Teva Pharmaceuticals v. Food and Drug Admin.

• Decision Date: 23 December 2004
• Docket Number: No. CIV.A.04-1416(RBW).,CIV.A.04-1416(RBW).
• Citation: Teva Pharmaceuticals v. Food and Drug Admin., 355 F.Supp.2d 111 (D. D.C. 2004)
• Parties: TEVA PHARMACEUTICALS, INDUSTRIES, LTD., et al., Plaintiffs, v. FOOD AND DRUG ADMINISTRATION, et al., Defendants.
• Court: U.S. District Court — District of Columbia

355 F.Supp.2d 111

TEVA PHARMACEUTICALS, INDUSTRIES, LTD., et al., Plaintiffs, v. FOOD AND DRUG ADMINISTRATION, et al., Defendants.

No. CIV.A.04-1416(RBW).

United States District Court, District of Columbia.

December 23, 2004.

Theodore C. Whitehouse, Willkie Farr & Gallagher, Benjamin Wallace Jackson, Washington, DC, Ian K. Hochman, William H. Rooney, New York, NY, for Plaintiffs.

Andrew E. Clark, US Dept. of Justice, Office of Consumer Litigation, Washington, DC, for Defendants.

Edward Anthony Figg, Sharon Lynch Davis, Rothwell, Figg, Ernst & Manbeck, PC, Washington, DC, for Movant.

MEMORANDUM OPINION

WALTON, District Judge.

The plaintiffs filed this action to challenge a decision by the Food and Drug Administration ("FDA"), which permits the sale of brand generic drugs¹ during the generic exclusivity period provided for in 21 U.S.C. § 355(j)(5)(B)(iv)(I). Verified Amended Complaint ("Compl.") ¶¶ 119-24.² The parties have filed cross-motions for summary judgment. Currently before the Court are (1) the Plaintiffs' Memorandum of Law in Support of Their Motion for Partial Summary Judgment ("Pls.' Mem."); (2) the Federal Defendants' Memorandum in Support of Motion to Dismiss Amended Complaint or, in the Alternative, for Summary Judgment; and in Opposition to Plaintiffs' Motion for Partial Summary Judgment (Defs.' Mem.); and (3) the Memorandum of Law in Opposition to Defendants' Motion to Dismiss and in Further Support of Plaintiffs' Motion for Summary Judgment ("Pls.' Reply").³ For the following reasons, this Court will grant the federal defendants' and the intervenor defendants' motions for summary judgment and deny the plaintiffs' motion.

I. Statutory Scheme

Prior to the passage of the Federal Food, Drug and Cosmetic Act ("FDCA"), 21 U.S.C. § 301 et. seq., commonly referred to as the Hatch-Waxman Amendments, all drug manufacturers — brand-name and generic — were required to conduct controlled human clinical studies to demonstrate that the drug that they wanted to introduce into the market was safe and effective. Allergan, Inc. v. Alcon Lab., Inc., 324 F.3d 1322, 1325 (Fed.Cir.2003). This requirement delayed the entry into the market of both new drugs and generic versions of such drugs. Id. The Hatch-Waxman Amendments sought to address this situation by striking "a balance between two competing policy interests: (1) inducing pioneering research and development of new drugs and (2) enabling competitors to bring low-cost, generic copies of those drugs to the market.'" Allergan, 324 F.3d at 1325 (citing Andrx Pharms., Inc. v. Biovail Corp., 276 F.3d 1368, 1371 (Fed.Cir.2002)). Under the Hatch-Waxman Amendments, only companies seeking to market a drug that has never been approved for use in the United States are required to submit a New Drug Application ("NDA"). A NDA is required to contain scientific data demonstrating the safety and effectiveness of the new drug. 21 U.S.C. § 355(a), (b), (c). However, companies seeking to market a generic drug of a previously approved drug no longer need to conduct human clinical tests. Instead, the generic drug manufacturer can submit an Abbreviated New Drug Application ("ANDA") demonstrating, among other requirements, that the generic version of the drug is the bioequivalent to the NDA approved version of the drug. 21 U.S.C. §§ 355, 360cc; 35 U.S.C. §§ 156, 271, 282.

The approval of an ANDA depends, in part, upon the applicant submitting "a certification ... with respect to each patent which claims [a] listed drug [previously approved by the Secretary of Health and Human Services (`HHS') for safety and effectiveness or whose approval has been withdrawn or suspended] or which claims a use for such a listed drug for which the applicant is seeking approval...." 21 U.S.C. §§ 355(j)(2)(A)(vii), 355(7). In addition, the certification must state one of the following:

(I) that the required patent information relating to such patent has not been filed;

(II) that such patent has expired;

(III) that the patent will expire on a particular date;

(IV) that such patent is invalid or will not be infringed upon by the drug for which approval is sought.

35 U.S.C. § 355(j)(2)(A)(vii). "If [a] certification is made under paragraph I or II indicating that patent information pertaining to the drug or its use has not been filed with the FDA or that the patent has expired, approval of the ANDA may be made effective immediately." Barr Labs. Inc. v. Thompson, 238 F.Supp.2d 236, 240 (D.D.C.2002) (citing 21 U.S.C. § 355(j)(5)(B)(i)). A paragraph III certification indicates that the applicant seeks approval to market the drug only after the applicable patent has expired. 21 U.S.C. § 355(j)(5)(B)(ii). When the ANDA contains a paragraph IV certification, the applicant must also provide notice of the paragraph IV certification to the NDA holder and the patent owner, and describe the factual and legal basis for the applicant's opinion that an active patent is invalid or not infringed. 21 U.S.C. § 355(j)(2)(B); 21 C.F.R. § 314.95. Under the Hatch-Waxman amendments, filing an ANDA with a paragraph IV certification is deemed to be a "highly artificial" act of infringement. 35 U.S.C. § 271(e)(2)(A); Eli Lilly & Co. v. Medtronic Inc., 496 U.S. 661, 678, 110 S.Ct. 2683, 110 L.Ed.2d 605 (1990). This act of infringement permits the NDA holder and the patent owner to sue the ANDA applicant before the drug is placed on the market, which helps expedite the generic drug reaching the marketplace. Allergan, 324 F.3d at 1326-27.⁴

Because of the likelihood of litigation, the filing of a paragraph IV certification can be costly. Thus, to encourage the investment in ANDA generic drugs, Congress granted an economic incentive to the first generic company to file a paragraph IV certification. Pharmachemie B.V. v. Barr Labs., Inc., 276 F.3d 627, 629 (D.C.Cir.2002). Under the Hatch-Waxman Amendments, the first drug manufacturing company to file a paragraph IV certification receives a 180-day period in which the first filer is entitled to be the only provider of generic versions of the drug in the market place ("generic exclusivity period"). 21 U.S.C. § 355(j)(5)(B)(iv)(I). Prior to 2003, this provision read as follows:

If the [ANDA] contains a [paragraph IV] certification ... and is for a drug for which a previous [ANDA] has been submitted [containing] such a certification, the [ANDA] shall be made effective not earlier than one hundred and eighty days after... the first commercial marketing of the drug under the previous ANDA.⁵

21 U.S.C. § 355(j)(5)(B)(iv)(I) (2001). In this case, the Court is asked to interpret this provision in light of the facts and circumstances of this case.

II. Factual Background

The facts in this case are not significantly in dispute and will only briefly be reviewed. On June 9, 2004, Teva filed a citizen petition with the FDA pursuant to 21 U.S.C. § 355; 21 C.F.R. § 10.30. Administrative Record ("A.R."), tab 1. The petition sought to have the FDA declare that the generic exclusivity period of a generic drug manufacturer could not be infringed upon by the brand-drug manufacturer's introduction into the market of its own brand generic drug. A.R., tab 1 at 1. The June 9, 2004 citizen's petition concerned a generic version of the drug Accupril®, which is administered to treat high blood pressure. Id. On July 2, 2004, the FDA responded to the petition and concluded that it did not have the authority under the FDCA to prevent brand generic drugs from being marketed during the 180-day marketing exclusivity period of the first ANDA filer. A.R., tab 4 ("FDA decision") at 2. Teva did not challenge the decision's application to Accupril ® in federal court, however, it now seeks to challenge the FDA's decision as applied to a different drug, Neurotin®, a drug administered to treat epilepsy, which contains the active ingredient gabapentin.

The plaintiffs seek relief in this case because they allege that Pfizer will begin selling a brand generic form of Neurotin® prior to the expiration of the generic exclusively period that will be shared by Teva and Purepac Pharmaceutical Co.⁶ Compl. ¶ 3. The plaintiffs allege that the FDA has decided, through final agency action concerning Accuril®, that brand generic drugs may be sold prior to the expiration of the Generic Exclusivity Period regardless of whether the generic exclusivity period is based upon the text of the FDCA. Compl. ¶ 2-3. Accordingly, the plaintiffs seek declaratory and injunctive relief declaring the FDA's denial of Teva's citizen's petition as arbitrary, capricious, an abuse of discretion, and a violation of the FDCA, 21 U.S.C. § 301 et seq., and the Administrative Procedure Act ("APA"), 5 U.S.C. § 701 et seq.

III. The Parties' Arguments

The plaintiffs raise a number of arguments in support of their motion for summary judgment. First, the plaintiffs contend that the challenged FDA decision is contrary to the purpose of the exclusivity period provision of the FDCA and is therefore arbitrary, capricious and contrary to law. Pls.' Mem. at 13-14. Specifically, the plaintiffs' opine that the purpose of the exclusivity provision is to provide a commercial incentive for ANDA applicants to undertake the paragraph IV certification process. According to the plaintiffs, if brand generic drugs are permitted to enter the market during the exclusivity period, this incentive is diminished. Pls.' Mem. at 15-16. Moreover, the plaintiffs assert that permitting brand generic drugs to enter the market during the exclusivity period benefits the NDA, not the ANDA, which is also contrary to the purpose of the exclusivity period provision of the FDCA. Id. at 17-19. Finally, the plaintiffs argue that both the FDA and courts have recognized that ANDA generic drugs and other brand generic drugs are legally and commercially equivalent, and therefore consistent with this determination, § 355(j)(5)(B)(iv) should be read to prohibit the marketing of both brand...