Apotex’s 2012 claim the earlier US Food and Drug Administration (FDA) import ban on drugs produced at its Etobicoke and Signet facilities had violated the North American Free Trade Agreement (NAFTA) was rejected last Wednesday.
The panel concluded that: “The Import Alert was a lawful and appropriate exercise of FDA’s regulatory authority. FDA’s issuance of the Import Alert, therefore, did not violate the United States’ obligations under NAFTA Chapter Eleven.”
Apotex had argued that the ban – which was imposed by the FDA after a 2009 inspection uncovered current good manufacturing practices (cGMP) standards violations at the plants - breached “most-favored-nation treatment” to which it claimed to be entitled under NAFTA.
Teva comparison
The Canadian drugmaker – which said the ban had cost it $520m over its two-year duration - also claimed it had been treated differently from Teva, which was not issued with an import alert when similar quality problems were discovered as its facility in Jerusalem in 2010.
Apotex did not suggest a reason it thought it had been treated differently in its original arbitration request, but did claim that “most of its [Teva’s] shareholders of record reside or are domiciled in the US.”
Evidently, this argument or lack thereof did not convince the NAFTA panel of FDA wrongdoing, which instead rejected all of Apotex’s calims and ordered it “to reimburse 100 percent of the US’ legal costs and to pay 75 percent of the costs of arbitration.”
In response, Apotex CEO, Jeremy Desai, reiterated the impact the ban had had on his firm, commenting that said: “The FDA's import alert against our Etobicoke and Signet facilities effectively removed Apotex from the US solid-dose drug market for almost two years.
He added that: “While we are disappointed in the Tribunal's decision, we remain strongly committed to the US market and we continue to work closely with the FDA to resolve all outstanding issues and to achieve our shared objective of expanding the public's access to quality, affordable generic medicines."