Abuse of the fda citizen petition process: ripe for antitrust challenge?

Antitrust Health Care Chronicle
January 2012
Abuse of the FDA Citizen Petition
Process:
Ripe for Antitrust Challenge?
By Seth C. Silber,1 Jonathan Lutinski,2 and
Rachel Taylon3
consumers $931 billion over the last 10 years.4 Introduction
With billions of dollars at stake, generic firms Several antitrust challenges have arisen in the have alleged, with varying success, that their branded counterparts have used a number of companies blocking or delaying the introduction different strategies to keep lower-priced generics out of the market in order to prolong manipulation of FDA regulatory processes. exclusivity for their branded drug products. Improperly impeding generic entry potentially For example, generic firms have alleged that costs American consumers billions of dollars, as it is estimated that generic drug use has saved patents—that do not, in fact, cover the drug product that they purport to cover—in the 1 Seth Silber is a partner in the antitrust group of Wilson FDA’s publication commonly referred to as the Sonsini Goodrich & Rosati. Prior to joining the firm, “Orange Book.” 5 The Orange Book is the Seth spent six years at the FTC, where he worked as a staff attorney in the Health Care Division, Assistant to the FDA’s official listing of drugs, including the Director of the Bureau of Competition, and as an attorney patents that could be infringed upon by an advisor to Commissioner (now Chairman) Jon Leibowitz. ANDA applicant seeking to market a generic version of the branded product.6 Regardless of http://www.wsgr.com/wsgr/DBIndex.aspx?SectionName=attorneys/BIOS/8902.htm. whether an Orange Book listing is proper (i.e., 2 Jonathan Lutinski is an associate in the antitrust group of 4 See “The Generic Pharmaceutical Industry—Improving Wilson Sonsini Goodrich & Rosati. Prior to joining the Lives For Less,” The Generic Pharmaceutical Association firm, Jonathan spent four years as a staff attorney in the (2011), available at http://www.gphaonline.org/about- Health Care Division of the FTC, where he worked gpha/about-generics/case/generics-providing-savings- almost exclusivity on Hatch-Waxman settlements and other investigations in the pharmaceutical sector. Jonathan’s bio is available at 5 See, e.g., In re Buspirone Patent Litig., 185 F. Supp. 2d http://www.wsgr.com/wsgr/DBIndex.aspx?SectionName= 363, 371 (S.D.N.Y. 2002) (concerning whether Bristol- Meyers-Squibb (BMS) made false filings with the FDA that caused BMS’s patents to be wrongfully listed in the Rachel Taylon is an associate in the health care group of Orange Book in an effort to obstruct generic competition). Kutak Rock. Prior to joining Kutak Rock, Rachel worked in the antitrust group of Wilson Sonsini Goodrich & 6 The official name for the “Orange Book” is the “Approved Drug Products List with Therapeutic http://kutakrock.com/index.cfm?fuseaction=DspBio&id= Equivalence Evaluations.” It is available at http://www.accessdata.fda.gov/scripts/cder/ob/default.cfm. Antitrust Health Care Chronicle
January 2012
the patent actually covers the drug product for Most recently, however, several antitrust which it is listed), once listed, the brand may challenges have been brought against branded drug companies allegedly seeking to use the infringement, obtaining an automatic 30-month FDA citizen petition process as a tactic to stay of final FDA approval for the generic forestall generic entry.10 Often filed on or near the eve of generic entry, citizen petitions can have the effect of delaying final ANDA Generic firms have also brought antitrust approval while the FDA sifts through and challenges where brand firms introduce new evaluates if the petitioners’ arguments have patented products with minor or no substantive merit. While, to date, the FTC has not brought therapeutic improvements in the hopes of an enforcement action in this area, it has expressed concern regarding the potential for misuse of citizen petitions. According to pharmaceutical industry as a “product hopping” Commissioner (now-Chairman) Jon Leibowitz, or “switch” strategy. Because a branded drug the citizen petition process is “susceptible to can only be substituted for its AB-rated generic systemic abuse. … It is no coincidence that equivalent, these changes in formulation—and brand companies often file these petitions at the the subsequent shift of the market to the new eleventh hour before generic entry and that the formulation—may have the effect of destroying vast majority of citizen petitions are denied.”11 the market for the previous formulation, thereby defeating potential generic competition. Moreover, plaintiffs have brought antitrust challenges against branded companies in the context of last minute labeling changes, which have the effect of delaying or impeding the ability of lower-priced generics to enter the See LA Wholesale Drug co. v Sanofi-Aventis, No. 07- market.9 Again, since a generic product needs CIV-7343, 2009 U.S. Dist. Lexis 77206 (S.D.N.Y. 2009); In re Wellbutrin XL Antitrust Litig., No. 08-2433 (E.D. Pa. 2011), 268 F.R.D. 539 (E.D. Pa. 2010), 260 F.R.D. equivalent, even minor changes to labeling or 143 (E.D. Pa. 2009); In re DDAVP Direct Purchaser the products’ “use code” can have significant Antitrust Litig., 585 F.3d 677 (2d Cir. 2009); In re impact on the timing or ability of a generic firm Flonase Antitrust Litig., (No. 08-3149 (Direct), No. 08-3301 (Indirect), No. 09-1638 (Roxane) (E.D. Pa. 2008). 11 Jon Leibowitz, Fed. Trade Comm’n, text based on speech given to Generic Pharmaceutical Annual Policy Conference, entitled “How Settlements Make Strange 7 Federal Food, Drug, and Cosmetic Act (FDCA), §§ Bedfellows: Or How the Federal Trade Commission has Managed to Unite the Entire Pharmaceutical Industry,” See, e.g., Abbott Labs v. Teva Pharms. USA, 432 F. http://www.ftc.gov/speeches/leibowitz/060929GPHApub Supp. 2d 408 (D.Del. 2006) (alleging that through its vers. See also J. Thomas Rosch, Fed. Trade Comm’n, strategy of reformulation and relabeling, Abbott Remarks before the World Generic Medicine Congress, foreclosed Teva from effectively competing with its AB- entitled “The Antitrust/Intellectual Property Interface: Thoughts on How To Best Wade Through the Thicket in 9 Novo Nordisk v. Caraco Pharm. Labs., 601 F.3d 1359 the Pharmaceutical Context,” (Nov. 17, 2010) available at (Fed. Cir. 2010) (alleging Novo manipulated its patent use http://www.ftc.gov/speeches/rosch/101117roschworldspe code in an effort to thwart anticipated generic entry). Antitrust Health Care Chronicle
January 2012
Strategy to Impede or Delay Generic
Enactment of the Food and Drug
Entry Through the Use of the Citizen
Administration Amendments Act
Petition Process
Congress enacted federal regulations that allow In part to deal with the potential anticompetitive individuals to express to the FDA genuine abuse of the citizen petition process, Congress concerns about the safety, scientific, or legal issues regarding a product any time before, or September 27, 2007.14 The FDAAA adds new section 505(q) to the Federal Food, Drug, and regulations, any person or entity, including a pharmaceutical company, may file a citizen citizen petitions and petitions for stay of FDA petition with the FDA requesting that the FDA take, or refrain from taking, any administrative 505(q)(1)(A) provides that the FDA may not action. The petition must describe the precise delay approval of an ANDA application because FDA action that the petitioner requests and must of any request to take any form of action related include a certification that the petition “includes to the pending ANDA unless “a delay is all information and views on which the petition necessary to protect the public health.” 15 relies, and that it includes representative data Moreover, the FDAAA authorizes the FDA to and information known to the petitioner which summarily deny any citizen petition whose primary purpose, as determined by the FDA, is to delay competition.16 While in most circumstances citizen petitions are filed for legitimate concerns regarding the In a report issued in June 2011, the FDA safety and effectiveness of new drug products, citizen petitions also have the serious potential to delay and/or impede competition from lower- application may be delayed based on the filing priced generic alternatives. For example, a of a citizen petition.17 For example, if the party could embark on a strategy of filing petition cannot be summarily denied on its face, baseless citizen petitions with the intent and the FDA will use a “but for” test in determining effect of using the time in which it takes the whether the petition would be the cause of a FDA to respond to the petition (i.e., the process, delay for approval of a particular ANDA. If, rather than the outcome) to delay generic entry. Additionally, citizen petitions can also be used 14 Public Law 110-85 (as amended by Public Law 110- strategies, such as product hopping, to thwart generic entry. For example, a branded firm 16 21 USC 355(q)(1)(E) states, “If the Secretary could file a citizen petition in an effort to “buy determines that a petition … was submitted with the time” to shift the market to a new formulation of primary purpose of delaying the approval of an [ANDA] the branded product, impeding generic entry on and the petition does not on its face raise valid scientific or regulatory issues, the Secretary may deny the petition at any point based on such determination…” FDA, Guidance for Industry: Citizen Petitions and Petitions for Stay of Action Subject to Section 505(q) of the Federal Food, Drug and Cosmetic Act (June 2011) Antitrust Health Care Chronicle
January 2012
regardless of the petition, the ANDA would not FDA 2010 report to Congress under 505(q)(3) be ready for final approval, then section 505(q)(1)(A) would not be implicated.18 If, While the enactment of the FDAAA will likely however, the ANDA would be ready for curb some of the most egregious abuses of the approval but for the petition, then the FDA will citizen petition process (i.e., delays of 1-2 years next determine if a delay of final approval is while the brand files a series of successive and necessary to protect the public health.19 If so, baseless citizen petitions as in Flonase the Agency will delay the ANDA application discussed below),23 there is still some potential until the public health concern is resolved. for the anticompetitive use of citizen petitions to delay generic competition. For example, a determines a delay is necessary to protect public carefully crafted citizen petition, drafted by a health, the FDA will take final agency action on party with sophisticated regulatory counsel, may be able to successfully attempt to implicate To help assess whether the FDAAA effectively issues relating to public health—such as curbs abuses in the citizen petition process, “whether a proposed generic drug product is Section 505(q)(3) requires the FDA to submit an bioequivalent to the reference listed drug” or annual report to Congress. That annual report “whether an indication can be safely omitted provides relevant data on petitions covered by from the labeling because that indication is the provisions of the Act and whether these protected by a patent”24—as a pretext to delay petitions have delayed approval of pending Moreover, certain types of petitions are provided to Congress on July 29, 2010, the FDA stated that “[a]lthough FDA now has 2 years of Notably, the FDAAA does not apply to petitions experience implementing section 505(q), it that “relate solely to the timing of approval of believes it may still be too early to make a determination as to whether section 505(q) is exclusivity provision at section 505(j)(5)(B)(iv) effectively discouraging petitions submitted of the Act.”25 In addition, pursuant to the FDA with the primary purpose of delaying approval guidance issued earlier this year, Section 505(q) of an ANDA or 505(b)(2) application.”22 The http://www.hpm.com/pdf/FDA%20FY2009%20505q%20 Id. In determining if public health is at issue, the agency considers “[i]f the application were approved before the Agency completed the substantive review of the issues in 23 According to the FDA’s reports to Congress, only two the petition and, after further review, the Agency ANDAs were delayed by 505(q) petitions from concluded that the petitioner’s arguments against approval September 27, 2007 through September 30, 2008 and only were meritorious, could the presence on the market of one ANDA was delayed by a 505(q) petition from drug products that did not meet the requirements for October 1, 2008 through September 30, 2009. Id. See also approval negatively affect the public health?” FDA Report to Congress, “Delays in Approvals of Applications Related to Citizen Petitions and Petition for FDA Guidance at 3 (discussing Section 505(q)(1)(F)). Stay of Agency Action for Fiscal Year 2008,” (Apr. 28, 22 FDA Report to Congress, “Delays in Approvals of Applications Related to Citizen Petitions and Petitions for Stay of Agency Action for Fiscal Year 2009,” (Jul. 29, Antitrust Health Care Chronicle
January 2012
will not apply to petitions submitted before One of the most significant hurdles for plaintiffs September 27, 2007. To the extent that a in this area, however, continues to be bypassing plaintiff sued a defendant—based on a scheme Noerr-Pennington immunity. The Noerr- to monopolize a particular market dating back Pennington doctrine generally immunizes several years—it is possible that petitions filed efforts to petition the government from antitrust before this cut-off date may have caused delay liability.27 The doctrine is based on the premise that parties should be able to exercise their First Amendment right to petition the government without penalty. However, not all conduct is Finally, a branded firm may still be able to delay generic approval while the FDA considers whether the relevant citizen petition implicates While petitioning is generally protected, a party issues of public health.26 In the high stakes is not entitled to Noerr-Pennington immunity world of pharmaceuticals, even relatively short where the petitioning activity “ostensibly delays of a few days or a couple weeks can cost directed toward influencing governmental action generic firms and consumers millions of dollars [ ] is a mere sham to cover … an attempt to in lost sales and overpayment of prescription interfere directly with the business relationships drugs, respectively. Thus, with the relatively of a competitor….” Noerr, 366 U.S. at 144. In small costs of filing a citizen petition, brands other words, when the sole goal of petitioning is may still utilize this tactic as a strategy to extend to interfere with the business of one’s rival, it is their drugs’ life cycles, particularly when not protected. To prove that the petitioning is a coupled with other exclusionary tactics used to sham, a plaintiff must demonstrate that it is both maintain and extend their monopolies for objectively and subjectively baseless.28 The sham exception to Noerr-Pennington was first set forth in the Supreme Court’s decision in Analyzing Citizen Petition Under the
Professional Real Estate Investors, Inc. v. Antitrust Laws
Columbia Pictures Industries, Inc., 508 U.S. 49, An antitrust plaintiff alleging that a branded 60 (1993). In that case, the Court explained that firm is using the citizen petition process to under the objective prong the plaintiff must show that the petition is “objectively baseless in particular drug faces a number of challenges, the sense that no reasonable [party] could including the establishment of relevant market realistically expect success on the merits.” definition, market power, and antitrust injury. However, to the extent that “an objective [party] could conclude that the [petition] is reasonably 26 See Section 505(q)(1)(B). If the FDA determines that a calculated to elicit a favorable outcome, the delay of approval of an ANDA or 505(b)(2) application is [petition] is immunized under Noerr, and an necessary to protect the public health, the FDA is required antitrust claim premised on the sham exception to provide to the applicant not later than 30 days after making the determination: (1) that notification that the 27 E. R.R. Presidents Conference v. Noerr Motor Freight, determination has been made, (2) if applicable, any Inc., 365 U.S. 127, 144 (1961). See also United Mine clarification or additional data that the applicant should Workers v. Pennington, 381 U.S. 657 (1965). submit to the petition docket to allow FDA to review the petition promptly, and (3) a brief summary of the specific 28 Professional Real Estate Investors, Inc. v. Columbia substantive issues raised in the petition which form the Pictures Indus., Inc., 508 U.S. 49, 60 (1993) [hereinafter Antitrust Health Care Chronicle
January 2012
must fail.”29 Moreover, under the subjective conduct on the PTO in procuring the ‘398 prong, the Court determined that plaintiffs must patent; (2) improperly listing the ‘398 patent in show that the subjective intent of the petitioning the Orange Book; (3) filing and prosecuting a party is to inhibit competition rather than to petition the government for redress. If the Laboratories and Teva Pharmaceuticals, who plaintiff is able to prove both prongs, the had each filed ANDAs for desmopressin; and relevant petitioning activity will not be entitled (4) filing a sham citizen petition with the FDA to further delay approval of generic desmopressin. The crux of the Plaintiffs’ Recent Cases Challenging Citizen
complaint was that lower-priced generic entry Petition Under the Antitrust Laws
was significantly delayed as a result of In recent years, there have been several cases brought by generic firms alleging that branded Ferring’s citizen petition, filed on February 2, firms have used the citizen petition process as a 2004 while Ferring was prosecuting its patent way to impede generic entry and maintain and infringement suit against Barr, requested that extend their monopoly power. In these cases, the FDA require Barr to submit additional plaintiffs allege that the branded companies testing to demonstrate bioequivalence to pursued baseless petitioning activity for which DDAVP.31 Specifically, Ferring wanted the the singular goal was to impede competition, FDA to require Barr to conduct and submit rather than to influence the FDA to take action. more tests—pharmacodynamic (“PD”) studies These cases are discussed in more detail below. measuring urine osmolarity—in order for Barr to establish the bioequivalence of Barr’s In re DDAVP Direct Purchaser Antitrust
Litigation
On February 18, 2005, direct and indirect bioequivalence tests did not adequately address purchasers (collectively, “Plaintiffs”) of safety and efficacy of oral desmopressin therapy DDAVP (desmopressin acetate tablets), an for nocturnal enuresis in children. On July 1, antidiuretic prescription medication, filed 2005, FDA rejected Ferring’s citizen petition. complaints against Ferring B.V., Ferring The FDA stated that Ferring “offer[ed] no Pharmaceuticals, Inc. (collectively “Ferring”), information) that any of [its] proposed changes complaints alleged that Ferring, the owner of were needed” and denied Ferring’s petition in U.S. Patent No. 5,047,398 (“‘398 patent”), which claims to cover DDAVP, and Aventis, In dismissing all claims by the direct and indirect purchasers of DDAVP, the district court (collectively, “Defendants”), unlawfully monopolized the market for desmopressin 31 See Ferring B.V. v. Barr Labs., Inc., No. 7:02-CV- tablets by: (1) committing fraud or inequitable 9851, 2005 WL 437981, at 10 (S.D.N.Y. Feb. 7, 2005); Ferring B.V. v. Barr Labs. Inc., 437 F.3d 1181 (Fed. Cir. 32 See FDA Letter Rejecting Ferring Citizen Petitions 30 Complaint, Meijer, Inc. et al. v. Ferring B.V. et al., No (July 1, 2005) [hereinafter “Ferring FDA Rejection Antitrust Health Care Chronicle
January 2012
found that Ferring’s citizen petition did not rise sham citizen petition with the FDA. Aventis to the level of sham petitioning.33 Indeed, the had the exclusive right to market Arava in court found that the citizen petition was “First 10mg, 20mg, and 100mg strengths until March Amendment protected activity even though delay of Barr’s access to the market was permission to sell generic versions of 10mg and 20mg Arava, but not 100mg Arava. The Second Circuit, however, reversed. The Court disagreed with the district court’s Nearly one year later, on March 31, 2005, apparent rationale that “plaintiffs could not Aventis filed a citizen petition with the FDA. plausibly show the petition to be a sham, i.e., The citizen petition, filed on the eve of final objectively and subjectively baseless.”35 In its generic approval for 10mg and 20mg Arava, rejection of Ferring’s citizen petition, the FDA requested that the FDA not approve any ANDA had “found that the citizen petition ‘had no for generic leflunomide unless the ANDA (1) convincing evidence’ and lacked ‘any basis’ for contained bioequivalence studies confirming its arguments.”36 Moreover, in finding that the that five of the generic applicants 20mg leflunomide tablets are bioequivalent to one 100 inequitable conduct, the district court noted that mg Arava tablet, or (2) sought approval to the petition may have been a “hardball litigation market the 100 mg loading dose strength of tactic, motivated by a desire to keep out Arava. The FDA denied Aventis’ citizen competition for as long as possible after the petition on September 13, 2005 and, on the expiration of the patent.” The court found these same day, approved ANDAs for six generic allegations to be enough for the plaintiff to manufacturers to market generic leflunomide. plausibility demonstrate that the citizen petition In denying the citizen petition, the FDA noted that Aventis’ request for relief “seem[ed] to be submitted a settlement to the court in which based on a false premise,” namely that if a Ferring and Aventis agreed to pay $20.25 generic manufacturer recommended the 100 mg loading dose as part of its label it either had to Louisiana Wholesale Drug Co. v. Sanofi-
produce its own 100 mg tablet, or recommend Aventis
using five 20 mg tablets. Aventis “seem[ed] to ignore a third possibility” that a generic Drug wholesaler Louisiana Wholesale filed a leflunomide product could simply recommend a complaint against Aventis, alleging that Aventis 100 mg loading dose in the label that it did not unlawfully delayed generic competition to its itself manufacture. The FDA noted that it was drug Arava (leflunomide) through the filing of a “not uncommon” for makers of brand drugs to reference in their labels drugs made by other 33 PRE, supra note 28; In re DDAVP Direct Purchaser manufacturers. Moreover, there was nothing in Antitrust Litig., No. 05-cv-2237, slip op. at 15 (S.D.N.Y. the FDCA or the regulations that requires a generic applicant to seek approval for all 35 In re DDAVP Direct Purchaser Antitrust Litig., 585 Louisiana Wholesale alleged that, as a result of Aventis’ citizen petition, which was both objectively and subjectively baseless, generic Antitrust Health Care Chronicle
January 2012
competition to Arava was delayed from March Flonase all filed suit claiming that GSK filed a 2005 to September 2005, or a period of at least series of sham citizen petitions in order to delay the entrance of Roxane Laboratories’ generic Flonase.41 In denying Aventis’ motion to dismiss,38 the court found that Aventis’ conduct could fall In 1994, the FDA approved the NDA for GSK’s within the “sham” exception to Noerr- Flonase nasal spray for sale within the United Pennington immunity. The court found States. After a six-month extension, GSK’s exclusive right to market Flonase in the United Wholesale, specifically that Aventis as a sophisticated pharmaceutical manufacturer meantime, Roxane Laboratories filed an ANDA familiar with FDA regulations and practices seeking approval to market an AB-rated generic could have had no reasonable belief that its citizen petition was viable. Indeed, Aventis had During the period of May 2004 through June in the past referred to other drugs and strengths 2005, GSK made a series of petitions to the on its own generic and brand labels when FDA regarding the FDA’s approval of ANDAs Aventis itself did not manufacture either the for Flonase. On February 22, 2006, the FDA responded with a 24-page letter rejecting GSK’s However, after a full trial on the merits, the jury entire series of petitions stating, among other things, that “GSK is not permitted to shield its Additionally, Louisiana Wholesale’s motion for market share when the Agency has reasonably a reversal of the verdict or new trial was products may be approved.”42 The same day the FDA issued this determination to GSK, it In re Flonase Antitrust Litigation
approved Roxane Laboratories’ ANDA for Flonase, previously one of the nation’s top- selling drugs, is a steroid nasal spray produced rejection letter, GSK filed suit in Maryland by Defendant SmithKline Beecham Corporation asking for a temporary restraining order (later known as GlaxoSmithKline or GSK) with (“TRO”) and preliminary injunction seeking to the active ingredient fluticasone propionate. Roxane Laboratories (a generic manufacture of 41 The three suits are: (1) direct purchasers of Flonase in Flonase), and indirect and direct purchasers of American Sales Co., Inc. v. SmithKline Beecham Corp., No. 08-cv-3149 (E.D. Pa. July 3, 2008); (2) indirect 37 Complaint at 7, LA Wholesale Drug Co., Inc. v. Sanofi- purchasers of Flonase in IBEW-NECA Local 505 Health Aventis, No. 07-cv-7343 (S.D.N.Y. Aug. 17, 2007). & Welfare Plan v. SmithKline Beecham Corp., No. 08-cv- 3301 (E.D. Pa. July 14, 2008); and (3) a generic See LA Wholesale Drug Co., Inc. v. Sanofi-Aventis, manufacturer of FP in Roxane Labs., Inc. v. SmithKline No. 07-cv-7343(HB), 2008 WL 169362, 1 (S.D.N.Y. Jan. Beecham Corp., No. 09-cv-1638 (E.D. Pa. April 17, 18, 2008) (motion to dismiss); LA Wholesale Drug Co., 2009). The suits are grouped up under In re Flonase Inc. v. Sanofi-Aventis, No. 07-cv-7343(HB), 2008 WL Antitrust Litig. [hereinafter Flonase Litig.]. 4580016, (S.D.N.Y. Oct. 14, 2008) (summary judgment). FDA Letter Rejecting GSK Citizen Petitions at 24 (Feb. Judgment, LA Wholesale Drug Co., Inc. v. Sanofi- 22, 2006) [hereinafter “GSK FDA Rejection Letter”], Aventis, No. 07-cv-7343 (S.D.N.Y. Dec. 9, 2008). 40 LA Wholesale Drug Co., Inc. v. Sanofi-Aventis, 2009 http://www.regulations.gov/#!documentDetail;D=FDA- Antitrust Health Care Chronicle
January 2012
reverse the FDA’s denial of its citizen petition request, explaining that it “is desirable” to issue and to enjoin Roxane Laboratories sale of the final guidance before ANDA approval but generic Flonase. The court originally granted “it is not always possible” to do so.45 the TRO, but, on March 6, 2006, it denied In Request 2, GSK requested the FDA require GSK’s motion for a preliminary injunction. ANDAs to include data from perennial allergic GSK moved for summary judgment in all three rhinitis (PAR) and perennial non-allergic suits claiming that its conduct of filing citizen rhinitis (PNAR) studies.46 The court reasoned petitions was immune from antitrust liability that genuine issues of fact remain as FDA under the Noerr-Pennington doctrine. On June guidance cannot require ANDA applicants to 2, 2011, the court denied GSK’s motion for perform specific tests unless the tests are required by law. Additionally, the FDA rejected this request stating that there is no reason that drug performance would be different in PNAR plaintiffs had provided enough evidence to fulfill the second, subjective prong necessary to demonstrate sham petition. Thus, the only issue In Request 3, GSK requested the FDA to require pharmacokinetic data to be collected over the “objectively baseless” in that GSK could not entire dosage interval of in vivo tests.48 The realistically expect its petitions to succeed. In court stated that this petition could be a sham by reasoning through each of the series of six pointing both to the FDA’s rejection letter citizen petitions filed by GSK, the court found stating that four consecutive samples during the that genuine issues of material fact remained as dosage are sufficient and to expert evidence to whether GSK’s conduct was objectively baseless and therefore constituted a “sham.” In Request 4, GSK requested the FDA to In Request 1, GSK requested the FDA to refrain reconsider its in vitro test for plume geometry from approving ANDAs prior to issuing final guidance on nasal aerosols and nasal sprays and a statistical appendix.44 The court responded that this request could be objectively baseless 45 GSK FDA Rejection Letter, supra note 42, at 22. based on evidence that the FDA is not obligated 46 The FDA approved Flonase to treat the nasal symptoms to issue any guidance and ANDA applicants are of seasonal allergic rhinitis (SAR), PAR and PNAR. The not required to use the guidance. Additionally, 2003 Draft Guidance provided that an ANDA could be in regard to issuing the statistical appendix, this approved to treat all three indications even if the application only included data from SAR patients. request is often impossible as the FDA often lacks data to do so. The FDA also rejected this GSK FDA Rejection Letter, supra note 42, at 12. 48 The FDA analyzes pharmacokinetic data generated from a single dose treatment over time. The 2003 Draft 43 See Flonase Litig., supra note 41. Guidance required an applicant to take measurements at least four consecutive times during the dose interval. In 1999 the FDA issued a draft guidance entitled Draft Guidance for Industry: Bioavailability and 49 GSK FDA Rejection Letter, supra note 42, at 13-14 Bioequivalence Studies for Nasal Aerosols and Nasal (“FDA believes that four consecutive sampling times Sprays for Local Action [hereinafter 2003 Draft using the maximum clinical dose is sufficient to detect Guidance]. This guidance was amended in 2003, but was whether two [FP] nasal spray suspension products [are Antitrust Health Care Chronicle
January 2012
and container shelf life.50 The plaintiffs standards were sufficient to ensure public submitted evidence that plume geometry is a relevant factor for ANDA applicants as well as Finally, the court looked at the Maryland pointed to the FDA’s letter stating the same.51 lawsuit in which GSK had filed for a TRO and The plaintiffs also argued that GSK’s proposed preliminary injunction.54 GSK argued that alternative test for shelf life was impossible and because it was granted the TRO, the lawsuit was directed the court to the FDA’s letter stating that not objectively baseless. The court rejected this its method for testing shelf life was sufficient.52 assertion finding that a court’s granting of a Therefore, the court found that genuine issues of TRO does not, by itself, establish an objective basis for petitioning activity. Furthermore, the In Request 5, GSK requested the FDA reconsider its endorsement of the geometric preliminary injunction, and the plaintiffs’ mean ratio method. Here the court responded evidence of baseless citizen petition, raise that genuine issues remained because GSK’s genuine issues of fact as to whether the criticisms were irrelevant to Flonase because the Maryland lawsuit was objectively baseless.55 request was relevant for solution-based nasal The court therefore denied GSK’s motion for sprays and Flonase is a suspension based spray. summary judgment because genuine issues of In Request 6, GSK asked the FDA to tighten fact remained on whether GSK’s citizen petition specifications for droplet size distribution constitute a sham and are not entitled to Noerr- (DSD) which measures the size of individual Pennington immunity. This suit is still pending. droplets in the spray and spray pattern (SP) which describes the cross-sectional shape of the In re Wellbutrin XL Antitrust Litigation
spray emitted.53 The court reasoned that On January 7, 2011, purchasers of Wellbutrin genuine issues of fact remained because these methods are proprietary and therefore differ Corporation.56 The plaintiffs sued Biovail, the producers of Wellbutrin XL (a once-a-day antidepressant) for conspiring to prevent generic presented expert testimony stating the existing 54 Glaxo Grp. Ltd. v. Leavitt, No. 06-cv-649 (D. Md. Feb. 23, 2006). Responses to citizen petitions constitute final agency action and are subject to immediate review by the Plume geometry describes the cross-sectional shape of the spray emitted from the device, measured on a plane parallel to the direction of the spray. 55 The court denied GSK’s Motion stating, “If I had any hesitation, and a man without hesitation is a dangerous GSK FDA Rejection Letter, supra note 42, at 18 man, I understand that. But if I had any hesitation (“Studies in literature have indicated that the spray angle whatsoever that you had any kind of likelihood of is one aspect of product performance that determines prevailing in this case, I would not hesitate. But I simply where in the nasal cavity drug is deposited.”). don’t have it. … I just don’t see any likelihood that you’re 52 GSK FDA Rejection Letter, supra note 42, at 17 going to prevail.” Prelim. Inj. Hr’g 124:4-17 Mar. 6, (“[FDA studies] are adequate to ensure that generic versions of the [FP] nasal spray product preserve identity, 56 Second Amended Consolidated Class Action Compl. strength, quality, and purity over their shelf life.”). and Jury Demand for End Payors, In re Wellbutrin XL 53 DSD and SP provide an internal measure of the Antitrust Litig., No. 2:08-cv-2433 (E.D. Pa. Jan. 7, 2011) production quality of any given batch of a drug. Antitrust Health Care Chronicle
January 2012
versions of Wellbutrin XL from entering the Stabenow (D-Mich.) and Trent Lott (R-Miss) market. Specifically, the plaintiffs allege that the defendants have: (1) filed three sham patent litigation cases, (2) filed a sham listing with the The case is currently pending in the Eastern Orange Book, (3) filed a baseless FDA citizen District of Pennsylvania61 and the court has yet petition, and (4) formed potentially illegal to reach the question of whether Biovail’s citizen petition will be given immunity under In reference to the citizen petition, the plaintiffs alleged that Biovail submitted its citizen petition requesting the FDA to require ANDA applicants “Plus” Factors that Make
to perform additional studies beyond those Monopolization Claims Based on
previously submitted to prove bioequivalence. Citizen Petition Theory More Likely to
Specifically, Biovail requested that the ANDA Survive Motion to Dismiss or
prove bioequivalence to not only Wellbutrin Summary Judgment
XL, but also Wellbutrin IR and Wellbutrin SR. The plaintiffs complained that FDA regulations While there is a high standard to prove the sham exception to Noerr-Pennington immunity, as bioequivalence to the referenced listed drug and therefore the requests were baseless.57 Further successfully survived at the motion to dismiss the plaintiffs claimed the citizen petition was a and/or summary judgment stages. While there sham because “it relied on unsubstantiated is no “formula” for a successful claim for theories, lacked scientific support, misapplied monopolization based on the filing of baseless governing legal and regulatory standards, and citizen petition, the courts have discussed was nothing more than a last-minute attempt to certain factors that make the success of these In denying the citizen petition, the FDA stated Suspect Timing
that the brand manufacturers did not have “the In considering whether the sham exception has right to be free of generic competition” once the been met, courts look to the timing of the filing patents had been held unenforceable, and that “Biovail [should] not be permitted to shield its market share.”59 In turn, the plaintiffs claimed 60 Wellbutrin Compl., supra note 56, at 3. that this citizen petition delayed approval of its 61 The indirect purchasers were recently granted class ANDA for four months. Notably, according to certification. See Meijer Inc. et al. v. Biovail Corp. et al., a letter sent by United States Senators Debbie No. 2:08-cv-0243 (E.D. Pa. Aug. 11, 2011). 62 There are two additional case filed recently which claimed a brand manufacturer filed a sham citizen petition. In re Ditropan XL Antitrust Litig., No. M:06-CV- 01761-JSW (2007) was dismissed on standing grounds and the court never reached an analysis of the citizen 59 FDA Letter Rejecting Biovail Citizen Petition at 16 petition. In New Mexico UFCW Union’s and Emloyers’ (Dec. 14, 2006) [hereinafter “Biovail FDA Rejection Health and Welfare Trust Fund v. Astellas Pharma U.S., Inc., Case No. 1:11-cv-11621 (D. Mass. Sept. 14, 2011), http://www.regulations.gov/#!documentDetail;D=FDA- the plaintiffs claim that Astellas filed a baseless citizen petition to extend its market exclusivity of Prograf. Antitrust Health Care Chronicle
January 2012
of the citizen petition. Courts have reasoned Relief Requested Contrary to FDA Regulations
that a NDA holder filing a citizen petition on the and Practice
Another significant factor is whether the party For example, in Louisiana Wholesale discussed filing the citizen petition made requests for above, the court seemed to suggest that the relief with the FDA that were contrary to FDA regulations and practice. Arguments made by determining whether it was a sham. In deciding sophisticated parties in the face of clear and whether triable issues of fact existed with contradictory FDA regulations may provide respect to the “reasonability and viability” of further evidence of an objectively baseless Aventis’s citizen petition, the court held that For example, in rejecting Aventis’ motion for circumstances surrounding Aventis’ filing “one summary judgment, the Louisiana Wholesale year after the generic manufacturers submitted court found it significant that Aventis’ citizen their ANDAs for FDA approval when no new petition requested relief that it knew was health and safety information on the loading contrary to FDA regulations and practice. First, dose or leflunomide in general and no new FDA Aventis demanded that generic manufacturers regulations on labeling had occurred.” produce their own 100 mg tablets in order to Although it would seem that the timing would succeed with their ANDAs, but Aventis knew be more probative in determining the brand’s that the FDA permitted generics to receive subjective state of mind in filing a citizen approval for some—but not all—dosage petition (i.e., whether the petition raise strengths of a branded drug, and cited nothing to legitimate safety issues or was intended as a contrary. Second, Aventis demanded that if the vehicle to delay generic entry), it appears that generics tried to substitute five 20 mg tablets to the court considered this as part of the threshold question of whether the petition was objectively demonstrate bioequivalence between those tablets and the 10 mg tablet. But again, Aventis Additionally, in Flonase the court noted that GSK did not file its first citizen petition until 2004, on the eve of potential generic entry and strengths of the same drug. Finally, Aventis insisted that the generics not be able to reference Laboratories had filed its ANDA application. the 100 mg loading dose in the label, but Indeed, as the plaintiffs complained, “… just days after the expiration of the statutory manufacturers to cross-reference other drugs or exclusivity period for GSK’s Flonase, and on other dosages because it did so in two other the eve of what could have been the FDA’s instances. Not only did Aventis cross-reference approval of Roxane Laboratories’ ANDA, GSK other drugs in manufacturing other brands and filed the first in a series of objectively baseless generics, but also, with respect to its own authorized generic leflunomide product, Aventis did not produce a generic 100 mg loading dose and referenced the brand tablet in the label. 63 Complaint of Roxane Laboratories, Inc. at 7, Roxane In Flonase, the plaintiffs contended that GSK’s Labs., Inc. v. SmithKline Beecham Corp., No. 09-cv-1638 (E.D. Pa. April 17, 2009) [hereinafter “Roxane Compl.”]. requests did not address the adequacy of Roxane Antitrust Health Care Chronicle
January 2012
Laboratories’ ANDA, present any evidence that of generic competition” once the patents had been held unenforceable, and that “Biovail bioequivalence, or raise any public health [should] not be permitted to shield its market share.”65 In Flonase the FDA stated, “[t]he Rejection Letter, the FDA stated that the tests policies behind the Hatch-Waxman dictate that GSK should not be permitted to shield its bioequivalence were sufficient. The plaintiffs in market share when the Agency has reasonably DDAVP, made the same types of claims stating that the citizen petition lacked scientific basis products may be approved…”66 The court in and was contrary to current practices. The FDA Flonase also took into account the Maryland specifically stated that the citizen petition Court’s outright rejection to GSK’s request for a requests made in DDAVP lacked “any basis” for The FDA’s response to citizen petition The vast majority of companies involved in these law suits are large pharmaceutical determination if a petition is considered companies which have substantial experience in objectively baseless. Obviously if the FDA takes action based on the citizen petition, the regulations. In turn, there is an expectation that petition will not be found to be baseless.68 On the other hand, as is present in these cases, the practices and procedures. Therefore, if the fact that the FDA strongly criticized the requests citizen petition requests action that the company may tend to show that a petition is objectively knows is contrary to FDA practice, courts may baseless and therefore not entitled to Noerr- use this as a telling factor that the petition was Pennington immunity. While not expressly baseless and part of a scheme to delay generic called out as a factor, the courts in these cases have recited and quoted extensively from the language contained in the FDA’s letters Tone of FDA Rejection of Citizen Petition
The tone of the FDA rejection letters also 65 Biovail FDA Rejection Letter, supra note 59, at 16. appears to play a role in plaintiffs surviving a dispositive motion. When the FDA harshly GSK FDA Rejection Letter, supra note 42, at 24. criticizes the citizen petition filer, the court may 67 The court denied GSK’s Motion stating, “If I had any use it as a relevant factor in making its decision. hesitation, and a man without hesitation is a dangerous man, I understand that. But if I had any hesitation For example, in DDAVP, the FDA found that whatsoever that you had any kind of likelihood of the citizen petition lacked “any basis” and “had prevailing in this case, I would not hesitate. But I simply don’t have it. … I just don’t see any likelihood that you’re going to prevail.” Prelim. Inj. Hr’g 124:4-17 Mar. 6, Further, in Louisiana Wholesale, the FDA noted that Aventis’ requested relief “seem[ed] to be 68 Although the plaintiffs in Louisiana Wholesale based on a false premise.” Additionally in successfully passed the preliminary motions stage, the Wellbutrin, the FDA stated, that the brand defendants were able to present evidence at trial showing manufacturers did not have “the right to be free the FDA took action based in part on one of the citizen petition requests. This is one factor the court later pointed out in subsequently denying Plaintiffs JNOV after the jury Antitrust Health Care Chronicle
January 2012
rejecting the branded firms’ citizen petition. defendants may have strong arguments that their Clearly, a strongly worded rejection from the citizen petition, even if baseless, had no adverse FDA—chastising petition for the lack of foundation for the citizen petition filed—is Although the four factors reviewed above are likely to play a role in the fact finders’ analysis certainly not all a court takes into account in its decision, facts that represent egregious Petition Actually Caused Delay
examples of most or all of these factors have pushed courts to find that claims based on the In all four of the cases above, the courts found it filing of baseless citizen petition can, in some important that the FDA granted final approval circumstances, survive dispositive motions and of the ANDAs on the same day as it rejected the brand manufacturer’s citizen petition, suggesting that the citizen petition was indeed Conclusion
holding up generic entry and competition. The abuse of the citizen petition process is an Indeed, the court in Louisiana Wholesale area of flux in the world of pharmaceutical specifically remarked on the FDA’s statement antitrust. With the enactment of the FDAAA, that it would not grant the generic ANDA there is a potential that the most egregious applicants approval while it addressed the abuses of the ANDA process are likely to be Aventis’ citizen petition. Moreover, in Flonase, the FDA seemed likely to approve Roxane’s approval of a pending ANDA application, as a generic, then reversed its thinking and issued a result of a citizen petition, unless “a delay is deficiency based on the citizen petition, and necessary to protect the public health.” 70 That finally approved the ANDA based primarily on said, it appears that the jury is still out on whether the FDAAA will effectively eliminate While a consideration of whether the citizen the potential for anticompetitive use of citizen petition actually delayed generic entry may petitions to impede or delay generic entry. relate more to the establishment of antitrust According to the FDA’s most-recent report to injury—rather than the establishment of the Congress, it is “too soon to determine whether sham exception to Noerr-Pennington section 505(q) is discouraging petitions immunity—it is important to note that causation submitted with the primary purpose of delaying approval of an ANDA.”71 Moreover, there are monopolization challenges based on the filing of baseless citizen petitions. In other words, to the extent that other factors—such as failure to exclusivity as well as agreements that predate September 2007, which, as discussed above, issues—may have caused delay in the generic could be relevant as part of a continued firm’s ability to obtain FDA approval, conspiracy to monopolize a particular drug market. 69 Conversely, a letter from the FDA tending to show that petitioner’s argument had legitimate bases that were carefully considered by the FDA is also likely to factor into the judge’s analysis, as it tends to show that the citizen petition was not objectively baseless. 71 FDA Report to Congress, supra note 22. Antitrust Health Care Chronicle
January 2012
To the extent that the FDAAA does not fully reign in the anticompetitive use of citizen petitions, there are several examples of cases filed in recent years that have survived dispositive motions—bypassing Noerr-Pennington immunity and proceeding through discovery—based on this conduct. Synthesizing those cases, it is apparent that several of the “plus” factors described above are predictive of whether a monopolization claim based on the manipulation of the FDA regulatory process through the filing of baseless citizen petitions is likely to be viable. While only time and continued monitoring of the FDAAA will tell whether these types of abuses are likely to be eradicated in the future, it is clear that potential plaintiffs pursuing these types of claims should emphasize these “plus” factors in any prospective litigation.

Source: http://www.wsgr.com/publications/PDFSearch/silber0112.pdf