Pennsylvania District Court Issues an XL Decision in WELLBUTRIN XL Antitrust, Sham Citizen Petition Case

By Kurt R. Karst –      

In a recent, 95-page decision from the U.S. District Court for the Eastern District of Pennsylvania in In re Wellbutrin XL Antitrust Litigation, the court once again tackled the issues of “sham” citizen petitions, liability under the Sherman Antitrust Act, and Noerr-Pennington immunity.  The court previously addressed citizen petitions alleged to be shams in In re Flonase Antitrust Litigation, 795 F. Supp. 2d 300 (E.D. Pa. 2011).

As a general matter, the standard for demonstrating a sham petition is pretty high.  Under the Noerr-Pennington doctrine, private entities are immune from antitrust liability in petitioning the government to influence the passage or enforcement of laws, even if the laws they advocate for would have anticompetitive effects.  See Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961); United Mine Workers v. Pennington, 381 U.S. 657 (1965).  Immunity extends to citizen petitions submitted to FDA.  The Noerr-Pennington doctrine is grounded in the First Amendment protection of political speech, and “upon a recognition that the antitrust laws, ‘tailored as they are for the business world, are not at all appropriate for application in the political arena.’” City of Columbia v. Omni Outdoor Advertising, Inc., 499 U.S. 365, 380 (1991) (quoting Noerr, 365 U.S. 127, 141 (1961)).

Noerr-Pennington immunity is not absolute.  When petitioning activity “ostensibly directed toward influencing governmental action[] is a . . . sham to cover what is . . . nothing more than an attempt to interfere directly with the business relationships of a competitor[, then] the application of the Sherman Act would be justified.”  Noerr, 365 U.S. at 144.  The sham exception requires that a petition be “(i) ‘objectively baseless,’ and (ii) ‘an attempt to interfere directly with the business relationships of a competitor through the use of the governmental process – as opposed to the outcome of that process – as an anticompetitive weapon.’”  Primetime 24 Joint Venture v. Nat’l Broad. Co., 219 F.3d 92, 100-01 (quoting Prof’l Real Estate Investors, Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49, 60 (1993) (“PRE”)).

In re Wellbutrin XL Antitrust Litigation stems from a July 2008 Complaint alleging that Biovail and GlaxoSmithKline (“GSK”) violated the Sherman Antitrust Act by conspiring to prevent generic versions of WELLBUTRIN XL (bupropion HCl) Extended-Release Tablets (NDA No. 021515) from entering the market by filing sham Hatch-Waxman patent infringement lawsuits (and then entering into agreements with generic companies to settle the lawsuits), and by submitting a sham citizen petition to FDA.  In granting Motions for Summary Judgment filed by Biovail and GSK, the court found that the patent infringement lawsuits and Biovail’s citizen petition “do not fall within the sham exception to Noerr-Pennington immunity.”  (The court did not decide whether the settlement agreements independently violated the antitrust laws, as that issue is still being briefed.)

The citizen petition at issue in the case was filed on behalf of Biovail on December 20, 2005 (Docket No. FDA-2005-P-0366; formerly Docket No 2005P-0498) and requested that FDA require that any ANDA for a generic version of WELLBUTRIN XL satisfy four criteria:

(1) All bioequivalence trials should calculate and evaluate parameters based on concentrations of the parent drug and active metabolites [(namely, the hydroxy-, threo-, and erythro-metabolites)].
(2) Any generic formulation should be shown, based on the above criteria, to be bioequivalent to Wellbutrin XL, sustained-release and immediate-release bupropion.
(3) The bioequivalence studies described above should be conducted at steady-state evaluating the performance of the dosage form based on AUC, Cmax, [and] Cmin.
(4) Data using FDA’s in vitro approach for evaluating the effect of alcohol on the performance of the controlled-release dosage form should be required to ensure the absence of “dose dumping” if the drug is consumed with alcohol.

The court termed these requests as the “metabolites evaluation request,” the “bioequivalence drift request,” the “steadystate request,” and the “dose dumping request,” respectively.

On December 14, 2006, FDA granted in part and denied in part the petition stating that:

FDA will require ANDA applicants for generic bupropion HCl extended-release tablets to demonstrate bioequivalence to Wellbutrin XL, but not to Wellbutrin SR and Wellbutrin.  FDA expects ANDA applicants for generic bupropion HCl extended-release tablets to measure the metabolite hydroxybupropion in their bioequivalence studies, but does not expect ANDA applicants to measure the metabolites threohydrobupropion and erythrohydrobupropion.  FDA also does not intend to require ANDA applicants to conduct steady-state bioequivalence studies.  FDA asked ANDA applicants for generic bupropion HCl extended-release tablets to submit data from in vitro dissolution studies addressing the performance of the drug-release mechanism in the presence of alcohol and expects to consider this data in its review of each ANDA.

Biovail, in the company’s Motion for Summary Judgment, made four arguments in favor of summary judgment with respect to the sham citizen petition allegations:

(1) First, that because the dose dumping request was granted, and the metabolites evaluation request was granted in part, the entire petition is immunized from antitrust liability under the Noerr-Pennington doctrine; (2) Second, that any competitive harm is immune from antitrust liability because it resulted from government decision; (3) Third, that even if the entire petition is not immunized, the unsuccessful requests were not objectively baseless; and (4) Finally, that even if the unsuccessful requests were objectively baseless, the plaintiffs have not shown that they caused any delay.

As an initial matter, the court found that the hydroxy-metabolite and dose-dumping petition requests that FDA granted are, by definition, non-sham.  The cound found so notwithstanding an argument proffered by the plaintiffs in the case that “petitioning the FDA to do something it has already done or to act on an issue about which it is already aware cannot be characterized as successful or objectively reasonable.”  Instead, said the court, the “standard for objective baselessness is a forward-looking standard from the point in time when the suit or petition was filed. . . .  To examine post hoc whether it was the petition that caused the government to reach a certain outcome would be contrary to the forward-looking language in PRE.”

Moving on to Biovail’s argument that “if a citizen petition includes more than one request, the entire petition is not a sham if at least one of the requests has objective merit” (i.e., whether a mixed petition is immune under Noerr-Pennington), the court said that it is an “interesting” issue, but one that does not need to be decided in the case, because “the plaintiffs have not shown any evidence that the unsuccessful and arguably sham requests in the Citizen Petition actually delayed FDA approval of the generic ANDAs any further than the delay caused by the successful requests.”  Nevertheless, the court went on to examine this issue further, and, relying on the court’s previous decision in In re: Wellbutrin SR Antitrust Litigation, No. 05-396, 2006 WL 616292 (E.D. Pa. Mar. 9, 2006), commented that “it is theoretically possible that a . . . sham request in a petition can cause antitrust damage above and beyond the delay caused by the non-sham claim – i.e., that the injury will exceed the portion of the conduct that is protected by Noerr-Pennington immunity.” 

With respect to Biovail’s government action immunity and unsuccessful request arguments, the court, as with the mixed petition issue, said that these issues do not need to be decided because the plaintiffs did not show that they caused antitrust injury above and beyond any delay from the successful, non-sham petition requests.  Nevertheless, the court considered and commented on each issue, first disagreeing with Biovail’s government action immunity argument, and second, indicating that there was no reasonable expectation of success of the petition requests that were ultimately unsuccessful (i.e., denied by FDA). 

So, the “interesting” issues the court commented on but did not need to decide with respect to allegedly sham citizen petitions and the extent to which there is Noerr-Pennington immunity will have to wait for another day.  But query whether that day will ever come given FDA’s timeframe under FDC Act § 505(q) (as added by the 2007 FDA Amendments Act) for responding to certain citizen petitions.