Tuesday, April 27, 2010

Please support me in the 200 km Ride to Conquer Cancer

Dear Patentidbits readers,

I have committed to riding 200 km on June 12-13, 2010 and raising $2,500 for this year’s Ride to Conquer Cancer – a two day bicycling trip from Toronto to Niagara Falls in support of The Princess Margaret Hospital.

Princess Margaret is one of the top 5 cancer research hospitals in the world, and the largest Canadian institution dedicated to cancer research and treatment. The work they are doing is cutting-edge – you can see a list of discoveries HERE.

I want to thank everyone who has supported me, both last year and this year. I really appreciate your generosity. It has been startling to learn how many people I know are touched by cancer, either directly or in someone they know - thank you for sharing your stories with me.

After last year’s debacle (I injured myself on the first day – totally my fault – and it was a real struggle to complete the ride), I wasn’t sure if I wanted to do this again. But, fighting cancer and supporting the Princess Margaret are important, and I would like to continue to contribute. Also, this year I have convinced my wife Carolyn to ride with me. ;)

Between us, Carolyn and I have to raise $5,000 – a considerable sum, but I hope with your generosity that we will make a dent in that amount.

Please go to this link if you wish to donate,

or I can provide you with a printed form.

Hopefully, with your support I will make it to Niagara Falls in June, and in the process raise some money for Princess Margaret Hospital and help to Conquer Cancer!

Yours truly,
Alex Stack

ps - thumbs-up! to the other lawyers from Gilbert's who also doing the ride this year - Shonagh, Sarah, Alison, Emily and Andrew.

Wednesday, April 21, 2010

Speaking of Dairy Farmers...

"Canada a double-dealer in world trade" according to this article by Jeffry Simpson of the G&M, commenting on Canada being left out of Asian free trade negotiations, with the blame being laid at the feet of our stubborn defence of supply-management and other agricultural subsidies.

Monday, April 19, 2010

Entire draft CA/EU trade deal leaked; tradejustice ruins my day

Just as I was putting the finishing touches on a magazine article regarding the draft text of the IP chapter of the Canada European Union Trade Agreement (CETA)...

Some bunch of troublemakers at tradejustice.ca (actually the Council of Canadians, Canadian Centre for Policy Alternatives, National Farmers Union, Sierra Club Canada, Canadian Conference of the Arts, among others) leaked the entire draft text along with commentary. This appears to be the kickoff of a concerted campaign opposing the deal.

Which means I have to print off and read it all (its lengthy) and adjust my magazine article accordingly. Thus ruining my day. :(

More seriously, I usually take the position that the more people interested in and commenting on trade deals, the better. So, good for them. Also, once I get over my grumbling, I'm sure I'll find lots of interesting stuff in the leaked documents...

Tuesday, April 13, 2010

Patent Agent Exams starting today

The Canadian Patent Agent exams start today and last till the end of the week. For those of you who are not familiar with them, here is the lowdown:

(a) you need to pass them to become a patent agent in Canada, and

(b) they are notoriously difficult: the pass rate on the initial sitting is less than 5%.

Most people pass through sheer bloody-mindedness: the exams are set in four sections, and if you get 60% on a section you don't have to write it again, so you can pass by sitting the exams several times (i.e. year after year) until you accumulate passes to all four sections.

The exams cover validity, infringement, patent drafting, and patent office practice. They tend to be practical in nature: for example, the patent drafting exam simply provides a description of an invention from an inventor, and gives the student four hours to draft a patent application. The practical nature of the exams seems to be what people trip up on. However, the validity, infringement and patent office exams also test knowledge on a pretty wide range of topics.
Good luck to everyone writing the exams! (especially those from Gilbert's)!

UofT gets $60 million for new School of Global Affairs

The University of Toronto has received $35 million from Peter and Melanie Munk (plus $25 million from the Ontario government) to set up a new school of global affairs. Of course, Peter Munk also donated the money a few years ago to set up the Munk Centre for international Studies. (oddly, the Globe seems to have scooped UofT itself on the announcement - nothing on the UofT web page)

In conjunction with the recent founding of Centre for International Governance Innovation or CIGI and the Balsillie School of International Affairs in Waterloo (Jim Balsillie should also be noted for his donations and funding), it is all terribly exciting if you're an international affairs junkie like me.

Although I still suspect that the Munk Chair in international patent law or Balsillie program in global intellectual property affairs are still a long ways off. (These programs spend too much time thinking about global warfare, famines, the middle-east and the like instead of important issues like trademark dilution ;) )

In any case, hooray for Mr. Munk!

Generic drugs, pharmacies and Ontario back in the news

More news on the Ontario government's ongoing fight with pharmacies to lower the cost of generic drugs. Four articles in today's Globe (three first section, one in the business section)

Shoppers holds a publicity stunt in Health Minister Deb Matthews' riding. Premier McGuinty is not impressed.

Adam Radwanski suggests that the Ontario government has already planned a showy "concession" that it can use to convince the public it is the reasonable party here (although the pharmacies aren't dong a good job of forcing the government to use it)

John Ibbitson writes that the other provinces are quietly cheering Ontario on, and also suggests a national formulary to replace the ten provincial formularies (on the basis that one big formulary will have superior negotiating clout with the drug companies).

An article from the business section doesn't seem to be online, but connects the debate to various drugs coming off patent in the next few years, notes that Ontario business could save as much as $100 per employee as a result, and that the Canadian Vehicle Manufacturers' Association came out in favour of the changes.

Boo! Dairy farmers!

According to the Globe and Mail, international trade's reigning bogeymen, dairy farmers, have caused Canada to be not invited to negotiations regarding a major pacific trade deal. As written by John Ibbitson:

"When asked in 2006 to join the Trans-Pacific Partnership negotiations that only recently got under way in Australia, the Harper government refused, largely to protect the Quebec and Ontario dairy industry from foreign competition. When Canada changed its mind earlier this year and asked to join, we were told it was too late, according to several sources.

As a result, this country could miss out on being part of a new free trade zone that would encompass 470 million people with a combined GDP of more than $16-trillion.

“It is foolish to hamstring our participation in these negotiations” just to protect the dairy industry, said Jayson Myers, president of the Canadian Manufacturers and Exporters association.

“There are much bigger economic interests at stake here,” he maintained."

Dairy farmers are the classic, textbook case of special interests who obtain benefits paid for by small losses to everyone else in society. However, Canada is hardly alone in catering to its agricultural interests.

Thursday, April 8, 2010

Ontario, Pharmacies declare "war"

The Ontario government and pharmacies are now openly engaged in an epic political battle - pitting a government determined to reshape health care spending versus an industry many feel has the power to seriously hurt a government come election time.

To begin - the Ontario government press release "Expanding Access to Affordable Drugs". The main points:

a) reduce the maximum cost for generics paid by the Ontario Drug Benefit Plan to 25% of the brand (i.e. patent-protected) price (presently 50%)

b) apply this 25% cap to private-market sales as well

c) eliminate professional allowances - after-sales payments to pharmacists by drug companies through which generic companies compete for shelf space in pharmacies - which takes $750 million directly out of the revenues of Ontario pharmacies

To put this in perspective, Ontario spent $800 million on generic drugs last year - i.e. professional allowances almost equaled public spending on generics.

The Ontario plan also includes some new streams of revenue for pharmacies (a small increase in dispensing fees and new funding for the delivery of health care services in pharmacies), but nowhere near enough to fully replace professional allowances. The government plan will also subsidize a limited number of rural, small-town pharmacies to ensure no community is left without access to a pharmacy.

But the tone of the press release - well, judge for yourself

"Eliminating abuse of the system by ending so-called 'professional allowances' - payments generic drug companies make to pharmacy owners intended to fund patient services, but are instead being used by many pharmacies as rebates to fund fringe benefits, bonuses, overhead costs and boost profits"


"In 2009, generic drug manufacturers reported paying pharmacy owners more than $750 million in professional allowances, with pharmacy owners themselves revealing that 70% were used for rebates instead of patient care.

In addition, during the past year, at least 100 pharmacy owners failed to provide any documentation related to the payments they've collected and 650 pharmacy owners provided incomplete reports. Some pharmacies have also been involved in a re-sale scheme in order to receive professional allowances multiple times for the same product - a practice that has resulted in the government taking legal action against them."

Listing on the Ontario Drug Benefit formulary - where the 25% cap comes in - is key to the private market in Ontario as well as the public market. To minimize operating costs, most pharmacies stock only two versions of a drug, the brand name and one generic. Generally, pharmacies will only purchase a generic product that can be sold to public-market ODB customers as well as private market customers.

How serious is all this? Well, Shoppers Drug Mart has been downgraded by analysts as a result.

Something which has not appeared in the newspapers is that the Ontario government wants to ban pharmacies like Shoppers from becoming generic manufacturers with their own in-house brands: the Ontario government's media briefing says "Not allow private label generics". Shoppers has already announced a move into this area.

Lots of articles in the papers about this - National Post, Globe and Mail (196 comments already!) and another from the Globe and Mail, and two articles from the Toronto Star.

Putting the pieces from these stories together - on the one hand, Deb Matthews (Ontario Health Minister) has the political attractiveness of lower drug prices for consumers on her side, as well as support from significant interest groups:

"Perhaps girding for the public-relations clash to come, Ms. Matthews brought along to her news conference the heads of the Canadian Association of Retired Persons, the Canadian Cancer Society and the Ontario Federation of Labour, with all of them predicting the changes would bring lower drug prices to their constituents."

Against this, the pharmacists argue that the loss of income from professional allowances (which follows the amorphous loss of income from rebates on ODB sales a few years ago) means that pharmacies will have to close, reduce services to patients and/or lay off staff.

"Andy Giancamilli, chief executive officer of the Katz Group, which operates Rexall and Pharma Plus, said the government’s move verges on “reckless action in health care” and could force his company to slash $100-million in costs.

He warned that these cuts could mean that customers will have to go to hospital emergency departments because drugstores can no longer afford to keep enough pharmacists on staff to deal with all their questions."

A fear for the national chains is that other provinces will simply follow Ontario's lead (after letting the McGuinty government take it on the chin from pharmacists ;) ). In particular, Quebec has a "best price available" policy - i.e. that Quebec should get the best price being provided to any other province. Quebec and Ontario, combined, are a significant majority of the Canadian marketplace. So, the line in the sand for national pharmacies is likely now and in Ontario.

But, the real political kicker is that the pharmacies most vulnerable to this change are likely the mom-and-pop stand alone operations. To quote Adam Radawanski more than I probably should:

"But at some level, it’s also because the Liberals think the province has more drugstores than it needs.

Not for nothing do officials note that there are more pharmacies in Ontario (3,306, by the government’s count) than there are Tim Horton’s across the entire country (3,015). They plainly believe that overly generous allowances have distorted the market, and that nobody would especially suffer from fewer Shoppers Drug Marts.

The unpleasant reality is that it’s not Shoppers – despite its aggressive expansion – that’ll face the worst pain. Unlike big chain stores, smaller pharmacies don’t use their drugs to lure in grocery consumers. So while independent pharmacies in small towns might be protected by the new premiums, their counterparts in urban centres are in big trouble.

That’s a point that industry advocates – ironically funded mostly by chain stores trying to protect their profits not just in Ontario, but in other provinces that might follow its lead – will drive home over and over.

The Liberals yielded to the parade of aggrieved mom-and-pop pharmacy owners last time. Soon, they’ll likely find out if there’s much cost in ignoring them."

The big battleground right now is over professional allowances for private sales. For example, here is Shoppers alternative plan - it would give the Ontario government price reductions on ODB sales, but would leave private sales alone, by dropping even present restrictions on rebates/etc.:

- Allowing generic drug manufacturers and pharmacy retailers to

negotiate supply agreements in accordance with ordinary commercial

terms, eliminating the concept of professional allowances; and

One of the more interesting outcomes of the Ontario government's attempts to control spending on pharmaceuticals during the last two years has been the development of two tier pricing, with private purchasers (whether cash-in-hand or covered by private insurance) paying significantly more for pharmaceuticals than the Ontario government. Indeed, some have accused the Ontario government of creating savings for itself on the backs of everyone else in Ontario. It seems that the Ontario government is determined to eliminate this reality. Although difficult to communicate to the public, this could also be a potent PR factor for Ontario.

Finally, where do the generic manufacturers stand in all this? Well, I think they are being quiet - after all, both the Ontario Government and pharmacies are essentially the generic manufacturers' customers, and who wants to engage in a public battle with your two main customers? They are concerned about where this will lead: for example, in the National Post article Jim Keon of the CGPA worries that other provinces will half-copy the Ontario approach, resulting in a particularly bad market for generic manufacturers:

" "It is possible generics will simply stop making some drugs available," he said. "Of course, that is a very bad thing, because it means the government will have to pay for the brand product at four times the price." "

More undoubtedly to come in the upcoming months...

Monday, April 5, 2010

Ontario procurement issue for European/Canada free trade deal

Just in case you thought the Canada/European trade agreement or CETA was all about intellectual property (a view which I'm sure would surprise the negotiators ;) )...

here's an article by Doug Saunders in the Globe about another major issue: an agreement by the provinces to stop giving preferential treatment to provincial or Canadian companies in government procurement.

If you read the background documents to the negotiations, a major concern on the European side was to have the provinces bound by the agreement, specifically in respect of procurement. The Ontario government - which was singled out by the Europeans, albeit probably because it is the largest province - is apparently only in reluctant agreement, and is dragging its feet on the details.

The key paragraph from the article:

"Officials from Premier Dalton McGuinty’s government say their work is taking longer than other provinces because of the complexity of Ontario’s government programs, but that they remain committed to a deal in principle. Nevertheless, Canadian negotiators fear a repeat of a 2005 attempt at a Canada-EU pact, when the lack of a unified position among 11 Canadian governments led to the Europeans walking away."

The article states that other than Ottawa's ability to deliver the provinces, the Europeans think the negotiations are going "surprisingly well".