I. INTRODUCTION 

1. In accordance with the Tribunal’s First Procedural Order and its Order of October 29, 2012, the United States respectfully submits this Reply to Claimants’ Opposition to Bifurcation of December 28, 2012. 

2. The U.S. Counter-Memorial on Merits and Objections to Jurisdiction established that bifurcating these proceedings is not only permitted by the applicable arbitration rules, but also compelled by reasons of economy, efficiency, and fairness. The United States has presented credible, well-founded jurisdictional objections that are separate from the merits and, if accepted, will eliminate or substantially reduce the scope of Apotex’s claims. Bifurcation thus is expected to save the parties the significant expense of (1) further briefing the merits; (2) preparing for and presenting argument and witness testimony at a lengthy merits hearing; and (3) gathering, reviewing, redacting, and producing documents. We thus ask that the Tribunal grant the United States’ request to decide the U.S. jurisdictional objections as a preliminary matter, in accordance with Article 45 of the ICSID Additional Facility Rules. 

3. We further request that the Tribunal reject Apotex’s proposed pleading schedule on issues of quantum. The Tribunal has reserved to itself the prerogative of fixing that schedule, if necessary, “at a later date.”1 And yet Apotex has sought, unilaterally, to join the scheduling of those issues to the United States’ bifurcation request. Apotex’s proposal is not only untimely, but also highly prejudicial, as it would require the United States to file an expert report on valuation and brief quantum issues a mere nine weeks after receiving Apotex’s “supplemental” damages report and evidence. The United States should not be penalized for Apotex’s own failure to submit a complete damages claim and complete evidence. It would be inefficient, moreover, for the United States to incur the enormous expense of pleading issues of quantum before the Tribunal first has adjudicated the United States’ well-founded jurisdictional objections, which we anticipate will eliminate Apotex’s entire case. 

4. Finally, we note that Apotex’s 48-page submission contains extensive arguments on the substance of the United States’ jurisdictional objections, which we believe are inappropriate for a submission on bifurcation. Although compelled to provide some response, we recognize that briefing on those issues has been reserved for the parties’ submissions on jurisdiction, as set forth in the First Procedural Order. The United States thus will provide a fuller response to Apotex’s arguments in a later substantive submission.