Ranbaxy Laboratories, Ltd. v. Leavitt

Citation459 F.Supp.2d 1
Decision Date01 May 2006
Docket NumberCivil Action No. 05-1838 (RWR).
PartiesRANBAXY LABORATORIES, LTD., et al., Plaintiffs, v. Michael O. LEAVITT, et al., Defendants.
CourtU.S. District Court — District of Columbia

Kate Cumming Beardsley, Carmen Mercedes Shepard, Buc & Beardsley, Douglas B. Farquhar, John Robert Fleder, Hyman, Phelps & McNamara, P.C., Washington, DC, Jay B. Shapiro, Samuel O. Patmore, Stearns Weaver Miller Weissler Alhadeff & Sitterson, P:A., Miami, FL, for Plaintiffs.

Drake S. Cutini, Department of Justice Office of Consumer Litigation, Washington, DC, for Defendants.

MEMORANDUM OPINION

ROBERTS, District Judge.

Ranbaxy Laboratories Limited1 ("Ranbaxy") and IVAX Pharmaceuticals, Inc. ("IVAX") each sued the Food and Drug Administration ("FDA") under 5 U.S.C. § 706 claiming that the FDA improperly nullified Ranbaxy and IVAX's rights to a 180-day period of exclusive marketing of a generic drug. Ranbaxy and IVAX moved for summary judgment against the FDA seeking to vacate the FDA's decision. The FDA filed a cross-motion for summary judgment. Because the FDA failed to give full effect to the unambiguous intent of Congress, Ranbaxy and IVAX's motions for summary judgment will be granted, and the FDA's cross-motion for summary judgment will be denied.

BACKGROUND
I. FDA STATUTORY AND REGULTORY SCHEME
A. FDA drug approval process and the Hatch-Waxman Amendments

The FDA regulates all drugs under the Federal Food, Drug, and Cosmetic Act ("FDCA"), 21 U.S.C. § 301 et seq. (2000). In 1984, Congress amended the FDCA in passing the Drug Price Competition and Patent Term Restoration Act, known as the Hatch-Waxman Amendments, in order to "make available more low cost generic drugs [.]"2 H.R.Rep. No. 98-857, pt. 1, at 14 (1984), reprinted in 1984 U.S.C.C.A.N. 2697, 2647. The Hatch-Waxman Amendments attempt to balance the conflicting policy objectives of "induc[ing] name-brand pharmaceutical firms to make the investments necessary to research and develop new drug products, while simultaneously enabling competitors to bring cheaper, generic copies of those drugs to the market." Abbott Labs. v. Young, 920 F.2d 984, 991 (D.C.Cir.1990) (Edwards, J., dissenting).

To accomplish these ends, the amendmerits established new guidelines for the approval of both name-brand and generic drugs. First, for pioneer drugs, a drug manufacturer must submit a new drug application ("NDA") to the FDA for approval. 21 U.S.C. § 355(a), (b). The NDA must contain studies demonstrating that the drug is safe and effective and must also include the patent number and expiration date of any patents claiming the drug. 21 U.S.C. § 355(b)(1). When the NDA is approved, the FDA lists the patent information in the "Approved Drug Products with Therapeutic Equivalence Evaluations," known as the "Orange Book." 21 U.S.C. § 355(c)(2). Once the NDA is approved, the NDA holder may market the new name-brand, pioneer drug.

With the Hatch-Waxman Amendments, Congress also created a streamlined procedure for the FDA to approve quickly generic versions of the name-brand drug. Drug manufacturers are required to file an abbreviated new drug application ("ANDA"), which incorporates the data that the name-brand producer had already submitted to the FDA. In order to obtain the FDA's approval, the ANDA must demonstrate that a generic drug is "bioequivalent" to a name-brand drug. 21 U.S.C. § 355(j)(2)(A)(iv). The applicant must also certify that the generic drug will not infringe any patents listed in the Orange Book which claim the name-brand drug. 21 U.S.C. § 355(j)(2)(A)(vii). An ANDA applicant must certify for each patent listed in the Orange Book:

(I) that such patent information has not been filed,

(II) that such patent has expired, (III) ... the date on which such patent will expire, or (IV) 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.

Id.

In a "paragraph IV" certification, the applicant must allege that the patent for the name-brand drug is either (1) invalid, or (2) will not be infringed by the marketing of the generic drug. 21 U.S.C. § 355(j)(2)(A)(vii). The ANDA applicant who files a paragraph IV certification must give notice of such certification to both the patent owner and the holder of the NDA for the drug that is claimed by the patent. 21 U.S.C. § 355(j)(2)(B)(i). The ANDA applicant is required to include in this notice "a detailed statement of the factual and legal basis of the applicant's opinion that the patent is not valid or will not be infringed." 21 U.S.C. § 355(j)(2)(B)(ii). The name-brand producer then has 45 days to sue the ANDA applicant. 21 U.S.C. § 355(j)(5)(B)(iii). If the namebrand producer sues, the FDA must wait 30 months before approving the generic manufacturer's ANDA or until a court fmds that the patent is invalid or not infringed, whichever is earlier. Id. If no suit is brought within 45 days, than the FDA may immediately approve the ANDA. Id.

Because filing a paragraph IV certification is an act of infringement under 35 U.S.C. § 271(e)(2)(A), the Hatch-Waxman Amendments give the first ANDA holder to file a paragraph IV certification 180 days of exclusive marketing of the generic product. 21 U.S.C. § 355(j)(5)(B)(iv). This provision states:

If the application contains a [paragraph IV certification] and is for a drug for which a previous application has been submitted under this subsection [containing]3 such a certification, the application shall be made effective not earlier than one hundred and eighty days after —

(I) the date the Secretary receives notice from the applicant under the previous application of the first commercial marketing of the drug under the previous application, or

(II) the date of a decision of a court in an action described in clause (iii) holding the patent which is the subject of the certification to be invalid or not infringed, whichever is earlier.

Id The exclusivity period is triggered by a court decision in a patent infringement suit, or the commercial marketing of the generic drug. Id. This period of exclusivity is an important component of the Hatch-Waxman Amendments because it "encourage[s] generic drug makers to incur the potentially substantial litigation costs association with challenging pioneer drug makers' patents" and brings generic drugs to the market faster. Mylan Pharms., Inc. v. Shalala, 81 F.Supp.2d 30, 33 (D.D.C.2000).

Initially, the FDA proposed a requirement that the ANDA holder be sued in order for that holder to be eligible for the 180-day exclusivity. Guidance for Industry: 180-Day Generic Drug Exclusivity Under the Hatch-Waxman Amendments to the Federal Food Drug, and Cosmetic Act 3 (June 1998) available at www.fda. gov/cder/guidance/2576fnl.pdf. The final rule, however, required that an ANDA holder successfully defend against a patent infringement suit to be eligible for the 180-day exclusivity. See 21 C.F.R. § 314.107(c) (1994).4 The FDA thought this rule would eliminate an incentive for frivolous claims. The D.C. Circuit, however, rejected this interpretation as contrary to the statute, holding that the successful defense requirement's "practical effect is to write the commercial-marketing trigger out of the statute." Mova Pharm,. Corp. v. Shalala, 140 F.3d 1060, 1069 (D.C.Cir. 1998); see also Inwood Labs., Inc. v. Young, 723 F.Supp. 1523, 1525 (D.D.C.), vacated as moot, 43 F.3d 712, 1989 WL 513201 (D.C.Cir.1989) (holding that the FDA's interpretation that "the 180-day exclusivity commences only when the primary ANDA has been sued for patent infringement" is contrary to the clear statutory language) (internal quotation marks omitted). The FDA subsequently amended § 314.107(c) by removing the language that required an ANDA applicant to have won a patent infringement suit to be eligible for the 180-days of exclusivity. See 21 C.F.R. § 314.107(c) (2000).

B. The Orange Book and the patent listing regulatory scheme

NDA patent information appears in the Orange Book because Congress included in the Hatch-Waxman Amendments a provision requiring the publication of such information to facilitate the new ANDA process. 21 U.S.C. § 355(c)(2). "Upon the submission of patent information [in the NDA], the Secretary shall publish it." Id. The statute does not address, however, how the FDA is to remove patents from this list. See id. The FDA has interpreted the Hatch-Waxman Amendments to afford the agency a ministerial role in listing and delisting patents in the Orange Book. (Defs.' Summ. J. Mot. at 5.) This scheme consists of a challenge process, whereby a third party can "dispute[ ] the accuracy or relevance of patent information ... published by FDA in the list." 21 C.F.R. § 314.53(f). The FDA then confirms with the NDA holder whether the patent information listed in the Orange Book is correct. Id. If the NDA holder requests that the patent be removed from the Orange Book, or "delisted," the FDA will do so. (Defs.' Summ. J. Mot. at 5.) If the NDA holder does not elect to alter the listing, the FDA will not remove the patent from the Orange Book. 21 C.F.R. § 314.53(f). (See Defs.' Summ. J. Mot. at 5.) The FDA "believes that the general rule of deference to the NDA holder's views on the scope of a patent and its appropriateness for listing should apply equally to the decision to list a patent and to delist a patent from the Orange Book." (Defs.' Summ. J. Mot at 5-6.)

The FDA has established one exception to this general rule. When the disputed patent is subject to litigation brought by the patent owner against the first ANDA applicant5, such a patent "shall not be removed from the list." 21 C.F.R. § 314. 94(a)(12)(viii)(B).6 The FDA explains that allowing a NDA holder to withdraw the patent during or after litigation and nullify the 180-day exclusivity would provide an "unjust result" if the ANDA applicant had invested heavy resources into defending the litigation and then...

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1 books & journal articles
  • Aia Proceedings: a Prescription for Accelerating the Availability of Generic Drugs
    • United States
    • Emory University School of Law Emory Law Journal No. 66-4, 2017
    • Invalid date
    ...505 F.3d 1343, 1347 (Fed. Cir. 2007).20. See 21 U.S.C. § 355(j) (2012); Caraco, 527 F.3d at 1282; Ranbaxy Labs., Ltd. v. Leavitt, 459 F. Supp. 2d 1, 2 (D.D.C.), aff'd, 469 F.3d 120 (D.C. Cir. 2006).21. Thomas, supra note 1, at 14-15; Shepherd, supra note 1, at 23. While many generic manufac......

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