Organon, Inc. v. Teva Pharmaceuticals, Inc.

• Decision Date: 18 December 2002
• Docket Number: Civil Action No. 01-3835.,Civil Action No. 01-2682.,Civil Action No. 01-2171.
• Citation: 244 F.Supp.2d 370
• Parties: ORGANON INC. and Akzo Nobel N.V., Plaintiffs, v. TEVA PHARMACEUTICALS, INC., Defendant. Organon Inc. and Akzo Nobel N.V., Plaintiffs, v. Mylan Pharmaceuticals, Inc., Defendant.
• Court: U.S. District Court — District of New Jersey

244 F.Supp.2d 370

ORGANON INC. and Akzo Nobel N.V., Plaintiffs, v. TEVA PHARMACEUTICALS, INC., Defendant.

Organon Inc. and Akzo Nobel N.V., Plaintiffs, v. Mylan Pharmaceuticals, Inc., Defendant.

Civil Action No. 01-2682.

Civil Action No. 01-2171.

Civil Action No. 01-3835.

United States District Court, D. New Jersey.

December 18, 2002.

OPINION

HOCHBERG, District Judge.

This matter comes before the Court upon a Motion for Summary Judgment filed jointly by defendant Mylan Pharmaceuticals, Inc. ("Mylan") and defendant Teva Pharmaceuticals, Inc. ("Teva") (jointly "Defendants"), for judgment as a matter of law in favor of Defendants on plaintiff Organon Inc.'s ("Organon") and plaintiff Akzo Nobel N.V.'s ("Akzo") ("Plaintiffs") complaint for patent infringement.

The issue posed by the instant motion, at its core, concerns the clash of equally valid and important legal rights: the rights of pioneer pharmaceutical patent owners to enjoy the exclusivity granted by patent law in return for their significant and costly innovations in the advancement of science, and the rights of generic drug manufacturers to enter the market and compete to sell generic equivalents of patented drugs after the patents have expired.¹ In this case, the clash comes before this Court because, shortly before expiration of Plaintiffs' patent on Remeron (known generically as mirtazapine), Plaintiffs patented a new combineduse therapy of Remeron with a selective seratonin reuptake inhibitor ("SSRI").² Defendants, meanwhile, had already begun developing generic mirtazapine upon the expiration of the Remeron patent.

It is undisputed that it would be perfectly legal for Defendants to sell mirtazapine if its ultimate use was prescribed by doctors (and filled by pharmacies) as a single drug therapy. It also is undisputed that a doctor who prescribed a combined therapy of generic mirtazapine and an SSRI would infringe Plaintiffs' patent rights. Plaintiffs assert that the actions of Defendants in selling generic mirtazapine to pharmacies will result in the inability to protect their patent for the combined-use therapy because Plaintiffs will be unable to police a prescription written by a doctor and filled by a pharmacy for combined-use therapy using the generic drug. Thus, Plaintiffs argue, notwithstanding that the great majority of prescriptions are for the use of mirtazapine either alone or combined with drugs other than SSRIs, which can lawfully be filled with the generic drug, Defendants Mylan and Teva cannot sell generic mirtazapine because doctors will also unlawfully prescribe the generic drug for combined-use therapy and pharmacists will fill those prescriptions. Where it is impracticable to police the line between the lawful and unlawful prescribing of generic mirtazapine by medical and pharmaceutical professionals, and Mylan and Teva know that some doctors will likely commit patent infringement, Plaintiffs argue, Defendants should be barred from all sales of the generic drug on the ground that such sales constitute inducement of patent infringement.

Defendants argue that they are merely selling a generic drug whose patent has expired; that they do not promote the generic for combined-use therapy; and that they take no steps to induce doctors or pharmacies to infringe Plaintiffs' combined-use patent. Thus, Defendants assert, it is not proper to bar them access to the vast lawful market for other uses of mirtazapine simply because some doctors and pharmacists may infringe Plaintiffs' patent rights. In sum, Defendants argue, the mere act of selling a bulk quantity of generic mirtazapine to pharmacies cannot constitute inducement to infringe without some other act encouraging doctors to infringe.

On December 3, 2001, this Court denied Mylan's and Teva's respective motions to dismiss, as premature, and ordered "that the parties proceed with focused discovery on the issue of whether Defendant knowingly took active steps to induce others to infringe Plaintiffs' patent." At the conclusion of this phase of discovery, Mylan and Teva³ were permitted to file motions for summary judgment solely as to this claim, which, if dispositive, would render it unnecessary to reach the remaining claims.

I. BACKGROUND

This lawsuit is brought by Organon and Akzo pursuant to 35 U.S.C. § 271(e)(2), a provision of the Hatch-Waxman Act, which regulates the process to be used by the Food and Drug Administration ("FDA") in approving new and generic pharmaceutical drugs. The Supreme Court has bemoaned the Hatch-Waxman Act's inelegant draftsmanship, Eli Lilly & Co. v. Medtronic, Inc., 496 U.S. 661, 679, 110 S.Ct. 2683,110 L.Ed.2d 605 (1990), and it has taken years for courts to interpret its numerous statutory provisions. The stage was set for this action immediately upon the filing by Mylan and Teva of an Abbreviated New Drug Application ("ANDA") to produce generic mirtazapine, filed upon the expiration of Organon's patent for the drug, known by its trade name Remeron. About 18 months after the expiration of Organon's mirtazapine patent, and about 18 months before its extended exclusive marketing period expired, Organon obtained a patent for the combined drug therapy of mirtazapine administered jointly with an SSRI. Organon contends that the sale of generic mirtazapine will infringe this new patent for combined-use therapy.

A. The Hatch-Waxman Act and Applications for New and Generic Drugs

In enacting the Drug Price Competition and Patent Term Restoration Act of 1984 Pub.L. 98-117, 98 Stat. 1585, better known as the Hatch-Waxman Act, Congress responded to the problem of long delays in bringing generic drugs to consumers after patents had expired. In an effort to benefit consumers and generic drug makers, without discouraging the development of new drugs by pioneering pharmaceutical companies, a compromise was struck. See Glaxo, Inc. v. Novopharm, Ltd., 110 F.3d 1562, 1568 (Fed.Cir.1997). "The Hatch-Waxman Act, inter alia, allows makers of generic drugs to market generic versions of patented drugs as soon as possible after expiration of the relevant patents, while providing patent holders with limited extensions of patent terms in order to recover a portion of the market exclusivity lost during the lengthy process of development and FDA review." Id.⁴

Before a pioneer pharmaceutical developer may market a new drug, it must obtain FDA approval. 21 U.S.C. § 355(a). This requires submission of a New Drug Application ("NDA"), which must detail the composition of the drug and the research done to test the drug's efficacy and safety. 21 U.S.C. § 355(b)(1). Because this application process is very long and expensive, the applicant for an approved NDA is granted an automatic five-year period of exclusivity to market that drug. 21 U.S.C. § 355(c)(3)(D)(ii). This is separate from any patent that the pioneer drug maker may already have, and runs concurrently. Thus, if a patent holder obtains FDA approval near the end of its patent term, it may extend the period of exclusivity by up to five years. This compensates the pioneer drug maker for the time spent doing the required testing for safety and efficacy, which in many cases takes up much of the patent term.

Although generic drug manufacturers must wait out the exclusive period granted to the pioneers, the process Hatch-Waxman created for them to obtain FDA approval thereafter is far less arduous. They file an ANDA, 21 U.S.C. § 355(j), which piggybacks on the pioneer's research by stating that the compound is the bioequivalent of the previously FDA-approved drug. 21 U.S.C. § 355(j)(4)(F); see also Eli Lilly, 496 U.S. at 675, 110 S.Ct. 2683 ("The ANDA applicant can substitute bioequivalence data for the extensive animal and human studies of safety and effectiveness that must accompany a full new drug application."). Bioequivalence refers to the extent and rate of the body's absorption of the active ingredient. 21 U.S.C. § 355(j)(8)(A). Prior to the enactment of the Hatch-Waxman Act, even uses of the patented drug solely to conduct the research in preparation for an FDA application were deemed infringements. Roche Prod., Inc. v. Polar Pharm. Co., 733 F.2d 858 (Fed.Cir.1984). Since the passage of Hatch-Waxman, generic drag manufacturers now may use patented drugs in any way that is necessary to the development of their generic version and the preparation of an ANDA. 35 U.S.C. § 271(e)(1) ("It shall not be an act of infringement to make, use, offer to sell, or sell within the United States or import into the United States a patented invention . . . solely for uses reasonably related to the development and submission of [an ANDA].") (overruling Roche).

However, in order to protect the patent holders, a generic manufacturer who has benefitted from section 271(e)(1) must, if there is any unexpired patent on the drug identified in the ANDA, include a certification (known as a "Paragraph IV certification") stating either that the patent is invalid or that it will not be infringed by the sale of his product.⁵ 21 U.S.C. § 355(j)(2)(A)(vii)(IV) (the ANDA shall contain a certification "that such patent is invalid or will not be infringed by the manufacture, use, or sale of the new drug for which the application is submitted").⁶ If the generic manufacturer files a paragraph IV certification, it must notify the patent-holder, 21 U.S.C. § 355(j)(2)(B)(i)(I), who then has forty-five days to initiate an action for infringement under 35 U.S.C. § 271(e)(2). 21 U.S.C. § 355(j)(5)(B)(iii). In order to allow courts to determine in advance whether the sale of a generic will infringe the patent listed in the Orange Book, § 271(e)(2) makes the filing of a paragraph IV certification automatically "an act of infringement." This allows courts to peer into the future at the likelihood of infringement once the generic is on the market, without a ripeness deficiency.

The § 271(e)(2) "infringement" is a "highly" artificial construct to create...