A drug manufacturer requested judicial review of a recommendation of the Respondent Agency. The Court dismissed the application, finding that the Applicant’s allegation that the Agency secretly or arbitrarily breached a duty of fairness by failing to publish the draft rules of a pilot project, and by failing to strictly follow the draft rules, was without merit.

Administrative law – Judicial review application – Government agencies – Government drug plans – Approval process – Procedural requirements and fairness – Disclosure of rules

Boehringer Ingelheim (Canada) Ltd. v. Canadian Agency for Drugs and Technologies in Health, [2008] O.J. No. 4331, Ontario Superior Court of Justice, October 29, 2008, L. K. Ferrier, J. M. Wilson and S. N. Lederman JJ.

The Respondent Agency is a non-profit Federal corporation with representatives from the Federal, Provincial and Territorial Ministries of Health. It is involved in various capacities reviewing new drugs and technology and recommending which drugs should be listed with government drug plans. It was undisputed that the Agency is part of the machinery of both the Federal and Provincial governments, rendering its conduct, including recommendations, subject to judicial review. While there was no specified defined decision-making power, the Agency was subject to a duty of procedural fairness.

The Applicant was a drug manufacturer seeking approval for its new drug, Pradox, which prevents blood clotting after knee or hip replacement surgery. A competing drug manufacturer appeared as an intervenor, and was seeking approval for its new drug, Xarelto, which was targeted for the same patient group.

The Agency launched a pilot project in 2006 to streamline the drug approval process. The Applicant’s competitor participated in the 2007 pilot project whereas the Applicant did not seek to participate. There was a possibility that both drugs would be approved at the same time, thereby depriving the Applicant, who had applied for approval first, of a significant market advantage. The Applicant argued that the Agency failed to list the draft rules for the pilot project on its website contrary to its usual practice and gave the competitor an unfair advantage by providing it with the unpublished rules.

The Court disagreed with the Applicant’s submission and characterization of the draft rules. It was abundantly clear from the undisputed facts that the Agency engaged in widespread communication from 2006 to 2008 with the pharmaceutical industry to both shape the direction of the pilot project initially, and to report to the industry as the project progressed. There was no attempt to hide the facts about the pilot project from certain drug companies, while favouring others. To the contrary, the Agency engaged in significant public effort to communicate information about the pilot project in a transparent manner. On the evidence, it was clear that the existence and nature of the pilot project was widely known in the Canadian pharmaceutical industry.

The draft rules dated March 2008 were provided to the competitor on March 10, 2008 due to their earlier participation in the pilot project. The draft rules were not posted on the Agency’s website, which according to the Applicant was contrary to established practice, and contrary to the legitimate expectations of the Applicant to be fully informed about any changes in drug approval procedures. The Court concluded that there was no obligation for the Agency to publish the draft rules on their website. The pilot project was in a state of flux, and the rules were a draft only and subject to change.

The competitor learned of the pilot project through publicly disseminated information that was available to the Canadian drug manufacturers, including the Applicant. It was not disputed that at any time, any drug manufacturer, including the Applicant, could voluntarily apply for inclusion in the pilot project. The final decision about who would be included in the pilot project was that of Health Canada. There was no evidence whatsoever of any preferential treatment for the competitor.

The Agency was entitled to initiate a pilot project to try to improve and streamline the process for the approval of drugs available to the public. Its conduct throughout had been transparent, even-handed, fair and reasonable. There was no breach of the legitimate expectation of the Applicant. In the result, the application for judicial review of the recommendations of the Agency and a prohibition order was dismissed.

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