Ranbaxy Laboratories Ltd. v. U.S. Food & Drug Admin.

• Citation: 307 F.Supp.2d 15
• Decision Date: 10 March 2004
• Docket Number: No. CIV.A.04-0133 PLF.,CIV.A.04-0133 PLF.
• Parties: RANBAXY LABORATORIES LIMITED, et al., Plaintiffs, v. UNITED STATES FOOD & DRUG ADMINISTRATION, et al., Defendants, and Pfizer Inc., Defendant-Intervenor.
• Court: U.S. District Court — District of Columbia

307 F.Supp.2d 15

RANBAXY LABORATORIES LIMITED, et al., Plaintiffs, v. UNITED STATES FOOD & DRUG ADMINISTRATION, et al., Defendants, and Pfizer Inc., Defendant-Intervenor.

No. CIV.A.04-0133 PLF.

United States District Court, District of Columbia.

March 10, 2004.

OPINION

PAUL L. FRIEDMAN, District Judge.

This matter initially came before the Court on plaintiffs' motion for a preliminary injunction. At filing, plaintiffs Ranbaxy Laboratories Limited, Ranbaxy Inc. and Ranbaxy Pharmaceuticals, Inc. (collectively, "plaintiffs" or "Ranbaxy") also moved for summary judgment and to consolidate the preliminary injunction hearing with a hearing on the merits. The federal defendants, the United States Food and Drug Administration; Mark B. McClellan, M.D., Ph.D., Commissioner of the Food and Drug Administration; and Tommy G. Thompson, Secretary, United States Department of Health and Human Services (collectively, the "Federal Defendants" or "FDA") filed an opposition to the motion for a preliminary injunction and a cross-motion for summary judgment. Defendant-intervenor Pfizer Inc. ("Pfizer") also filed a cross-motion for summary judgment and an opposition to both of plaintiffs' motions.

Oral argument on the motions took place on March 4, 2004. All the parties requested that the Court expedite its decision so that an appeal may be taken promptly in light of the time-sensitive nature of the matter.

I. BACKGROUND

A. Statutory Background

Broadly, this matter concerns the process by which the FDA approves generic drugs, which is delineated in a 1984 amendment to the Federal Food, Drug and Cosmetic Act ("FDCA"), 21 U.S.C. § 301 et seq., commonly referred to as the "Hatch-Waxman Amendments." See 21 U.S.C. § 355(j). This matter also concerns a second amendment to the FDCA that provides for an additional exclusivity period for patents held by brand-name drug manufacturers that participate in pediatric studies of those patented drugs. See 21 U.S.C. § 355a. Both these statutory schemes are explained in great detail in Mova Pharmaceutical Corp. v. Shalala, 140 F.3d 1060, 1063-65 (D.C.Cir.1998), and Barr Laboratories, Inc. v. Thompson, 238 F.Supp.2d 236, 239-241 (D.D.C.2002). There is no need to recite their background again here.

B. Administrative History of this Action

On January 29, 1990, the FDA approved Pfizer's new drug application ("NDA") for fluconazole (brand name Diflucan), which is indicated for the treatment of various fungal infections, including vaginal yeast infections, oral yeast infections and cryptococcal meningitis. See Complaint ("Compl."), Ex. 1, Physicians' Desk Reference 2592 (58th ed.2004) at 3. Pfizer filed patents that claim Pfizer's approved drug product and uses, and the FDA listed these patents in the "Approved Drug Products With Therapeutic Equivalence Evaluations" listing ("Orange Book"). U.S. Patent No. 4,404,216 ("'216 Patent"), the last of the Pfizer patents at issue in this matter, expired on January 29, 2004. See Compl., Ex. 2, Orange Book Excerpt at 3.

Ranbaxy, a generic drug manufacturer, submitted to the FDA an abbreviated new drug application ("ANDA") for fluconazole (oral suspension) on December 26, 2001, and an ANDA for fluconazole (tablet) on March 27, 2002. See Compl., Ex. 3, July 11, 2003, Letter from Gary Buehler, Director, Office of Generic Drugs to Abha Pant, U.S. Agent for Ranbaxy Laboratories, Ltd. (oral suspension) ("July 11, 2003 FDA Letter"); Compl., Ex. 4, May 1, 2003, Letter from Gary Buehler, Director, Office of Generic Drugs to Abha Pant, U.S. Agent for Ranbaxy Laboratories, Ltd. (tablet) ("May 2, 2003 FDA Letter").¹ Each ANDA contained a Paragraph IV certification to the '216 Patent. Ranbaxy provided notice of the certifications to Pfizer in accordance with Section 505(j)(2)(B), and in response Pfizer filed a patent infringement suit on each ANDA within the 45-day period provided for in the statute in the United States District Court for the District of New Jersey. These filings triggered a 30-month statutory stay. The district court subsequently consolidated the two suits. During the course of the litigation the FDA tentatively approved both of Ranbaxy's ANDAs. See July 11, 2003 FDA Letter; May 2, 2003 FDA Letter.

Also during the course of the patent infringement litigation, the district court denied Pfizer's motion for summary judgment. See Administrative Record ("AR"), Ex. 30, December 26, 2003 Letter from Abha Pant to Gary J. Buehler ("December 26, 2003 FDA Letter") at 1 and attached court docket. After the summary judgment decision, however, the court indicated to Ranbaxy and Pfizer that the court's schedule would not allow for a trial until after the January 29, 2004, expiration of the '216 Patent. See December 26, 2003 FDA Letter at 2. In response, the parties entered into a stipulation of dismissal on November 14, 2003. See Compl., Ex. 9, Pfizer Inc. v. Ranbaxy Pharmaceuticals, Inc., Consolidated Civil Action No. 02-2493(GEB), Stipulation of Dismissal (D.N.J. Nov. 14, 2003). The Stipulation provided that in light of the fact that the '216 Patent was set to expire prior to the time that the court's schedule could accommodate a trial, the consolidated actions would be "dismissed as moot upon the January 29, 2004 expiration of the '216 patent with no further action of the parties, with each party to bear its own costs and attorneys' fees." Id. at 1.

Meanwhile, on December 31, 2001, the FDA had issued a written request to Pfizer for pediatric studies on fluconazole, and Pfizer submitted the requisite studies in response. On January 21, 2004, the FDA determined that Pfizer's pediatric studies adequately responded to the written request, and concluded that Pfizer was entitled to pediatric exclusivity for fluconazole under Section 505a. See AR, Ex. 32, Pediatric Exclusivity Determination Checklist (granting pediatric exclusivity). In response to the threat of a pediatric exclusivity grant to Pfizer that would preclude the final approval of Ranbaxy's ANDAs, Ranbaxy sought confirmation with the FDA by letters of June 6, 2003, August 21, 2003, and January 16, 2004, that its fluconazole ANDAs would be approved upon expiration of the '216 Patent on January 29, 2004. In each letter Ranbaxy asserted that the preconditions for delaying an ANDA on the basis of pediatric exclusivity provided for in Section 505a(c)(2)(B) (governing Paragraph IV certifications) could not be satisfied unless Pfizer obtained a ruling that the '216 Patent was valid and would be infringed, which it was unlikely to do in view of the district court's schedule. See AR, Ex. 26, June 6, 2003 Letter from Abha Pant to Gary J. Buehler; AR, Ex. 28, August 21, 2003 Letter from David G. Adams, Esq. to Daniel E. Troy, Chief Counsel Food and Drug Administration; AR, Ex. 31, January 16, 2004 Letter from Richard M. Cooper, Esq. to Daniel E. Troy.

By letter of January 28, 2004, the FDA issued an administrative decision indicating that Ranbaxy's ANDAs would not be approved until after the expiration of Pfizer's pediatric exclusivity on July 29, 2004. In the decision, the FDA concluded that "an ANDA applicant will be subject to any pediatric exclusivity that attaches to a patent where the ANDA applicant has filed a paragraph IV certification, was sued by the NDA holder or patent owner within 45 days, and the litigation is unresolved on the merits and the 30-month stay has not run when the patent expires." AR, Ex. 34, January 28, 2004 Letter from Gary J. Buehler to Richard M. Cooper ("FDA Ranbaxy Decision"). In so concluding, the FDA first determined that Ranbaxy had relied on the wrong subsection of the pediatric exclusivity statute because the generic manufacturer wrongly had assumed that its Paragraph IV certification remained in effect past the expiration of the patent. See id. at 4. Instead, the FDA decided that upon patent expiry, the Paragraph IV certification became a Paragraph II certification (irrespective of Ranbaxy's failure to amend its certification to reflect the change in each patent's status under 21 C.F.R. § 314.94(a)(12)(viii)(C)(1)) and that under a Paragraph II certification, the statute provides for a delayed ANDA approval for six months beyond expiration of the patent. See id. at 4-5.²

The FDA then opined that even if Section 505a(c)(2)(B) were the applicable subsection for the purpose of determining Pfizer's pediatric exclusivity, the subsection does not address expressly a situation in which the patent litigation is unresolved at the time of patent expiry. Assuming its duty to fill gaps left in the statute by Congress, the FDA concluded that the absence of a provision addressing unresolved patent litigations in the Paragraph IV certification context did not mean that Congress intended to exclude such circumstances from the pediatric exclusivity provision. See FDA Ranbaxy Decision at 5-6. This alternative reading, the FDA concluded, would undercut the purpose of pediatric exclusivity and invite anomalies and manipulation of the statute. See id. at 6-7.

C. Summary of the Parties' Arguments on the Merits

Ranbaxy's summary judgment argument can be summarized as follows: Ranbaxy held an ANDA with a Paragraph IV certification until midnight on January 29, 2004, at which time the '216 Patent expired and the Stipulation of Dismissal came into effect. This event lifted the 30-month stay and, at that "magic moment," the ANDAs automatically gained, or were entitled to gain, immediate effective final approval. This is so because the patent litigation became moot at the very instant the patent expired and the statutory stay terminated. Ranbaxy argues in the alternative that if the ANDAs did not obtain final approval automatically upon the dismissal of the suit and the lifting of the stay, approval should have been granted nunc pro tunc back to that date. Turning to the pediatric exclusivity issue, Ranbaxy asserts that having maintained a Paragraph IV certification up to the time of approval on ...