Reeling from lost sales and fleeing customers, Toronto drug giant Apotex is lashing out at Health Canada, alleging in a lawsuit that the regulator’s recent ban of drugs from its Indian factories was illegal and politically motivated.

Apotex alleges Health Minister Rona Ambrose acted with “malice” toward the company and buckled under political pressure after a series of Star articles exposed widespread problems in the company’s Bangalore facilities.

The company is asking a federal court to quash the Health Canada ban blocking many of its India-made products from reaching Canadian consumers.

“The minister’s decision to implement the import ban was politically motivated and, in particular, was calculated to deflect public and parliamentary criticism of the minister as a result of the Toronto Star articles,” Apotex alleges in a lawsuit filed in Toronto on Oct. 29.

An earlier Star investigation found Health Canada so lax that it allowed the import of Apotex drugs and pharmaceutical ingredients that are banned from the United States because the adulterated medications are potentially unsafe.

Inspectors from the U.S. Food and Drug Administration (FDA) had found that staff at Apotex plants in Bangalore manipulated data, destroyed records and retested samples until they got favourable results, the Star articles revealed.

Apotex’s president previously told the Star that “compliance is a journey” and the firm was working to fix “procedural lapses” flagged by inspectors.

The fallout was swift and loud, as critics lambasted Canada’s drug regulator as “feeble, inadequate and incompetent.”

Less than two weeks later, Ambrose declared the trust between Apotex and the regulator was “broken” and announced the ban that affected more than 60 drugs and drug ingredients — including a generic form of Viagra and popular treatments for hypertension, dementia and high blood pressure.

Apotex, which says it employs nearly 6,000 Canadians and makes drugs that fill about one of every five prescriptions in this country, alleges it was blindsided by the unnecessary and unfair ban.

“The (Health) Minister has acted in an unlawful and discriminatory manner for improper purposes against Apotex,” the suit alleges.

After U.S. agents found serious problems during inspections of Apotex’s India facilities, the company said it kept Health Canada informed on a “voluntary basis” of the FDA concerns, which the firm says had nothing to do with product quality.

(In its lawsuit, the company claims the FDA’s foreign plant inspection procedure is “discriminatory” and a “breach” of fair trade agreements.)

Nevertheless, as Apotex continued to share information with the regulator throughout the summer, the company alleges it never received any indication the regulator had serious concerns about its India facilities.

In fact, in September, Health Canada inspectors gave one of the Bangalore plants a compliant rating, the lawsuit says.

Then, on Sept. 30, the company alleges, Health Canada suddenly banned products from Apotex’s India plants without giving the firm detailed reasons or an opportunity to address the regulator’s concerns.

What the Star found and reported earlier this year was that Health Canada, concerned about U.S. inspection results showing suspect drug ingredients were made by Apotex in India, twice asked the firm to “stop sale and cease imports” from this Bangalore facility. Health Canada said at the time that the company refused.

The Star has also learned from new FDA records that Apotex recently recalled more than 60,000 bottles of blood pressure tablets — a medication called candesartan cilexetil — because of impurities. The tablets were made at one of Apotex’s Bangalore factories.

An Apotex spokesperson did not answer several questions from the Star about the lawsuit and the recent recall. “Apotex prides itself on a long legacy for providing our customers with the highest quality medicines, care and service,” he said. “Our products are safe and effective. We cannot, per company policy, discuss any proprietary commercial information or offer comment regarding ongoing litigation.”

In its lawsuit, Apotex has demanded reversals, retractions and reimbursements. It wants the court, among other things, to order Ambrose to retract her online statements justifying the import ban as well as release all Apotex products “unlawfully seized” by the government.

“Apotex is taking the shotgun approach for every grievance it has with the health minister. It smacks of a desperate and hurt company rather than one who is using the courts in an ordinary way,” said Amir Attaran, a University of Ottawa law professor who researches drug policy.

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“The pleading has the flavour of a lover’s tiff, almost as if Apotex was spurned and had its feelings hurt because the minister decided to deal with a public safety issue — perish the thought — in public.”

Ambrose did not answer the Star’s questions about the lawsuit. Earlier this month, in announcing new drug safety legislation, Ambrose said an unnamed drug company was taking her to court.

“I’m being sued right now by a pharmaceutical company that’s not happy with action that we took. That’s part of the business but it’s not going to stop me from taking action,” she said.

The lawsuit provides a behind-the-scenes look at the day of the ban and the tense aftermath.

On Sept. 30, Health Canada informed the company in a phone call that border agents had been “instructed to restrict importation” of products from the two India facilities.

That kicked off a month of urgent discussions between top regulatory officials and Apotex, it was demanding a justification for the ban.

Apotex alleges that on the evening of Oct. 28, a senior Health Canada official phoned the company’s president to say her recommendation that the import ban be lifted was rejected by “unidentified persons.”

The official said one of the reasons against lifting the ban was concern over how Ambrose would explain such an apparent flip-flop to the public, Apotex alleges.

It’s not the first time Apotex has complained about what it calls unfair and costly regulatory sanctions.

In 2012, Apotex complained before an international trade tribunal that a U.S. ban on its imports unfairly punished the Canadian firm and decimated its U.S. sales. In August, the tribunal unanimously rejected Apotex’s claim and ordered it to pay $1.2 million in legal fees to the U.S. government to cover the cost of the litigation.

In a letter to the court requesting an expedited hearing, an Apotex lawyer said Ambrose’s actions have severely affected the company’s business.

“Apotex has lost sales and, more importantly and irreparably, it is losing customers.”

David Bruser can be reached at 416-869-4282 or dbruser@thestar.ca

Jesse McLean can be reached at 416-869-4147 or jmclean@thestar.ca

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