Teva Sues FDA Over Generic COZAAR and HYZAAR 180-Day Exclusivity Forfeiture and Patent Delisting Rule

By Kurt R. Karst –      

Teva Pharmaceuticals USA, Inc. (“Teva”) recently filed a Complaint and a Motion for Preliminary Injunctive Relief (and a memorandum supporting the company’s motion) in the U.S. District Court for the District of Columbia against FDA concerning 180-day exclusivity forfeiture for generic versions of Merck & Co., Inc.’s (“Merck’s”) blockbuster angiotensin II receptor antagonist drugs COZAAR (losartan potassium) Tablets and HYZAAR (hydrochlorothiazide; losartan potassium) Tablets.  Teva’s lawsuit is the latest challenge to FDA’s interpretation of the “failure to market” 180-day exclusivity forfeiture provisions at FDC Act § 505(j)(5)(D)(i)(I), and in particular with respect to FDA’s interpretation of the patent information withdrawal provision at FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC).  The 180-day exclusivity forfeiture provisions were added to the FDC Act in December 2003 by the Medicare Modernization Act (“MMA”).

Under the FDC Act, an ANDA applicant who is a “first applicant” (i.e., “an applicant that, on the first day on which a substantially complete [ANDA] containing a [Paragraph IV certification] is submitted for approval of a drug, submits a substantially complete [ANDA] that contains and lawfully maintains a [Paragraph IV certification]”) is eligible for 180-day exclusivity, but forfeits such exclusivity if there is a “failure to market” under FDC Act § 505(j)(5)(D)(i)(I).  Specifically, FDC Act § 505(j)(5)(D)(i)(I) states that a first applicant forfeits 180-day exclusivity if it fails to market the drug by the later of two dates:

(aa) the earlier of the date that is –

(AA) 75 days after the date on which the approval of the application of the first applicant is made effective under subparagraph (B)(iii); or

(BB) 30 months after the date of submission of the application of the first applicant; or

(bb) . . . the date that is 75 days after the date as of which, as to each of the patents with respect to which the first applicant submitted and lawfully maintained a certification qualifying the first applicant for the 180-day exclusivity period under subparagraph (B)(iv), at least 1 of the following has occurred:

(AA) In an infringement action brought against that applicant with respect to the patent or in a declaratory judgment action brought by that applicant with respect to the patent, a court enters a final decision from which no appeal (other than a petition to the Supreme Court for a writ of certiorari) has been or can be taken that the patent is invalid or not infringed.

(BB) In an infringement action or a declaratory judgment action described in subitem (AA), a court signs a settlement order or consent decree that enters a final judgment that includes a finding that the patent is invalid or not infringed.

(CC) The patent information submitted under [FDC Act § 505(b) or (c)] is withdrawn by the holder of the application approved under [FDC Act § 505(b)]. [(Emphasis added)]

In FDA’s May 2008 Letter Decision concerning 180-day exclusivity for generic PRECOSE (acarbose) Tablets, the Agency ruled that a request to withdraw patent information from the Orange Book is a forfeiture event under FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC).  (See our May 11, 2008 post here.)  In reaching this conclusion, FDA determined that the U.S. Court of Appeals for the District of Columbia Circuit’s 2006 decision in Ranbaxy Labs. Ltd. v. Leavitt holding that FDA may not condition the delisting of a patent on the existence of patent litigation and deprive an ANDA applicant eligible for 180-day exclusivity of such exclusivity does not apply to the version of the FDC Act amended by the MMA.  FDA’s PRECOSE Letter Decision states:

[T]he Ranbaxy court noted that the decisions rendered by the FDA and the district court had been made pursuant to the Act “as it stood before the MMA and, because the MMA was not made retroactive . . . this decision is also geared to the Act pre-MMA” (469 F.3d at 122). Therefore, the court did not purport to render a decision on patent delisting and exclusivity under the MMA. The effect of patent delisting on eligibility for 180-day exclusivity is expressly addressed by the plain language of section 505(j)(5)(D)(i)(I) of the Act. . . .  FDA reads the plain language of 505(j)(5)(D)(i)(I)(bb)(CC) to apply whenever a patent is withdrawn (or requested to be “delisted”) by the NDA holder.

FDA’s Letter Decision was challenged in the U.S. District Court for the District of Columbia; however, the challenge was abandoned after the court denied a generic applicant’s motion for a temporary restraining order. 

In October 2008, FDA once again applied its interpretation of FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC) when the Agency issued a Letter Decision ruling that Hi-Tech Pharmacal Co., Inc. (“Hi-Tech”) forfeited 180-day exclusivity for a generic version of Merck’s COSOPT (dorzolamide hydrochloride; timolol maleate) after the information on two exclusivity-qualifying Orange Book-listed patents covering the drug had been withdrawn by Merck.  (See our October 28, 2008 post here.)  FDA issued its Letter Decision after the U.S. District Court for the District of Columbia decided 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 and to obtain a prompt exclusivity decision from FDA to allow Hi-Tech to seek judicial relief in case of an adverse FDA decision.  Hi-Tech challened FDA’s Letter Decision in the U.S. District Court for the District of Columbia, but was ultimately unsuccessful in its lawsuit.  (Teva submitted an amicus brief in that case.)       

According to Teva’s Complaint, the company believes it is a first applicant with respect to both COZAAR and HYZAAR based on ANDA submissions in 2003 and 2004.  There are three patents listed in the Orange Book for both drug products.  Teva reportedly submitted a Paragraph III certification with respect to two of the patents, which expire in February and April 2010, and a Paragraph IV certification with respect to U.S. Patent No. 5,608,075 (“the ‘075 patent”), which expires in September 2014.  Subsequent to Teva’s Paragraph IV certification, Merck reportedly requested that FDA withdraw (or “delist”) the ‘075 patent information from the Orange Book for both COZAAR and HYZAAR.  Thus, according to Teva:

forfeiture events have already occurred under both prongs of the failure-to-market trigger.  As of August 12, 2006, thirty months had passed from the date Teva submitted its ANDA for generic Cozaar.  And as of January 16, 2007, thirty months had passed from the date Teva submitted its ANDA for generic Hyzaar.  these dates serve as the applicable dates in the (aa) subsection of the failure-to-market provision . . . .  And with respect to the (bb) subsection, well over 75 days now have passed from the date that Merck voluntarily asked FDA to delist the ‘075 patent from the Orange Book’s patent listings for Cozaar and Hyzaar.

But Teva argues that it should not forfeit 180-day exclusivity because FDA’s interpretation of FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC) (which Teva terms as the “Delisting Rule” in its court papers) is unlawful.  Teva states that:

The Agency’s assertion that the delisting trigger renders Ranbaxy irrelevant because the trigger now “expressly addresses” the “effect of patent delisting” is a classic non-sequitur.  While the delisting trigger unquestionably addresses “the effect” of patent delistings after they occur, it says nothing about when patent delistings are permissible – and thus can occur – in the first instance.  Other amendments made by the MMA supply the answer to that question, by creating a new mechanism for delisting: a cause of action that for the first time allows patent-challenging generic applicants to seek a court order compelling the brand manufacturer to delist a challenged patent against its will.  See 21 U.S.C. § 355(j)(5)(C)(ii)(I).

Read together, as statutory provisions must be, it thus is clear that these twin
Amendments – the delisting mechanism, on one hand, and the delisting trigger, on the other – were not remotely intended to open the proverbial floodgates to manipulative, exclusivity-divesting patent delistings by brand manufacturers, and thus sub silentio to abrogate the longstanding prohibition against such delistings that Ranbaxy recognized.  To the contrary, these interlinked provisions merely provide that when a first applicant secures a court-ordered patent delisting that clears the last remaining hurdle to generic competition, it cannot indefinitely delay generic competition by refusing to sell its product for more than 75 days after the court-ordered delisting.  Beyond that, however, the delisting trigger does not remotely authorize manipulative patent delistings that take place apart from, and wholly outside the confines of, the statute’s new delisting mechanism.  FDA has no answer to this simple point, and it is dispositive. [(Emphasis in original)]

Furthermore, Teva states that FDA’s policy – as expressed in the Hi-Tech case – of not providing early exclusivity decisions, but rather issuing 180-day exclusivity  decisions simultaneous with taking action on ANDA approvals, “has shielded the Delisting Rule from challenge in the courts” and “thwarts effective judicial review of that rule.”  Thus, Teva argues that “[b]ecause FDA’s Delisting Rule is arbitrary, capricious and contrary to law, and because any delay will deprive both Teva of its right to meaningful judicial relief and the public of its right to access generic losartan potassium products, the Delisting Rule immediately must be invalidated.”

Although originally assigned to Judge Gladys Kessler, the Teva case has been reassigned to Judge Rosemary M. Collyer.  FDA’s response, originally due on June 26th, will likely be due on July 1st once Judge Collyer rules on an unopposed motion for extension of time for FDA to respond to Teva’s preliminary injunction.  We will certainly be watching this case closely and will update FDA Law Blog readers on important developments.