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Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 20, 2010 Decided November 9, 2010

No. 10-5066

ACTAVIS ELIZABETH LLC,

APPELLANT

v.

UNITED STATES FOOD AND DRUG ADMINISTRATION, ET AL.,

APPELLEES

Appeal from the United States District Court

for the District of Columbia

(No. 1:09-cv-00362)

Chad A. Landmon argued the cause for appellant. With him

on the briefs was Robert B. Greenbaum.

Andrew E. Clark, Senior Litigation Counsel, U.S.

Department of Justice, argued the cause for federal appellees. 

With him on the brief were Eugene M. Thirolf Jr., Director, and

Eric M. Blumberg, Deputy Chief Counsel, U.S. Department of

Health & Human Services. R. Craig Lawrence, Assistant U.S.

Attorney, entered an appearance. 

George F. Pappas, Peter O. Safir, and Emily J. Henn were

on the brief for appellee Shire Pharmaceuticals, Inc.

USCA Case #10-5066 Document #1276415 Filed: 11/09/2010 Page 1 of 12
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Before: BROWN, Circuit Judge, and EDWARDS and

RANDOLPH, Senior Circuit Judges.

Opinion for the Court filed by Senior Circuit Judge

RANDOLPH.

RANDOLPH, Senior Circuit Judge: This is an appeal from

the order of the district court granting summary judgment

against Actavis Elizabeth LLC. In 2007, the Food and Drug

Administration approved Vyvanse, a name-brand drug for the

treatment of attention deficit hyperactivity disorder. Two years

later, Actavis submitted an application for lisdexamfetamine

dimesylate, a generic version of the same drug. The FDA

returned Actavis’ application. It did so because it had

previously determined that Vyvanse was entitled to five years of

marketing exclusivity under the Hatch-Waxman Amendments

to the Federal Food, Drug, and Cosmetic Act. Actavis brought

this action claiming that Vyvanse was not entitled to five years

of exclusivity.

I

New drugs, including generic versions of previously

approved drugs, may not be marketed without the FDA’s

approval. Purepac Pharm. Co. v. Friedman, 162 F.3d 1201,

1201 (D.C. Cir. 1998). The approval process is governed by the

Federal Food, Drug, and Cosmetic Act, as amended by the Drug

Price Competition and Patent Term Restoration Act of 1984

(known as the “Hatch-Waxman Amendments”), Pub. L. No.

98-417, 98 Stat. 1585. So-called “new drug

applications”—required for “pioneer” drugs that have never

before received FDA approval—must be supported by full

reports of investigations showing the drug is safe and effective. 

21 U.S.C. § 355(b)(1); Serono Labs., Inc., v. Shalala, 158 F.3d

1313, 1316 (D.C. Cir. 1998). The Hatch-Waxman

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Amendments allowed generic versions of previously approved

drugs to gain approval through the submission of an

“[a]bbreviated new drug application.” 21 U.S.C. § 355(j).1

These abbreviated applications reduce the effort required to gain

marketing approval by, among other things, allowing the

applicant to rely on clinical studies submitted as part of a

previous new drug application. Id. § 355(j)(2)(A)(i)-(v); Mylan

Labs., Inc. v. Thompson, 389 F.3d 1272, 1275 (D.C. Cir. 2004).

The Hatch-Waxman Amendments also grant various

periods of marketing exclusivity to certain pioneer drugs

approved under § 355(b). The exclusivity provisions protect

these drugs from generic competition for the specified terms by

preventing the submission of abbreviated applications that refer

to them. See 21 U.S.C. § 355(j)(5)(F)(i)-(v). At issue here,

§ 355(j)(5)(F)(ii) provides that

[i]f an application submitted under subsection (b) of this

section for a drug, no active ingredient (including any ester

or salt of the active ingredient) of which has been approved

in any other application under subsection (b) of this section,

is approved after September 24, 1984, no application may

be submitted under this subsection which refers to the drug

before the expiration of five years from the date of the

approval . . ..

Id. § 355(j)(5)(F)(ii).

In addition to this five-year period, the Amendments grant

three-year exclusivity to drugs that include previously approved

active ingredients if the application for the drug “contains

1

 Among other requirements, generic drugs must contain the

same active ingredients as a “listed drug” that has already received

FDA approval. See 21 U.S.C. § 355(j)(2)(A)(i)-(viii).

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reports of new clinical investigations . . . essential to the

approval of the application and conducted or sponsored by the

applicant . . ..” Id. § 355(j)(5)(F)(iii).

The FDA has implemented these exclusivity provisions

through regulations. 21 C.F.R. § 314.108. The regulations give

five years of exclusivity for each “drug product that contains a

new chemical entity.” Id. § 314.108(b)(2). A “new chemical

entity” is “a drug that contains no active moiety that has been

approved by FDA in any other” new drug application. Id.

§ 314.108(a). “Active moiety” is defined as “the molecule or

ion, excluding those appended portions of the molecule that

cause the drug to be an ester, salt (including a salt with hydrogen

or coordination bonds), or other noncovalent derivative (such as

a complex, chelate, or clathrate) of the molecule, responsible for

the physiological or pharmacological action of the drug

substance.” Ibid. Thus, to qualify for five-year exclusivity

under § 355(j)(5)(F)(ii), an approved drug must contain no

previously approved active moieties.

In 2005, New River Pharmaceuticals, the predecessor in

interest to intervenor-defendant Shire Pharmaceuticals, sought

approval to market lisdexamfetamine dimesylate for the

treatment of attention deficit hyperactivity disorder under the

brand name Vyvanse. Vyvanse received FDA approval on

February 23, 2007. The agency determined that the drug was

entitled to a five-year period of exclusivity under its regulations. 

In January 2009, Actavis submitted its abbreviated application

for the generic drug lisdexamfetamine dimesylate.2

 Its

application referenced Vyvanse. The FDA returned Actavis’

2

 Because the FDA returned Actavis’ abbreviated application,

it never determined whether the drug qualified for approval under

§ 355(j). For sake of simplicity, we refer to lisdexamfetamine

dimesylate as the generic version of Vyvanse.

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application unfiled because Vyvanse’s period of market

exclusivity had not expired. See 21 C.F.R. § 314.101(e)(2).

Actavis brought this suit in the district court under the

Administrative Procedure Act, seeking to force the agency to

rescind its grant of exclusivity to Vyvanse and to accept

Actavis’ abbreviated application. In response, the agency

began its own administrative review of the matter, during which

the suit was stayed. In October 2009, the FDA affirmed its

original determination, and the case resumed. The district court

eventually granted summary judgment to the agency and Shire

on all claims.

II

A

To understand Actavis’ arguments, it is necessary briefly to

describe the chemical structure of lisdexamfetamine dimesylate,

the drug molecule in question. Lisdexamfetamine dimesylate

is a salt of lisdexamfetamine. Since, under the agency’s

regulations, salts are not considered active moieties, the

agency’s analysis centered on the lisdexamfetamine molecule

alone. Lisdexamfetamine consists of a portion of lysine, a

common amino acid, connected to dextroamphetamine. These

two parts are linked by an amide bond, a type of covalent bond

that utilizes a nitrogen atom to perform the linking function.3

What is important is that once it enters the body,

lisdexamfetamine undergoes a chemical conversion to produce

dextroamphetamine. In industry parlance, this makes

3

 Covalent bonds are formed between two atoms when those

atoms share a pair of electrons. HAWLEY’S CONDENSED CHEMICAL

DICTIONARY 342 (15th ed. 2007).

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lisdexamfetamine a “prodrug” of dextroamphetamine.4

HAWLEY’S CONDENSED CHEMICAL DICTIONARY 1043 (15th ed.

2007). Drugs containing dextroamphetamine, but not

lisdexamfetamine, had received FDA approval before New

River filed its application for Vyvanse.

B

There is little to Actavis’ argument that the award of

five-year exclusivity to Vyvanse conflicted with the FDA’s

regulations. The agency interprets its regulations to allow

five-year exclusivity for drugs containing derivative molecules

of previously approved “active moieties” when those derivative

molecules contain non-ester covalent bonds.5

 As the FDA

explained in its final decision with regard to Vyvanse: “Under

FDA’s interpretation of its regulation, the active moiety of a

molecule with a non-ester covalent bond is the entire molecule,

even if the molecule includes a covalent bond to a molecule that

was itself previously an active moiety.”

An agency’s interpretation of its own regulations is entitled

to judicial deference. Mistick PBT v. Chao, 440 F.3d 503, 511

(D.C. Cir. 2006). Although a court will reject an agency’s

interpretation when it is shown to be “plainly erroneous or

inconsistent with the regulation,” Actavis has not met that

standard. Thomas Jefferson Univ. v. Shalala, 512 U.S. 504, 512

(1994); see also Office of Commc’n, Inc. v. FCC, 327 F.3d 1222,

1224-25 (D.C. Cir. 2003).

4

 The parties also refer to the lisdexamfetamine molecule as

a “derivative” of dextroamphetamine.

5

 An ester bond is a type of covalent bond that uses an oxygen

atom to perform the linking function.

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The regulatory definition of “active moiety” excludes only

“those appended portions of the molecule that cause the drug to

be an ester, salt . . ., or other noncovalent derivative.” 21 C.F.R.

§ 314.108(a). When the drug molecule is not in the form of an

ester, salt, or other noncovalent derivative, the FDA treats the

entire molecule as that “responsible for the physiological or

pharmacological action of the drug substance,” and therefore a

separate “active moiety.” Ibid. Any drug that does not contain

a previously approved active moiety is entitled to five-year

exclusivity. Id. § 314.108(a), (b)(2). This leaves certain types

of prodrugs eligible for five-year exclusivity—namely, those

that are not esters, salts, or other types of noncovalent

derivatives. The FDA’s interpretation is squarely within the

language of its regulations. And since lisdexamfetamine

contains an amide bond, the FDA properly treated it as an

“active moiety” of its own.

C

Actavis spends the bulk of its briefs arguing that the FDA’s

interpretation is inconsistent with the clear meaning of the

statute. Where Actavis sees clarity we see ambiguity.

Under the Hatch-Waxman Amendments, five-year

exclusivity is granted to drugs “no active ingredient (including

any ester or salt of the active ingredient) of which” has been

approved in a prior new drug application. 21 U.S.C.

§ 355(j)(5)(F)(ii). Actavis thinks this language prevents the

FDA from granting five-year exclusivity to any drug containing

a drug molecule (such as lisdexamfetamine) that eventually

produces a previously approved drug molecule in the body. In

addition, the company believes that the FDA’s interpretation

allowing such exclusivity upends the incentive scheme created

by Congress and “eviscerates” the distinction between three- and

five-year exclusivity.

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Actavis relies mainly on the term “active ingredient,” which

it says obligates the FDA to identify the particular drug

molecule that reaches the “site” of the drug’s action. This

molecule, Actavis argues, is necessarily the “active ingredient”

of the drug in question, regardless of the form of the molecule

before it enters the body. But there is nothing to indicate that

Congress used the term in the sense Actavis urges. The HatchWaxman Amendments do not define active ingredient. The

legislative history establishes only that Congress was concerned

with providing incentives for innovation by granting five-year

exclusivity to “new chemical entities” and is silent on what

determines novelty. See 130 Cong. Rec. 24425 (1984)

(statement of Rep. Waxman).6

The word “active,” standing alone, does not get Actavis any

further. Actavis argues that by using the term “active,”

Congress was requiring the FDA to determine the particular

molecule that provides the drug’s “activity,” which it claims is

limited to the drug’s specific therapeutic effect. If this molecule

has been previously approved, then five-year exclusivity is not

warranted. But the FDA is right—or at least we have been given

no reason to doubt—that the activity of a drug cannot be

reduced to such a simple formulation. The agency has

concluded that, for certain types of prodrugs, the entire

pre-ingestion drug molecule should be deemed responsible for

6

 We note that FDA has adopted different definitions of

“active ingredient” in different statutory contexts. See 21 C.F.R.

§ 210.3(b)(7); 54 Fed. Reg. 28872, 28881 (July 10, 1989). None of

these definitions accord with the “plain meaning” of “active

ingredient” urged by Actavis. In addition, the Federal Circuit has held

that “active ingredient” has a plain meaning that, if adopted, would

allow more prodrugs to attain five-year exclusivity than the FDA’s

current interpretation. See Photocure ASA v. Kappos, 603 F.3d 1372,

1376 (Fed. Cir. 2010).

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the drug’s activity, which can include its “distribution within the

body, its metabolism, its excretion, or its toxicity.” There is no

reason to believe Congress thought differently—or thought

about it at all.

Our court has dealt with this particular language of the

Hatch-Waxman Amendments before. In Abbott Laboratories v.

Young, we held that the parenthetical “(including any ester or

salt of the active ingredient)” in § 355(j) could refer to “either

the active ingredient of the original approved drug or to the

active ingredient in the new drug.”7

 920 F.2d at 987. Each side

claims support from Abbott. This is partly because the Abbott

opinion was not entirely clear about what “active ingredient”

means under § 355(j)(5)(F). At one point the Abbott opinion

referred to “active ingredient” as “the substance prior to the

introduction into the human body.” Id. at 986. But then the

court based its holding, in part, on the potential ambiguity of

that phrase. See id. at 987-88. Abbott certainly did not adopt an

interpretation of “active ingredient” that “unambiguously

foreclose[d]” the agency’s current approach. Nat’l Cable &

Telecomm. Ass’n v. Brand X Internet Servs., 545 U.S. 967, 983

(2005).

Neither does the structure or purpose of § 355(j) foreclose

the agency’s interpretation. The Hatch-Waxman Amendments

“struck a balance between expediting generic drug applications

and protecting the interests of the original drug manufacturers.” 

Abbott Labs., 920 F.2d at 985. Actavis argues that the FDA’s

current approach violates the statutory scheme, which it claims

“reserves five-year exclusivity only for major innovations.” 

7Abbott dealt with another exclusivity provision, then codified

at 21 U.S.C. § 355(j)(4)(D)(i), that governed drugs approved between

January 1, 1982, and September 24, 1984. The relevant language is

identical to that in current § 355(j)(5)(F)(ii). 

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Actavis Br. 37. In this view, a drug containing a derivative

molecule such as lisdexamfetamine should be entitled, at most,

to three years of exclusivity. To buttress its claim, Actavis

offers a scenario in which drug companies such as Shire are able

to maintain never-ending periods of five-year exclusivity for

“minor” variations on already approved drug molecules simply

by adding different covalent appendages to them. Actavis Br.

42-43.

Shire is right that “Actavis’ structural arguments represent

little more than question-begging.” Shire Br. 27. In the FDA’s

view, drug derivatives such as lisdexamfetamine are “major

innovations” deserving five-year exclusivity. The FDA’s

regulations leave many types of drug derivatives eligible only

for three-year exclusivity. For example, an ester derivative of

a previously approved drug molecule remains entitled to

three-year exclusivity if the application required for its approval

“contains reports of new clinical investigations . . . essential to

the approval of the application and conducted or sponsored by

the applicant.” 21 U.S.C. § 355(j)(5)(F)(iii). The FDA is

defining the line between three- and five-year exclusivity, not

eviscerating it.

Actavis’ prediction of multiple repeated periods of five-year

exclusivity for minor variations on existing drug products

assumes a view (contrary to the agency’s) of what constitutes a

minor variation. It also finds little support in reality. In the

nearly two decades since the current FDA regulations came into

effect, there is no such example, or at least none Actavis has

identified. This is hardly surprising, given the time and effort

required to gain approval under § 355(b). See Teva Pharm.,

USA, Inc., v. Leavitt, 548 F.3d 103, 104 (D.C. Cir. 2008).

Since nothing in the text, structure, purpose, or legislative

history of the statute “speaks directly to the precise question at

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issue,” the agency’s interpretation must stand if it is reasonable. 

Citizens Coal Council v. Norton, 330 F.3d 478, 481 (D.C. Cir.

2003); see also Brand X, 545 U.S. at 986.

The FDA’s policy is based on its view that drug derivatives

containing non-ester covalent bonds are, on the whole, distinct

from other types of derivative drugs such that the former are

uniquely deserving of “new chemical entity” status and the

resulting five-year exclusivity. The FDA explained its

distinction in a 1989 response to a citizens’ petition:

It has been FDA’s longstanding experience that even minor

covalent structural changes are capable of producing not

only major changes in the activity of a drug but changes

that are not readily predicted . . . . In contrast to most

changes in the covalent structure of a molecule, the

formation of a salt or a complex, or of an ester, is not

intended to, and generally cannot, alter the basic

pharmacologic or toxicologic properties of the

molecule . . ..

We are hard pressed to second-guess the FDA’s view,

especially since it “rests on the agency’s evaluations of scientific

data within its area of expertise.” Serono Labs., Inc. v. Shalala, 

158 F.3d 1313, 1321 (D.C. Cir. 1998) (internal quotation marks

omitted). At best, Actavis has offered evidence that some

covalent structural changes do not alter the basic properties of

the drug in question and that some noncovalent structural

changes do. But agencies may “employ bright-line rules for

reasons of administrative convenience, so long as those rules fall

within a zone of reasonableness and are reasonably explained.” 

Emily’s List v. Fed. Election Comm’n, 581 F.3d 1, 22 n.20 (D.C.

Cir. 2002). The FDA has explained that its policy is based in

part on the “difficulty in determining precisely which molecule,

or portion of a molecule, is responsible for a drug’s effects.” 

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Nothing in the record establishes that the FDA’s approach is

unreasonable. Given the complexity of the statutory regime, we

defer to the agency’s interpretation. See Cmty. Care Found. v.

Thompson, 318 F.3d 219, 225 (D.C. Cir. 2003).

III

Actavis has other arguments designed to show that the

FDA’s grant of five-year exclusivity to Vyvanse was “arbitrary

[and] capricious.” 5 U.S.C. § 706(2)(A). Primary among these

is that the Vyvanse decision was in tension with past agency

decisions, which, Actavis claims, establish that the FDA

generally followed an “activity-based” approach to five-year

exclusivity under the Hatch-Waxman Amendments. We do not

consider it necessary to go into the details of these prior

decisions. None of them rendered the FDA’s grant of

exclusivity to Vyvanse arbitrary and capricious.

The district court’s grant of summary judgment to the FDA

and to Shire is affirmed.

So ordered.

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