Hill Dermaceuticals, Inc. v. U.S. Food & Drug Admin., Civil Action No. 11-1950 (RCL)

Decision Date18 May 2012
Docket NumberCivil Action No. 11-1950 (RCL)
PartiesHILL DERMACEUTICALS, INC., Plaintiff, v. U.S. FOOD AND DRUG ADMINISTRATION, et al., Defendants, and AMNEAL PHARMACEUTICALS, LLC, Intervenor-Defendant.
CourtUnited States District Courts. United States District Court (Columbia)
ORDER

In accordance with the Court's Order of May 8, 2012, the Court hereby files on the public record a redacted copy (with the redactions proposed by the government) of the Court's May 8, 2012 Memorandum Opinion.

SO ORDERED.

Signed by Royce C. Lamberth, Chief Judge, on May 18, 2012.

MEMORANDUM OPINION

Plaintiff Hill Dermaceuticals, Inc. ("Hill") has brought this action against the U.S. Food and Drug Administration ("FDA"); the U.S. Department of Health and Human Services ("HHS"); Kathleen Sebelius, in her official capacity as Secretary of HHS; and Margaret Hamburg, M.D., in her official capacity of Commissioner of FDA. Amneal Pharmaceuticals, LLC ("Amneal") has intervened as a defendant. Hill manufactures fluocinolone acetonide topical oil products under the brand names Derma-Smoothe/FS (Body Oil and Scalp Oil) and Derm-Otic Oil Ear Drops. On October 17, 2011, the FDA approved requests by Identi Pharms, Inc. ("Identi") to market purported generic versions of these fluocinolone acetonide products. Hill moves for summary judgment, requesting that the Court enter a declaratory judgment that FDA's approval of Identi's three abbreviated new drug applications ("ANDAs") constitutes arbitrary and capricious agency action in violation of the Administrative Procedure Act, 5 U.S.C. § 706. Hill also requests that the Court enter a permanent injunction requiring FDA to withdraw or suspend its approval of Identi's ANDAs to prevent the marketing and distribution of Identi'sproducts. Federal defendants have filed a Motion to dismiss and intervenor defendant has filed a Cross-Motion for summary judgment, requesting that the Court uphold the FDA's approval of Identi's ANDAs.

Upon consideration of plaintiff's Motion [59] for summary judgment, Federal defendants' opposition and Motion [71, 78] to dismiss, intervenor defendant's opposition and Cross-Motion [68] for summary judgment, plaintiff's reply and response [80], Federal defendants' reply [87], intervenor defendant's reply [82], the administrative record, the applicable law, and the entire record in this case, the Court will DENY plaintiff's Motion [59] for summary judgment and GRANT defendants' Motions [68, 71, 78] for summary judgment.1 Upon consideration of plaintiff's Motion [89] for leave to file two supplemental declarations, Federal defendants' opposition [90], plaintiff's reply [92] thereto, intervenor defendant's opposition [93], plaintiff's reply [95] thereto, the applicable law, and the entire record in this case, the Court will DENY plaintiff's Motion [89] for leave to file. The Court will explain its reasoning in the analysis that follows.

I. BACKGROUND
A. Statutory and Regulatory Framework
1. New Drug Applications and Abbreviated New Drug Applications

Under the Federal Food, Drug, and Cosmetic Act ("FDCA"), 21 U.S.C. § 301 et seq., pharmaceutical companies seeking to market "pioneer" or "innovator" drugs must first obtain FDA approval by filing a new drug application ("NDA"). 21 U.S.C. §§ 335(a), (b). The NDA must contain extensive scientific data and other information, including investigative reportsdemonstrating the drug's safety and effectiveness, a statement of the drug's components, and specimens of proposed labeling for the packaging of the drug. 21 U.S.C. § 335(b)(1).

The Drug Price Competition and Patent Term Restoration Act of 1984 ("Hatch-Waxman Amendments"), codified at 21 U.S.C. § 355 and 35 U.S.C. §§ 156, 271, and 282, permits the submission of abbreviated new drug applications ("ANDAs") for approval of generic versions of drug products with approved NDAs. 21 U.S.C. § 355(j). The Hatch-Waxman Amendments were intended to balance the encouragement of innovation in drug development with the acceleration of the availability of lower cost generic alternatives to innovator drugs. See H.R. Rep. No, 98-857 (Part I), 98th Cong., 2d Sess. at 14-15 (1984), reprinted in 1984 U.S.C.C.A.N. 2547-48; see also Tri-Bio Labs., Inc. v. United States, 836 F.2d 135, 139 (3d Cir. 1987).

2. ANDA Approval Requirements

To obtain approval, ANDA applicants are not required to submit clinical evidence to establish the safety and effectiveness of the generic drug product. Rather, an ANDA references an approved drug—the reference listed drug ("RLD")—and relies on FDA's previous finding that the RLD is safe and effective. Additionally, an ANDA applicant must provide sufficient information to show that the generic drug product has the same active ingredient or ingredients, dosage form, route of administration, and strength as the RLD. 21 U.S.C. § 355(j)(2)(A)(ii), (iii). An ANDA applicant must also demonstrate that its product is bioequivalent to the RLD and has the same labeling as the RLD. 21 U.S.C. §§ 355(j)(2)(A)(iv), (v). The agency must approve an ANDA unless it finds, among other things, that the ANDA has not provided sufficient evidence of the foregoing. 21 U.S.C. § 355(j)(4).

The FDCA requires that an ANDA contain "information to show that the labeling proposed for the new [generic] drug is the same as the labeling approved for the listed drug . . .except for changes required because of differences approved under a petition filed under [21 U.S.C. § 355(j)(2)(C)] or because the new drug and the listed drug are produced or distributed by different manufacturers." 21 U.S.C. § 355(j)(2)(A)(v). Permissible labeling differences include "differences in expiration date, formulation, bioavailability, . . . [or] labeling revisions made to comply with current FDA labeling guidelines or other guidance." 21 C.F.R. § 314.94(a)(8)(iv).

The FDCA also requires an ANDA to include information showing that the generic drug product is bioequivalent to the pioneer drug product. 21 U.S.C. §§ 355(j)(2)(A)(iv), (j)(4)(F); 21 C.F.R. §§ 314.127(a)(6)(i), 314.94(a)(7). A drug is considered to be bioequivalent if "the rate and extent of absorption of the drug do not show a significant difference from the rate and extent of absorption of the listed drug." 21 U.S.C. § 355(j)(8)(B)(i). FDA regulations further define bioequivalence as "the absence of a significant difference in the rate and extent to which the active ingredient or active moiety in pharmaceutical equivalents or pharmaceutical alternatives becomes available at the site of drug action when administered at the same molar dose under similar conditions in an appropriately designed study." 21 C.F.R. § 320.1(e). For certain generic drug products, the bioequivalence of the generic may be self-evident. In such cases, the FDA will grant a bioequivalence waiver (or "biowaiver")—that is, the FDA will not require the submission of evidence obtained in vivo demonstrating the bioequivalence of these drug products. A generic drug product's bioequivalence "may be considered self-evident based on other data in the application," and thus FDA will grant a biowaiver, if the drug product: (1) is "an ophthalmic or otic solution"; and (2) "contains the same active and inactive ingredients in the same concentration as a drug product that is the subject of an approved full new drug application or abbreviated new drug application." 21 C.F.R. § 320.22(b)(1)(i)-(ii). Alternatively, FDA will grant a biowaiver if the generic drug product: (1) "is a solution for application to the skin"; (2)"contains an active drug ingredient in the same concentration and dosage form as a drug product that is the subject of an approved full new drug application or abbreviated new drug application"; and (3) "contains no inactive ingredient or other change in formulation from the drug product . . . that may significantly affect absorption of the active drug ingredient." 21 C.F.R. § 320.22(b)(3)(i)-(iii).

B. Factual Background
1. Hill's Fluocinolone Acetonoide Products

FDA first approved Hill's new drug application ("NDA") for Derma-Smoothe (fluocinolone acetonide 0.01% topical oil) on February 3, 1988. See FDA895; FDA646. Hill's NDA includes Body Oil, Scalp Oil, and Oil Ear Drops, even though they are separate products. FDA646. Derma-Smoothe Body Oil is indicated to topically treat atopic dermatitis for adult patients and some pediatric patients with moderate to severe atopic dermatitis. Id. Derma-Smoothe Scalp Oil is indicated to treat scalp psoriasis on adult patients. Id. DermOtic Oil Ear Drops are indicated to treat chronic eczematous external otitis in adults and pediatric patients two years of age and older. FDA1238. These products are intended for local, topical use and are not intended to be systemically absorbed. FDA646. FDA has designated Derma-Smoothe as the RLDs for generic fluocinolone acetonide topical oil products.

Hill's Derma-Smoothe products include peanut oil that has been refined in accordance with the United States Pharmacopeia-National Formulary ("USP-NF") standard. FDA668. When Hill submitted a supplement to its NDA in 1998, FDA asked Hill to improve its testing of the Derma-Smoothe product because the then-current USP-NF monograph for peanut oil did not include enough information to ensure that the peanut oil would be sufficiently free of peanut protein. Id. FDA requested, and Hill provided, a representation that its peanut oil had beenheated to 475°F (250°C) for fifteen minutes. Id. Hill amended its NDA to state that Hill would use only peanut oil that had been heat-treated as described, and that Hill tested each lot of peanut oil for residual proteins. Id. Hill initially conducted this test using a "sandwich" enzyme-linked immunosorbent assay (S-ELISA) method, which Hill claimed to be capable of detecting peanut protein at a level as low as 2.5 parts per million (ppm). Id. Hill used a non-proprietary, commercially available S-ELISA test to detect residual peanut proteins. FDA920; FDA925. FDA approved Hill's NDA...

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