Akebia Therapeutics, Inc. v. Azar
| Decision Date | 04 February 2020 |
| Docket Number | Civil Action No. 19-cv-12132-ADB |
| Citation | 443 F.Supp.3d 219 |
| Court | U.S. District Court — District of Massachusetts |
| Parties | AKEBIA THERAPEUTICS, INC., Plaintiff, v. Alex M. AZAR II, in his official capacity as Secretary of Health and Human Services; United States Department of Health and Human Services; Seema Verma in her official capacity as Administrator of the Centers for Medicare & Medicaid Services ; Centers for Medicare & Medicaid Services, Defendants. |
Brian M. Boynton, Pro Hac Vice, Bruce S. Manheim, Pro Hac Vice, Leon T. Kenworthy, Pro Hac Vice, Wilmer Cutler Pickering Hale and Dorr LLP, Washington, DC, Nicole R. Hadas, Pro Hac Vice, Akebia Therapeutics, Inc., Cambridge, MA, Lindsey B. Silver, Wilmer Cutler Pickering Hale and Dorr LLP, Boston, MA, for Plaintiff.
Erin E. Brizius, Gregg D. Shapiro, Office of the United States Attorney, Boston, MA, for Defendants.
BURROUGHS, D.J.
Plaintiff Akebia Therapeutics, Inc. ("Akebia") seeks a preliminary injunction, enjoining a decision of the Centers for Medicare & Medicaid Services ("CMS") which eliminated coverage under Medicare Part D for Akebia's product Auryxia for use in treating iron deficiency anemia
in patients with chronic kidney disease. [ECF No. 15]. Because Akebia has failed to make a sufficient showing that it is likely to succeed on the merits or will suffer irreparable harm, Akebia's motion for a preliminary injunction, [ECF No. 15], is DENIED.
Medicare provides healthcare coverage for, in relevant part, (1) people age 65 and older; (2) people under the age of 65 with certain disabilities; and (3) people under the age of 65 with end-stage renal disease
. 42 U.S.C. § 1395c. Medicare Part D provides low-cost prescription drug coverage to Medicare beneficiaries. Unlike other coverage under Medicare, Part D beneficiaries enroll in a Part D plan offered by private insurance companies. CMS contracts with these health insurance providers, called "sponsors," which in turn administer prescription drug plans to provide coverage for drugs that have been identified as "covered part D drugs." 42 U.S.C. § 1395w-102(a)(1), (b) ; 42 U.S.C. § 1395w-111(e)(2)(A) ; 42 U.S.C. § 1395w-112. Part D participants may choose from several benefits packages and sponsors, and pay a monthly premium for their selected plan.
Part D requires that plan sponsors pay for the actual costs of covered Part D drugs. 42 U.S.C. § 1395w-111(e)(2)(A). A "covered part D drug" is defined as "a drug that may be dispensed only upon a prescription" that has been "approved [by the U.S. Food and Drug Administration] for safety and effectiveness as a prescription drug under section 505" of the Federal Food, Drug, and Cosmetic Act. 42 U.S.C. § 1395w-102(e)(1)(A) ; 42 U.S.C. § 1396r-8(k)(2)(A)(i). Relevant to this case, the definition of "covered Part D drug" excludes "[p]rescription vitamins and mineral products, except prenatal vitamins
and fluoride preparations." 42 U.S.C. § 1395w-102(e)(2) ; 42 U.S.C. § 1396r-8(d)(2)(E).
In December 2018, Akebia purchased Keryx Biopharmaceuticals ("Keryx"), which had developed the drug "Auryxia," an iron salt. According to Akebia, "Auryxia is a unique, chemically synthesized organic compound called a ferric citrate ‘coordination complex’ and is distinct from the active ingredient in iron nutritional supplements
." [ECF No. 16 at 8]. Akebia has obtained or is a licensee of fifteen patents covering Auryxia or methods of using the drug. [Id. ]. Akebia alleges that Auryxia "does not merely replace missing iron," but "causes the body to transport ferric iron into the blood, where it ‘can be incorporated into hemoglobin.’ " [Id. at 9 (quoting ECF No. 25-5 at 7, FDA Label, Auryxia) ].
Auryxia has been approved by the U.S. Food and Drug Administration ("FDA") for treatment of two diseases associated with chronic kidney disease
. In September 2014, the FDA approved Auryxia to treat hyperphosphatemia (elevated levels of phosphate in the blood) in patients with chronic kidney disease who receive dialysis.1 [ECF No. 25-5 at 2]. Following additional clinical trials, the FDA approved Auryxia in November 2017 to treat iron deficiency anemia in patients with chronic kidney disease who are not on dialysis.2 [ECF No. 25-5 at 2]. After the FDA's approval, CMS treated Auryxia as a covered Part D drug under the Medicare Part D Prescription Drug Program.
Almost a year after the approval of the second indication, CMS emailed Part D sponsors in September 2018 and revoked Part D coverage for the second indication, treating iron deficiency anemia
in patients not on dialysis, and advised that Part D plan sponsors would require patients to obtain prior authorization before Auryxia could be reimbursed for the first indication, treating hyperphosphatemia. In relevant part, that email provided:
on dialysis, and CMS does not consider it to be excluded from Part D for this use, Auryxia® will be added back to the September CY 2018 FRF (). Since Auryxia® may or may not meet the definition of a Part D drug depending on its use, we expect that Part D sponsors will utilize a prior authorization (PA) edit, or other process, to ensure that it is being used for a Part D covered indication. Part D sponsors may add prior authorization to the affected RXCUI on both their CY 2018 and CY 2019 formularies.
Following the CMS email, Part D sponsors terminated coverage of Auryxia for its second indication, treatment of iron deficiency
anemia, and required prior authorization for payment to ensure that Auryxia was being used for its first indication, treatment of hyperphosphatemia. [ECF No. 18 at 3]. Akebia met with a number of CMS and HHS officials in an effort to get Part D coverage reinstated. [Id. at 3–4]. On August 23, 2019, it submitted a memo to HHS' General Counsel and Deputy General Counsel, as well as to CMS' Chief Legal Officer. [Id. ]. On October 4, 2019, CMS confirmed that it would not revisit its decision regarding Auryxia's Part D coverage. [Id. at 4].
On October 15, 2019, Akebia filed its complaint in this action, alleging that CMS' decision is contrary to law and arbitrary and capricious under the Administrative Procedure Act ("APA"). [ECF No. 1]. Akebia then filed its motion for a preliminary injunction on October 29, 2019. [ECF No. 15]. The Court permitted briefing from amici Massachusetts Biotechnology Council, [ECF No. 39], the Medicare Advocacy Project of Greater Boston Legal Services, [ECF No. 43], and the Center for Medicare Advocacy, Inc., [ECF No. 51], in support of Akebia's preliminary injunction. After the Court granted a motion to extend time to file its opposition, [ECF No. 42], the Government opposed on December 3, 2019, [ECF No. 48].3
Preliminary injunctions function to "preserve the relative positions of the parties until a trial on the merits can be held." Univ. of Tex. v. Camenisch, 451 U.S. 390, 395, 101 S.Ct. 1830, 68 L.Ed.2d 175 (1981). As a result, "findings of fact and conclusions of law made by a court granting a preliminary injunction are not binding at trial on the merits." Id. (citing Indus. Bank of Wash. v. Tobriner, 405 F.2d 1321, 1324 (D.C. Cir. 1968) ). The granting of a preliminary injunction is "an ‘extraordinary and drastic remedy’ ... ‘that is never awarded as of right.’ " Voice of the Arab World, Inc. v. MDTV Med. News Now, Inc., 645 F.3d 26, 32 (1st Cir. 2011) (quoting Munaf v. Geren, 553 U.S. 674, 689–90, 128 S.Ct. 2207, 171 L.Ed.2d 1 (2008) ).
When deciding whether to grant a motion for preliminary injunction, courts must consider four factors: "(i) the movant's likelihood of success on the merits of its claims; (ii) whether and to what extent the movant will suffer irreparable harm if the injunction is withheld; (iii) the balance of hardships as between the parties; and (iv) the effect, if any, that an injunction (or the withholding of one) may have on the public interest." Corp. Techs., Inc. v. Harnett, 731 F.3d 6, 9 (1st Cir. 2013). As the moving party, Akebia bears the burden of satisfying each of these four elements. See Nieves–Marquez v. P.R., 353 F.3d 108, 120 (1st Cir. 2003).
The First Circuit has held that these four factors "are not entitled to equal weight in the decisional calculus." Corp. Techs., 731 F.3d at 9. Rather, the movant's likelihood of success on the merits "is the main bearing wall of the four-factor framework." Id. at 10. "[P]roving likelihood of success on the merits is the ‘sine qua non ’ of a preliminary injunction." Arborjet, Inc. v. Rainbow Treecare Sci. Advancements, Inc., 794 F.3d 168, 173 (1st Cir. 2015) (quoting New Comm Wireless Servs., Inc. v. SprintCom, Inc., 287 F.3d 1, 9 (1st Cir. 2002) ). Therefore, "[i]f the moving party cannot demonstrate that [it] is likely to succeed in [its] quest, the remaining factors become matters of idle curiosity." Id. (quoting New Comm Wireless Servs., 287 F.3d at 9 ).
Under 5 U.S.C. § 706, the Court shall "hold unlawful and set aside agency action, findings, and conclusions found to be ... arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law...." 5 U.S.C. § 706(2)(A).4
Akebia seeks a judgment declaring that CMS...
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