FDA Rules that Hi-Tech Forfeited 180-Day Exclusivity Under Reasoning Similar to the Agency’s Acarbose Decision; Changes Called for in FDA Exclusivity Decision-Making

By Kurt R. Karst –

Further cementing FDA’s position that a generic applicant can forfeit 180-day exclusivity after patent information is "withdrawn" by the NDA holder, FDA ruled earlier today that Hi Tech Pharmacal Co., Inc. (“Hi Tech”) forfeited 180-day exclusivity after the information on  two exclusivity-qualifying Orange Book-listed patents covering the ophthalmic drug product COSOPT (dorzolamide hydrochloride; timolol maleate) had been withdrawn by the NDA holder, Merck & Co., Inc. (“Merck”).  FDA’s ruling was issued in the U.S. District Court for the District of Columbia around 10:00AM this morning, after the Court decided earlier this month not to grant Hi-Tech’s preliminary injunction motion seeking to prevent FDA from granting final ANDA approval to any subsequent ANDA applicant during Hi-Tech’s period of 180-day exclusivity.  Hyman, Phelps & McNamara, P.C. has represented Hi-Tech in its efforts – thereby explaining our decision not to address, until now, this case on the FDA Law Blog.  Apotex, Inc., a subsequent ANDA applicant, is an Intervenor-Defendant in the case, and Teva Pharmaceuticals USA, Inc., also subsequent ANDA applicant, filed an amicus brief in the case supporting Hi-Tech’s position.

We will spare you all of the details of the case.  Instead, we will focus on FDA’s Letter Decision.  But first, some quick facts . . . .  

Hi-Tech submitted the first ANDA to FDA containing a Paragraph IV certification to three patents listed in the Orange Book covering COSOPT.  This qualified Hi-Tech as a “first applicant” eligible for 180-day exclusivity.  Merck challenged Hi-Tech on one of those patents – U.S. Patent No. 4,797,413 (“the ‘413 patent”) – and Hi-Tech lost.  The ‘413 patent expired on April 28, 2008, but was subject to a period of pediatric exclusivity that expired on October 28, 2008.  Merck did not challenge Hi-Tech on the remaining two patents – U.S. Patent Nos. 6,248,735 (“the ‘735 patent”) and 6,316,443 (“the ‘443 patent”).  Instead, on April 26, 2006, Merck sent a letter to FDA requesting that information on the ‘735 and ‘443 patents be delisted from the Orange Book.  The patents have continued to be listed in the Orange Book, even today. 

Then along comes FDA’s May 2008 Letter Decision concerning 180-day exclusivity for generic PRECOSE (acarbose) Tablets.  In that case, FDA ruled that a request to withdraw patent information from the Orange Book is a forfeiture event under the “failure to market” provisions at FDC Act § 505(j)(5)(D)(i)(I), which were added to the law in December 2003 by the Medicare Modernization Act (“MMA”).  (See our May 11, 2008 post for a discussion of FDA’s acarbose decision.)  Hi-Tech then sent a letter to FDA arguing that the company could not forfeit 180-day exclusivity, and requesting that FDA make a prompt exclusivity decision to allow Hi-Tech to seek judicial relief in case of an adverse FDA decision.  FDA refused to make a decision before October 28, 2008, when the period of pediatric exclusivity on the ‘413 patent expired, and Hi-Tech sued FDA to get an exclusivity decision.  FDA subsequently opened a public docket, and, as mentioned above, the District Court, denied Hi-Tech’s motion for preliminary injunction, but instructed the parties to meet in court at 10:00AM on October 28, 2008 when FDA would issue its Letter Decision. 

FDA’s 16-page COSOPT Decision Letter concludes that Hi-Tech forfeited 180-day exclusivity on April 11, 2008, which is 30 months after Hi-Tech submitted its ANDA, and is also the “later of” date under the FDC Act § 505(j)(5)(D)(i)(I) “failure to market” forfeiture analysis.  In FDA’s January 2008 Letter Decision concerning 180-day exclusivity for generic KYTRIL (granisetron), the Agency determined that there must be both an item (aa) and an item (bb) forfeiture event under FDC Act § 505(j)(5)(D)(i)(I) for the Agency to determine a “later of” forfeiture date.  With respect to generic COSOPT, the item (aa) date was April 11, 2008, and the item (bb) event was, according to FDA, July 10, 2006 – 75 days after Merck withdrew information on the ‘735 and ‘443 patents (FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC)).  With respect to Hi-Tech’s argument that FDC Act § 505(j)(5)(D)(i)(I) requires a failure on Hi-Tech’s part (and that Hi-Tech did not “fail” to do anything it was required to do), FDA ruled that the “failure to market” forfeiture provisions “must be read as establishing a ‘no-fault’ forfeiture when an applicant fails to market by one of the identified dates.”  Hi-Tech also argued that the 180-day exclusivity tolling provisions under the Best Pharmaceuticals for Children Act (FDC Act § 505A(m)) should prevent a forfeiture.  FDA, however, ruled that FDC Act § 505A(m) applies only in the pre-MMA context, where 180-day exclusivity could be triggered by a court decision of patent invalidity, non-infringement, or unenforceability. 

FDA’s position for not providing an early exclusivity decision with respect to generic COSOPT – and in other cases as well – is that “[m]aking and advance decision on generic exclusivity . . . would result in FDA making decisions in piecemeal fashion, and FDA could be inundated with such requests from ANDA sponsors.  In addition, FDA would be unable to fully explain the basis for an advance exclusivity decision since many details of ANDAs are non-public until approval, and judicial review would thus be similarly circumscribed.”  FDA also notes that a policy of not making advance decisions “is also consistent with Congress’s choice to vest FDA with the authority to take and give effect to its actions, such as approving drugs, subject to subsequent challenge under the Administrative Procedure Act.”  Notwithstanding these concerns and points, and as we stated in court today, and the judge has articulated on several occasions, such a system leads to unnecessary court fire drills, and, more importantly, can preclude meaningful judicial review of FDA decisions.  FDA would do well to rethink its exclusivity decision-making process.  A status conference on the case has been scheduled for November 7, 2008.