The Quiet Arrival of Patent Term Adjustment in Canada

On January 1, 2025, Canada implemented a patent term adjustment (“PTA”) system to account for unreasonable delays by the Canadian Intellectual Property Office (“CIPO”) in issuing a patent. The PTA system has been enacted for compliance with Canada’s obligations under the Canada-United States-Mexico Agreement. The final regulations implementing the PTA system were published on December 18, 2024, and contain few substantive changes from the proposed amendments that were published for public consultation and discussed in our previous article, meaning that PTA will not be available for the vast majority of patents.

Notwithstanding the fact that the legal provisions governing the new PTA system have come into force, CIPO has advised that it will not be updating its Manual of Patent Office Practice regarding additional terms until autumn 2025.

PTA Eligibility

As will be seen from the below, while the amendments to the Patent Act and the amended Patent Rules came into force on January 1, 2025, no patent granted prior to December 2, 2025, can be eligible for PTA.

In order to be eligible for PTA:

• The patent must be based on a Canadian patent application with a filing date on or after December 1, 2020;
• The patent must have been issued after the later of:
  • the third anniversary of the date of the request for examination, and
  • the fifth anniversary of the patent’s “applicable day,” which is:
    • the national entry date for Patent Cooperation Treaty applications,
    • the presentation date for divisional applications, and
    • the filing date for any other application; and
• The Patentee must apply for PTA and pay the prescribed fee of C$2,500 (C$1,000 for small entities) within three months of the issue date of the patent.

The application for PTA will be dismissed if the application does not meet the eligibility requirements set out above or if the duration of the additional term as determined by CIPO produces a result of zero or of a negative value of days.

PTA Calculation

If an application for PTA has not been dismissed for failing to meet the eligibility requirements, CIPO will send a notice to the patentee indicating CIPO’s preliminary determination of the number of days of additional term, if any. The preliminary determination is the result of applying a formula for determining additional term duration that takes into account the number of days from the start date, which is the later of five years from the “applicable day” described above and three years from the examination request date, up to the date of grant of the patent, minus “days to be subtracted.”

The “days to be subtracted” include, for example:

• each day that a Request for Examination is deferred;
• all days starting from the date of an Office Action and ending on the date that a response is filed;
• all days starting from the date of a Notice of Allowance and ending on the date that the Final Fee is paid;
• all days starting from the date a first Request for Continued Examination (“RCE”) is filed, or, if the RCE procedure does not apply, from the date of a third Office Action and ending on the date that the Final Fee is paid;
• all days of extension granted by CIPO; and
• all days a patent application is in abandonment.

Very Few Patents Will Receive PTA

In all cases, CIPO will have a minimum of a cumulative total of 36 months to carry out the following tasks:

• issue a first Office Action after examination is requested;
• issue a second Office Action after response to the first Office Action;
• issue a third Office Action or Notice of Allowance after response to the second Office Action; and
• issue the patent after payment of the Final Fee.

Based on CIPO’s current published performance targets, in 90% of cases, the above tasks should be completed within a cumulative total of 39 months for an application in, for example, the biotechnology or electrical disciplines. In other disciplines, these tasks should be completed within 33 months.

It therefore appears that very few patents will receive any significant PTA, if at all, as CIPO will usually be able to carry out the requisite tasks in substantive examination in less than, or about equal to, the minimum 36 months required before any PTA can accrue.

Reconsideration of PTA Calculation

CIPO can reconsider the duration of the additional term granted on CIPO’s owninitiative or upon the application of any person. Upon reconsideration, the additional term may remain the same or may be shortened, but it cannot be lengthened. In addition, an action may be brought in Federal Court for an order shortening (but not lengthening) the duration of the additional term granted for a patent.

Maintenance During the PTA Term

To maintain the rights accorded by the PTA, annual maintenance fees (C$1,000 for standard entities; C$400 for small entities) are required to be paid on the anniversary of the patent filing date to maintain the patent in force during the additional PTA term.

Special Considerations for Medicines

The period of PTA will run concurrently with any patent term extension granted under Canada’s Certificate of Supplementary Protection (“CSP”) regime, which regime accounts for delays in the regulatory approval process for medicines. Specifically, the term of the CSP commences at the expiry of the basic 20-year patent term, not at the expiry of the additional term acquired due to PTA.

If a PTA is granted in respect of a patent that is listed on the Patent Register under the Patented Medicines (Notice of Compliance Regulations or NOC Regulations), the federal Minister of Health must be informed of the adjusted expiry date.

Likewise, if a PTA is granted in respect of a patent that is subject to the Patented Medicines Regulations, within 30 days, the adjusted expiry date must be reported to the Patented Medicines Prices Review Board (“PMPRB”) and the PMPRB’s jurisdiction over pricing will apply to the adjusted term.

Practical Considerations

Because the filing of an RCE or the issuance of a third Office Action effectively terminates potential accrual of PTA, to maximize the chances of obtaining PTA, applicants may wish to consider making early amendments to facilitate condensed prosecution.

Given the substantial C$2,500 official fee for a PTA application and the reality that few patents will receive PTA, patentees or their advisors should perform their own preliminary PTA calculation to rule out the prospect that PTA would be granted and to avoid the requirement to pay the hefty official fee to only have such confirmed by CIPO.

The Patent & Industrial Designs Group at Aird & McBurney LP assists clients in acquiring the appropriate IP rights to support their business mandates. Please contact the author or a member of the group if you have questions or require assistance.