Canadian officials are considering granting Canada’s generic pharmaceutical firms the right to copy, sell and potentially export into the US patent protected drugs.

In the latest development in the trade war between the US and Canada, Canadian officials are taking aim at the US pharmaceutical industry by potentially allowing Canadian pharmaceutical firms to manufacture drugs protected by patent rights and export them into the US.

The purpose is to apply pressure to the US pharmaceutical industry in an attempt to have it get behind Canada’s cause. This might not lead to the outcome Canada is wanting and Canada may be being overly optimistic that US pharma will support Canada rather than call for strict penalties and sanctions.

Despite what it seems the scheme may be totally legal. If Canada has the crown use exception to patent infringement which apply in Australia, then the Canadian government can authorise the exploitation of Canadian patents. The crown use exception arose so that the government could exploit patents and authorise others to exploit patents in the times of war. However, under the Australian Patents Act, there is no requirement for the crown use patent infringement exception to only apply in times of war.

The crown use patent infringement exception is not binding on other jurisdictions, so how the US will react to the import of drugs which infringe US patents remains to be seen.