Apotex Holdings Inc. and Apotex Inc. v. United States of America (ICSID Case No. ARB(AF)/12/1), Reply of the Claimant (May 24, 2013)
Published:
May, 2013
Jurisdictions:
Practice Areas:
Description:
In accordance with Article 38 of the Arbitration (Additional Facility) Rules, the Tribunal’s First Procedural Order of November 12, 2012 and the Procedural Order of January 25, 2013, claimants Apotex Holdings Inc. (“Apotex Holdings”) and Apotex Inc. (“Apotex-Canada”) (collectively, “Apotex”) respectfully submit this Reply on the merits and counter-memorial on jurisdiction in support of their claims against respondent United States of America.
INTRODUCTION
- The US Counter-Memorial largely confirms the case established by Apotex in its Memorial. The US does not dispute that FDA repeatedly inspected Apotex’s facilities without incident for many years. The parties concur that, six months after the 2008 Etobicoke inspection, FDA issued Apotex a warning letter. A warning letter, the parties agree, signals a violation of regulatory significance that, if not promptly and adequately corrected, would lead to enforcement action. Apotex had never before received a warning letter.
- The parties also agree that, one month after the warning letter, FDA inspected the Signet facility. Two weeks after that inspection, FDA adopted the Import Alert. The US does not dispute that FDA did so without issuing a warning letter concerning the facility, without notice, without providing Apotex an opportunity to present its position, without any suggestion that Apotex’s products were unsafe or ineffective and without providing Apotex any opportunity to correct the issues raised by FDA before the measure was adopted.
- The US acknowledges that during the past several years FDA issued warning letters to US and foreign investors. It does not contest that those investors owned pharmaceutical businesses and marketing authorizations in the US, comparable to those of Apotex. It is not in dispute that FDA found cGMP violations as to these investors and investments comparable to those FDA found for Apotex’s Etobicoke and Signet facilities. FDA, however, adopted no enforcement measure with respect to any of the US or foreign investors or investments identified in the Memorial. By contrast, the FDA Import Alert crippled Apotex’s US business.
- The Counter-Memorial thus leaves the core of Apotex’s case on liability unrefuted. The US has no response to the factual record establishing Apotex’s claims of less favorable treatment under Articles 1102 and 1103 and failure to accord the procedural safeguards required by the international minimum standard under Article 1105 of the NAFTA.