Otsuka Alleges Premature Notice From a Repeat Offender in SAMSCA Patent Infringement Case

By Kurt R. Karst –      

A Complaint recently filed in the U.S. District Court for the District of Delaware by Otsuka Pharmaceutical Co., Ltd. (“Otsuka”) against Par Pharmaceutical, Inc. (“Par”) concerning notice of a Paragraph IV certification contained in an ANDA Par submitted to FDA for a generic version of SAMSCA (tolvaptan) Tablets raises the issue of so-called “premature notice.”  The issue is not a new one – particularly for Par.

FDA approved SAMSCA on May 19, 2009 under NDA No. 022275 and granted a period of 5-year New Chemical Entity (“NCE”) exclusivity.  Because patents are listed in the Orange Book for SAMSCA, that raises the possibility of submission of an ANDA containing a Paragraph IV certification beginning on the so-called NCE-1 date of May 19, 2013.  It also means that a timely filed patent infringement lawsuit within 45 days of the NDA holder/patent owner having received notice of a Paragraph IV challenge results in a 30-month litigation stay on ANDA approval that lasts until 7.5 years after the date of NDA approval (or until November 19, 2016 in the case of SAMSCA), unless an earlier court decision terminates the stay. 

Although it has been nearly 7 months since the NCE-1 date of May 19, 2013, FDA’s Paragraph IV Certifications List has not yet been updated to reflect receipt (i.e., filing) of an ANDA for generic SAMSCA containing a Paragraph IV certification.  But Otsuka recently filed a Complaint in the U.S. District Court for the District of Delaware in response to a Paragraph IV notice received by Par.  That means either FDA’s Paragraph IV Certifications List has not yet been updated to reflect receipt of an ANDA . . . . or that the list is currently correct and the notice sent by Par with respect to the company’s ANDA No. 206119 is not effective.  Not effective you ask?  Yes, ineffective beacuse it is premature.

Under FDC Act § 505(j)(2)(B)(ii), as added by the 2003 Medicare Modernization Act:

(ii) TIMING OF NOTICE.—An applicant that makes a [Paragraph IV] certification . . . shall give notice as required under this subparagraph—

(I) if the certification is in the application, not later than 20 days after the date of the postmark on the notice with which the Secretary informs the applicant that the application has been filed; or

(II) if the certification is in an amendment or supplement to the application, at the time at which the applicant submits the amendment or supplement, regardless of whether the applicant has already given notice with respect to another such certification contained in the application or in an amendment or supplement to the application.

According to Otsuka, which confirmed with FDA that as of November 14, 2013, Par’s ANDA No. 206119 had not been accepted for review:

Upon information and belief, as of October 10, 2013, Par did not have an ANDA with respect to Otsuka’s SAMSCA® (tolvaptan) that had been accepted for review by [FDA].  The acceptance of an ANDA by the FDA is a prerequisite that must be satisfied before Par can send Otsuka proper notification that an ANDA containing a “Paragraph IV certification” has been filed.  Such a notice letter, if it were valid, would start a time period in which Otsuka must sue for patent infringement in order to obtain a 30-month statutory period during which the FDA cannot approve Par’s ANDA.  Because, upon information and belief, Par’s ANDA had not yet been accepted by the FDA, Par could not send a valid notice letter to Otsuka, and therefore could not trigger Otsuka's statutory right to sue for infringement or commence the 30-month stay.

Shortly after confirming with FDA that Par’s notice letter was premature, Otsuka contacted Par and asked the company to withdraw the Paragraph IV notice.  Among other things, Otsuka cited a 2008 court decision – SB Pharmco Puerto Rico, Inc. v. Mutual Pharm. Co, Inc., 552 F. Supp. 2d 500 (E.D. Pa. 2008) (see here) – which held that a Paragraph IV notice letter sent prior to FDA’s receipt of an ANDA is premature and ineffective.  In that decision, the court also noted that premature certification, if accepted, could lead to manipulation of the Hatch-Waxman scheme by “accelerat[ing] the timing provisions and litigation process well beyond the framework that Congress intended.”  This point is reiterated by Otsuka in its Complaint: “By filing prematurely or notifying the NDA holder or patent owner prematurely, the first ANDA filer may also be able to manipulate the rules surrounding the 30-month stay to its advantage and reach the market sooner than would otherwise be permitted.”

Par declined Otsuka’s request to withdraw the notice (see here), saying that the “Paragraph IV Notice may be necessary to protect Par’s potential first-to-file status.”  Furthermore, according to Par, Otsuka’s reliance on SB Pharmco “is not persuasive” because the court in that case “improperly gave deference to the FDA’s interpretation of [FDC Act § 505(j)(2)(B)(ii)(II)].”  “No deference is owed to the FDA’s interpretation if the statutory language is clear and unambiguous, as is [FDC Act § 505(j)(2)(B)(ii)(II)],” writes Par.  (Of course, in the case of SAMSCA and Par's original ANDA, FDC Act § 505(j)(2)(B)(ii)(I), and not FDC Act § 505(j)(2)(B)(ii)(II), is the operative provision.)   

Interestingly, Par’s notice to Otsuka is not the first time the company has attempted to jump the gun by sending notice before FDA’s receipt of an ANDA as substantially complete.  According to one letter from FDA sent in August 2012, the Agency rebuffed Par for doing the same thing on another drug.  Indeed, we understand that the notice to Otsuka is not even the second time Par has followed an early notice strategy.  This may be a pattern of conduct followed by Par in more than 6 instances.  Will FDA finally more forcefully step in and take action to prevent future premature notices?  We may not know for sure, but the absence of future complaints alleging premature notice could be a sign that FDA had enough of the practice and took action to put an end to it.