Politico | 20 March 2017
Canada scores ISDS victory over Eli Lilly
By MEGAN CASSELLA
Canada has prevailed over pharmaceutical giant Eli Lilly in a long-running investor-state dispute the drug company filed under NAFTA’s investment chapter, a Canadian government spokeswoman confirmed to POLITICO.
“The government of Canada welcomes the tribunal’s decision in this case,” a foreign ministry spokeswoman said in a statement.
The full decision of the tribunal, which was rendered on March 16, and the amount it awarded Canada in the case hasn’t been released yet. What’s clear is Eli Lilly failed to successfully challenge Canada’s law compelling drug companies to prove “utility” or usefulness of a pharmaceutical in the face of a patent challenge from a generic competitor.
Eli Lilly, which sought $500 million in damages, had not merely challenged the law but rather the way courts set the legal standard for utility on two of its pharmaceutical products. The Indianapolis-based company argued that the Canadian courts are creating too high of a standard for companies to prove the “usefulness” of their products when their patents are challenged by other firms seeking to produce their own versions of drugs. Usefulness is a common benchmark for establishing or maintaining a patent.