In re Ranbaxy Generic Drug Application Antitrust Litig., MDL 19-md-02878-NMG

CourtUnited States District Courts. 1st Circuit. United States District Courts. 1st Circuit. District of Massachusetts
PartiesIn re Ranbaxy Generic Drug Application Antitrust Litigation, Cross-Motions for Summary
Decision Date22 November 2021
Docket NumberMDL 19-md-02878-NMG

In re Ranbaxy Generic Drug Application Antitrust Litigation, Cross-Motions for Summary

MDL No. 19-md-02878-NMG

United States District Court, D. Massachusetts

November 22, 2021



This multi-district litigation involves five actions which were centralized in this Court and divided into two classes against Ranbaxy Inc. and Sun Pharmaceutical Industries Limited (collectively, “Ranbaxy” or “defendants”) for allegedly causing the delayed market entry of three generic drugs.

The two plaintiff classes are composed of direct purchaser plaintiffs (“DPPs”) and end-payor plaintiffs (“EPPs”). DPPs, such as wholesalers and distributors, purchase generic drugs directly from drug manufacturers. EPPs are third-party payors, such as health plans and insurance companies, that indirectly purchase and/or provide reimbursement for generic drugs at the end of the distribution chain from retailers and other intermediaries. The DPPs and EPPs (collectively, “plaintiffs”)


bring claims against Ranbaxy for violations of federal and state antitrust law, the federal Racketeer Influenced and Corrupt Organizations Act (“RICO”) and state consumer protection statutes.

Pending before the Court are cross motions for summary judgment under Federal Rule of Civil Procedure 56. For the reasons that follow, both the defendants' and plaintiffs' motions will be denied.

I. Background

A. Factual Background

Both the Court and the parties are well acquainted with the facts, which are described in detail in the Report and Recommendation of United States Magistrate Judge M. Page Kelley on Ranbaxy's motion to dismiss the complaint of the plaintiffs in the original action in this Court prior to centralization. See Meijer, Inc. v. Ranbaxy, Inc., No.1:15-cv-11828-NMG (D. Mass. Sept. 7, 2016). For purposes of completeness, however, the Court provides the following abbreviated summary of the background relevant to the pending motions.

In the early 2000s, Ranbaxy filed a series of applications with the United States Food and Drug Administration (“FDA”) seeking approval to manufacture and market generic versions of various pharmaceuticals. Under the Hatch-Waxman Act, Pub. L.


No. 98-417, 98 Stat. 1585 (1984), the first generic drug manufacturer to submit a substantially complete Abbreviated New Drug Application (“ANDA”) is entitled to a 180-day period of exclusivity during which no other manufacturer is permitted to market a generic version of the subject drug. The FDA may, however, revoke the exclusivity period if the generic manufacturer fails to obtain tentative approval from the FDA within 30 months of submission, among other reasons. Tentative approval, which requires the manufacturer to demonstrate that its facilities comply with current good manufacturing practices, effectively means that the ANDA meets all the substantive requirements for final approval, but the FDA is barred from formally approving the application due to preexisting patents.

In 2004 and 2005, Ranbaxy submitted the first substantially complete ANDAs for the three brand drugs at issue here: Diovan, Nexium and Valcyte. Ranbaxy subsequently obtained tentative approval for each of those drugs in 2007 and 2008. Despite its early success, Ranbaxy failed to secure final approval for its generic version of Diovan until June, 2014 and did not bring that generic to market until July, 2014. Before defendants could secure final approval for its generic Nexium and Valcyte ANDAs, the FDA revoked its tentative approval for both drugs. Ranbaxy's generic versions of these two drugs were never brought to market.


Plaintiffs allege that Ranbaxy violated RICO, federal and state antitrust laws and state consumer protection laws by submitting multiple ANDAs with missing, incorrect or fraudulent information, thereby wrongfully acquiring exclusivity periods and delaying the market entry of generic Diovan, Nexium and Valcyte. Plaintiffs assert that but for defendants' allegedly anti-competitive conduct, generic versions of those three drugs would have entered the market and been available at lower prices much sooner. As a result, plaintiffs contend they paid artificially inflated prices for Diovan, Nexium and Valcyte during the Class Periods.

B. Relevant Procedural History

The five actions comprising this multidistrict litigation were centralized in this Court in February, 2019. In April, 2019, the Court consolidated for pretrial purposes all direct purchaser actions and all end-payor actions that were centralized in this District and assigned to this Court, thereby creating two putative class actions. Amended complaints were filed by the DPPs and EPPs later that month. The EPPs further amended their complaint in February, 2020 and March, 2021. The DPPs also amended their complaint in March, 2021. After oral argument, this Court certified two sets of classes, one for DPPs and EPPs, in May, 2021. Each set is composed of three


nationwide classes, one for each of the pharmaceuticals at issue.

Shortly thereafter, the parties filed cross motions for summary judgment. Parties have submitted oppositions to these motions, which have, in turn, engendered sur-replies. This Court heard oral argument on the motions in October, 2021.

II. Legal Standard

The role of summary judgment is “to pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial.” Mesnick v. Gen. Elec. Co., 950 F.2d 816, 822 (1st Cir. 1991) (quoting Garside v. Osco Drug, Inc., 895 F.2d 46, 50 (1st Cir. 1990)). The burden is on the moving party to show, through the pleadings, discovery and affidavits, “that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a).

A fact is material if it “might affect the outcome of the suit under the governing law....” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A genuine issue of material fact exists where the evidence with respect to the material fact in dispute “is such that a reasonable jury could return a verdict for the nonmoving party.” Id.


If the moving party satisfies its burden, the burden shifts to the nonmoving party to set forth specific facts showing that there is a genuine, triable issue. Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). The Court must view the entire record in the light most favorable to the non-moving party and make all reasonable inferences in that party's favor. O'Connor v. Steeves, 994 F.2d 905, 907 (1st Cir. 1993). Summary judgment is appropriate if, after viewing the record in the non-moving party's favor, the Court determines that no genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law. Celotex Corp., 477 U.S. at 322-23.

III. Analysis

A. Ranbaxy's Motion for Summary Judgment

Defendants contend that summary judgment is appropriate for a variety of reasons and, in the alternative, partial summary judgment on damages is required.

1. FDCA Preclusion

This Court has previously rejected Ranbaxy's contention that the authority to enforce violations of the Federal Food, Drug, and Cosmetic Act (“FDCA”) belongs exclusively to the FDA, recognizing that the issue is one of first impression in this Circuit. While Ranbaxy yet again asserts the relevance of Buckman v. Plaintiffs' Legal Committee, 531 U.S. 341 (2001),


defendants have failed to provide any persuasive reason for the Court to reexamine its prior analysis, which concluded that the Buckman decision did not directly resolve the matter. See Arizona v. California, 460 U.S. 605, 618, supplemented by 466 U.S. 144 (1984) (“[W]hen a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case.”). Neither party cites new case law addressing FDCA preclusion of federal antitrust claims involving fraud on the FDA and the Court has found none. See Naser Jewelers, Inc. v. City of Concord, N.H., 538 F.3d 17, 20 (1st Cir. 2008) (“Narrow exceptions to the doctrine exist if the initial ruling was made on an inadequate record or was designed to be preliminary; if there has been a material change in controlling law; if there is newly discovered evidence bearing on the question; and if it is appropriate to avoid manifest injustice.” (citations omitted)).

Accordingly, the Court relies upon its prior reasoning and finds the plaintiffs' claims are not precluded by the FDCA.

2. RICO Predicate Offenses

Citing the recent decision in Kelly v. United States, 140 S.Ct. 1565 (2020), Ranbaxy urges this Court to reconsider its determination that the plaintiffs have provided evidence sufficient to allege the predicate offenses of mail and/or wire


fraud under RICO. As the Court has previously articulated, mail and wire fraud require proof of: (1) a scheme or artifice to defraud, (2) knowing and willing participation in that scheme with the specific intent to defraud, and (3) the use of interstate mail or wire communications in furtherance of the scheme. Sanchez v. Triple-S Mgmt., Corp., 492 F.3d 1, 9-10 (1st Cir. 2007). Both statutes are “limited in scope to the protection of property rights.” Cleveland v. United States, 531 U.S. 12, 18 (2000) (citation omitted). In other words, the thing obtained by fraud must be “property in the hands of the victim.” Id. at 15. Defendants allege that plaintiffs have provided no cognizable property upon which to ground their RICO claims. Defendants seek to draw a distinction between Ranbaxy's regulatory interests and property rights.

The Court has already rejected this reasoning. In its order on defendants' motion to dismiss, the Court found the plaintiffs had sufficiently pled a predicate offense under RICO by asserting that Ranbaxy's fraud affected the interests of individuals and...

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