Bill C-13 is the government’s emergency legislation in response to the COVID-19 pandemic. The bill includes amendments to the Patent Act by adding a new section (19.4) which includes the following:
- Empowers the Minister of Health to require the Commissioner of Patents to authorize any person specified by the Minister to “make, construct, use and sell a patented invention to the extent necessary to respond to the public health emergency described in the application.”
- The authorizations are not referred to as compulsory licenses in the legislation, however, that is their effect.
- The provision is targeted at all patented inventions and not just for drugs – ventilators, diagnostics and other medical devices may be the initial target.
- There are already provisions in the Act (65(2)) that allow for compulsory licenses if there is abuse (e.g. if the patent holder is unable to satisfy demand), but that process anticipates a prospective licensee justifying the need to the Commissioner of Patents – this amendment to the act bypasses all that to fast-track compulsory licenses.
- The authorizations (licenses) must be in response to the COVID-19 emergency – the patent holder can seek an order from federal court to stop abuses of the compulsory license.
- There is a provision for royalties to be paid (eventually) to patent holders.
- Authorizations (licences) can only be issued until September 30, 2020, will expire one year from authorization and are non transferable.
- Although there is no mention of the PMPRB, presumably any person (manufacturer) authorized to sell a patented invention under this section would be subject to PMPRB review given that the authorized person is benefiting from the patent and that there are no provisions exempting the authorized products from PMPRB review (as there were for the older compulsory licenses).
For your reference, the text of the amendment is reproduced below:
51 The Patent Act is amended by adding the following after section 19.3:
Application by Minister
19.4 (1) The Commissioner shall, on the application of the Minister of Health, authorize the Government of Canada and any person specified in the application to make, construct, use and sell a patented invention to the extent necessary to respond to the public health emergency described in the application.
Contents of application
(2) The application must
(a) set out the name of the patentee and the number, as recorded in the Patent Office, of the patent issued in respect of the patented invention;
(b) include a confirmation that the Chief Public Health Officer, appointed under subsection 6(1) of the Public Health Agency of Canada Act, believes that there is a public health emergency that is a matter of national concern;
(c) include a description of the public health emergency; and
(d) specify a person, if any, that is to be authorized to make, construct, use and sell the patented invention for the purposes of responding to the public health emergency.
Cessation of effect
(3) The authorization ceases to have effect the earlier of
(a) the day on which the Minister of Health notifies the Commissioner that the authorization is no longer necessary to respond to the public health emergency set out in the application, and
(b) one year after the day on which it is granted.
(4) The Commissioner shall notify the patentee of any authorization that is granted under this section and provide them with the information referred to in subsection (2).
Payment of remuneration
(5) The Government of Canada and any person authorized under subsection (1) shall pay the patentee any amount that the Commissioner considers to be adequate remuneration in the circumstances, taking into account the economic value of the authorization and the extent to which they make, construct, use and sell the patented invention.
Authorization not transferable
(6) An authorization granted under this section is not transferable.
For greater certainty
(7) For greater certainty, the use or sale, in relation to a public health emergency, of a patented invention that is made or constructed in accordance with an authorization granted under this section is not an infringement of the patent.
Power of Federal Court
(8) On the application of the patentee, the Federal Court may make an order requiring the Government of Canada or any person authorized under subsection (1) to cease making, constructing, using or selling the patented invention in a manner that is inconsistent with the authorization granted under this section.
(9) The Commissioner shall not make an authorization under subsection (1) after September 30, 2020.