NJ District Court Punts in ASACOL DJ Action to Trigger 180-Day Exclusivity Forfeiture; Rules that Subsequent ANDA Applicant Lacks Standing

April 5, 2011

By Kurt R. Karst –      

Some court decisions just leave us scratching our heads after we read them, and the decision handed down last week by Judge Freda Wolfson of the U.S. District Court for the District of New Jersey in Medeva Pharma Suisse A.G. v. Par Pharmaceuticals, Inc., Case No. 3:10-cv-04008 (D.N.J., Mar 29, 2011), is one of them.  We’ve all heard of FDA’s 180-day exclusivity forfeiture “punts” under FDC Act § 505(j)(5)(D)(i)(IV), where a first applicant fails to obtain tentative (or final) ANDA approval within 30-months of application submission and FDA says that the Agency is not making a formal forfeiture determination at the time of ANDA approval and will do so only if another applicant becomes eligible for approval within 180 days after the first applicant begins commercial marketing.  Last week’s decision in Medeva, concerning a generic version of ASACOL (mesalamine) Delayed-Release Tablets, 400 mg, and in the context of a subsequent ANDA applicant’s standing to bring a declaratory judgment action to trigger a first applicant’s 180-day exclusivity, seems to create a new type of court-created punt. 

We’ll spare you a full recitation of the facts in this case, but here’s what you need to know . . . .   There are two patents listed in the Orange Book for Warner Chilcott Pharmaceuticals, Inc.’s (“Warner Chilcott’s”) ASACOL – U.S. Patent Nos. 5,541,170 (“the ‘170 patent”) and 5,541,171 (“the ‘171 patent”), both of which expire on July 30, 2013.  Par Pharmaceutical, Inc. (“Par”) is a subsequent ANDA applicant whose ANDA contains Paragraph IV certifications to the ‘170 and ‘171 patents.  FDA has not yet approved, or even tentatively approved, an ANDA for a generic version of ASACOL. 

Warner Chilcott (and Medeva Pharma Suisse A.G.) sued Par for infringement of the ‘170 patent, but not for the ‘171 patent.  Par filed papers seeking a declaratory judgment of non-infringement or invalidity with respect to both patents, presumably in an effort to trigger the first applicant’s 180-day exclusivity (reportedly Roxane, which submitted an ANDA in June 2007).  In response, Warner Chilcott offered Par a covenant not to sue only with respect to the ‘171 patent and then filed a Motion to Dismiss Par’s declaratory judgment action for lack of standing.  Warner Chilcott’s papers also note that the first applicant “may be deemed to have lost its 180-day exclusivity period as a result of a forfeiture event” (presumably under FDC Act § 505(j)(5)(D)(i)(IV) for failing to obtain timely tentative approval). 

Par opposed the Motion to Dismiss arguing that pursuant to the Federal Circuit’s decision in Teva Pharmaceuticals USA, Inc. v. EISAI Co., Ltd., 620 F.3d 1341 (Fed. Cir. 2010), “this Court has and should exercise jurisdiction over defendants’ declaratory judgment counterclaims,” and that any argument that the first applicant forfeited 180-day exclusivity eligibility is speculative.  Indeed, Par notes that in an August 2010 citizen petition response, “FDA announced particular bioequivalence requirements for mesalamine drugs,” and that as a result FDA might determine that there was a change in or review of the requirements for ANDA approval and that the first applicant’s failure to obtain timely tentative approval might be excused under the exception provision at FDC Act § 505(j)(5)(D)(i)(IV).  (And although we did not see anything to this effect in the various court filings, FDA could also extend the 30-month period under FDC Act § 505(j)(5)(D)(i)(IV) pursuant to FDC Act § 505(q)(1)(G), which states that if “approval of the [ANDA] was delayed because of a [citizen] petition [subject to FDC Act § 505(q)], the 30-month period under [FDC Act § 505(j)(5)(D)(i)(IV)] is deemed to be extended by a period of time equal to the period beginning on the date on which the Secretary received the petition and ending on the date of final agency action on the petition (inclusive of such beginning and ending dates) . . . .”)  

Warner Chilcott’s Reply presses the company’s point that “[a]ny apprehension of potential litigation involving the ‘171 Patent has been extinguished by Plaintiffs’ express covenant not to sue.” 

Judge Wolfson, in her March 29, 2011 decision, punted on the issue of the appropriate standard for declaratory judgment jurisdiction in Hatch-Waxman Orange Book patent listing cases, and instead grabbed onto the first applicant’s potential forfeiture of 180-day exclusivity under FDC Act § 505(j)(5)(D)(i)(IV) as the basis for granting Warner Chilcott’s Motion to Dismiss Par’s declaratory judgment action with respect to the ‘171 patent.  According to Judge Wolfson:

Seizing on the Act’s language exempting a failure to obtain tentative approval “caused by a change in or a review of the requirements for approval of the application imposed after the date on which the application is filed,” 21 U.S.C. § 355(j)(5)(D)(i)(IV), Defendants argue that its allegations do not suggest that Roxane forfeited its eligibility because, in August 2010, the FDA announced a change to the bioequivalence requirements for a class of drugs covering Roxane’s application.  The flaw in Defendant’s argument is that this alleged announcement came four months after Defendants allege that Roxane’s 30-month tentative approval period had expired and, therefore, could not have been the cause of Roxane’s failure to obtain approval.  Moreover, nothing in the record suggests that an approval or extension of Roxane’s application from the FDA is imminent; in fact, at this juncture, more than 10 months after Roxane’s 30-month approval allotment has expired, the Court cannot discern whether an approval or extension will ever be granted.  Therefore, based on the allegations in Defendants’ counterclaim, and the plain language of the Act, Defendants have not sufficiently alleged that they are barred from entry into the market.  This means that any potential barrier that could result from a subsequent approval and reinstatement of Roxane’s market exclusivity is speculative at best, and does not meet the Article III requirement of actual or imminent injury for standing. [(emphasis in original)]

Of course, just because FDA responds to a citizen petition after the 30-month date for obtaining tentative approval (or final approval) has passed does not necessarily mean that FDA did not earlier change the requirements for ANDA approval . . .  or that a citizen petition affects the 30-month period pursuant to FDC Act § 505(q)(1)(G).   And what if FDA rules that the first applicant did not, in fact, forfeit 180-day exclusivity eligibility.  Would a subsequent applicant (here, Par) then have standing . . . . and if so, would it be too late to trigger a forfeiture event under the failure-to-market provisions?

Thanks to Shashank Upadhye for bringing the decision to our attention.