New Lawsuit Challenges FDA’s Authority to Compel Patent Certifications

August 11, 2022By Sara W. Koblitz

For years, FDA has been wrestling with questions about what patents should be listed in the Orange Book, but, as we have reported, FDA has made little to no progress on addressing those questions.  One of those pressing questions that remains unanswered involves the listing of REMS patents in the Orange Book.  While FDA asked for Comments in 2020 about whether REMS patents, among others, “are in fact the type of patents that must be submitted” for listing in the Orange Book, FDA has not yet taken a position on the issue.  With no guidance from FDA, sponsors have listed their REMS patents in the Orange Book, requiring follow-on sponsors to certify to those REMS patents upon submission of their 505(b)(2) NDAs or ANDAs.  Though the Agency has not officially blessed listing REMS patents in the Orange Book, a recent lawsuit challenges FDA’s facilitation of such a listing by requiring a patent certification to a REMS patent listed in the Orange Book where the proposed follow-on developed its own REMS and proposed to carve-out the method of use claimed in the listed REMS patent.  Essentially, the lawsuit asks, does FDA have the authority to compel patent certifications where a section viii statement has been filed?

In July, Avadel CNS Pharmaceuticals (“Avadel”) sued FDA (here and here) over a 16-page decision requiring Avadel to certify to a method-of-use REMS patent listed in the Orange Book with use code, U-1110, a “method of treating patients with a prescription drug using a computer database in a computer system for distribution”—or as Avadel puts it, “the use of a ‘computer database.’”  Avadel submitted a 505(b)(2) NDA for Lumryz, a sodium oxybate drug product referencing Jazz Pharmaceuticals’ Xyrem.  Xyrem is listed in the Orange Book with multiple patents, including the aforementioned method-of-use patent, U.S. Patent Number 8,731,963 (the “’963 patent”), which describes Jazz’s single, centralized REMS drug distribution database with use code U-1110.  Because Avadel intended to use its own REMS rather than Jazz’s, Avadel did not certify to the ‘963 patent but instead submitted a section viii statement confirming that the patent does not “claim a use for such drug for which the applicant is seeking approval.”  Despite this section viii statement, FDA, more than a year and a half after NDA submission—525 days to be exact—ordered Avadel to certify to the ‘963 patent based on the conclusion that the Lumryz REMS’s use of four computer databases for distribution overlaps with the U-1110 use code.  In other words, because the U-1110 use code describes the use of “a computer database in a computer system for distribution,” and because the proposed Lumryz REMS will use four computer databases for distribution, FDA determined that the patent does claim a use for which the applicant is seeking approval.

Avadel certified to the ‘963 patent “under protest” in June 2022, Jazz sued Avadel for infringement of the ‘963 patent on July 15, 2022, and FDA tentatively approved the Lumryz NDA on July 18, 2022.  Because Jazz timely sued Avadel, the lawsuit triggered a 30-month stay, which effectively precludes final approval of the Lumryz NDA until the expiration of the patent in June 2023.

Looking at an almost-one-year delay before final approval of Lumryz, Avadel filed suit against FDA alleging that FDA violated the Administrative Procedure Act by requiring certification to the ‘963 patent and thereby delaying final approval.  Avadel argues that the decision whether to file a patent certification or a section viii statement rests solely in the “opinion” of the new drug “applicant” under the plain language of the statute set forth in 21 U.S.C. § 355(b)(2), and FDA therefore lacks statutory authority to “second-guess Avadel’s decision to file a patent statement, rather than a patent certification.”  Accordingly, Avadel argues that FDA does not have legal basis to compel a patent certification to the ‘963 patent.

First, Avadel explains that the U-1110 use code “does not describe the use of any drug, much less sodium oxybate,” and thus does not trigger the patent certification requirement.  Nor does FDA have the authority to look beyond the Lumryz labeling to its REMS document for a use that overlaps with the listed use code, Avadel argues.  Finally, Avadel explains that its REMS does not use “a computer database in a computer system for distribution,” but uses multiple computer databases to implement the Lumryz REMS and therefore does not overlap with the U-1110 use code.  Thus, Avadel believes that FDA’s decision ordering Avadel to submit a patent certification with respect to the ‘963 patent is arbitrary, capricious, an abuse of discretion, not in accordance with law, in excess of statutory jurisdiction and authority, and short of statutory right.  In a second claim, Avadel also alleges that FDA’s prolonged review of the Lumryz NDA unlawfully withheld agency action.

The argument that the statute does not provide FDA authority to require a patent certification rather than a section viii statement is interesting.  Textually, it makes sense.  After all, 21 U.S.C. § 355(b)(2) calls for certification based on “the opinion of the applicant and to the best of his knowledge.”  This seems to delegate decision-making authority regarding the proper patent certification to the applicant.  But under this interpretation, FDA would not be able to disagree with a sponsor’s certification decision, which seems like it could be ripe for abuse—and really pretty impractical.  That said, practicality doesn’t have anything to do with statutory interpretation.

Another interesting question this suit raises is whether FDA can look beyond the labeling to determine whether a section viii carve-out is acceptable.  Because FDA regulations state that a patent certification is necessary “[i]f the labeling of the drug product for which the application is seeking approval includes an indication or other condition of use that, according to the patent information submitted under section 505(b) or (c) of the Federal Food, Drug, and Cosmetic Act and § 314.53 or in the opinion of the applicant, is claimed by a method-of-use patent,” (emphasis added) Avadel argues that FDA’s review of the Lumryz REMS document to assess the use code overlap—rather than the Prescribing Information alone—violated FDA regulations.  This is an important question because FDA frequently assesses the propriety of use code carve-outs in Citizen Petitions and, in that assessment, often looks at the impact of a carve-out on doctors’ prescribing decisions.  If FDA is not permitted to look beyond the confines of the Prescribing Information to assess a carve-out, FDA likely could not rely on the implications of the omission of that carved-out language beyond the actual instructions for use in the labeling to the foreseeable use of those instructions.

Further, Avadel’s suit is also challenging the propriety of listing REMS patents in the Orange Book when that patent doesn’t cover a specific drug product.  Indeed, Avadel questions whether a patent certification for the REMS patent as the use code in question “does not describe the use of any drug, much less sodium oxybate” and therefore should not “trigger a patent certification” under section 505(b).  If a patent shouldn’t trigger a certification, it follows then that that patent shouldn’t be in the Orange Book.  Thus, it seems that this lawsuit implicitly challenges FDA’s current approach—or lack thereof—to listing in the Orange Book (and thereby requiring certification to) patents that don’t explicitly claim the drug substance.

If the Court opines on whether REMS patents that do not claim the drug product specifically should be listable in the Orange Book, the District Court of D.C. will join the First Circuit in exploring the types of patents that should be eligible for listing in the Orange Book.  The First Circuit, in 2020, was the first to weigh in on the propriety of listing patents in the Orange Book when, in the context of an antitrust case, it declared that device component patents that do not explicitly claim the drug product cannot be listed in the Orange Book.  Though FDA has since opened a docket to explore the issue of these types of patents in the Orange Book, the Agency’s inaction may result in the court deciding the issue on FDA’s behalf.