FDA Lawyers Blog

On June 28, Judge Katherine B. Forrest of the United States District Court for the Southern District of New York granted summary judgment of non-infringement to SAP AG and SAP America, Inc. ("SAP") due to DataTern, Inc.'s ("DataTern") failure to serve patent infringement contentions. SAP AG v. DataTern, Inc., No. 1:11-cv-02648. The ruling stems from a suit filed by SAP, seeking a declaratory judgment that it has not infringed U.S. Pat. No. 5,937,402 ("the '402 patent"). DataTern counterclaimed, asserting infringement of the '402 patent. Although Judge Richard J. Holwell was originally the presiding judge over this case, he stepped down from the bench in February 2012, and the case was reassigned to Judge Forrest. Shortly after taking over the case, Judge Forrest issued an order, mandating that DataTern serve its infringement contentions for the '402 patent by March 23, 2012. Broadly speaking, infringement contentions are the patent holder's assertion of which claims of the patent-in- suit it believes are infringed by which products or methods of use of the accused infringer. Specifically, the patent holder must produce a "claim chart", identifying where each element of each asserted claim is found in each accused product or method of use. The patent holder must also indicate how it intends to satisfy each element of the asserted claims for infringement.

DataTern failed to serve the infringement contentions for the '402 patent by the deadline that Judge Forrest set. Accordingly, on April 26, 2012, SAP filed a motion for partial summary judgment, seeking a judgment that it has not infringed the '402 patent. In opposition, DataTern alleged that it has not served infringement contentions because SAP failed to timely provide it with the source code necessary to formulate the contentions. Judge Forrest was unconvinced by this argument and pointed out that DataTern had never filed a motion to compel discovery. Accordingly, Judge Forrest concluded that any alleged failure by SAP to provide source code could not excuse DataTern's failure to file infringement contentions.

DataTern additionally argued that under Judge Forrest's Procedures for Patent Cases, a party may amend its infringement contentions "upon a timely showing of good cause." Judge Forrest rejected this argument. She explained that a prerequisite to amending infringement contentions is to serve initial infringement contentions for the relevant patent in compliance with the court's orders. Judge Forrest noted that if this rule were read otherwise, patent holders in multi-patent cases could serve infringement contentions with respect to one patent, and then "amend" the contentions to include the other patents in suit. Further, Judge Forrest noted that even if DataTern's late contentions were considered "amendments," they would not be accepted, because DataTern had failed to show good cause for the delay, as required by the rule.

On June 15, supplemental briefing was completed in Association for Molecular Pathology v. Myriad Genetics, Inc. at the Federal Circuit. The parties had been Ordered to file simultaneous briefs addressing the question: "What is the applicability of the Supreme Court's decision in Mayo [v. Prometheus] to Myriad's isolated DNA claims and to method claim 20 of the '282 patent [U.S. Patent No. 5,747,282]?" In addition, the Federal Circuit invited amicus briefs. As many as seventy organizations and individuals answered this invitation, as well as the United States (who received an express invitation). Oral argument for this appeal is scheduled for Friday, July 20, 2012.

This case considers a fundamental issue, namely: What subject matter is eligible for patent protection? This is a threshold question of patentability, previously reported here, which the United States Supreme Court recently considered in Mayo Collaborative Services v. Prometheus Laboratories, Inc. After deciding Prometheus, the Supreme Court vacated the Federal Circuit's previous decision in Myriad and set this present appeal in motion by remanding the case to the Federal Circuit for reconsideration in light of Prometheus. As demonstrated by their briefing, however, both the Plaintiffs and Myriad have very different takes on what Prometheus stands for--and what subject matter is patentable.

The Plaintiffs argue that claiming isolated DNA does no more than to patent laws of nature and products of nature; in other words, the correlation between the patented DNA and the BRCA proteins it encodes. Plaintiffs assert that the product is the DNA itself and "another entity cannot invent a DNA molecule that encodes for the same protein and embodies a person's BRCA1 and BRCA2 genetic information" because Myriad's patents stand in the way. Thus, Plaintiffs state, "[a]s a consequence, no other laboratory in the U.S. has been able to provide clinical testing of these genes . . . ."

The founder of an online pharmacy was recently arrested for allegedly selling counterfeit prescription drugs. Specifically, the United States government has charged Andrew Strempler ("Strempler"), the founder of Mediplan Health Consulting, Inc.--also known as RxNorth.com ("RxNorth")--with one count of conspiracy to commit mail fraud and wire fraud, as well as two counts of mail fraud. A grand jury returned an indictment against Strempler for these offenses in June 2011, but because Strempler was deemed a flight risk, the indictment was sealed until his arrest.

In support of the charges, the indictment alleges that Strempler falsely claimed that RxNorth was selling safe prescription drugs that complied with the rules of United States regulatory authorities. These claims were allegedly made through RxNorth's website and brochures. The indictment alleges that contrary to these representations, Strempler and his co-conspirators obtained the prescription drugs from various countries without ensuring the drugs' safety or authenticity. More specifically, Strempler is alleged to have operated a facility in the Bahamas, where the drugs were shipped. The orders were then allegedly filled in the Bahamas, and given labels stating that they had been filled by RxNorth in Canada. Further, the drugs allegedly were not sold in accordance with FDA regulations, because they were allegedly counterfeit, misbranded, and not FDA-approved. Additionally, the indictment alleges that RxNorth falsely boasted that it was using the "best equipped" laboratory to test its drugs for safety and authenticity even though RxNorth actually only had one piece of equipment that was capable of limited testing.

The indictment further claims that the FDA previously wrote a letter to Strempler in 2001, warning him that it would be illegal to sell drugs that were not approved by the FDA. This allegation, if proven true, will likely be used to show that Strempler knowingly violated federal law. If convicted of the charges, Strempler faces up to twenty years in prison. Additionally, the government seeks forfeiture of the proceeds that Strempler obtained from his allegedly unlawful conduct. The government estimates that Strempler's proceeds have been at least $95 million. This criminal case underscores the federal government's commitment to ensuring that only genuine, FDA-approved prescription drugs are sold in the United States.

On June 11, the U.S. Supreme Court agreed to address the issue of whether investors must prove that alleged misrepresentations had a material effect on stock price in order to pursue a class-action stock-fraud suit. Amgen, Inc. ("Amgen") petitioned the Supreme Court for a writ of certiorari addressing the decision from the Court of Appeals for the Ninth Circuit. The Ninth Circuit held that shareholders did not need to show the materiality of alleged misstatements prior to receiving class certification. The Ninth Circuit explained that plaintiffs "need only allege materiality with sufficient plausibility" to be awarded class certification. Amgen's appeal is supported by the U.S. Chamber of Commerce, former SEC commissioners, and the pharmaceutical industry's trade group.

In 1988, the Supreme Court held in Basic v. Levenson that a class only needs to demonstrate an efficient market and alleged public misstatements in order to be certified as a class based on the fraud-on-the-market presumption. However, since that decision, there has been a split among the Circuits as to whether shareholders have to show materiality of the misstatements in order to get class certification. The Second and Fifth Circuits require proof of materiality for class certification and allow defendants to rebut such evidence. The Third Circuit does not require proof of materiality prior to class certification, but, allows defendants to present evidence disproving the materiality of any alleged misrepresentation. The Seventh and Ninth Circuits require no proof of materiality for class certification and defendants cannot present any evidence rebutting the materiality of any alleged misrepresentations.

This suit was brought by Connecticut pension funds on behalf of purchasers of Amgen stock (collectively, "plaintiffs"). Plaintiffs allege that Amgen down-played safety concerns about Aranesp and Epogen--two drugs used to treat anemia--which led to inflated share prices for Amgen stock. Amgen is seeking to overturn the Ninth Circuit's decision that certified the lawsuit as a class action. Class certification confers a substantial benefit to plaintiffs in settlement negotiations because of the substantial risk that defendants take by litigating a class action trial. Amgen argues that allowing class certification in a case such as theirs would lead to settlement of meritless cases. Amgen asserts that plaintiffs in this case cannot show that the alleged misrepresentations had a material effect on the price of Amgen shares. Amgen further asserts that market had readily available access to the drugs' safety information and therefore, adjusted itself accordingly.

Plaintiffs allege that the misrepresentations took place from April 2004 through May 10, 2007. Plaintiffs assert that Amgen's stock price was inflated because Amgen hid concerns that Aranesp and Epogen exacerbated tumor growth in clinical trials. Amgen's shares dropped more than 9% on May 10, 2007 when FDA's expressed concern about these drugs and recommended new limits on patient use. According to plaintiffs, Amgen repeatedly reassured inventors of the safety of Aranesp and Epogen despite this negative clinical trial data. Plaintiffs do not dispute that they need to show the materiality of Amgen's statements, however, they assert that issue should be left for trial, not a decision made prior to class certification. The Supreme Court will hear oral arguments in October 2012.

On June 7, the Federal Circuit in In re Bill of Lading Transmission & Processing System Patent Litigation clarified the standards necessary to plead a claim of patent infringement. Notably, the Federal Circuit (O'Malley, J.) discussed the differences between stating a claim for direct patent infringement versus indirect patent infringement (i.e., induced infringement or contributory infringement). The case involves a patent directed to "a method in which documents are scanned on board vehicles for use by dispatchers in preparing manifests dictating which shipments should be consolidated and shipped on which trucks heading to which location." Slip op. at 28. The District Court dismissed the plaintiff's complaints under Rule 12(b)(6). Among other things, the District Court found that the complaints were based upon conclusory allegations of direct infringement that were based upon unreasonable inferences. The plaintiff then appealed to the Federal Circuit.

Regarding direct infringement, the Federal Circuit concluded that the District Court had improperly required too high of a standard to meet the pleading requirements for direct infringement. Specifically, the Federal Circuit pointed to Form 18 in the Appendix of Forms to the Federal Rules of Civil Procedure, which lays out a sample complaint for direct patent infringement. Form 18 requires: (1) an allegation of jurisdiction; (2) a statement that the plaintiff owns the patent; (3) a statement that the defendant has been infringing the patent by making, selling, and using the device embodying the patent; (4) a statement that the plaintiff has given the defendant notice of its infringement; and (5) a demand for an injunction and damages. The Federal Circuit explained that under Rule 84, the forms are deemed sufficient. Accordingly, the Federal Circuit concluded, in the event of a conflict between the forms and the Supreme Court's pleading standards set forth in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009), the forms control. Therefore, for claims of direct patent infringement, the question of whether a complaint contains sufficient specificity must be measured by the specificity required by Form 18.

Regarding indirect infringement, however, the Federal Circuit found that Form 18 is of no assistance. This is because the complaint in Form 18 only involves a claim of direct infringement. Accordingly, for claims of induced and contributory infringement, the standards outlined in Twombly and Iqbal apply. Therefore, the Federal Circuit explained, to state a claim for contributory infringement, the plaintiff must, "among other things, plead facts that allow an inference that the components sold or offered for sale have no substantial non-infringing uses." Slip op. at 21. More particularly, the Federal Circuit found it insufficient simply to set forth an infringing use and then baldly conclude that there is no other substantial non-infringing use. As for induced infringement, the Federal Circuit concluded that a complaint must contain facts plausibly showing that the accused infringer specifically intended its customers to infringe the patent and knew that the direct infringer's acts constituted infringement.

On May 22, the United States District Court for the Central District of California granted
a prevailing patent infringement plaintiff's motion for attorneys' fees under Section 285 of the Patent Act. Jake Lee v. Mike's Novelties, Inc., et al., LA CV10-02225, Order Granting Motion for Attorney Fees and Motion for Enhanced Damages, May 22, 2012, ECF No. 197. The Court concluded that an award of attorneys' fees was appropriate, in part because the defendants had engaged in bad faith litigation tactics. These tactics included, among other things, bad faith settlement offers, unreasonable delay tactics during a deposition, and threats to report the plaintiff's attorneys to various state bars. To the extent patent challenges continue to be part of the landscape for applicants filing generic drug applications (Abbreviated New Drug Applications or "ANDAs"), new drug applications under Section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act ("505(b)(2) NDAs"), and in the future biosimilar applications, litigators involved in these challenges should consider best practices to avoid the payment of attorney fees for such behavior.

Regarding the bad faith settlement offers, the court found that counsel for the defendants had repeatedly sent intimidating written communications to the plaintiff's counsel demanding that the plaintiff dismiss his claims and pay the defendants their attorney's fees. In one communication, the plaintiff was warned that he was "in a hole that is getting deeper every day," and that he should "settle this case and limit [his] exposure to a very bad result" in light of the Court's summary judgment and claim construction rulings. The Court found that these communications were made in bad faith. In particular, the Court pointed to the fact that the plaintiff had prevailed on its claim construction arguments, and further pointed to the intimidating nature of the communications. Accordingly, the Court found that these communications weighed in favor of an award of attorneys' fees.

Additionally, the Court considered the defendants' delay tactics during one of the depositions. In particular, when the plaintiff's counsel attempted to take the deposition of one of the defendants in the plaintiff's presence, the deponent refused to allow the deposition to proceed in the plaintiff's presence. The deposition did not continue until the Court ordered the deposition to proceed, resulting in a two-hour delay. Although the Court found that this conduct offered "modest support" for an award of attorneys' fees, it found that this behavior alone would be insufficient to justify such an award.

On May 30, AstraZeneca Pharmaceuticals LP ("AstraZeneca") reached an agreement to a settlement with a class of indirect purchasers in an antitrust action involving the drug Toprol-XL® (metoprolol succinate) in Delaware. The class of indirect purchasers allege that AstraZeneca used frivolous patent litigation as a method of delaying generic competition for Toprol-XL®.

In an order signed by Chief U.S. District Court Judge Gregory M. Sleet, the case was stayed following a joint notice highlighting that the parties had reached an agreement in principle to settle all claims. Mark S. Merado, the lead plaintiff in the case, filed the suit in February of 2006, alleging that AstraZeneca created a monopoly or was attempting to create a monopoly for Toprol-XL® and was thus in violation of both the Sherman and Clayton Acts.

Merado alleged that AstraZeneca fraudulently obtained U.S. Patent Nos. 5,001,161 ("the '161 patent") and 5,081,154 ("the '154 patent") and filed sham patent infringement suits against generic competitors to delay the approval and market entry of generic metoprolol succinate. "Defendants knew that under the Hatch-Waxman Act, the mere filing of patent litigation--even groundless suits based on invalid or unenforceable underlying patent--would automatically prevent the FDA, for up to 30 months, from granting generic competitors final approval," the complaint said. The suit asked the court to find the '161 and '154 patents invalid and to order AstraZeneca to provide restitution for the plaintiffs by disgorging its unjust enrichment.

On May 16, Judge Leonard Stark of the District Court of Delaware held that a Paragraph IV certification is not a necessary predicate to an infringement claim under 35 U.S.C. § 271(e)(2)(A). Section 271(e)(2)(A) states that it is an act of infringement to submit an abbreviated new drug application ("ANDA") for a drug or the use of a drug claimed in a patent. If an act of infringement is found under Section 271(e)(2)(A), Section 271 (e)(4)(A) states that "the court shall order the effective date of any approval of the drug . . . involved in the infringement to be a date which is not earlier than the date of the expiration of the patent which has been infringed."

In March 2009, Galderma sued an ANDA filer for infringement under section 271 (e)(2)(A) based on the applicant's ANDA for a generic doxycycline product. In its ANDA, the applicant included certifications under 21 USC §355(j)(2)(A)(iv) that four of Galderma's patents (later listed in the Orange Book for Galderma's Oracea® product) were either invalid or not infringed by the applicant's manufacture, use, or sale of its generic product. FDA later granted the applicant a tentative approval for its ANDA.

Following the ANDA applicant's tentative approval, another patent issued (U.S. Patent No.7,749,532 ("the '532 patent") that was listed in FDA's Orange Book as covering Oracea®. The ANDA applicant did not amend its ANDA to include the '532 patent, but instead brought a declaratory judgment action asserting that its generic product does not infringe the '532 patent. The District of Delaware consolidated the declaratory judgment action with the ANDA suit, and after a bench trial, Judge Stark held that the '532 patent claims were valid and infringed by the generic products. Judge Stark also held that FDA must withdraw the tentative ANDA approval, and FDA cannot approve the ANDA until at least December 19, 2027, the expiration date of the '532 patent.

On March 27, FDA granted final approval to 10 drug companies for their generic versions of AstraZeneca's Seroquel® (quetiapine fumarate) tablets. Seroquel® is used to treat the symptoms of schizophrenia and to treat and prevent mania or depression in patients with bipolar disease. Seroquel® is AstraZeneca's second-best selling drug, generating $5.83 billion in revenue in 2011.

On March 28, 2012, the majority, if not all, of the ANDA filers launched their products. Also on March 28, 2012, AstraZeneca filed a complaint against FDA stating that it is entitled to exclusive rights for Seroquel® until December 2, 2012, and FDA's approval of these ANDAs was unlawful and will cause AstraZeneca irreparable harm. AstraZeneca had filed another law suit against FDA prior to the ANDA approvals, but this suit was dismissed without prejudice on March 23, 2012 based on a lack of ripeness (see our blog on this here). The Court held that AstraZeneca could seek a new action "[s]hould the FDA ever give final approval to a competing generic in a manner that is not to AstraZeneca's liking." Four days later, FDA provided Astrazeneca with notice of approval of the ANDAs for Seroquel®, and AstraZeneca filed the current suit on March 28, 2012.

Similar to the arguments made in the first suit, AstraZeneca claims that it is entitled to a three-year new-patient- population exclusivity period as a result of a labeling change that FDA mandated in the supplemental NDAs that were approved on December 2, 2009. AstraZeneca argues that it is improper for FDA to approve any ANDAs prior to December 3, 2012, because AstraZeneca has exclusive rights to the clinical data that FDA required to be added to its Seroquel® and Seroquel XR® labels.

On April 11, Arkansas State Court Judge Tim Fox entered judgment on fines totaling $1.2 billion against pharmaceutical giant Johnson & Johnson and its subsidiary Janssen Pharmaceuticals (collectively "J&J") for wrongdoing surrounding their prescription antipsychotic medication, Risperdal® (risperidone). (No. CV07-15345.) FDA originally approved Risperdal® in 1993 for the treatment of psychotic disorders like schizophrenia.

Arkansas Attorney General Dustin McDaniel alleged, among other things, that J&J violated Arkansas' false claims act and deceptive trade practices act in marketing and selling Risperdal®. In particular, he alleged that J&J caused improper reimbursement for prescriptions covered by Medicaid by falsely asserting that Risperdal® was safer and more effective than comparable medications and not adequately warning about serious side effects, including diabetes and neurological complications. According to the complaint, J&J sold and marketed Risperdal® for off-label uses, including the treatment of bipolar disorder, dementia, and mood, and anxiety disorders.

After a jury determined that J&J violated the Arkansas False Claims Act and Arkansas Deceptive Trade Practices Act, Fox evaluated damages. He found nearly a quarter million instances in which J&J violated the Arkansas False Claims Act, based on the number of Risperdal® prescriptions written in the state. He also found nearly 5,000 instances in which J&J violated the Arkansas Deceptive Trade Practices Act, based on the number of Risperdal® direct mailings to Arkansas physicians. As a result, he held that J&J improperly induced the state to spend Medicaid funds for Risperdal® prescriptions. The statutory minimum penalties--ranging from $2500 to $5000 per violation--resulted in a judgment of $1.2 billion. J&J has moved for a new trial, contending that the fines dwarf actual Medicaid payments for Risperdal®, which J&J argues are no more than $8.1 million. J&J further contends that the state showed no evidence that any patient suffered actual harm, that any doctor was misled into writing a prescription that was not warranted, or that any prescription did not warrant reimbursement. The Arkansas False Claims Act, however, requires only that a person "[k]nowingly makes or causes to be made any false statement or representation of a material fact in any application for any benefit or payment under the Arkansas Medicaid program." J&J may be better off trying the Eighth-Amendment route. See United States ex rel. Bunk v. Birkart Globistics GmbH & Co., Nos. 1:02cv1168 & 1:07cv1198, 2012 U.S. Dist. LEXIS 18445 (E.D. Va. Feb. 14, 2012).

While the unanimous Supreme Court's decision (see our previous blog post here) made it clear that "Caraco may bring a counterclaim seeking to 'correct' Novo's use code 'on the ground that' the [method of use] patent 'does not claim an approved method of using the drug,'" Justice Sonia Maria Sotomayor's concurrence indicates that the Court has neither answered all the questions nor fixed all the problems associated with the counterclaim provisions. She initially noted "the counterclaim can only lessen the difficulties created by an overly broad use code; it cannot fix them." The concurrence summarized how a generic manufacturer now will be able to challenge an overbroad use code: "submit an ANDA with a paragraph IV certification . . . wait for the brand [to sue], file a counterclaim, litigate the counterclaim, and, if successful [in obtaining a corrected use code] . . . file an ANDA with a section viii statement."

Sotomayor, however, identified two problems with this process. First, the process introduces a delay and litigation expense that the statutory scheme does not envision when the generic applicant deliberately carves out uses protected by a patent and files a section viii statement. Second, there is no guarantee that it would be in the interest of a brand company to instigate a lawsuit against the generic applicant that files a Paragraph IV certification when a section viii statement is initially not available for an overly broad use code that overlaps with an indication for the listed method of use patent. In this case, the generic applicant may obtain approval for the broader use(s) and then be at risk for a claim of induced infringement for selling a product with a label "that suggests that the product be used for a patented method of use."

Sotomayor concluded by criticizing FDA's minimal guidance on this issue. She highlighted how "remarkably opaque" FDA's guidance on what is required of a brand manufacturer when submitting use codes and even noted that "FDA's opacity" was part of the reason this case came to the Supreme Court. While recognizing that Novo's interpretation of the counterclaim provision is erroneous, Sotomayor expressed some sympathy for the drug company, because it only changed its use code to "correspond" to new labeling required by FDA. She noted that a fix to this statutory scheme likely would require a fix from Congress or FDA, and that "[a]bsent greater clarity from FDA concerning what is required of brand manufactures in use codes, Congress' fears of undue litigation may be realized."

Over a year ago, prior to the Court's ruling and Sotomayor's observations, FLH Partners Brian J. Malkin and Andrew S. Wasson published a FDLI Policy article, "Should FDA Undertake More Than a Ministerial Role With Respect to Patent Information?" In this article, Malkin and Wasson noted that for many years FDA has argued that it lacks the resources and expertise to review patents substantively, calling its hands-off role as "ministerial." While many courts have upheld FDA's position, they note, it is not the case that courts have mandated that FDA take this position. Instead, the authors suggest that hiring a few competent patent attorneys, trained in biotechnology or the pharmaceutical sciences, could result in the more efficient administration of the Hatch-Waxman Act Amendments to the Federal Food, Drug, and Cosmetic Act. Following Sotomayor's concurrence, perhaps their recommendations should be considered again.

On April 17, the Supreme Court issued its decision that is likely to have far reaching consequences in pharmaceutical litigation regarding method of use patents. The Court's ruling overturned the Federal Circuit's April 2010 Novo Nordisk v. Caraco decision, most recently blogged on here, which had held that 21 U.S.C. § 355(j)(5)(C)(ii)(I) ("the counterclaim provision") did not provide an avenue for Caraco to compel Novo Nordisk ("Novo") to modify the "patent use code narrative" associated with a patent listed in FDA's Orange Book for Prandin® (repaglinide). A unanimous Supreme Court, with a concurrence by Justice Sonia Maria Sotomayor, instead held that "a generic manufacturer may employ [the counterclaim provision] to force correction of a use code that inaccurately describes the brand's patent as covering a particular method of using the drug in question."

The Court, through Justice Elena Kagan, principally addressed the construction of two statutory phrases found in the counterclaim provision; namely, the "patent does not claim . . . an approved method" phrase and the "patent information submitted . . . under subsection (b) and (c)" phrase. Regarding the first phrase, the Supreme Court addressed whether the "not . . . an" language in the counterclaim provision meant "not any" (the view of Novo and the Federal Circuit) or "not a particular one" (the view of Caraco). Kagan noted that the correct meaning of "not . . . an" depends on context and provided a number of real life examples to make her point. Here, the Court found that the context in the statute supported Caraco's interpretation of "not a particular one."

Kagan explained that the Hatch-Waxman framework, specifically 21 U.S.C. § 355(j)(2)(A)(viii) ("section viii"), provides generic drug companies with a mechanism to seek approval for less than the referenced drug's uses, when those uses are listed for patents in FDA's Orange Book. In essence, the aim of this statutory scheme is to prevent one patented use from blocking the marketing of a generic drug for other non-patented uses. According to the Court's reasoning, Congress's reasons for establishing the section viii carve-out and counterclaim provisions would be frustrated by Novo's reading of "not . . . an." The Court noted that Congress could have drafted that counterclaim provision to cover Novo's interpretation by using "not . . . any" instead of "not . . . an." Kagan elaborated, "We think that the 'not any' construction does not appear in the relevant counterclaim provision because Congress did not mean what Novo wishes it had." The Court concluded that Congress meant for the counterclaim provision to aid the statutory scheme of "facilitating the approval of non-infringing generic drugs under section viii." The Court next addressed Novo's argument that Caraco's counterclaim to correct patent information must fail because a use code is not "patent information submitted by the [brand] under subsection (b) or (c)" of section 21 U.S.C. § 355(j)(5)(C)(ii)(I). Dismissing the fact that the statute does not define "patent information," the Court readily held that a use code is "patent information," such meaning that "fits under any ordinary understanding of the language."

by Andrew S. Wasson

As promised, ViroPharma filed a complaint in the United States District Court for the District of Columbia for a declaratory judgment and injunctive relief, as well as a motion for a temporary restraining order and/or preliminary injunction against FDA. ViroPharma's lawsuit responds to FDA's decision to mostly deny ViroPharma's Citizen Petition with regard to its Vancocin® (vancomycin hydrochloride) product and the simultaneous approval of three generic vancomycin hydrochloride capsule products (Akorn, Strides Arcolabs Ltd., and Watson Pharmaceuticals) (see our blog here. ViroPharma previously sued FDA in September 2010, only to have the court dismiss ViroPharma's suit for a lack of standing.

In the present action, ViroPharma alleged that: (1) FDA violated the Section 706(A) and (D) of the Administrative Procedure Act ("APA") by adopting and applying in vitro dissolution testing as the bioequivalence method in approving the generic vancomycin products, and (2) FDA violated Section 706 of the APA and the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(c)(3)(E)(iv) and (j)(5)(F)(iv)) by denying ViroPharma's request for the three-year period of regulatory exclusivity. ViroPharma alleged that FDA's actions have been arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.

In particular, ViroPharma characterized the use of in vivo testing as the "traditional" approach to testing for bioequivalence. ViroPharma stated that, "[e]xcept in very limited circumstances, regulations adopted by FDA to implement the statute requires 'bioequivalence' to be demonstrated through in vivo testing, i.e., clinical testing on humans." What is more, ViroPharma alleged that drugs that act locally in the gastrointestinal tract should be treated differently for bioequivalence standards (clinically efficacy and safety endpoints). According to ViroPharma, prior to 2006, FDA consistently held that it would require generic applicants to demonstrate bioequivalence through the use of in vivo studies with clinical endpoints.

by Brian Malkin

On April 9, FDA simultaneously denied ViroPharma's Citizen Petition regarding bioequivalence and labeling requirements for generic Vancocin® capsules (vancomycin hydrochloride)
and approved three generic applications to Akorn, Strides Acrolabs Ltd. and Watson Pharmaceuticals. In an unprecedented 87-page response (with index), FDA responded to a myriad of arguments presented in ViroPharma's original Citizen Petition dated March 17, 2006, as well as its 20 additional supplements and 16 submissions to a public docket for FDA's Draft Vancomycin Bioequivalence Guidance.

FDA's response provides numerous insights into FDA's decision-making process for bioequivalence determinations in addition to FDA's affirmation of its draft generic Vancocin recommendation as "scientifically sound" and "the most accurate, sensitive, and reproducible approach for demonstrating bioequivalence for generic vancomycin capsules." For generic Vancocin® FDA will continue to permit in vitro dissolution data alone to demonstrate bioequivalence for generic Vancocin® capsule versions that contain the same active and inactive ingredients in the same amounts ("Q1/Q2"). Non-Q1/Q2 formulations must perform clinical endpoint studies in patients with Clostridium difficile Associated Diarrhea.

FDA's decision secondarily answered an issue raised in a later supplement regarding certain labeling changes to Vancocin® that was supported with clinical data, which FDA determined would not be eligible for 3 years of clinical data exclusivity because it is not a new indication. According to FDA, "old" antibiotics, such as vancomycin, may only obtain 3-year new data exclusivity for a significant new use or new indication, not for "refinements in labeling related to previously approved used for Old Antibiotics."

by Brian Malkin

On March 30, FDA denied the Natural Resources Defense Council, Inc.'s ("NRDC's") Citizen Petition to remove the chemical bisphenol A ("BPA") from food packaging and other products where it comes in contact with food. NRDC said that BPA may be found in a wide variety of the liners of metal food cans and hard plastic containers such as baby bottles.

As we previously reported here, on August 19, 2011, NRDC sued FDA for declaratory and injunctive relief for FDA to grant the citizen petition and issue a regulation prohibiting the use of BPA in food packaging. NRDC's original Citizen Petition was filed in October 2008 yet remained unanswered by more than 1000 days, as of the complaint filing date. According to NRDC's complaint, FDA should have responded to its type of petition within 90 days and had a maximum time of 180 days to respond. NRDC had asserted that FDA's failure to respond to NRDC's Petition prolonged its members from unwanted exposure to BPA in food packaging. FDA's failure to respond to the Petition, NRDC further claimed, denied NRDC from seeking judicial review, if necessary.

NRDC's latest suit on this Petition resulted in a Consent Judgment, where FDA agreed to issue a final decision to NRDC's Citizen Petition "on or before March 31, 2012" as the "settlement of all claims that were asserted, or could have been asserted . . . related to the allegations in the Complaint." NRDC was also awarded $10,500 as "attorney feed and costs arising out of this Action" in a Stipulation and Order that followed the Consent Judgment.