Generic DEPAKOTE Litigation Update: Nu-Pharm Appeals District Court Decision
April 3, 2008Earlier this year, we reported on the U.S. District Court for the District of Columbia’s January 24, 2008 order dismissing Nu-Pharm Inc.’s complaint against FDA seeking declaratory and emergency injunctive relief with respect to Nu-Pharm’s ANDA #77-615 for a generic version of Abbott Laboratories’ DEPAKOTE (divalproex sodium) Delayed-Release Tablets, 500 mg. Specifically, Nu-Pharm sought both a judicial declaration that FDA’s decision not to approve ANDA #77-615 violated the Administrative Procedure Act (“APA”), and preliminary and permanent injunctive relief requiring FDA to approve ANDA #77-615. The district court dismissed the complaint, declining to exercise jurisdiction for “prudential reasons,” reportedly on the ground that the injunctive relief sought by Nu-Pharm would “conflict irreconcilably” with a previous order entered in a contempt proceeding (see below). As we anticipated, on January 29, 2008, Nu-Pharm appealed the decision to the U.S. Court of Appeals for the District of Columbia Circuit.
Nu-Pharm submitted ANDA #77-615 to FDA in March 2005 with paragraph IV certifications to two Orange Book-listed patents covering DEPAKOTE: U.S. Patent #4,988,731 (“the ‘731 patent”) and #5,212,326 (“the ‘326 patent”). These patents expired on January 29, 2008; however, in December 2007, FDA granted Abbott pediatric exclusivity for the drug, thereby delaying generic approval under certain circumstances until July 29, 2008. Abbott sued for patent infringement within the statutory 45-day period, and the 30-month stay triggered by the suit reportedly expired on November 13, 2007. Nu-Pharm argued that FDA must approve ANDA #77-615 because the company satisfied all requirements for final ANDA approval and the 30-month stay of approval triggered by the submission of Nu-Pharm’s ANDA with a paragraph IV patent certification expired without a substantive ruling on patent validity or infringement. FDA nevertheless refused to approve ANDA #77-615 based on an order entered in a contempt proceeding by the U.S. District Court for the Northern District of Illinois (Eastern Division) (Judge Richard Posner sitting by designation) involving an ANDA with a paragraph IV patent certification for generic DEPAKOTE submitted by Apotex Inc. (which formerly owned Nu-Pharm) that also extended to Nu-Pharm’s product. In October 2007, the U.S. Court of Appeals for the Federal Circuit held in Abbott Labs. V. TorPharm, Inc. that the contempt procedure used by the Illinois court was proper, that Nu-Pharm’s divalproex sodium drug product was not colorably different from Apotex’s divalproex sodium drug product, and that Nu-Pharm’s product would infringe patents covering DEPAKOTE. On January 7, 2008, Apotex petitioned the U.S. Supreme Court for review (Case #07-912). A response from the Supreme Court as to whether or not the Court will hear the case is anticipated later this month.
After appealing the January 24, 2008 district Court order, Nu-Pharm submitted a motion to expedite consideration of the company’s appeal. Nu-Pharm argues that “the district court improperly refused to exercise jurisdiction over Nu-Pharm’s complaint” when it declined to exercise subject matter jurisdiction over Nu-Pharm’s complaint for “prudential reasons” given the order entered in the contempt proceeding. “The court’s decision conflicts with the well-accepted principle that the federal courts have a virtually unflagging obligation . . . to exercise the jurisdiction given them” (internal quotations omitted), states Nu-Pharm. Further, Nu-Pharm argues that FDA’s decision not to approve ANDA #77-615 is contrary to the language of FDC Act § 505(j)(5)(B)(iii), which states that ANDA approval “shall be made effective” after the expiration of the 30-month stay, and that FDA’s decision conflicts with past Agency policies and practices. “To Nu-Pharm’s knowledge, FDA has never delayed one ANDA applicant’s approval based on an unfavorable decision in another, unrelated action that did not arise out of that applicant’s paragraph IV certification,” states Nu-Pharm. Nu-Pharm also argues that “FDA’s ruling [with respect to ANDA #77-615] turns the entire Hatch-Waxman system on its head and can not stand,” as it “impermissibly rewards the NDA-holder for attempting to escape a finding of non-infringement in the patent infringement action it filed against a particular ANDA applicant by running to an entirely different district court to extend an injunction order over and entirely different ANDA product.”
FDA’s Combined Motion for Summary Affirmance and Response to Nu-Pharm’s Motion to Expedite Appeal Consideration was filed on February 13, 2008. “The baseless nature of this case makes it unnecessary for this Court even to reach the question of expedited briefing; Judge Roberts’ decision should be affirmed summarily. The weakness of this case also means that the case does not present a ‘substantial challenge,’ which is one of the Circuit’s requirements for expedited consideration,” states FDA. The Agency goes on in its brief to argue that the district court properly declined jurisdiction, that under the D.C. Circuit’s recent opinion in Taylor v. Blakey, res judicata bars Nu-Pharm’s complaint, and that Nu-Pharm’s complaint fails to state a claim that is plausible on its face.
Abbott, which joined the case as an intervenor-defendant-appellee, takes issue with Nu-Pharm’s lack of expedition in attending to the appeal in its response to Nu-Pharm’s motion to expedite: “Nu-Pharm has not been acting with the sort of dispatch one might expect from a party claiming to be irreparably harmed and thus requiring immediate relief and expedited treatment from this Court.” Abbott cites several examples, including the fact that Nu-Pharm took 5 days to notice its appeal of the district court’s order. Abbott also argues that “the fact that Nu-Pharm would prefer not to compete with other manufacturers does not mean it will suffer ‘irreparable harm’ absent relief in this case; it simply means that Nu-Pharm will have to play by the same rules as everyone else.” In response, Nu-Pharm argues that “[w]hat Abbott and FDA continue to ignore is the fact that Nu-Pharm is not in the same position ‘as everyone else.’ Unlike other divalproex sodium paragraph IV ANDA-filers, Nu-Pharm, to its knowledge, was the only applicant entitled to final approval prior to the natural expiration of Abbott’s patents . . . . [W]hile ‘everyone else’ may have been rightfully denied access to the market during Abbott’s pediatric exclusivity period, by virtue of FDA’s refusal to approve Nu-Pharm’s ANDA after the 30-month stay had expired, Nu-Pharm was unlawfully denied the opportunity to take advantage of limited generic competition during this six-month period.”
Nu-Pharm’s February 29, 2008 brief in opposition to FDA’s motion to summarily affirm the district court’s dismissal argues that the motion should be denied because dismissal “would deprive Nu-Pharm from ever having its APA case heard on the merits,” and because “additional briefing and argument would benefit the disposition of this appeal.” With respect to FDA’s argument that res judicata bars Nu-Pharm’s complaint, the company counters that “the issues raised in Nu-Pharm’s APA complaint were not, and could not have been, raised [in previous patent infringement litigation] . . . . Further, these cases involve not only different parties, but also different rights, different injuries, and different requests for relief . . . and a different nucleus of facts.”
In response to FDA’s argument that Nu-Pharm’s complaint fails to state a claim, the company argues that “[t]he truth is that FDA simply is unwilling to take-on the straight-forward statutory arguments raised in Nu-Pharm’s complaint, as demonstrated by the Agency’s refusal to address these arguments anywhere below or in its motion to this Court.” FDA’s March 7, 2008 reply brief ups the ante in this war of words and states that Nu-Pharm’s argument “is based on a contrived and convoluted view of exactly what constitutes Nu-Pharm’s ‘claim.’ Nu-Pharm attempts to define its claim narrowly so that it would pertain only to APA allegations against FDA, and then argue that that particular claim was not addressed by the Illinois court because FDA was not a party there . . . . This is too clever by half. . . . Nu-Pharm is attempting to litigate here the issue resolved by Judge Posner, i.e., the timing of FDA approval of its ANDA . . . . [T]his attempt should be rejected and the district court should be summarily affirmed.”