Losartan – D.C. Circuit Denies FDA’s Petition for Panel Rehearing and Rehearing en banc; Roxane/Apotex Case Continues

By Kurt R. Karst –   

Late on May 17th, the U.S. Court of Appeals for the District of Columbia Circuit denied, in separate orders (here and here), FDA’s petition for panel rehearing and rehearing en banc of the D.C. Circuit’s March 2, 2010 decision in Teva Pharms USA, Inc. v. Sebelius, 595 F.3d 1303 (D.C. Cir. 2010).  In that case, a 3-judge panel of the D.C. Circuit ruled, in the context of Teva’s ANDAs for generic versions of Merck’s COZAAR/HYZAAR, that the patent delisting counterclaim provision at FDC Act § 505(j)(5)(C)(ii)(I) added by the 2003 Medicare Modernization Act must be read together with the patent delisting forfeiture provision at FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC), and that there is “no reason to conclude that the 2003 addition of forfeiture provisions meant to give the brand manufacturer a right to unilaterally vitiate a generic’s exclusivity.”  FDA’s approved Teva’s ANDAs (here and here) on April 6, 2010 with 180-day exclusivity.

FDA’s petition argued, among other things, that the panel’s decision was “essentially an advisory opinion” because a forfeiture event other than patent delisting “has, in fact, occurred” (i.e., patent expiration through failure to pay maintenance fees), and that the panel lacked jurisdiction on the date it issued its opinion because Teva’s ANDAs for generic COZAAR/HYZAAR had not yet received final approval.  Teva, in the company’s opposition brief, vigorously defended its position that there is no basis for granting en banc review.  In denying FDA’s petition, the D.C. Circuit has ended one battle in the fight over generic COZAAR/HYZAAR 180-day exclusivity.  But another battle wages on . . . .

Roxane Laboratories, Inc. and Apotex, Inc. have appealed to the D.C. Circuit the D.C. District Court’s (Judge Rosemary M. Collyer) April 2, 2010 ruling denying Roxane’s and Apotex’s preliminary injunction motions (here and here).  Those motions challeged FDA’s March 26, 2010 letter decision concluding that Teva did not forfeit 180-day exclusivity eligibility under FDC Act § 505(j)(5)(D)(i)(VI).  That provision states that 180-day exclusivity eligibility is forfeited if “[a]ll of the patents as to which the applicant submitted a certification qualifying it for the 180-day exclusivity period have expired.”  FDA issued its response after soliciting public comment on whether Teva forfeited 180-day exclusivity eligibility because the only exclusivity-qualifying patent – U.S. Patent No. 5,608,075 – “expired” in March 2009 after Merck ceased paying certain patent maintenance fees.  As we previously reported, although FDA concluded that Teva did not forfeit 180-day exclusivity, the Agency spilled a lot of ink in its letter decision repudiating its own decision (essentially inviting a court challenge). 

Judge Collyer agreed that FDA properly followed the logic of the D.C. Circuit’s March 2, 2010 decision in Teva:

The Court cannot find that the FDA was arbitrary or capricious when it politely expressed its disagreement with a D.C. Circuit decision that had ruled against the agency, but nonetheless applied the reasoning of the Circuit to a different but, on these facts, closely related question.  Given the facts and law in this record, the Court finds that Plaintiffs have a very slim chance of success on the merits.  This factor does not support issuance of a preliminary injunction.

Apotex and Roxane, in their combined brief to the D.C. Circuit, argue that the “Court should conclude that the plain language of the statute requires a finding that Teva forfeited its 180 days of exclusivity,” and that “FDA’s decision to the contrary was not based on the plain language, or any other tools of statutory interpretation, but on the ‘reasoning’ in . . . [Teva],” under which, according to Apotex and Roxane, FDA falsely believed it was required “to reach a result with which it disagreed.”  FDA, in its May 18th brief, replies that:

FDA agrees with Apotex and Roxane that, based on the plain text of the statute, 21 U.S.C. § 355(j)(5)(D)(i)(VI), (ii), expiration of a patent for any reason should result in the forfeiture of 180-day exclusivity.  However, although FDA disagrees with the reasoning and holding of the Court in Teva, the agency must abide by that decision and consider its inescapable effect on the closely related issue involved here. Taking that ruling into account, FDA properly concluded that the expiration of a patent for nonpayment of fees does not trigger a forfeiture event. Thus, Apotex and Roxane are not likely to succeed on the merits.

Teva, in its May 18th Appellee brief, takes a more firm position:

At bottom, this is not a close case, and FDA’s decision only underscores how clear it is. While that decision sharply criticizes Teva, FDA nonetheless found itself compelled to conclude that unilateral patent delistings and unilateral patent terminations are two sides of the same coin—and thus equally foreclosed by Teva’s analysis of the statute’s incentive scheme. If there were a sensible way to split that coin in half, the tenor of FDA’s letter decision makes clear the Agency would have found it. But FDA did not do so—because it could not do so—and the district court’s decision should be affirmed.