In re Remeron Antitrust Litigation

• Decision Date: 08 September 2004
• Docket Number: No. 03-222(FSH).,No. 03-5488(FSH).,No. 03-0085(FSH).,No. 02-2007 (FSH).,02-2007 (FSH).,03-0085(FSH).,03-222(FSH).,03-5488(FSH).
• Parties: In re REMERON ANTITRUST LITIGATION In re Remeron Direct Purchaser Antitrust Litigation Walgreen Co., et al., Plaintiffs, v. Organon, Inc. and Akzo Nobel N.V., Defendants. CVS Meridian, Inc. and Rite Aid Corp., Plaintiffs, v. Organon, Inc. and Akzo Nobel N.V., Defendants.
• Court: U.S. District Court — District of New Jersey

335 F.Supp.2d 522

In re REMERON ANTITRUST LITIGATION

In re Remeron Direct Purchaser Antitrust Litigation

Walgreen Co., et al., Plaintiffs, v. Organon, Inc. and Akzo Nobel N.V., Defendants.

CVS Meridian, Inc. and Rite Aid Corp., Plaintiffs, v. Organon, Inc. and Akzo Nobel N.V., Defendants.

No. 02-2007 (FSH).

No. 03-0085(FSH).

No. 03-222(FSH).

No. 03-5488(FSH).

United States District Court, D. New Jersey.

September 8, 2004.

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Lisa J. Rodriguez, Trujillo, Rodriguez & Richards, LLC, Haddonfield, NJ, for Plaintiffs and Defendants.

Kevin J. McKenna, Gibbons, Del Deo, Dolan, Griffinger & Vecchione, PC, Newark, NJ, for Defendants.

Michael Lieberman, Hangley Aronchick Segal & Pudlin, Philadelphia, PA, for Plaintiffs.

OPINION

HOCHBERG, District Judge.

INTRODUCTION

This matter comes before the Court upon Defendants Organon USA Inc. and Akzo Nobel N.V.'s (collectively "Organon") consolidated motion to dismiss Plaintiffs' antitrust claims pursuant to Fed.R.Civ.P. 12(b)(6). The Court has considered the written submissions of the parties pursuant to Fed.R.Civ.P. 78.

BACKGROUND

Organon manufactures the antidepressant drug mirtazapine, commercially marketed as Remeron, which was originally claimed in its now-expired United States Patent No. 4,062,848 (the" '848 patent"). Adding its patent and regulatory exclusivities, Organon's exclusive right to manufacture and sell mirtazapine expired on June 14, 2001.

On November 2, 1999, Organon was granted United States Patent No. 5,977,099 (the "'099 patent") for a method of treating depression using a combination of mirtazapine and a selective serotonin reuptake inhibitor ("SSRI"). In January 2001, fourteen months after being granted the '099 patent, Organon submitted the '099 patent to the United States Food and Drug Administration (the "FDA") for listing in the APPROVED DRUG PRODUCTS WITH THERAPEUTIC EQUIVALENCE EVALUATIONS (the "Orange Book").¹

Beginning in February 2001, several generic drug manufacturers (the "Generics") filed Abbreviated New Drug Applications ("ANDAs") with the FDA, seeking approval for their generic version of mirtazapine. The Generics each filed a certification, under 21 U.S.C. § 355(j)(2)(A)(vii)(IV) (the "Paragraph IV Certifications"), which stated that the '099 patent was invalid or would not be infringed by their generic version of mirtazapine.

Subsequently, Organon sued the Generics for inducement to infringe the '099 patent. Because Organon sued each of the Generics within forty-five days of receipt of the Paragraph IV Certifications, FDA approval of the generic ANDAs was automatically stayed by operation of the Hatch-Waxman Act and would remain stayed until the earlier of thirty months or a judicial determination that the '099 patent was invalid or not infringed. See 21 U.S.C. § 355(j)(5)(B)(iii). On December 18, 2002, this Court ruled that the Generics' sale of mirtazapine did not induce infringement of the '099 patent. See Organon Inc. v. Teva Pharms., Inc., 244 F.Supp.2d 370 (D.N.J.2002) ("Organon I").

The Generics filed counterclaims against Organon for antitrust violations under the Sherman Act. Organon Inc. v. Mylan Pharms., Inc., 293 F.Supp.2d 453 (D.N.J.2003) ("Organon II"). These claims include: 1) improperly listing the '099 patent in the Orange Book; and 2) baselessly initiating patent infringement actions against the Generics.² On December 3, 2003, this Court granted Organon's motion to dismiss the Generics' antitrust claims based on the grounds that: 1) the language of 21 U.S.C. §§ 355(b)(1), (c)(2) and 21 C.F.R. § 314.53(b) "gave Organon a reasonable basis for listing in the Orange Book"; and 2) Organon had an objective basis to believe it could assert a claim of patent infringement with a reasonable calculation of a favorable outcome.³ Organon II, 293 F.Supp.2d at 459, 461. This Court made clear, however, that it had not ruled on whether a late listing claim could survive a motion to dismiss. In April of 2004, the Generics settled their counterclaims against Organon.

In the instant action, Plaintiffs, the direct purchasers of mirtazapine, filed amended antitrust complaints against Organon alleging "an overall scheme" to monopolize the relevant market, claiming that when taken together, the allegations against Organon constitute an antitrust violation, even if the individual allegations are found to not violate antitrust laws. Their complaints alleged also that: 1) Organon obtained the '099 patent through fraud on the PTO; 2) Organon improperly listed the '099 patent in the Orange Book; 3) Organon baselessly initiated patent infringement actions in Organon I;⁴ and 4) Organon improperly delayed listing the '099 patent in the Orange Book for the purpose of extending their monopoly on the mirtazapine market.⁵ This fourth claim is premised on the allegation that, had Organon listed the '099 patent within 30 days after its issuance (December 2, 1999) as is required by FDA rules, the Generics could have filed Paragraph IV certifications as early as June 15, 2000. Because the '099 patent was not listed in the Orange Book until February 1, 2001, however, the first ANDAs for generic mirtazapine were not filed until February 28, 2001, and the Hatch-Waxman contesting process was delayed. As a result, Organon gained an extended period of market exclusivity. This "late listing" claim is among Plaintiffs' antitrust allegations in the instant case.

STANDARD

A. Motion to Dismiss

A motion to dismiss under Fed.R.Civ.P. 12(b)(6) should be granted "if it appears to a certainty that no relief could be granted under any set of facts which could be proved." Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir.1997). While a court need not credit a complaint's "bald assertions" or "legal conclusions," it is required to accept as true all of the allegations in the complaint and all reasonable inferences that can be drawn therefrom, and view them in the light most favorable to the plaintiff. Id. (citing Rocks v. City of Philadelphia, 868 F.2d 644, 645 (3d Cir.1989)); In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1429-30 (3d Cir.1997).

B. Antitrust Claims

The Supreme Court has dictated that an antitrust injury is a type of injury the antitrust laws were intended to prevent and also one that is a result of a defendant's unlawful conduct. Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489, 97 S.Ct. 690, 50 L.Ed.2d 701 (1977). The purpose of the Sherman Act is "to protect the public from the failure of the market." 15 U.S.C.A. § 2 n. 4, quoting Spectrum Sports, Inc. v. McQuillan, 506 U.S. 447, 113 S.Ct. 884, 892, 122 L.Ed.2d 247 (1993).

The offense of monopolization under Section 2 of the Sherman Act has two elements: 1) the possession of monopoly power in the relevant market; and 2) the willful acquisition or maintenance of that power, as distinguished from growth or development as a consequence of a superior product, business acumen or historic accident. United States v. Grinnell Corp., 384 U.S. 563, 570-71, 86 S.Ct. 1698, 16 L.Ed.2d 778 (1966). A specific intent to monopolize is not required for a court to find a Section 2 violation. The "completed offense of monopolization ... demands only a general intent to do the act, for `no monopolist monopolizes unconscious of what he is doing.'" Times-Picayune Publ'g Co. v. United States, 345 U.S. 594, 626, 73 S.Ct. 872, 97 L.Ed. 1277 (1953) (distinguishing monopolization claim from "attempted monopolization" claim which requires showing of specific intent to destroy competition).

DISCUSSION

A. "Overall Scheme" Claim

The Direct Purchasers contend that Organon undertook an overarching scheme to delay generic competition for mirtazapine and that the actions of an alleged monopolist must be viewed in their totality, not in isolation. Organon counters that because none of its actions individually was illegal, taken together they cannot constitute an "overall scheme" to hinder competition, citing Intergraph Corp. v. Intel Corp., 195 F.3d 1346 (Fed.Cir.1999), in which the court declined to view a series of activities "together" and found that since each legal theory upon which antitrust claims were based was insufficient, they could not add up to anti-competitive behavior as a whole. Id. at 1366-67.

The Intergraph court, however, held that a group of factual allegations may be viewed in their totality, even while pieces of legal theory may not be added up and taken as a whole. Id. (citing Cont'l Ore Co. v. Union Carbide & Carbon Corp., 370 U.S. 690, 699, 82 S.Ct. 1404, 8 L.Ed.2d 777 (1962) (holding that the factual components of a case should be viewed together)); see also LePage's Inc. v. 3M, 324 F.3d 141, 162 (3d Cir.2003) (declaring that "the relevant inquiry is the anti-competitive effect of [the defendant's] exclusionary practices considered together," and that "courts must look to the monopolist's conduct taken as a whole rather than considering each aspect in isolation."). Further clarifying what may constitute an "overall scheme" claim, the court in Intergaph explicitly rejected "the notion that if there is a fraction of validity to each of the basic claims and the sum of the fractions is one or more, the plaintiffs have proved a violation of section 1 or section 2 of the Sherman Act." Intergraph Corp., 195 F.3d at 1367 (quoting City of Groton v. Connecticut Light & Power Co., 662 F.2d 921, 928-29 (2d Cir.1981)). Because the "overall scheme" claim rests upon determinations that flow from factual allegations, this Court shall reserve judgment on this issue at this stage of the litigation. See Morse, 132 F.3d at 906.

B. Walker Process Fraud Claim

Fraudulent procurement of a patent or the enforcement of a patent obtained by fraud may provide the basis for Sherman Act Section 2 liability if the other elements of a Sherman Act claim are present. Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172, 177,...