on

the matter and the Respondent has refused requests to examine other individuals who may have more knowledge on the matter, such as the current Director General of TPD. The complete lack of evidence demonstrates that there is no basis for the continued insistence on data integrity packages and, as such, the decision should be quashed as unreasonable. B. Respondent

(1) Nature of the Administrative Action under Review [ 51 ] The Respondent submits that the purported November 2014 Decision and its continuation is not a decision or administrative action that is amenable to judicial review. At the time of the telephone call between Ms. Sabourin and Dr. Desai on November 17, 2014, TPD was still developing an approach to submissions containing data from foreign sites with data integrity concerns. Policy development continued after the telephone call and was finalized in January 2015.

As such, a direct challenge to the telephone call is precluded by the doctrine of prematurity, upon which courts will not interfere with ongoing administrative processes until they are complete, absent exceptional circumstances: Canada (Border Services Agency) v CB Powell Limited , 2010 FCA 61 at para 31 . [ 52 ] The matter at issue is actually TPD’s overarching data integrity policy which requires additional information to confirm the integrity of data from APIPL and ARPL.

While an ongoing policy is subject to judicial review at any time, internal departmental policies do not attract a duty of procedural fairness or a duty to give reasons and are entitled to significant deference.

(2) Reasonableness of the Data Integrity Policy (

a) Initial Submissions in November 2016 [ 53 ] The Respondent submits that the policy is reasonable and contains no reviewable error. [ 54 ] The Minister, and consequently TPD as the appointed delegate, has broad discretion to request any additional information considered necessary to assess the safety and effectiveness of a proposed new drug. TPD’s ongoing policy of requiring additional information to confirm the reliability of pre-January 1, 2015 data generated at APIPL and ARPL represents a reasonable response to a complex problem and does not warrant court intervention.

The policy is supported by multiple reasons: the FDA made observations of problematic testing at these two sites, including re-testing failed results without reporting the prior failures; Dr.

Desai acknowledged during cross-examination that only a specific, individual investigation into problematic testing could confirm whether the data was reliable, which is effectively what TPD requests in the additional data integrity packages; Apotex’s review of data acknowledged 5 Canadian submissions were affected by the data integrity problems; Apotex made modifications due to issues with data integrity in submissions where data integrity confirmation was requested; and TPD is unable to independently confirm the reliability of the data in submissions that may have been affected by the problematic testing. [ 55 ] The policy is not unreasonably onerous for Apotex.

TPD employs its own resources to review submissions on a case-by-case basis and to request additional information rather than rejecting submissions outright. These additional information requests are not limited to Apotex and apply to other drug manufacturers’ products as well. [ 56 ] The requests for additional information were and are motivated by the same data integrity concerns which led to the imposition of the Import Ban, but not by the Import Ban itself. Ms.

Sabourin’s notes from the call do not demonstrate that TPD acted solely on the basis of the Import Ban; instead, the notes reference " “signification [ sic ] data integrity issues as perceived by inspectors from the US FDA” " and Ms. Sabourin’s concerns about the integrity of the data contained in Apotex’s submissions. The evidence does not suggest that Ms. Sabourin was pressured by the Minister or was acting for an improper purpose. Instead, Ms.

Sabourin took careful consideration of the matter: she asked her subordinates to review the matter; she convened a meeting of scientists to advise on how to handle concerns about the integrity and reliability of data in submissions; she drew her concerns regarding data integrity to Apotex’s attention upon reviewing a draft NOC on November 17, 2014; and she met with Apotex to discuss the matter. Months later, these considerations culminated in a policy that provided Apotex with notice of its concerns and an opportunity to respond. (

b) Further Submissions in February 2017 [ 57 ] Following the second hearing, the Respondent made further submissions regarding the additional evidence, documentary production and evidence, and clarification of prior evidence. [ 58 ] With regards to the impact of the additional evidence, the Respondent submits that it is limited, entirely consistent with the original evidence, and immaterial. The Respondent contends that the November 10 Call is consistent with Ms.

Sabourin’s evidence that: the analysis of the data integrity issues began in September 2014; her staff was developing a policy for submissions with data from affected sites before November 13, 2014; regular meetings concerning the policy and data integrity issues were held; and the affected sites were not limited to Apotex sites. The notes from the November 10 Call discussed data integrity concerns involving a variety of drug companies. Additionally, Ms.

Sabourin’s inability to recall the November 10 Call is not surprising for the reason that her testimony was not delivered until 18 months afterwards. [ 59 ] Likewise, the November 14 Call does not demonstrate any inappropriate influence on Ms. Sabourin’s decision-making. Ms. Sabourin testified that it was not unusual to consult with Dr. Sharma on a difficult file given that Dr. Sharma had held the same position of Director General of TPD. Moreover, Ms. Sabourin believes the November 14 Call likely involved discussion of her concerns regarding issuing a NOC in the midst of data integrity issues, with Dr.

Sharma counselling that she could not sign the NOC in those circumstances. This is consistent with her prior evidence that her job duties entailed briefing the Assistant Deputy Minister on " “hot” " files. [ 60 ] Similarly, the emails regarding the November 10 Call do not suggest that TPD was not concerned with health and safety issues or

that the adverse media coverage was a significant motivating factor. Ms. Sabourin explicitly rejected the former in her testimony and the emails actually contradict the latter because the media risk was categorized as a secondary risk factor. It is not unreasonable that reputational risk could be a factor, but the evidence does not support it was a significant motivating factor.

Moreover, by November 2014, the media attention had subsided and there was no evidence to demonstrate the Minister was under political pressure at the time. [ 61 ] As for the concerns regarding documentary production and evidence, the Respondent contends that TPD was in compliance on the matter. If Apotex required additional documents, it should have requested them when the opportunity arose. Instead, Apotex withdrew its motion to compel the production of a Rule 317 record and declined Ms. Sabourin’s offer to fact-check her answers during her cross- examination. Nonetheless, regardless of Ms.

Sabourin’s recollection of specific conversations of meetings, her testimony that the main concern was data integrity has always been clear and consistent. [ 62 ] The Respondent also seeks to clarify the prior evidence; namely, that APIPL had a non-compliant rating. Apotex had argued that both APIPL and ARPL had compliant ratings at all times, but APIPL had had a non-compliant rating since April 29, 2014. A draft compliant rating was assigned on September 25, 2014 but was never issued in final form.

(3) Request for Mandamus [ 63 ] The Respondent submits that there are no grounds to grant Apotex’s request for an order in the nature of mandamus because Apotex has not established a vested right to a NOC or to hold IP Hold status. The Minister has the discretion to revisit applications on IP Hold in light of new information that casts doubt on the initial conclusions regarding the safety and effectiveness of a drug: Apotex Inc v Canada (Attorney General) , 2012 FCA 322 . VIII. ANALYSIS A. Improper Motive

(1) Introduction [ 64 ] In its Memorandum of Fact and Law, Apotex asks the Court to grant the following orders: (

a) quashing the decision of the Minister to refuse to end her prohibition on granting NOCs for products manufactured at ARPL or having APIs sourced from APIPL; (

b) in the nature of mandamus that all other submissions for products manufactured at ARPL or having APIs sourced from APIPL be reviewed without requiring Apotex to provide further evidence to refute the same purported data integrity concerns upon which the Minister relied to ground her decision to impose the Import Ban. [ 65 ] As confirmed by Ms.

Rosenthal, acting for Apotex at the resumption of the hearing on February 13, 2017, the principal Decision under review in this application is the decision of the Minister " “to continue to require data integrity packages for products from APIPL and ARPL manufactured or tested prior to” " January 2015. [ 66 ] On October 14, 2015, Justice Manson’s decision quashed the Import Ban because it was not motivated by data integrity concerns, but rather " “was motivated by the Minister’s desire to ease pressure triggered from the media and in the House of Commons.” " Following this decision, Apotex felt that the underpinning for TPD’s requiring additional data integrity packages had been removed.

As a consequence, Apotex wrote to Ms. Sabourin of TPD and asked that TPD reconsider its earlier decision to require data integrity packages (which Apotex says was made in November 2014). Ms. Sabourin advised that she would consider the implications of Justice Manson’s decision and, after she had done so, advised Apotex that Justice Manson’s decision did not affect TPD’s need for additional information to deal with outstanding NOCs for products manufactured or tested at APIPL or ARPL prior to a certain date – which is now January 2015.

Consequently, TPD continued that requirement for data integrity packages for NOC submissions that remained in the system and that relied upon pre-January 2015 data. [ 67 ] Notwithstanding that the principal Decision under review was made in the fall of 2015, Apotex’s focus in this application is heavily concentrated upon earlier events that took place in 2014 and, in particular, what it says was a decision made in November 2014 to suspend Apotex’s NOC submissions for products manufactured or tested at APIPL or ARPL. [ 68 ] As matters presently stand between the parties in this dispute, it appears that TPD no longer requires Apotex to provide additional information to support the integrity of submission data generated at ARPL or APIPL after January 1, 2015, because TPD has concluded that data generated after Apotex took corrective and preventive action can now be considered reliable.

So we are only dealing with submissions containing data generated before January 2015. [ 69 ] In addition, of the 30 drugs listed in the Notice of Application, Apotex has submitted to TPD the requested information for 28. Of the 28, 26 have been approved and 2 have not been approved for reasons not related to data integrity. This leaves 2 drugs whose submissions rely upon data generated before January 2015 and for which TPD is requesting data integrity packages.

Those submissions are for Varenicline and Sitagliptin which contain data from stability studies conducted at ARPL in 2013. [ 70 ] So the relief requested could only apply to Varenicline and Sitagliptin, or to some, as yet, unidentified drug that will rely upon pre- January 2015 data in its submission to TPD.

This is because there is no general prohibition " “on granting NOCs for products manufactured at ARPL or having API sourced from APIPL.” " The reality is that TPD is refusing to grant NOCs for Varenicline and Sitagliptin until such time as Apotex provides the data integrity packages requested to satisfy data integrity concerns that arise from information generated in 2013. As regards any future submissions, the Court has no record before it to determine what any concerns might be for data generated pre-January 2015. This is why, I think, Apotex is simply asking that submissions for products manufactured

at ARPL or having APIs sourced from APIPL " “be reviewed without requiring Apotex to provide further evidence to refute the same purported data integrity concerns upon which the Minister relied to ground her decision to impose the Import Ban ” " (emphasis added). [ 71 ] I see nothing in this application to suggest that, in a general sense, TPD cannot request additional information to satisfy data integrity concerns identified in any submission, including any submission made by Apotex.

Nor do I see that Apotex objects to the policy that the Minister has developed to deal with data integrity concerns and which applies to all manufacturers as set out in the notice of May 22, 2015. Apotex is only challenging decisions (at present, the withholding of NOCs for Varenicline and Sitagliptin) where Apotex alleges that TPD is relying upon data integrity concerns that were used as a justification for the Import Ban. [ 72 ] This raises some extremely complex causal issues in this dispute.

To begin with, it seems to me that Apotex needs to demonstrate that TPD’s present position of requiring data integrity packages to satisfy data integrity concerns in the Varenicline and Sitagliptin submissions is improper because it emanates from, and arises out of, the Import Ban that Justice Manson found in his decision of October 14, 2015 in T-2223-14 to have been improperly motivated: [107] The above facts suggest that the Import Ban was motivated by the Minister’s desire to ease pressure triggered from the media and in the House of Commons – a purpose falling outside her delegated authority from the enabling legislation, which must be exercised in accordance with the rule of law.

The Minister’s actions were therefore ultra vires and she erred in her exercise of jurisdiction by implementing an Import Ban on September 30, 2014. The public statements released on September 30, 2014, by the Minister and Health Canada constituted a manifestation of this improper purpose; they were a way for the Minister to publicly convey she was taking strong action and was not weaker than her US regulatory counterpart. [ 73 ] In the case of the Import Ban, the Minister was removing rights already enjoyed by Apotex.

In the present instance, TPD is seeking additional information before it is prepared to allow Apotex the rights it seeks under NOC submissions.

Even if Apotex can satisfy the Court that TPD’s initial decision to require additional information from Apotex was improperly motivated by the Import Ban back in November 2014 (when, as a result of Apotex’ s Apo-Rasagiline submission, TPD informed Apotex that it would require additional information), this does not mean that TPD’s present requirement for additional information in relation to Varenicline and Sitagliptin is either improper or unreasonable if that information is, in fact, required so that TPD can be satisfied that the health and safety of Canadians is not at risk.

In my view, this requires Apotex to show that TPD continues to be motivated by the improperly imposed Import Ban in requiring Apotex to provide additional information for these particular submissions. [ 74 ] Another problem for the Court is that, for the most part, Apotex has provided TPD with the requested additional information for 28 of the 30 drugs listed in the Notice of Application, and only the Varenicline and Sitagliptin submissions remain unresolved. In the case of Varenicline, the submission was made on March 22, 2013 and TPD requested the additional information on July 15, 2015.

In the case of Sitagliptin, the submission was made on December 16, 2013 and the request for additional information was on July 15, 2015. In the case of the Apo-Rasagiline submission that first raised the data integrity concerns under review here, the request for additional information was made on December 9, 2014. Apotex provided that information and the NOC was granted on January 11, 2016. Apotex has not asked the Court to review these requests for additional information as separate decisions, as the time for doing so has lapsed and, in the case of Apo-Rasagiline, is no longer necessary.

Yet it was the Apo-Rasagiline submission on November 14, 2014 that first involved the data integrity concerns that Justice Manson referred to when considering the Import Ban. [ 75 ] So out of 30 submissions involving data for products manufactured at ARPL or having APIs sourced from APIPL, Apotex has complied with TPD’s requests for additional information rather than seek judicial review. In all likelihood, this is because Apotex considered that, if the Import Ban was found to be improper then all data integrity concerns would dissolve along with the quashing of the Import Ban.

This does not, of course, mean that Apotex accepts those requests for additional information to be legitimate. However, as the evidence I will come to later shows, for Varenicline and Sitagliptin, Apotex is having difficulties in completing the internal review process that it agreed with the FDA to complete. Apotex has asked the Court to draw many inferences (dealt with below) concerning the motivation of TPD’s requests for additional information.

Inferences, of course, can be drawn both ways, so that Apotex’s compliance with 28 requests for additional information and its resort to judicial review for two drugs for which it has yet to complete its own agreed- upon internal review of data concerns cannot be left out of account. B. The November 2014 Exchanges [ 76 ] The linchpin for Apotex’s argument that TPD’s refusal to grant NOCs for products manufactured at ARPL or having APIs sourced from APIPL is improper is the exchange that took place between Dr. Desai, CEO and President of Apotex, and Ms.

Sabourin, the then Director General of TPD, in November 2014, and the events that led up to that exchange. [ 77 ] It was at this time that a draft NOC for Apo-Rasagiline came to Ms. Sabourin for signature. The submission indicated that APIPL and ARPL would be responsible for manufacturing the drug product and release testing the drug. Ms. Sabourin declined to sign the NOC and telephoned Dr. Desai on the next business day to discuss the situation. [ 78 ] Apotex says that Ms. Sabourin’s refusal to sign the NOC for Apo-Rasagiline was improperly motivated by the Import Ban. TPD says that Ms.

Sabourin’s actions were motivated by genuine data integrity concerns affecting the safety, quality and effectiveness of the drug. [ 79 ] Following her telephone discussion with Dr. Desai on November 17, 2014, Ms. Sabourin summarized their conversation in an email to her colleagues on the same day. That email reads as follows: phone call with Jeremy Desai today Barbara J Sabourin to: karen.reynolds, Craig Simon Cc: john.patrick.stewart

2014-11-17 05:13 PM Hi – I spoke to Jeremy Desai today regarding Apotex’s submissions for products being manufactured at ARPL or having API sourced from APIPL both in India. These sites both are subject to an import ban due to signification [ sic ] data integrity issues as perceived by inspectors from the US FDA. I told Jeremy that we would not be issuing NOCs for submissions from these sites until further notice. If we have specific questions we will ask them through normal means (clarifiax, NON, NOD) as we work through the reviews.

As a follows up, we need to send something in writing to them indicating what we are doing. Could you develop a first draft please, or delegate this to someone else to do? We also need to develop a more formal communication to Industry as a whole, regarding how we are dealing with this type of situation. That is partly why I asked for tomorrow’s internal meeting. Key points from my conversation with Jeremy are: - our inspectors plus those from MHRA went through their labs after seeing the US FDA’s 483 letter, and found no issues.

Australia stood behind their inspectors and did not institute an Import ban - October 22 – an internal audit of their own qc. labs found no issues - November 27 – a 3rd party sign off of data reviews will be completed - They have been requested to use 3rd party testing for all imported products from these sites, and cannot even use their own Canadian labs - companies who do not sell to the USA will never have a 483, and therefore those who do sell to the USA are being treated unfairly by Canada - This will add to their damage claim against Health Canada He also indicated that he would appreciate knowing what we need to assure ourselves there is nothing wrong with the integrity of the files.

He pointed out that if there was something wrong with the products, that it would be found as they test in their Canadian labs as well for all imported products. He also indicates that the level of scrutiny is already very high for all companies, very different than in previous years. Jeremy also mentioned that their QC labs have been accepted to do additional testing / full release testing (my notes are not good on this point).

I committed to having a follow up call with him next Monday, November 24 2014. … [ 80 ] Apotex argues that by halting the issuance of NOCs for products produced at APIPL or ARPL, the Minister was aligning TPD’s approach to regulatory submissions with the Inspectorate’s approach to products already on the market, as implemented by the Import Ban.

Apotex sees the November 17, 2014 exchange as yet another politically-motivated move against Apotex by the Minister, so that suspending NOCs " “until further notice” " was simply part of the Minister’s response to the media and political pressure that motivated the Import Ban (eventually found to be improper by Justice Manson in his decision of October 14, 2015) and the Minister’s August 31, 2016 decision that varied the terms of Apotex’s Drug Establishment Licenses for APIPL and ARPL, which Justice Manson declared unlawful in his decision of June 15, 2016 in file no.

T-1653-15: [57] The question before the Court here is not whether the Minister had the jurisdiction to amend terms and conditions to a drug manufacturer’s Els, or of the Minister improperly specifying the source of her jurisdiction. In fact, it is quite evident that the power to amend or impose terms and conditions falls squarely within the Minister’s mandate.

Instead, the issue is whether the August 2015 Decision was unlawful on the basis that the amendment, in effect, sustained a decision quashed by this Court by maintaining in part, the 2014 Terms and Conditions in the 2015 Terms and Conditions. [58] In essence, the lawfulness of the August 2015 Decision depends upon (

i) whether it is a sufficiently independent decision from the 2014 Import Ban, and (ii) whether it could nonetheless be justified in the evidence, such that the Minister’s improper purpose in imposing the Import Ban did not also taint this subsequent and related decision. [59] It is evident that the August 2015 Decision was not implemented as, nor intended to be, a new and independent decision from the 2014 Import Ban. I disagree with the Respondents that the characterization of the August 2015 Decision as an amendment is immaterial.

The two decisions are inextricably interconnected, and the facts before me suggest the August 2015 Decision was neither in substance or form a free-standing and uninfluenced decision, such that it was not also infected by the improper purpose that motivated the Import Ban. … [65] I find that the August 2015 Decision cannot stand as lawful when the close interconnection between this Decision and the Import Ban is coupled with the lack of evidence before the Minister that supports any reasonable belief an Import Ban was necessary in August of 2015.

The Respondents have pointed to no evidence, either of any affiant or circumstantial, to persuade me that even though the August 2015 Decision was an amendment and closely connected to the 2014 Decision, it was nonetheless justified on the facts.

… [69] Fundamentally, it is not simply the Minister’s reference to a certain provision of the FD Regulations or to a decision subsequently set aside that, in my view, makes the August 2015 Decision unlawful.

Rather, it is the perpetuation of a decision found to have been motivated by a purpose falling outside the Minister’s delegated authority, and thus a decision not made in accordance with, or respecting the supremacy of the rule of law ( Apotex v Canada , above, at para 107). [70] According to the Respondents, it is fundamentally important that the decision in the First Judicial Review did not undermine the legitimate data integrity concerns Health Canada had about the facilities in question.

I note that neither the First Judicial Review, nor these reasons suggest that Health Canada did not have data integrity concerns, or that Health Canada is not entitled to consider information from international regulatory counterparts.

However, I disagree on these facts that any existing data integrity concerns, which the evidence demonstrates had only improved since September of 2014, justified the continuation of an Import Ban in the August 2015 Decision, without more. … [74] This case involves a very unique set of circumstances where an underlying decision of the Minister, found to have been made for an improper purpose and carried out unfairly, has been perpetuated in identical form in a subsequent decision without an evidentiary or lawful basis to do so. (emphasis in original) [ 81 ] Likewise, the question before the Court in the present application is not whether the Minister (in this case acting through TPD) has the jurisdiction to request additional information before granting NOCs or returning to IP Hold.

It seems to me, and I don’t believe Apotex questions this, that the power to request additional information falls squarely within the Minister’s mandate under C.08.002.1 (3) of the Regulations .

The issue is whether, by requesting data integrity packages for Varenicline and Sitagliptin from Apotex in this case, TPD is acting unlawfully because that request is so inextricably interconnected with the improper Import Ban that it is fatally infected by the improper purpose that motivated the Import Ban and for which the Import Ban was quashed by Justice Manson. [ 82 ] As was the case before Justice Manson in his June 15, 2016 decision, the lawfulness of the continuing request for data integrity packages depends upon: (

a) whether it is a sufficiently independent decision from the 2014 Import Ban; and (

b) whether it can nonetheless be justified on the evidence, such that the Minister’s improper purpose in imposing the Import Ban did not also taint this subsequent and related action by TPD to continue to withhold NOCs for Varenicline and Sitagliptin until Apotex has provided the additional information. [ 83 ] On its face, and viewed in isolation, I don’t think it can be said that the decision communicated verbally to Dr. Desai on November 14, 2014 and summarized in Ms. Sabourin’s email to her colleagues of the same date is not a sufficiently independent decision.

It has to be borne in mind that it was not the Import Ban, per se , that was improper. It was the motivation behind it, i.e. the Minister imposed the Import Ban in response to media and political pressure and not to protect the health and safety of Canadians. Ms. Sabourin, in her email to colleagues on November 17, 2014 refers to " “an import ban due to significant data integrity issues as perceived by inspectors from the US FDA.” " The Import Ban is referred to, but the email makes is clear that it is the " “significant data integrity concerns” " behind it that are her concern.

It seems to me that TPD decided to put Apotex’s APIPL- and ARPL- related NOC submissions on hold until such time as TPD could find a way to determine that it had the information it needed to satisfy itself that those submissions did not give rise to health, safety or efficacy concerns. Ms. Sabourin’s email refers to the Import Ban but it clearly sees that ban as being " “due to significant data integrity issues as perceived by inspectors from the US FDA.” " And this, in my view, is consistent with Ms. Sabourin’s later evidence.

There is no suggestion in the email that TPD is acting at the behest of, or under pressure from, the Minister herself, or responding to media pressure. That is why, until the recent disclosure of further evidence from Ms. Sabourin (which I shall come to later) Apotex placed great reliance upon circumstantial and contextual issues to convince the Court of the true motivation behind the decision by TPD to suspend Apotex’s NOC applications and request more information. C.

Stronger Measures [ 84 ] Apotex alleges, in effect, that TPD, like the Inspectorate, was given its marching orders to implement “stronger measures” with regard to Apotex’s NOC submissions because of the political pressure on the Minister that caused her to impose the improper Import Ban. [ 85 ] The record shows that, on September 23, 2014, Mr.

Clarke Olsen, the Minister’s Director of Issues Management, sent an email to the Inspectorate that made it clear that the Minister was not pleased with the way the Inspectorate was dealing with Apotex and that the Minister wished to move to “stronger measures” against the company. The Inspectorate had asked Apotex to voluntarily quarantine ARPL products without pointing to any particular safety concerns with those products, but Mr. Olsen wanted quicker action against Apotex.

As a result, the Inspectorate accelerated the deadline the following day from 5 p.m. to 10 a.m., which was barely one hour from the time the letter accelerating the deadline was sent. Hence, there was clear evidence that the Minister made direct contact with the Inspectorate and that the Inspectorate responded with " “stronger measures.” " [ 86 ] Before additional evidence disclosed by Ms. Sabourin following the hearing of this application in November 2016, (as discussed below) there was no direct evidence that Mr.

Olsen, or anyone else acting for the Minister, contacted TPD directly and urged TPD to take " “stronger measures.” " The evidence was that Ms. Sabourin was contacted by phone by Sharon Mullin, a senior official at the Inspectorate. [ 87 ] Ms. Sabourin’s evidence was that she had a two-minute telephone conversation with Ms. Mullin who alerted her " “to the situation with the two Apotex facilities in India” " and that " “there were possible implications for submissions.” " [ 88 ] Apotex originally argued before me that:

36. The obvious conclusion is that, just as the Inspectorate officials were being given their marching order to impose “stronger measures”, so too was Ms. Sabourin. And indeed Ms. Sabourin wasted no time in passing on those orders to her subordinates. Upon finishing her call with Ms. Mullin, Ms. Sabourin immediately contacted the two most senior officials responsible for reviewing and making recommendations in respect of submissions: Karen Reynolds and Craig Simon.

Again, no notes, memos or emails of this discussion have been produced. (footnotes omitted) [ 89 ] There was, in fact, no direct evidence to support this conclusion. The only direct evidence came from Ms. Sabourin who said that she was alerted to a situation which could have possible implications for submissions, but she acted upon the basis of data integrity concerns that had been identified in the FDA Form 483s, and acknowledged by Apotex. Apotex was asking the Court to infer that Ms. Sabourin was, in fact, given her " “marching orders” " by Ms. Mullin, or by the Minister through Ms. Mullin.

It wasn’t all that surprising that there were no notes of this brief telephone call, and the inference that Apotex wanted the Court to draw ( i.e. that Ms. Sabourin deliberately began to ensure that there would be no paper trail) was speculation. [ 90 ] There is no evidence that Ms. Sabourin was urged or asked to do anything by Ms. Mullin. She was " “alerted to the situation.” " Having been so alerted, it was Ms. Sabourin’s duty to consult with her senior officials about “the situation” to see if anything needed to be done about NOC submissions. So, once again, in my view, there was nothing untoward in Ms.

Sabourin’s immediate contact with her own senior officials. [ 91 ] Alerting someone to a situation so that they can assess the implications in terms of their own statutory obligations is not “marching orders,” and it is not improper interference. Justice Manson has found that the Minister’s contact with the Inspectorate did amount to improper interference and compromised the action taken by the Inspectorate. But this does not automatically mean that Ms.

Sabourin and the TPD were told to do anything more than assess the situation for themselves, which they quickly set about doing. [ 92 ] The decision to impose the Import Ban was communicated to Apotex in a conference call on September 30, 2014. However, Apotex was not contacted about any NOC submission issues until Ms. Sabourin contacted Dr. Desai by telephone on November 17, 2014. Given the displeasure expressed by Mr. Olsen to the Inspectorate and the immediate response he required and received from the Inspectorate, it does not look as though TPD was being pushed to do anything quickly.

In fact, the more obvious inference is that TPD took a few weeks to internally review the whole “situation” and work out what their response should be before contacting Dr. Desai. [ 93 ] However, following the initial hearing of this application in November 2016, and in the course of discussions about the related damages action commenced by Apotex, Ms. Sabourin remembered that, in addition to Dr. Craig Simon, she may also have spoken to Dr. Patrick Steward on November 14, 2014, and that she had spoken to Dr.

Sharma, prior to her decision not to sign the NOC for Apo- Rasagiline on November 14, 2014. [ 94 ] Further cross-examinations of Ms. Sabourin then took place during which she recalled that she and Dr. Sharma had both participated in a conference call concerning data integrity concerns with other employees of TPD and the Assistant Deputy Minister’s Office on November 10, 2014. Neither Ms. Sabourin or Dr.

Sharma retained notes of the November 10 Call, but four other participants did, and those notes have been located and were placed before the Court in the resumption hearing on February 13, 2017. [ 95 ] This new evidence, and the way it has been characterized, is important in various ways. First of all, in presenting it to the Court, Apotex appears to concede that there was no " “direct” " evidence to support its case until this new evidence was revealed: 3. This late-breaking information, along with a few related documents, effects a significant change in the evidence in the within proceedings.

It provides, for the first time, a clear and direct link between the architect of the Import Ban – Dr. Sharma – and the November 2014 decision that is at issue herein. It also provides, for the first time, direct evidence that the same concerns that motivated the Import Ban, namely, concerns about adverse reports in the media, continued to motivate the responsible Health Canada officials in November 2014. [ 96 ] More important, however, is what the new evidence tells us about what took place in November 2014 concerning the Import Ban and Ms.

Sabourin’s decision not to sign the NOC for Apo-Rasagiline and to raise data integrity concerns for Apotex’s submissions that involved products manufactured or tested at APIPL and/or ARPL. From Apotex’s perspective, the conclusions are obvious: 15. Unfortunately, at the time that the foregoing arguments were advanced, the parties did not have the benefit of certain key documents. Those documents – which were produced to Apotex only after the conclusion of the hearing – are notable for two main reasons. First, they provide clear evidence that the November 2014 decision was based upon the Import Ban.

They demonstrate that, not only were the same people behind the November 2014 decision as were behind the Import Ban, but also that the November 2014 decision was motivated by the same type of media-related concerns that led to the imposition of the Import Ban. Second, the documents highlight still further reasons as to why Ms. Sabourin’s evidence is not credible and should be rejected. (emphasis in original) [ 97 ] As Apotex points out, on the very same day that Ms. Sabourin informed Apotex that Apotex’s NOC submissions were to be suspended, Dr.

Craig Simon, who was the Associate Director of the Bureau of Pharmaceutical Sciences and a senior advisor to Ms. Sabourin, wrote in an email to Karen Reynolds that " “Barb [Ms. Sabourin] talked to Supriya [Dr. Sharma] and was told she couldn’t sign it [ i.e. the Apo-Rasagiline NOC submission].” " [ 98 ] Apotex argues that Dr. Sharma’s involvement at this juncture in the process is " “highly significant” " for the present application: 19. Dr. Sharma’s involvement in the November 2014 decision - hitherto unknown to Apotex - is highly significant. Dr.

Sharma was one of the key personnel involved in the decision to implement the Import Ban. If she was not the actual decision-maker (and that point remains unclear), she was unquestionably a leader of the very small circle of senior Health

Canada personnel who collectively decided to impose the Import Ban. 20. For Dr. Sharma to be involved in TPD’s deliberations in respect of new drug submissions (such as the Apo-Rasagiline submission that allegedly prompted the November 2014 decision) was very unusual. This was confirmed by Ms. Sabourin on cross-examination and, indeed, is evident from the fact that neither in her affidavit nor in her original cross-examination did Ms. Sabourin suggest any role being played by Dr.

Sharma specifically or by members of the Assistant Deputy Minister’s Office more generally in TPD’s review and approval of new drug submissions. 21. Moreover, as is made clear by the new documents, Dr. Sharma was not merely involved in the November 2014 decision, she was the actual decision-maker, telling Ms. Sabourin that the NOC for Apo-Rasagiline could not be signed. 22. Moreover, it is notable that, in Court File No. T-2223- 14, Dr. Sharma gave evidence that was strikingly similar to that given by Ms. Sabourin in the within application. Like Ms. Sabourin herein, Dr.

Sharma gave evidence in T-2223-14 that her decision (in that case, to impose the Import Ban) was motivated by a concern that the data integrity problems identified by the US FDA and the resulting risk to the health and safety of Canadians were so significant as to justify her decision. 23. However, the evidence given by Dr. Sharma in T-2223-14 as to her motives in imposing the Import Ban was rejected by Justice Manson.

He found that the Import Ban was not, in fact, motivated by a desire to protect health and safety, but rather by a desire to deflect “intense media criticism” and by a “desire to ease pressure triggered from the media and in the House of Commons”. 24. There is no evidence to suggest that these motivations that underlay Dr. Sharma’s actions in September 2014 had changed by the time she was directing Ms. Sabourin barely six weeks later in November 2014. On the contrary, the new documents reveal that these same factors were motivating TPD and Ms.

Sabourin in the days leading up to the November 2014 decision. (footnotes omitted) [ 99 ] The fact that Ms. Sabourin was " “told she couldn’t sign it” " is not inconsistent with Ms. Sabourin’s evidence that she was concerned about the Apo-Rasagiline NOC because of data integrity concerns at APIPL and ARPL, the FDA Form 483s and missing test results. Ms. Sabourin has testified in her continued cross-examination that it was not out of the ordinary for her to consult with Dr. Sharma on a difficult file. The reason she did this was because Dr. Sharma had previously filled the same role at TPD as Ms.

Sabourin (Director General) and Dr. Sharma is a senior medical officer. She was an obvious person to consult if Ms. Sabourin was having difficulties in dealing with a NOC submission. And if Ms. Sabourin, as she has testified, had concerns about data integrity, FDA Form 483s and missing test results, then Dr. Sharma’s advice that she couldn’t sign the NOC seems entirely reasonable. It is the kind of advice that any knowledgeable person might give. Dr. Simon’s email doesn’t say that Dr. Sharma contacted Ms. Sabourin and told her not to sign the NOC.

The evidence is that " “Barb talked to Supriya and was told she couldn’t sign it.” " It is worth bearing in mind that, at this juncture, Ms. Sabourin could not know that the Court would find the Import Ban to be improper. There was no reason for her not to talk to Dr. Sharma and seek her advice, as she had on other occasions. [ 100 ] In my view, this evidence does not establish, as Apotex alleges, that the November decision was " “made by an official in the Assistant Deputy Minister’s Office – the very same official who had been the architect of the Import Ban – Dr.

Supriya Sharma.” " The evidence establishes that Ms. Sabourin consulted with Dr. Sharma – as she had consulted with her on other occasions – about the data integrity concerns she had about the Apo-Rasagiline NOC submission and was told she couldn’t sign it. [ 101 ] It may be that, in giving Ms. Sabourin this advice, Dr. Sharma was motivated by the improper influences behind the Import Ban, and this is a possible inference. But there is no evidence that Dr. Sharma was the person who made the November 2014 Decision or that Ms.

Sabourin did not have genuine data integrity concerns when she made the decision, or that Ms. Sabourin refused to sign the NOC because of “marching orders” from Dr. Sharma or anyone else. [ 102 ] Apotex has not established before me that in November 2014 there were no genuine data concerns at APIPL or ARPL, as identified on the FDA Form 483s. An Import Ban that Justice Manson later found to be improper, does not mean that there were no genuine data integrity concerns identified by TPD that had to be dealt with.

And the fact that the Inspectorate was improperly influenced by the Import Ban, as found by Justice Manson, does not again mean that TPD was improperly influenced. And even if TPD was prompted or galvanized to take action on data integrity concerns (that had existed for some time) by the Import Ban, this does not mean that such action was not entirely appropriate given the existence (as Apotex has acknowledged) of data integrity concerns at APIPL and/or ARPL. [ 103 ] The fact that Justice Manson rejected Dr.

Sharma’s evidence that she was motivated in relation to the Import Ban by data integrity problems identified by the United States FDA, and the resulting risk to the health and safety of Canadians, does not mean that the Court must reject Ms. Sabourin’s evidence. As Apotex’s own dealings with the FDA and its actions at APIPL and ARPL demonstrate, those data integrity concerns were real and were not simply an excuse for TPD to succumb to media and political pressure, or to accept “marching orders” from the Minister.

It seems inconsistent to me that Apotex would take such forceful action itself to address the data integrity concerns at APIPL and ARPL but now argue that there was no reason for TPD to address those concerns other than the improper influence brought to bear by the Import Ban and those officials involved in the Import Ban.

This position asks the Court to leave out of account TPD’s subsequent dealings with Apotex over submissions for drugs connected to APIPL and ARPL, TPD’s prior concerns about data integrity at APIPL and/or ARPL, the development and implementation of a general policy to deal with data integrity concerns that TPD has applied to all drug manufacturers, and not just Apotex, and to accept that in the Fall of 2015 when TPD desired to continue to ask for data integrity packages for Varenicline and Sitagliptin, (which is the decision under review) that it did so because it was still motivated by the Import Ban and the Minister’s “marching orders.” It seems to me that this is a bit of a stretch. [ 104 ] Similar considerations apply to the use that Apotex seeks to make of the new evidence concerning an Issues Management Report that Karen Reynolds was asked to prepare:

25. Thus, on November 7, 2014, when Karen Reynolds (the head of the Bureau of Pharmaceutical Sciences) was asked to prepare an analysis - known as an “Issues Management Report” - of the issue facing TPD with regard to “submission s in cue [sic] that are implicated by the Import Ban”, she identified three potential risks, one of which was the risk of adverse media reports: Reputational/media related risks could result from the approval of new products from the implicated sites. 26. Thus, despite the fact that September’s media storm had died down, it would appear that Health Can

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