Veloxis Pharm., Inc. v. U.S. Food & Drug Admin., Civil Action No. 14–2126 (RBW)

• Decision Date: 12 June 2015
• Docket Number: Civil Action No. 14–2126 (RBW)
• Citation: 109 F.Supp.3d 104
• Parties: Veloxis Pharmaceuticals, Inc., Plaintiff, v. United States Food and Drug Administration, et al., Defendants.
• Court: U.S. District Court — District of Columbia

109 F.Supp.3d 104

Veloxis Pharmaceuticals, Inc., Plaintiff,

v.United States Food and Drug Administration, et al., Defendants.

Civil Action No. 14–2126 (RBW)

United States District Court, District of Columbia.

Signed June 12, 2015

Colin V. Ram, Jennifer L. Bragg, Lauryn K. Fraas, Mitchell S. Ettinger, Skadden Arps Slate Meagher & Flom LLP, Washington, DC, Maya P. Florence, Skadden, Arps, Slate, Meagher & Flom LLP, Boston, MA, for Plaintiff.

Heide L. Herrmann, Department of Justice, Washington, DC, for Defendants.

MEMORANDUM OPINION

REGGIE B. WALTON, United States District Judge

The plaintiff, Veloxis Pharmaceuticals, Inc., filed this civil suit against the defendants—the United States Food and Drug Administration ("FDA"); Margaret Hamburg, the Commissioner of the FDA; the United States Department of Health and Human Services ("DHHS"); and Sylvia Burwell, the Secretary of the DHHS—seeking declaratory and injunctive relief to redress the FDA's decision to delay complete and final approval of Envarsus XR, which is the plaintiff's anti-rejection medication for kidney transplant

recipients. Complaint for Declaratory and Injunctive Relief ("Compl.") ¶ 1. Without such approval from the FDA, the plaintiff cannot market Envarsus XR until July 2016. Id. ¶ 7. The plaintiff alleges that the FDA's decision violates the Administrative Procedure Act ("APA"), 5 U.S.C. § 706(2) (2012). Id. ¶¶ 114–28. The plaintiff initially filed a motion for a preliminary injunction, but the parties subsequently agreed to "advance the trial on the merits and consolidate it with the hearing [on the plaintiff's motion for a preliminary injunction]."

Fed.R.Civ.P. 65(a)(2) ; see also January 15, 2015 Order at 1 & n.1. The parties then filed cross-motions for summary judgment, which are now ripe for resolution.¹ Plaintiff's Motion for Summary Judgment ("Pl.'s Summ. J. Mot."); Defendants' Motion to Dismiss, or in the Alternative, Motion for Summary Judgment ("Defs.' Summ. J. Mot."). After careful consideration of the parties' submissions,² the Court concludes for the reasons below that it must deny the plaintiff's summary judgment motion and grant the defendants' summary judgment motion.

I. BACKGROUND

A. Statutory Background

1. The Hatch–Waxman Amendments

The Food, Drug, and Cosmetic Act ("FDCA") governs the pharmaceutical drug approval process for both new and generic drugs. See 21 U.S.C. § 355(a) (2012) ("No person shall introduce or deliver for introduction into interstate commerce any new drug, unless an approval of an application filed pursuant to ... this section is effective with respect to such drug."). The FDCA was later amended by the Drug Price Competition and Patent Term Restoration Act of 1984 ("Hatch–Waxman Amendments"), Pub.L. No. 98–417, 98 Stat. 1585."The significance of the Hatch–Waxman Amendments to [the FDCA] cannot be understated." Allergan, Inc. v. Crawford, 398 F.Supp.2d 13, 17 (D.D.C.2005). "Prior to 1984, all [sponsors] seeking to market pioneer drugs ... had to file [a new drug application] containing, inter alia, extensive scientific data demonstrating the safety and effectiveness of the drug. As a result, few generic ... drugs were approved by FDA." Id. The Hatch–Waxman Amendments sought to strike a "balance [between] two competing interests in the pharmaceutical industry: (1) inducing pioneering research and development of new drugs and (2) enabling competitors to bring low-cost, generic copies of those drugs to market." Takeda Pharms., U.S.A., Inc. v. Burwell, 78 F.Supp.3d 65, 68, 2015 WL 252806, at *1 (D.D.C.2015) (internal quotation marks omitted). "[The] Hatch–Waxman Amendments created an abbreviated approval process for generic ... drugs, while retaining incentives for [sponsors of] pioneer drugs, such as marketing exclusivity...." Allergan, 398 F.Supp.2d at 17 (citations omitted); see alsoAstraZeneca Pharms. LP v. FDA, 850 F.Supp.2d 230, 234 (D.D.C.2012) ("Through the Hatch–Waxman Amendments, even while creating new incentives for the development of generic drugs, Congress sought to encourage innovation. To this end, pioneer drug companies are entitled to certain periods of marketing exclusivity....").

The length of a pioneer drug's marketing exclusivity varies. See Allergan, 398 F.Supp.2d at 17 ("Because Congress still wanted to provide incentives for new drug development, alongside the [Abbreviated New Drug Application] process that eased the marketing of generic drugs, [the] Hatch–Waxman [Amendments] entitle[d] [a New Drug Application] applicant to a period of market exclusivity ( [three] or [five] years, depending on the degree of innovation reflected in the NDA)."). For example, certain provisions in the Hatch–Waxman Amendments provide three years of marketing exclusivity ("three-year exclusivity"). See 21 U.S.C. § 355(c)(3)(E)(iii), (j)(5)(F)(iii)–(iv) (providing three-year exclusivities).

Under the Hatch–Waxman Amendments, sponsors seeking to market new or generic drugs can obtain FDA approval for their drug products through one of three pathways: (1) a full New Drug Application ("NDA"), see 21 U.S.C. § 355(b)(1)³ ; (2) an Abbreviated New Drug Application ("ANDA"), see 21 U.S.C. § 355(j) ; or (3) an intermediate process referred to as a Section 505(b)(2) NDA, see 21 U.S.C. § 355(b)(2). As recently explained by another member of this Court:

The full NDA process requires the [sponsor] to submit detailed safety and efficacy data for the drug, including, among other things, "full reports of investigations which have been made to show whether or not such drug is safe for use and whether such drug is effective in use" (i.e., clinical trials); all components of the drug; the methods used for the drug's manufacture, processing, and packing; [and] examples for proposed labeling for the drug.... This path is used by [sponsors] for "new branded drugs," which are sometimes called "pioneer" or "innovator" drugs.

A [sponsor] may also choose to file an ... ANDA.... The ANDA process facilitates efficient approval of generic versions of pioneer drug products that have already been determined to be safe and effective. Rather than requiring generic [sponsors] to conduct expensive and time consuming clinical trials, the ANDA process allows the [sponsors] to rely on the clinical trials already performed in connection with the approval of the previously approved drug, provided that the generic [sponsor] can show that its drug has the same relevant characteristics (including, inter alia, the same labeling, active ingredient, route of administration, dosage form, strength, and bioequivalency). In other words, an ANDA does not attempt to demonstrate safety or effectiveness; instead, the [sponsor]'s only goal is to establish that the generic product is equivalent to another drug that is already known to be safe and effective. Thus, this path is used by [sponsors] "for the introduction of generic versions of previously approved branded drugs."

The Section 505(b)(2) NDA is a sort of hybrid of the other two pathways. Like the full NDA, a 505(b)(2) NDA must directly demonstrate that the proposed drug product is safe and effective; however, like the ANDA, a 505(b)(2) [sponsor]can rely on clinical studies that were previously submitted to [the] FDA in support of another drug and that were not conducted or licensed by the 505(b)(2) [sponsor]. The drug for which the borrowed studies were conducted is referred to as the "Reference Listed Drug" (RLD), and the RLD–related clinical studies that a Section 505(b)(2) [sponsor] relies upon may be proffered to satisfy the [sponsor]'s entire burden of proving safety and effectiveness, or they may only support some of the necessary findings; in the latter case, the [sponsor] can supplement with studies of its own. This means that a Section 505(b)(2) NDA may include the [sponsor]'s own research supporting the basic safety and efficacy of the drug in addition to the research studies related to the RLD, or it may rely entirely on the RLD, but, in any event, the Section 505(b)(2) [sponsor] must present information that bears upon the safety and effectiveness of its drug product in light of the difference between the pioneer drug product and the [sponsor]'s modification of that drug product. The 505(b)(2) NDA pathway is often used when the new drug differs only slightly from the pioneer drug, and this pathway is often favored by [sponsors] seeking to market drugs that are neither "entirely new" nor "simply a generic version of a branded drug."

Takeda Pharms., 78 F.Supp.3d at 71–72, 2015 WL 252806, at *4 (alteration, citations, footnote, and internal quotation marks omitted).

2. The Food and Drug Administration Modernization Act of 1997

The Food and Drug Administration Modernization Act of 1997 ("FDAMA"), Pub.L. No. 105–115, 111 Stat. 2296, further amended the FDCA. ViroPharma, Inc. v. Hamburg, 898 F.Supp.2d 1, 6 (D.D.C.2012). Leading up to the passage of the FDMA,

"antibiotic" drugs were approved under Section 507 of the [FDCA] and non-antibiotic drugs were approved under Section 505. This difference had a long history, dating back to the development of penicillin

, the first drug to have the capacity to kill microbes, i.e., be "anti-biotic." ...

Two key consequences arose from these different treatments. [Sponsors] for generic versions of antibiotic drugs were only requested to show conformance with statutorily-mandated, published standards of identity, strength, quality, and purity for the antibiotic substance, as reflected in antibiotic "monographs" published by [the] FDA. [Sponsors] did not have to submit the safety and efficacy data that was required for pioneer and generic non-antibiotic drugs. Therefore, generic antibiotics were developed and marketed fairly readily. However, antibiotic drugs did not receive the ... marketing exclusivity benefits available to pioneer and non-antibiotic drugs after enactment of the [Hatch–Waxman Amendments]....

In 1997, with the enactment of the FDAMA, Congress extended Hatch–Waxman to...