NJ District Court Dismisses Patent Use Code Counterclaim as Not Valid Under Current Law; All Eyes Move to the Supreme Court PRANDIN Use Code Case

By Kurt R. Karst –      

Less than a month before the U.S. Supreme Court is scheduled to hear Oral Argument in Caraco Pharmaceutical Laboratories, Ltd. v. Novo Nordisk A/S, Docket No. No. 10-844 (see here and here), concerning whether the patent delisting counterclaim provisions at FDC Act §505(j)(5)(C)(ii)(I), as added by the Medicare Modernization Act, may be used to correct or delete an Orange Book-listed Patent Use Code (“PUC”), the U.S. District Court for the District of New Jersey granted a Motion to Dismiss a similar counterclaim in Hoffmann-La Roche Inc. v. Orchid Chemicals & Pharmaceuticals Ltd., a patent infringement lawsuit concerning generic BONIVA (ibandronate sodium) Tablets, 150 mg (“BONIVA Once-Monthly”).

BONIVA Once-Monthly, approved under NDA No. 021455, is a bisphosphonate indicated for the treatment and prevention of postmenopausal osteoporosis.  The drug is currently listed in the Orange Book with five patents, including U.S. Patent Nos. 7,718,634 (“the ‘634 patent”) and 7,410,957 (“the ‘957 patent”).  Both the ‘634 and ‘957 patents are listed in the Orange Book as method-of-use patents and expire on May 6, 2023.  The ‘634 patent, which issued on May 18, 2010, is listed with a “U-642” PUC, defined as “TREATMENT AND PREVENTION OF OSTEOPOROSIS,” and the ‘957 patent, which issued on August 12, 2008, is listed with a “U-887” PUC, defined as “TREATMENT AND PREVENTION OF OSTEOPOROSIS.” 

Orchid Healthcare, an unincorporated division of Orchid Chemicals and & Pharmaceuticals Ltd. (“Orchid”), submitted ANDA No. 078998 to FDA on or about May 16, 2007 seeking approval to market a generic version of BONIVA Once-Monthly, and containing a certification to the then-listed Orange Book patents for NDA No. 021455.  After having amended ANDA No. 078998 with Paragraph IV certifications to the ‘634 and ‘957 patents, Hoffmann-La Roche, Inc. (“Roche”) sued Orchid for patent infringement.  In response to Roche’s First Amended Complaint, Orchid included in its Answer, among other things, a counterclaim pursuant to FDC Act § 505(j)(5)(C)(ii)(I) requesting that the court issue an order requiring Roche to correct the PUCs for the ‘634 and ‘957 patents.  According to Orchid, “Roche’s use codes do not accurately describe the patented methods of use found in the claims of the 634 and 957 patents, in that they state that the 634 and 957 patent claims cover prevention of osteoporosis,” and “Roche must correct the use code for the 634 patent . . .  from ‘U-642: treatment and prevention of osteoporosis’ to ‘treatment of osteoporosis,’ and correct the use code for the 957 patent . . . from ‘U-887: treatment and prevention of osteoporosis’ to ‘treatment of osteoporosis.’”

Of course, hanging over Orchid’s counterclaim was the Federal Circuit’s 2010 decision in Novo Nordisk A/S v. Caraco Pharmaceutical Laboratories, Ltd., 601 F.3d 1359 (Fed. Cir. 2010), in which the Court reversed and vacated a 2009 decision from the U.S. District Court for the Eastern District of Michigan (Southern Division).  The district court ruled and issued an Order and Injunction requiring Novo Nordisk to change an Orange Book-listed PUC for a patent concerning PRANDIN (repaglinide) Tablets as a result of Caraco’s FDC Act §505(j)(5)(C)(ii)(I) counterclaim.  The Federal Circuit ruled that Caraco “does not have a statutory basis to assert a counterclaim requesting” a court to enter an order to change a PUC.  First, the Federal Circuit ruled that “the Hatch-Waxman Act authorizes a counterclaim only if the listed patent does not claim any approved methods of using the listed drug.”  Second, “the terms of the counterclaim provision do not authorize an order compelling the patent holder to change its use code narrative,” just the patent number and expiration date of an Orange Book-listed patent.  As noted above, the Federal Circuit’s decision is before the Supreme Court. 

Orchid says in its counterclaim that it believes the Federal Circuit’s “ruling is incorrect and that a cause of action for equitable relief exists . . . .”  Roche, however, says otherwise it its Motion to Dismiss: “[U]nder Caraco, the specific patent-listing issue for which the counterclaim was created does not apply here.  Since, there is no statutory basis for the new counterclaim as the Federal Circuit has stated in Caraco, Orchid’s Third Counterclaim should be dismissed pursuant to Fed. R. Civ. P. 12(b)(6), for failure to state a claim upon which relief can be granted.”  Orchid attempted to bolster its case in the company’s opposition to Roche’s Motion to Dismiss, stating that “[g]iven the substantial possibility that the law in this area will change before the present case is concluded, Roche’s motion to dismiss should be denied, without prejudice to renewal after the Supreme Court decision in Caraco.”   But Roche fired back that Orchid’s counterclaim is “dead in the water.”  “The highly speculative possibility that the Supreme Court might overturn years of established precedent in implied private right of action cases in a way that would give Orchid some grounds for relief does not justify burdening this Court or Plaintiffs with additional discovery and delay as the case is prepared for trial early next year,” argued Roche. 

Judge Stanley R. Chesler quickly dispensed with Orchid’s PUC counterclaim, saying that it “may be decided easily.”  Orchid’s sole argument in opposition to Roche’s Motion to Dismiss, writes Judge Chesler “is that a case is pending before the Supreme Court which might change existing law, and so this Court should abstain from deciding this motion now.  This Court construes this position as a concession that the third counterclaim is not valid under existing law.”  Accordingly, Judge Chesler granted Roche’s Motion to Dismiss Orchid’s third counterclaim.