Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-97-05111/USCOURTS-caDC-97-05111-0/pdf.json

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 March 13, 1998 Decided April 14, 1998

No. 97-5082

Mova Pharmaceutical Corp.,

Appellee

v.

Donna E. Shalala,

Secretary, U.S. Department of Health & Human Services and

Michael A. Friedman, Acting Commissioner, U.S. Food and

Drug Administration, Appellees

Mylan Pharmaceuticals, Inc.,

Appellant

Consolidated with

No. 97-5111

Appeals from the United States District Court

for the District of Columbia

(No. 96cv02861)

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Steven Lieberman argued the cause for appellant Mylan

Pharmaceuticals, Inc., with whom E. Anthony Figg was on

the briefs.

Howard S. Scher, Attorney, United States Department of

Justice, argued the cause for the federal appellants, with

whom Frank W. Hunger, Assistant Attorney General, Mary

Lou Leary, United States Attorney at the time the briefs

were filed, and Douglas N. Letter, Litigation Counsel, were

on the briefs.

Steven J. Glassman argued the cause for appellant Pharmacia & Upjohn Company, with whom David O. Bickart was

on the briefs.

Ronald L. Grudziecki argued the cause for appellee, with

whom James S. Rubin was on the brief.

John F. Cooney filed the brief for amicus curiae Teva

Pharmaceuticals, USA.

Before: Wald, Silberman and Tatel, Circuit Judges.

Opinion for the Court filed by Circuit Judge Wald.

Wald, Circuit Judge: On December 19, 1996, the Food and

Drug Administration ("FDA") approved an application by a

drug manufacturer, Mylan Pharmaceuticals, Inc. ("Mylan") to

market a generic version of micronized glyburide, a drug used

to treat diabetes. Another drug manufacturer, Mova Pharmaceutical Corp. ("Mova"), had filed an earlier application to

market a generic version of the same drug; however, Mova's

application had not yet been approved, because of a patent

infringement suit brought by Pharmacia & Upjohn Company

("Upjohn"), in which Upjohn claimed that Mova's product

infringed a patent belonging to Upjohn.

When Mova learned that the FDA had approved Mylan's

application, it brought suit in the United States District Court

for the District of Columbia, relying on 21 U.S.C.

s 355(j)(5)(B)(iv) (1994),1 to compel the FDA to delay the

__________

1 At the time that Mova brought its action, this section was

designated 21 U.S.C. s 355(j)(4)(B)(iv). On November 21, 1997, the

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effective date of this approval until 180 days after the earlier

of the dates that Mova won its suit or began to market its

product. Because the statutory scheme governing the approval of successive generic drug applications is quite complex, we will, for purposes of the introduction, describe the

parties' contentions only in general terms. Mova argued

that, because it had filed a previous application to market a

generic version of micronized glyburide, the applicable statutory provision, 21 U.S.C. s 355(j)(5)(B)(iv), granted a 180-day

market exclusivity period to Mova running from the date

Mova won its suit or began marketing its product, and the

FDA was barred from approving Mylan's similar application

until after the end of that 180-day period. In response, the

FDA cited a regulation that permitted the agency to approve

Mylan's application immediately, because at the time Mylan

submitted its application Mova had not yet "successfully

defended" against (that is, prevailed in) Upjohn's patent

infringement suit. See 21 C.F.R. s 314.107(c)(1). Mova in

turn challenged the FDA's regulation as inconsistent with the

plain language of s 355(j)(5)(B)(iv). The district court agreed

with Mova, and entered a preliminary injunction requiring

the FDA to delay its approval of Mylan's application until 180

days after Mova won its suit or began to market its product

(whichever came first). The FDA and Mylan have appealed

this decision.

While Mova's request for a preliminary injunction was

pending, Upjohn submitted a motion to intervene in the

litigation. After granting the injunction, the district court

denied Upjohn's motion to intervene, concluding that it was

moot, and that in any case Upjohn did not have a legally

protected interest in the subject matter of the litigation.

__________

Food and Drug Administration Modernization Act of 1997 was

enacted; section 119(b)(1)(A) of that law inserted a new section

355(j)(3), and redesignated former paragraphs 355(j)(3) to (8) as

paragraphs (4) to (9). See Pub. L. No. 105-115, 111 Stat. 2296

(1997). According to section 501 of that Act, the amendments "shall

take effect 90 days after the date of enactment of this Act." We

will therefore use the section's new designation.

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Upjohn has appealed this ruling and its appeal has been

consolidated with that of the FDA and Mylan.

On the merits of the preliminary injunction, we find that

the district court was correct in finding that Mova was very

likely to be able to show that the FDA's regulation exceeded

its authority under the statute. On Upjohn's motion to

intervene, we find that the district court's reasons for denying

the motion were erroneous, and that Upjohn is entitled to

participate both in this appeal and in any further proceedings

before the district court.

I. Background

A.Statutory and Regulatory Framework

We will first briefly outline the statutory and regulatory

framework applicable to the marketing of generic drugs.

Generic drugs are versions of brand-name prescription drugs

that are often sold without a brand name and that contain the

same active ingredients, but not necessarily the same inactive

ingredients, as the original. United States v. Generix Drug

Corp., 460 U.S. 453, 455 (1983). Ordinarily, an applicant to

market a drug must complete a document called a New Drug

Application, or NDA. Preparing such applications can be a

time-consuming and costly process, as they must include data

from studies showing the drug's safety and effectiveness.

Formerly, a firm that wished to make a generic version of a

brand-name drug that had already been approved by the

FDA was required to file a new NDA, complete with new

studies showing the drug's safety and effectiveness. See

generally H.R. Rep. No. 98-857, Part I, at 16-17 (1984).

In 1984, Congress enacted the Hatch-Waxman Amendments, which established a simplified procedure for FDA

approval of generic drugs. Under this procedure, the original

applicant for FDA approval of a drug, called the "pioneer"

applicant, must still complete a full NDA. However, subsequent applicants who wish to manufacture generic versions of

the original have an alternative: they may instead complete

an Abbreviated New Drug Application, or ANDA, which

relies on the FDA's previous determination that the drug is

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safe and effective, and thus avoid submitting new safety and

effectiveness studies.

The Hatch-Waxman Amendments specify the contents of

an ANDA in detail. One requirement is that, for each of the

patents applicable to the pioneer drug, the ANDA applicant

must certify whether the proposed generic drug would infringe that patent, and, if not, why not. The statute provides

ANDA applicants with four certification options: they may

certify (I) that the required patent information has not been

filed; (II) that the patent has expired; (III) that the patent

has not expired, but will expire on a particular date; or (IV)

that the patent is invalid or will not be infringed by the drug

for which the ANDA applicant seeks approval. 21 U.S.C.

s 355(j)(2)(A)(vii). We will call these paragraph I, II, III,

and IV certifications, respectively.

If the applicant makes a certification under paragraphs I or

II, the statute provides that the FDA may approve the

ANDA effective immediately. 21 U.S.C. s 355(j)(5)(B)(i). If

the applicant makes a certification under paragraph III, the

FDA may approve the ANDA effective on the date that the

applicant certifies that the patent will expire. 21 U.S.C.

s 355(j)(5)(B)(ii).

When an applicant makes a certification under paragraph

IV, things become more complicated. In such cases, the

statute begins by providing a forty-five-day window during

which the patent-holder may bring suit against the applicant.

If the patent-holder brings suit during that forty-five-day

period, the statute says that the FDA's approval of the

ANDA must be delayed for thirty months, a provision that is

presumably intended to allow the patent-holder time to vindicate its patent in court before the generic competitor is

allowed entry into the market. 21 U.S.C. s 355(j)(5)(B)(iii).

The statute permits the court to lengthen or shorten this

period if it finds that either party has failed to "reasonably

cooperate in expediting the action." Id. If the court finds

that the patent is invalid or is not infringed, the FDA's

approval becomes effective as of the date of that ruling. 21

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U.S.C. s 355(j)(5)(B)(iii)(I), (III).2

It is the succeeding provision of the statute, however, that

has occasioned the dispute involved in this suit (and many

others). That provision says:

__________

2 The full text of section 355(j)(5)(B)(iii) reads:

If the applicant made a certification described in subclause (IV)

of paragraph (2)(A)(vii), the approval shall be made effective

immediately unless an action is brought for infringement of a

patent which is the subject of the certification before the

expiration of forty-five days from the date the notice provided

under paragraph (2)(B)(i) is received. If such an action is

brought before the expiration of such days, the approval shall

be made effective upon the expiration of the thirty-month

period beginning on the date of the receipt of the notice

provided under paragraph (2)(B)(i) or such shorter or longer

period as the court may order because either party to the

action failed to reasonably cooperate in expediting the action,

except that--

(I) if before the expiration of such period the court decides

that such patent is invalid or not infringed, the approval shall

be made effective on the date of the court decision,

(II) if before the expiration of such period the court decides

that such patent has been infringed, the approval shall be made

effective on such date as the court orders under section

271(e)(4)(A) of Title 35 or

(III) if before the expiration of such period the court grants

a preliminary injunction prohibiting the applicant from engaging in the commercial manufacture or sale of the drug until the

court decides the issues of patent validity and infringement and

if the court decides that such patent is invalid or not infringed,

the approval shall be made effective on the date of such court

decision.

In such an action, each of the parties shall reasonably cooperate in expediting the action. Until the expiration of forty-five

days from the date the notice made under paragraph (2)(B)(i) is

received, no action may be brought under section 2201 of Title

28 for a declaratory judgment with respect to the patent. Any

action brought under section 2201 shall be brought in the

judicial district where the defendant has its principal place of

business or a regular and established place of business.

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If the application contains a certification described in

subclause (IV) of paragraph (2)(A)(vii) and is for a drug

for which a previous application has been submitted

under this subsection continuing [sic] 3 such a certification, the application shall be made effective not earlier

than one hundred and eighty days after--

(I) the date the Secretary receives notice from the

applicant under the previous application of the first

commercial marketing of the drug under the previous

application, or

(II) the date of a decision of a court in an action

described in clause (iii) holding the patent which is the

subject of the certification to be invalid or not infringed,

whichever is earlier.

21 U.S.C. s 355(j)(5)(B)(iv). This provision on its face appears to provide an advantage to the first party who files a

paragraph IV ANDA (henceforth, the "first applicant"), by

granting him a 180-day period in which to market his generic

drug without competition from other ANDA applicants.4 We

will call this Edenic moment of freedom from the pressures of

the marketplace the statute's "exclusivity period." Section

355(j)(5)(B)(iv) has two sub-clauses, each of which can trigger

the start of the 180-day exclusivity period; we will call subclause (I), which turns on the first commercial marketing of

the drug, the "commercial-marketing trigger," and sub-clause

(II), which turns on a court decision finding the patent to be

invalid or not infringed, the "court-decision trigger."

The FDA, however, concluded, for reasons discussed below,

that Congress could not have intended for this provision to be

read literally. Thus, in drafting the regulations implementing

__________

3 This should probably read "containing."

4 The statute actually says that the exclusivity period applies

whenever there is a "previous" application; thus, the statute might

conceivably be read to confer this 180-day period on a second or

third applicant in some situations. For purposes of this litigation,

however, the only previous application is Mova's, which is also the

first. We will therefore refer only to the first applicant.

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section 355(j)(5)(B)(iv), the FDA added its own requirement

that the first applicant must have "successfully defended

against a suit for patent infringement" before the exclusivity

period can begin to run. (We will refer to this as the

"successful defense" requirement.) The relevant regulation

states:

If an abbreviated new drug application contains a certification that a relevant patent is invalid, unenforceable, or

will not be infringed and the application is for a generic

copy of the same listed drug for which one or more

substantially complete abbreviated new drug applications

were previously submitted containing a certification that

the same patent was invalid, unenforceable, or would not

be infringed and the applicant submitting the first application has successfully defended against a suit for patent infringement brought within 45 days of the patent

owner's receipt of notice submitted under s 314.95, approval of the subsequent abbreviated new drug application will be made effective no sooner than 180 days from

whichever of the following dates is earlier:

(i) The date the applicant submitting the first application first commences commercial marketing of its drug

product; or

(ii) The date of a decision of the court holding the

relevant patent invalid, unenforceable, or not infringed.

21 C.F.R. s 314.107(c)(1) (emphasis added).

B.The Factual Scenario of This Case

Glyburide is a drug used in treating diabetes, and micronized glyburide is one form of that drug. Upjohn holds a

patent for a particular formulation of micronized glyburide

entitled "Spray-Dried Lactose Formulation of Micronized

Glyburide."

In December, 1994, Mova filed an ANDA for a generic

form of micronized glyburide, which included a paragraph IV

certification. Mova gave the required notice to the patentholder, Upjohn; within 45 days of receiving this notice,

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Upjohn filed a patent infringement suit against Mova in the

District of Puerto Rico.

While this litigation was underway, in November, 1995,

Mylan, too, filed an ANDA for a generic form of micronized

glyburide. Mylan's initial filing contained a paragraph III

certification; this meant that Mylan conceded patent infringement, so that its ANDA could not receive FDA approval until

Upjohn's patent expired. In August 1996, however, Mylan

amended its ANDA to contain a paragraph IV certification.

As Mova had, Mylan gave the required notice to Upjohn;

but this time Upjohn, for reasons unclear, failed to sue within

the prescribed 45-day period.5 The thirty-month suspension

of FDA approval provided for in section 355(j)(5)(B)(iii) only

applies if the patent-holder sues the ANDA applicant within

45 days; thus, this waiting period did not apply to Mylan.

And, because Mova had not yet "successfully defended"

against Upjohn's patent infringement suit, 21 C.F.R.

s 314.107(c)(1), which incorporates the FDA's interpretation

of section 355(j)(5)(B)(iv), did not require the FDA to delay its

approval of Mylan's ANDA. Thus, the FDA approved Mylan's ANDA effective immediately, as of December 19, 1996.

After learning of this approval, Mova, on December 26,

1996, filed suit in the United States District Court for the

District of Columbia, seeking a temporary restraining order

compelling the FDA to postpone the effective date of Mylan's

approval. Although declining to issue a TRO, the district

court, on January 23, 1997, granted a preliminary injunction

requiring that the FDA render its approval of Mylan's ANDA

effective no earlier than 180 days after the earlier of (1)

Mova's first commercial marketing of its micronized glyburide

product, or (2) the date of Mova's victory in the Puerto Rico

litigation. (This was precisely the relief Mova had sought.)

In an accompanying memorandum, the district court explained that the successful-defense requirement in the FDA's

regulations was inconsistent with the plain language of section 355(j)(5)(B)(iv), and therefore unenforceable. The FDA

__________

5 Upjohn did eventually sue Mylan, on February 17, 1997. On

March 31, 1998, the court ruled that Upjohn's patent was invalid

and not infringed.

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and Mylan (which had intervened in the proceedings) appealed.

One further matter remained to be resolved. Before the

preliminary injunction was issued, Upjohn had filed a motion

seeking to intervene in the proceedings before the district

court. The district court had not adverted to this motion in

granting the preliminary injunction. A few days later, however, on February 10, it denied Upjohn's motion to intervene,

stating that the motion was moot (because the district court

had already issued the preliminary injunction), and also that

Upjohn did not have a "cognizable interest" in the litigation,

and was therefore not entitled to intervene. Upjohn has

appealed this order, and argues that it should be allowed to

participate in this appeal and in any further proceedings in

the district court.

While these appeals were pending, there have been subsequent developments in Upjohn's patent infringement suit

against Mova. On December 2, 1997, a jury found that

Upjohn's patent was invalid, unenforceable, and had not been

infringed. Mova received final approval from the FDA to

market its product on December 22, and began to sell its

product shortly afterwards. By its terms, the district court's

preliminary injunction will therefore expire 180 days after

December 2, 1997, on May 31, 1998.

II. Analysis

A.The Preliminary Injunction

To demonstrate entitlement to a preliminary injunction, a

litigant must show "1) a substantial likelihood of success on

the merits, 2) that it would suffer irreparable injury if the

injunction is not granted, 3) that an injunction would not

substantially injure other interested parties, and 4) that the

public interest would be furthered by the injunction." Cityfed Financial Corp. v. Office of Thrift Supervision, 58 F.3d

738, 746 (D.C. Cir. 1995). The district court balances the

litigant's showings in these four areas in deciding whether to

grant an injunction. Id. at 747. "We review a district court's

decision regarding a preliminary injunction for abuse of disUSCA Case #97-5111 Document #344897 Filed: 04/14/1998 Page 10 of 32
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cretion, and any underlying legal conclusions de novo." Id. at

746.

Balancing these factors, the district court found, as to the

first, that Mova had a "very high" likelihood of success on the

merits, because Mova would probably be able to show that

the FDA's successful-defense requirement was contrary to

the plain language of section 355(j)(5)(B)(iv) and therefore

unenforceable. As to the second, the district court found that

"the earliest generic drug manufacturer in a specific market

has a distinct advantage over later entrants," and that Mova,

a small company, would find it extremely difficult to compete

against the much larger Mylan if Mylan got its product to

market first. As to the third prong, the district court found

that any harm to Mylan was small, because Mylan was so

likely to lose on the merits. And, as to the fourth, the district

court found that the public was the principal other interested

party, and that the public's interest in the "faithful application

of the laws" outweighed its interest in immediate access to

Mylan's generic product.

The FDA and Mylan have not seriously contested the

district court's findings as to the second, third and fourth

factors.6 However, they both vigorously contest the district

court's conclusion that the successful-defense requirement is

__________

6 The FDA notes that "the mere existence of competition is not

irreparable harm, in the absence of substantiation of severe economic impact." WMATA v. Holiday Tours, 559 F.2d 841, 843 n.3

(D.C. Cir. 1977). Here, however, the district court found that Mova

would be harmed by the loss of its "officially sanctioned head start,"

and that Mova's small size put it at a particular disadvantage. This

suffices to show a severe economic impact to Mova.

Both the FDA and Mylan also contend that the district court

should have declined to issue a preliminary injunction in order to

further the public's interest in the rapid movement of generic drugs

into the marketplace. Supposing that they are right in their

assessment of the public's interest, however, this factor alone

cannot support denying an injunction. Our polity would be very

different indeed if the courts could decline to enforce clear laws

merely because they thought them contrary to the public interest;

we decline to embark upon that path.

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inconsistent with section 355(j)(5)(B)(iv). We will focus on

the FDA's arguments, because it is on an agency's own

justifications that the validity of its regulations must stand or

fall. See SEC v. Chenery Corp., 318 U.S. 80 (1943).

The FDA concedes that the text of section 355(j)(5)(B)(iv)

makes no provision for a successful-defense requirement. It

asserts, however, that a literal reading of that statutory

provision would produce consequences of a kind Congress

could not have intended when it wrote the law, and that its

interpolation of a successful-defense requirement is an appropriate way of implementing Congress's underlying intent.

The FDA points to two principal situations in which a

literal reading of the statute would produce bizarre results:

(1) cases in which the first applicant is never sued, and (2)

cases in which the first applicant loses its suit. If the first

applicant is never sued, the FDA claims, then the courtdecision trigger will never be satisfied. Later ANDA applicants will be unable to market their products until the first

applicant decides to put its product on the market, thereby

satisfying the commercial-marketing trigger. But the first

applicant could in theory wait indefinitely to begin selling its

product, and thereby block all sales by later applicants. This

unfortunate scenario could happen, for instance, if the first

applicant colludes with the pioneer drug company to eliminate

generic competition, or if the first applicant is simply unable

to obtain FDA approval of its production facilities and so

cannot put its product on the market.

If the first applicant loses its infringement suit, the delay

problem could be even more serious. The first applicant

would then be able to satisfy neither the court-decision trigger nor the commercial-marketing trigger (because, having

lost a patent-infringement suit, it would be unable to sell its

product). Thus, the FDA claims, no generic drugs could

enter the market until after the pioneer company's patent

expired.

The successful-defense requirement, according to the FDA,

is calculated to eliminate both occurrences. An applicant that

is never sued or that loses its suit will not have "successfully

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defended against a suit for patent infringement," 21 C.F.R.

s 314.107(c)(1), and so the exclusivity period will not apply.

Such applicants will therefore not interfere with the orderly

movement by successive applicants of generic drugs into the

marketplace.

1. Applicable Principles of Judicial Review

In assessing the validity of an agency's interpretation of a

statute, we begin by asking whether "Congress has directly

spoken to the precise question at issue"; if so, "the court, as

well as the agency, must give effect to the unambiguously

expressed intent of Congress." Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-43

(1984). If we find that "the statute is silent or ambiguous

with respect to the specific issue, the question for the court is

whether the agency's answer is based on a permissible construction of the statute." Id. at 843.

In the district court's judgment, the FDA's pragmatic

reading of the statute could not survive the first prong of

Chevron. Concluding that the language of the statute "may

be complex, and even cumbersome, but it is plain and unambiguous," and that the statute "does not include a 'successful

defense' requirement, and indeed it does not even require the

institution of patent litigation," the district court found that,

under the plain language of the statute, if a paragraph IV

ANDA has been filed by a prior applicant, the FDA must

delay approval of all subsequent ANDAs until either the

court-decision trigger or the commercial-marketing trigger is

satisfied.

We think that the district court achieved the right result,

but we are not quite as sanguine as the district court that, in

applying the first prong of Chevron, it suffices to look only at

the plain language of the statute. "[I]n expounding a statute,

we must not be guided by a single sentence or member of a

sentence, but look to the provisions of the whole law, and to

its object and policy." Pilot Life Insurance Co. v. Dedeaux,

481 U.S. 41, 51 (1987); see also McCarthy v. Bronson, 500

U.S. 136, 139 (1991). Here, the FDA cannot point to any

particular ambiguity in the words of section 355(j)(5)(B)(iv)

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that permits it to interpolate its "successful defense" requirement. Instead, the FDA's argument is that a literal reading

of the statute would thwart Congress's central goal, in enacting the Hatch-Waxman Amendments, to bring generic drugs

onto the market as rapidly as possible.

In effect, the FDA seeks to invoke the long-standing rule

that a statute should not be construed to produce an absurd

result. "It is a familiar rule, that a thing may be within the

letter of the statute and yet not within the statute, because

not within its spirit nor within the intention of its makers....

If a literal construction of the words of a statute be absurd,

the act must be so construed as to avoid the absurdity."

Holy Trinity Church v. United States, 143 U.S. 457, 459-60

(1892); see also United States v. X-Citement Video, Inc., 513

U.S. 64, 68-69 (1994) (rejecting the "most natural grammatical reading" of a statute to avoid "absurd" results); Green v.

Bock Laundry Machine Company, 490 U.S. 504, 527, 527-29

(1989) (Scalia, J., concurring); In re Nofziger, 925 F.2d 428,

434 (D.C. Cir. 1991); Veronica M. Dougherty, Absurdity and

the Limits of Literalism, 44 Am. U.L. Rev. 127 (1994). Over a

hundred years ago, the Court explained this rule thus:

The common sense of man approves the judgment mentioned by Puffendorf, that the Bolognian law which enacted "that whoever drew blood on the streets should be

punished with the utmost severity," did not extend to the

surgeon who opened the vein of a person who fell down

on the street in a fit. The same common sense accepts

the ruling, cited by Plowden, that the statute of 1st

Edward II, which enacts that a prisoner who breaks

prison shall be guilty of a felony, does not extend to a

prisoner who breaks out when the prison is on fire--"for

he is not to be hanged because he would not stay to be

burnt."

United States v. Kirby, 74 U.S. (7 Wall.) 482, 487 (1868)

(citations omitted).

In deciding whether a result is absurd, we consider not

only whether that result is contrary to common sense, but

also whether it is inconsistent with the clear intentions of the

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statute's drafters--that is, whether the result is absurd when

considered in the particular statutory context. If " 'the literal

application of a statute will produce a result demonstrably at

odds with the intentions of its drafters,' ... the intention of

the drafters, rather than the strict language, controls." United States v. Ron Pair Enterprises, 489 U.S. 235, 242 (1989)

(quoting Griffin v. Oceanic Contractors, Inc., 458 U.S. 564,

571 (1982)); see also Environmental Defense Fund, Inc. v.

EPA, 82 F.3d 451, 468 (D.C. Cir. 1996) (applying Ron Pair ).

The rule that statutes are to be read to avoid absurd

results allows an agency to establish that seemingly clear

statutory language does not reflect the "unambiguously expressed intent of Congress," Chevron, 467 U.S. at 842, and

thus to overcome the first step of the Chevron analysis. But

the agency does not thereby obtain a license to rewrite the

statute. When the agency concludes that a literal reading of

a statute would thwart the purposes of Congress, it may

deviate no further from the statute than is needed to protect

congressional intent. Of course, the agency might be able to

show that there are multiple ways of avoiding a statutory

anomaly, all equally consistent with the intentions of the

statute's drafters (and equally inconsistent with the statute's

text). In such a case, we would move to the second stage of

the Chevron analysis, and ask whether the agency's choice

between these options was "based on a permissible construction of the statute." Id. at 843. Otherwise, however, our

review of the agency's deviation from the statutory text will

occur under the first step of the Chevron analysis, in which

we do not defer to the agency's interpretation of the statute.

Here, we think that the FDA's interpretation cannot survive analysis under the first step of Chevron. The FDA's

"successful defense" requirement achieves the FDA's stated

goal of preventing first applicants who are not sued or who

lose their suits from benefiting from the exclusivity period.

But it also does more. The FDA had two routes by which it

could have addressed the problem of first applicants who lose

their suits, which we will call the "wait-and-see" approach and

the "win-first" approach. Under the wait-and-see option,

later applicants would need to wait to see whether the first

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applicant won or lost its patent infringement suit. If the first

applicant lost, the exclusivity period would not apply; if he

won, it would.7 The FDA chose the other option, the winfirst approach. Under this approach, later applicants do not

need to wait to see whether the first applicant wins or loses.

Instead, while the first applicant's litigation is underway, the

FDA may approve the applications of later ANDA applicants

effective immediately, if they are otherwise eligible for approval.8 Thus, the first applicant must win its lawsuit before

section 355(j)(5)(B)(iv) has any effect on subsequent applicants at all.

It is the FDA's decision to adopt the win-first approach

that led to the present litigation. If the FDA had instead

chosen the wait-and-see approach, the FDA could not have

approved Mylan's application when it did; instead, Mylan

would have needed to wait for the end of Mova's patent

infringement suit. We will therefore focus on this aspect of

the successful-defense requirement.

We conclude that the FDA's successful-defense requirement is inconsistent with the unambiguously expressed intent

of Congress. The rule is gravely inconsistent with the text

and structure of the statute. Nor can the FDA show that the

successful-defense requirement is needed to avoid "a result

demonstrably at odds with the intentions of [section

355(j)(5)(B)(iv)'s] drafters." Ron Pair Enterprises, 489 U.S.

at 242. The FDA could have adopted a more narrow solution

to the problem of first applicants who are never sued or who

lose their suits. It instead adopted the broad win-first rule,

which it cannot show is needed to implement congressional

intent. In effect, the FDA has embarked upon an adventurous transplant operation in response to blemishes in the

__________

7 We do not mean to foreclose a third possibility, which is that

some lawsuit other than that against the first applicant might

satisfy the court-decision trigger before the first applicant's suit is

over. We discuss this possibility below.

8 That is, if they have not been sued by the patent-holder, and are

therefore not subject to the 30-month waiting period, or if the 30-

month period has expired.

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statute that could have been alleviated with more modest

corrective surgery.

2. The Statute's Text and Structure

Section 355(j)(5)(B)(iv) is far from a model of legislative

draftsmanship. The district court in this case called the

provision "cumbersome"; another district court described it

as "very confusing and ambiguous." Mylan Pharmaceuticals, Inc. v. Sullivan, No. 89-36-C(K), slip op. at 6 (N.D.W.V.

May 5, 1989). But, to the extent that the statute is clear

about anything, it clearly forecloses the FDA's successfuldefense requirement.9

The successful-defense requirement is inconsistent with the

literal language of the statute. Section 355(j)(5)(B)(iv) says

that, if an applicant has already filed a paragraph IV ANDA,

later applications shall be approved "not earlier than one

hundred and eighty days after" the commercial-marketing

trigger or the court-decision trigger is satisfied. The FDA's

successful-defense requirement, by contrast, permits later

applications to be approved even though neither trigger has

been satisfied, simply because the first applicant's litigation

has not yet come to a successful conclusion.

The win-first rule also infringes on the statutory scheme in

a second, subtler way: its practical effect is to write the

commercial-marketing trigger out of the statute. The commercial-marketing trigger seems intended to ensure that, if a

first ANDA applicant chooses to begin marketing its product

before it has won its patent-infringement suit, the 180-day

exclusivity period will begin to run immediately. Under the

FDA's regulation, however, the 180-day exclusivity period is

only available to an applicant who has already "successfully

defended against a suit for patent infringement." Thus, if the

first applicant begins marketing its product before it wins its

__________

9 We note that the Fourth Circuit recently came to the same

conclusion in an unpublished opinion. See Granutec, Inc. v. Shalala, Nos. 97-1873, 97-1874, slip op. at 13-14 (4th Cir. Apr. 3, 1998).

Because the rules of the Fourth Circuit disfavor (but do not

prohibit) citation of unpublished opinions, we will not discuss the

reasoning of Granutec further.

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infringement suit, the 180 days of exclusivity do not begin to

run; other applicants remain eligible for FDA approval to

begin marketing their products, at least up to the date that

the first applicant wins the infringement action.

If the first applicant eventually wins its lawsuit, the exclusivity period is counted as though it had begun to run when

the applicant started commercial marketing. Thus, an applicant who begins commercial marketing 120 days before winning its lawsuit receives only 60 days of exclusivity; an

applicant who begins commercial marketing 180 days (or

more) before winning its suit receives no exclusivity period at

all. The FDA thus construes the commercial-marketing trigger to potentially hurt, but never benefit, the first ANDA

applicant.

There is no indication in the text or history of section

355(j)(5)(B)(iv) that the commercial-marketing trigger is supposed to function in that one-sided manner. The FDA itself

provided a more plausible explanation of how it should work

in an initial notice of proposed rulemaking for the ANDA

regulations. As the FDA then explained the statutory

scheme,

Congress's decision to begin the 180-day period under

section 505(j)(4)(B)(iv)(I) of the act from "the first commercial marketing of the drug," rather than from the

effective date of the ANDA, serves a rational policy only

if Congress contemplated a situation in which an approval of an ANDA is in effect but the applicant's decision not

to market the drug deserves to be protected because a

delay in marketing serves the public interest.

Such a situation occurs where, under the terms of

section 505(j)(4)(B)(iii) of the act, an ANDA goes into

effect 30 months after a lawsuit is filed, but the lawsuit is

still pending. It serves the public interest to permit a

prudent ANDA holder in that situation to stay off the

market until the litigation is resolved, thereby minimizing potential damages.

As drafted, sections 505(j)(4)(B)(iv)(I) and (II) of the

act carefully avoid providing an incentive for immediate

marketing; the 180-day reward of exclusive marketing

begins when the applicant wins the lawsuit or when the

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applicant actually begins marketing, "whichever is earlier." The applicant thus does not lose any of the 180-day

period by electing to stay off the market until the lawsuit

is over.

Abbreviated New Drug Application Regulations, 54 Fed. Reg.

28,872, 28,894 (1989). In other words, the 180-day exclusivity

period should begin to run as soon as the first applicant

begins commercial marketing. In adopting the successfuldefense requirement in its final rulemaking, the FDA neither

rejected the foregoing analysis, nor explained how the successful-defense requirement would be consistent with it. See

Abbreviated New Drug Application Regulations, 59 Fed. Reg.

50,338, 50,353 (1994).10

3. Does a Literal Reading Produce Absurd Results?

The FDA contends that the statute should not be read

literally, because such a reading would produce results that

are clearly inconsistent with the intent of Congress in enacting the statute. We do not think that it is sufficiently clear

that Congress intended the "win-first" reading of the statute

to justify disregarding the most natural reading of the statutory text.

We begin by setting aside the problems of the first applicant who is never sued or who loses his lawsuit. The FDA

may or may not be right that a literal reading of the statute

to permit a first applicant to receive an exclusivity period in

these situations would be inconsistent with the statutory

scheme; we do not decide this question. As we have already

pointed out, the fatal flaw in the FDA's "absurd results"

argument is that the agency could have addressed these two

(supposedly) problematic situations without imposing the

broad win-first rule by creating narrower exceptions to sec-

__________

10 The FDA said only that "[o]ne comment said the rule, as

drafted, created an incentive for frivolous claims of patent invalidity

or noninfringement because it would give ANDA applicants exclusivity even if the applicant was unsuccessful in defending against

the patent owner's lawsuit. The comment would replace the phrase

'to be sued within 45 days' with 'and to successfully defend a suit

brought within 45 days.' The FDA agrees and has amended

s 314.107(c) accordingly." Abbreviated New Drug Application

Regulations, 59 Fed. Reg. 50,338, 50,353 (1994).

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tion 355(j)(5)(B)(iv) for the "no suit" and "lost suit" cases.

Indeed, the FDA has come close to doing so already. As for

first applicants who are never sued, the initial draft of 21

C.F.R. s 314.107(c)(1) contained, instead of the successfuldefense requirement, only a requirement that the first applicant have been "sued for patent infringement within 45 days

of the patent owner's receipt of notice" in order to be eligible

for the statutory period. Abbreviated New Drug Application

Regulations, 54 Fed. Reg. 28,872, 28,929 (1989). This language would have corrected the problem of first applicants

who are never sued (and only that problem).11

As to first applicants who lose their suits, Mova observed at

oral argument that one of the FDA's current regulations

suggests a possible way of addressing this problem (and

indeed may already have solved it). That regulation provides

that, if an ANDA applicant who makes a certification under

paragraph IV later loses its patent-infringement suit, it must

amend its ANDA to make a new certification under paragraph III, and provides that the ANDA will then "no longer

be considered to be one containing a certification under

paragraph [IV]." 12 The FDA claims that the regulation does

__________

11 Even this may not be the narrowest way of resolving the

underlying problem. After all, Congress may have intended to

reward the first ANDA applicant for his enterprise whether or not

he is later sued; the statutory scheme only runs into problems if

the first applicant never starts selling his product. An alternative

might be to prescribe a period within which a first applicant who

has not been sued must bring his product to market in order to

benefit from the exclusivity period.

12 The relevant regulation provides:

An applicant who has submitted a certification under paragraph (a)(12)(i)(A)(4) of this section and is sued for patent

infringement within 45 days of the receipt of notice sent under

s 314.95 shall amend the certification if a final judgment in the

action against the applicant is entered finding the patent to be

infringed. In the amended certification, the applicant shall

certify under paragraph (a)(12)(i)(A)(3) of this section that the

patent will expire on a specific date. Once an amendment or

letter for the change has been submitted, the application will no

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not have the effect of rendering the exclusivity period inapplicable after such an amendment, and of course we owe deference to the agency on the interpretation of its own regulations.13 But even if the present version of the regulation does

not accomplish the desired end, the FDA could presumably

draft a regulation that did so.

The FDA did not choose to adopt these narrower approaches; instead, it adopted the "win-first" reading of the

statute, which deviated from the literal language of the

statute by allowing an application to be approved while the

first applicant's lawsuit was pending and before either statutory trigger had been satisfied. In analyzing the successfuldefense requirement, then, we must ask whether the win-first

reading is needed to avoid "a result demonstrably at odds

with the intentions of [section 355(j)(5)(B)(iv)'s] drafters."

Ron Pair Enterprises, 489 U.S. at 242.

The FDA did not explain its decision to adopt the win-first

approach (instead of a narrower approach) in issuing its

regulation, see 59 Fed. Reg. 50,338, 50,353 (1994), and it has

not presented any argument for that approach in this litigation. There is, however, a compelling argument for the winfirst approach, which is advanced by Mylan. What if the first

__________

longer be considered to be one containing a certification under

paragraph (a)(12)(i)(A)(4) of this section. If a final judgment

finds the patent to be invalid and infringed, an amended

certification is not required.

21 C.F.R. s 314.94(a)(12)(viii)(A).

13 The FDA said at oral argument that its regulation is intended

only for "housekeeping" purposes, and that it should not be read to

affect the application of section 355(j)(5)(B)(iv). We owe "substantial deference" to an interpretation by the FDA of its own regulations, which has "controlling weight unless it is plainly erroneous or

inconsistent with the regulation." S.G. Loewendick & Sons, Inc. v.

Reich, 70 F.3d 1291, 1294 (D.C. Cir. 1995) (quoting Thomas Jefferson Univ. v. Shalala, 512 U.S. 504, 512 (1994)). We confess to not

understanding how the FDA can reconcile its reading with the

language of its own regulation, but stress that this issue has not

been briefed and is not necessary to the decision in this case.

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applicant does a poor job of designing its product to avoid

infringing the patent-holder's patent, and the second applicant does a much better job? The first applicant would then

be sued for infringement by the patent-holder, but the second

applicant would not. Indeed, this is exactly what Mylan

claims happened in the present case (although Mova vigorously contests this claim).

In such a situation, a literal reading of the statute admittedly produces a strange result. The second applicant, even

though it has designed its product well and avoided suit, is

barred from selling its product until the first applicant's

lawsuit finishes (maybe years later). The ingenious second

applicant is thus harmed, and the public is deprived of the

fruits of its ingenuity--a result seemingly at odds with Congress's apparent purposes, in enacting section 355(j)(5)(B)(iv),

of rewarding innovation and bringing generic drugs to market

quickly. Indeed, the first applicant could even collude with

the original patent-holder to prolong their litigation, and

thereby keep the second applicant's drug off the market

indefinitely.14

Yet we are not persuaded that this third anomaly suffices

to show that a literal reading of the statute leads to results

manifestly inconsistent with the intent of Congress. The

legislative history of section 355(j)(5)(B)(iv) is limited, and

fails utterly to specify or even provide any signals as to

whether Congress intended that a second ANDA applicant

who was not sued for patent infringement would have to wait

until one of the statutory triggers was satisfied, or instead be

__________

14 An amicus brief filed by Biovail Corporation International

dramatically illustrates an analogous risk, not necessarily involving

collusion. Biovail was the second applicant to file a paragraph IV

ANDA for a generic version of a heart medication. Biovail was not

sued by the pioneer drug company. The first applicant and the

pioneer drug company are now in litigation, and, Biovail claims, the

pioneer is paying the first applicant some $10 million per quarter in

exchange for the first applicant's agreement not to sell its product

after the 30-month waiting period expires. Under these circumstances, neither party would seem to have maximum incentive to

bring the litigation to a close.

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able to immediately market its product. Congress may very

well never even have thought about this question. But it is

not inconceivable that Congress meant what the statute says,

i.e., that the second applicant would have to wait for the first

lawsuit to finish. The fact that a patent-holder fails to sue an

ANDA applicant does not necessarily mean that it has concluded that the applicant did a good job of designing around

its patent. The patent-holder might have simply made a

mistake, and negligently failed to file suit (or filed a few days

after the end of the 45-day window). If a second ANDA

applicant who is not sued by the patent-holder is allowed to

immediately market its product, then the patent-holder's

error will have unfairly deprived the first applicant of the

benefits of the exclusivity period. Moreover, even if the

second applicant is sued, the successful-defense requirement

will allow him to receive FDA approval immediately once the

30-month waiting period expires. Given the nature of litigation, the first applicant's patent-infringement suit could easily

take longer than thirty months. The successful-defense requirement may therefore have the effect of allowing many

ANDA applicants to sell their products without regard to the

exclusivity period, a result that Congress might not have

intended.15

Additionally, there may be other ways in which a second

applicant with a better product can bring that product to

market before the first lawsuit terminates. Amicus curiae,

Teva Pharmaceutical Inc. ("Teva"), has pointed to one possibility. Teva observes that the court-decision trigger, by its

terms, can be satisfied by any "decision of a court in an action

described in clause (iii) holding the patent which is the

subject of the certification to be invalid or not infringed."

Teva claims that the actions "described in clause (iii)" are not

__________

15 Under the FDA's regulation, once a later applicant's drug has

been approved, it will apparently remain on the market even if the

exclusivity period later begins to run. The regulation only applies

the 180-day exclusivity period to ANDAs that are "subsequent" to a

successful defense by the first applicant, 21 C.F.R. s 314.107(c)(1),

and an ANDA that has already been approved does not fall in this

category.

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limited to infringement suits by the patent-holder, because

the last two sentences of clause (iii) say:

Until the expiration of forty-five days from the date the

notice made under paragraph (2)(B)(i) is received, no

action may be brought under section 2201 of Title 28 for

a declaratory judgment with respect to the patent. Any

action brought under section 2201 shall be brought in the

judicial district where the defendant has its principal

place of business or a regular and established place of

business.

21 U.S.C. s 355(j)(5)(B)(iii). Thus, Teva says, a declaratory

judgment action provides an alternative way of satisfying the

court-decision trigger. An ANDA applicant who doesn't want

to wait for the first applicant's patent infringement litigation

to finish can bring its own declaratory judgment action

against the patent-holder, and, if the second applicant prevails, the court-decision trigger will be satisfied, and it will be

allowed to market its product.

Teva's argument is elegant and textually persuasive. It

also provides a particularly appropriate solution in cases in

which the second applicant has done a better job of designing

around the pioneer drug manufacturer's patent than the first

did: in such cases, the second applicant should find it (relatively) easy to win a declaratory judgment action against the

patent-holder. Teva's reading thus rewards those applicants

(and only those applicants) who have built a better mousetrap.

Teva's reading is not, however, flawless. One difficulty is

that the 180-day exclusivity period will seemingly always go

to the first applicant, no matter whose suit satisfies the courtdecision trigger; the statute provides that any applications

after the first one "shall be made effective not earlier than

one hundred and eighty days after" the court-decision trigger

is satisfied. 21 U.S.C. s 355(j)(5)(B)(iv).16 It seems odd to

reward the first applicant if some later applicant was the

__________

16 This is the most natural reading of the statute, but we do not

necessarily find that it is the only permissible reading.

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party that actually prevailed in the patent-infringement litigation.17

Mylan has also noted what may be a more serious fly in the

(patented) ointment. In order to satisfy the Constitution's

case or controversy requirement, a party filing a declaratory

judgment action must show that there is a controversy of

"sufficient immediacy and reality to warrant the issuance of a

declaratory judgment." Federal Express Corp. v. Air Line

Pilots Ass'n, 67 F.3d 961, 964 (D.C. Cir. 1995) (quoting

Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S.

270 (1941)). To employ Teva's declaratory-judgment device,

a party would therefore need to demonstrate a "reasonable

apprehension of facing a lawsuit." Federal Express Corp., 67

F.3d at 964. The Federal Circuit has exclusive jurisdiction

over appeals in actions for patent infringement. 28 U.S.C.

s 1292(c). Under the Federal Circuit's caselaw, a declaratory judgment plaintiff must be able to point to some conduct

by the patent-holder that suggests that the plaintiff is at risk

of being sued; the fact that the patent-holder has sued others

is "pertinent," but "not always conclusive." See West Interactive Corp. v. First Data Resources, 972 F.2d 1295, 1297-98

(Fed. Cir. 1992). An ANDA applicant seeking to bring a

declaratory judgment action might have difficulty in meeting

this test, especially if the patent-holder disclaims any intention of bringing suit.18

__________

17 Indeed, the first applicant may still be enmeshed in patentinfringement litigation when the 180-day period begins, and therefore be unable to take advantage of the exclusivity period.

18 One way of eliminating strategic behavior of this kind might be

for the FDA to provide by regulation that a court decision ruling

that an ANDA applicant cannot reasonably anticipate suit by a

patent-holder is equivalent, for purposes of section 355(j)(5)(B)(iv),

to a ruling that the patent is invalid or not infringed. After all, the

purpose of the scheme set up by section 355(j)(5)(B) is to allow the

patent-holder an opportunity to defend its patent. If the patentholder declines even to create enough adversity to support a

declaratory judgment action, it might well be fair to deem the

patent-holder to have conceded noninfringement, at least for purposes of the statutory scheme. Certainly, there would be no danger

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The problem of the meritorious second applicant is a real

one, but the successful-defense requirement is too blunt an

instrument to solve it. The requirement cannot be reconciled

with the literal language of the statute, and alters the statutory scheme in a number of ways that do not clearly serve

congressional intent. We do not, of course, foreclose the

FDA from attempting to address the problem of the meritorious second applicant in some narrower way, as long as that

solution conforms to the statute. For now, however, we are

presented with the successful-defense requirement, and we

uphold the district court's decision to enjoin the FDA's enforcement of that requirement.

B.Upjohn's Motion to Intervene

We now turn to Upjohn's appeal of the district court's

denial of its motion to intervene. The district court denied

Upjohn's motion on two grounds: first, that Upjohn's motion

was mooted by the grant of the preliminary injunction, and

second, that s 355(j)(5)(B)(iv) "does not provide a cognizable

interest upon which a pioneer patent owner or an NDA owner

can challenge the approval of an ANDA." We find that the

district court was in error on both grounds.

A motion to intervene as of right turns on four factors: (1)

the timeliness of the motion; (2) whether the applicant

"claims an interest relating to the property or transaction

which is the subject of the action," Fed. R. Civ. P. 24(a); (3)

whether "the applicant is so situated that the disposition of

__________

in such a case that the patent-holder's failure to enforce its patent is

attributable to a mistake.

Moreover, the Federal Circuit has had no occasion to decide

whether there is "a controversy of sufficient immediacy and reality"

to support a declaratory judgment action, Federal Express Corp., 67

F.3d at 964, when the plaintiff requires a judgment under section

355(j)(5)(B) in order to bring its product to market. It is possible

that such a statutorily-created bottleneck, coupled with the statute's

express reference to declaratory judgment actions as a means of

relieving that bottleneck, might suffice to allow a plaintiff to show

the existence of a "case or controversy" without demonstrating an

immediate risk of being sued.

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the action may as a practical matter impair or impede the

applicant's ability to protect that interest," id.; and (4) whether "the applicant's interest is adequately represented by

existing parties." Id. To the extent that a district court's

ruling on a motion to intervene as of right is based on

questions of law, it is reviewed de novo; to the extent that it

is based on questions of fact, it is ordinarily reviewed for

abuse of discretion. See Massachusetts School of Law at

Andover, Inc. v. United States, 118 F.3d 776, 779-80 (D.C.

Cir. 1997) (noting, however, that application of the abuse-ofdiscretion standard seems anomalous in some circumstances).

The issues that Upjohn raises on its appeal are all pure

questions of law, so we apply de novo review.

The district court erred in finding that Upjohn's motion to

intervene was moot. The district court had entered only a

preliminary injunction, not a permanent injunction. The

district court presumably would have considered new evidence or new arguments in future proceedings, had Upjohn

(or some other party) wished to present them. And intervening even after the injunction had been issued would have

allowed Upjohn to participate in the appeal of the injunction.

See Massachusetts School of Law at Andover, 118 F.3d at 779

(discussing intervention before the district court for purposes

of appeal).

The district court was also in error in finding that Upjohn

did not "claim[ ] an interest relating to the property or the

transaction which is the subject of the action," as is required

by Federal Rule of Civil Procedure 24(a)(2). Rule 24(a)

"impliedly refers not to any interest the applicant can put

forward, but only to a legally protectable one." Southern

Christian Leadership Conference v. Kelley, 747 F.2d 777, 779

(D.C. Cir. 1984). Thus, a party that seeks to intervene as of

right must demonstrate that it has standing to participate in

the action. See id. There is no dispute that Upjohn has

constitutional standing; numerous cases have found that a

firm has constitutional standing to challenge a competitor's

entry into its market. See, e.g., Association of Data Processing Serv. Orgs., Inc. v. Camp, 397 U.S. 150, 152 (1970) ("Data

Processing ").

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Mylan argues, however, that Upjohn is not within the "zone

of interests" of section 355(j)(5)(B)(iv), and that it therefore

lacks prudential standing. We do not agree. The first step

in the prudential standing analysis is to identify the interests

protected by the statute. To do so, we consider the purposes

of the specific statutory provision that is at issue (here,

section 355(j)(5)(B)(iv)), read in the context of the statutory

scheme as a whole. See Bennett v. Spear, 117 S. Ct. 1154,

1167 (1997); Clarke v. Securities Industry Assoc., 479 U.S.

388, 401 (1987) (stating that a court is "not limited to considering the statute under which respondents sued, but may

consider any provision that helps us to understand

Congress's overall purposes...."). The purpose of section

355(j)(5)(B)(iv) is to provide a reward, in the form of an

exclusivity period, to generic drug companies that are the

first to file paragraph IV ANDAs. Section 355(j)(5)(B)(iv) is

not intended to benefit pioneer drug companies directly.

Indeed, quite the opposite is true: the provision is intended

to reward generic drug manufacturers who challenge pioneer

drug companies' patents. Thus, in the nomenclature of this

circuit's caselaw, Upjohn cannot show that it is an "intended

beneficiary" of section 355(j)(5)(B)(iv). Scheduled Airlines

Traffic Offices, Inc. v. Dept. of Defense, 87 F.3d 1356, 1359

(D.C. Cir. 1996) ("Scheduled Airlines").

But a plaintiff can be within the zone of interests of a

statute even in the absence of "an indication of congressional

purpose to benefit the would-be plaintiff." Clarke, 479 U.S.

at 399-400. As the Court recently made clear in National

Credit Union Administration v. First National Bank &

Trust Co., 118 S. Ct. 927 (1998) ("NCUA "), a plaintiff only

needs to show that its interest is among those "arguably ...

to be protected" by the statute. Id. at 935 (quoting Data

Processing, 397 U.S. at 153) (emphasis added). This analysis

focuses, not on those who Congress intended to benefit, but

on those who in practice can be expected to police the

interests that the statute protects. In NCUA, the provision

before the Court imposed a rule called the "common bond

requirement," which limits the membership of credit unions

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tion." 12 U.S.C. s 1759 (1994). The question for the Court

was whether a group of banks who had an interest in limiting

the markets that credit unions could serve were within the

zone of interests of this provision. The Court found that the

common bond requirement was intended to "reinforce the

cooperative nature of credit unions, which in turn was believed to promote their safety and soundness and allow access

to credit by persons otherwise unable to borrow." NCUA,

118 S. Ct. at 935 n.6. The Court reasoned that "by its very

nature, a cooperative institution must serve a limited market," id., so that there is an "unmistakable" link between the

statute and a "limitation on the markets that federal credit

unions can serve." Id. at 935 & n.6. The Court concluded

that limiting the markets served by credit unions is therefore

an interest "arguably to be protected" by the statute, so that

the banks had prudential standing.

The test applied by NCUA is not far removed from this

circuit's "suitable challenger" test. See, e.g., Scheduled Airlines, 87 F.3d at 1359-61 (applying this test). Under the

"suitable challenger" test, a plaintiff must demonstrate that

its "interests are sufficiently congruent with those of the

intended beneficiaries that the litigants are not 'more likely to

frustrate than to further ... statutory objectives.' " Id. at

1359 (quoting First Nat'l Bank & Trust Co. v. National

Credit Union Admin., 988 F.2d 1272, 1275 (D.C. Cir. 1993)

(quoting Clarke, 479 U.S. at 397 n.12)). NCUA allows a

plaintiff to demonstrate that its interest and the interest

served by the statute have, by their "very nature," an "unmistakable" link. NCUA, 118 S. Ct. at 935 & n.6; in other

words, the plaintiff may show an inevitable congruence between the two interests. The two standards are thus very

similar.

It seems clear under NCUA that Upjohn has prudential

standing. Here, Upjohn is seeking to enforce (its interpretation of) section 355(j)(5)(B)(iv), a statute by which Congress

sought to regulate the timing of generic drug manufacturers'

entry into the market. Although the statute speaks directly

only to freeing the first generic drug company to file a

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paragraph IV ANDA from competition from other generic

drug manufacturers, this necessarily entails freeing the pioneer drug producer from such competition as well. Thus,

Upjohn's interest in limiting competition for its product is,

"by its very nature," NCUA, 118 S. Ct. at 935 n.6, linked with

the statute's goal of limiting competition between generic

manufacturers. See also MD Pharmaceutical, Inc. v. Drug

Enforcement Admin., 133 F.3d 8, 12-13 (D.C. Cir. 1998)

(finding that a drug company was within the zone of interests

of an "entry-restricting" statute that regulated entry into its

market); Scheduled Aircraft, 87 F.3d at 1360-61 (finding that

a party seeking to enforce a "statutory demarcation" is a

suitable challenger) (quoting First Nat'l Bank & Trust, 988

F.2d at 1278).

Upjohn need not show anything more than that it has

standing to sue in order to demonstrate the existence of a

legally protected interest for purposes of Rule 24(a). See

Mausolf v. Babbitt, 85 F.3d 1295, 1299-1302 (8th Cir. 1996)

(finding that a showing of standing suffices to demonstrate a

legally protected interest for purposes of Rule 24(a)); but cf.

United States v. 39.96 Acres of Land, 754 F.2d 855, 859 (7th

Cir. 1985) (finding, on the peculiar facts of that case, that

more than a showing of standing was required). We therefore reject the district court's contrary conclusion that Upjohn did not have a sufficient interest in the action to intervene.

The district court never reached the remaining elements of

the Rule 24(a) analysis--timeliness, the risk that Upjohn's

interests would be impaired, and whether Upjohn's interests

were already adequately represented in the litigation. Upjohn has included in its brief on this appeal a number of

arguments for the affirmance of the district court's injunction.

In order to determine whether Upjohn is properly a party to

the appeal of the injunction question, we must reach the

remaining Rule 24(a) issues. See Dimond v. District of

Columbia, 792 F.2d 179, 193 (D.C. Cir. 1986) (similarly addressing Rule 24(a) issues that the district court had, after

making an erroneous legal ruling, failed to reach); see also

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Mausolf v. Babbitt, 125 F.3d 661, 666-67 (8th Cir. 1997)

(holding that if the court of appeals reverses the district

court's denial of a party's motion to intervene, that party may

participate in an appeal of a later ruling in the same litigation,

if it has met the procedural requirements for doing so). As

to timeliness, Upjohn sought to intervene a few weeks after

Mova initiated its action, and before the district court ruled

on the preliminary injunction; this cannot be regarded as

untimely. Upjohn's interests were also at risk; Upjohn was

in danger of losing market share to Mylan if the district court

denied the injunction and allowed Mylan's product on the

market. Finally, as to adequacy of representation, Mova is a

generic drug manufacturer, and therefore might have strategic reasons not to press certain arguments available to Upjohn in anticipation of (perhaps) finding itself in Mylan's

situation in a future case. We thus conclude that Upjohn was

entitled to intervene as of right, and that Upjohn is therefore

a proper party to the appeal of the injunction order and in all

further proceedings in the district court.19

III. Conclusion

We find that the FDA exceeded its statutory authority in

imposing the successful-defense requirement as a prerequisite

to the invocation of the 180-day exclusivity rule by a first

applicant under section 355(j)(5)(B)(iv). The successfuldefense requirement is inconsistent with the statutory text

and structure, and is not justified by a need to protect the

essential function of the statute or a clear congressional

intent. We therefore affirm the district court's decision to

strike down the successful-defense requirement.

As to Upjohn's motion to intervene, we conclude that the

district court erred in finding that Upjohn's motion was moot

and that Upjohn did not have a sufficient interest in the

__________

19 Upjohn also challenges the district court's denial of its motion

for permissive intervention under Federal Rule of Civil Procedure

24(b). Because we find that Upjohn was entitled to intervene as of

right, we do not reach this issue.

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subject-matter of the litigation. We also find that the other

elements of Rule 24(a) have been met by Upjohn, and reverse

the district court's denial of Upjohn's motion. Upjohn is

properly a party to this appeal, and to any proceedings on

remand.

So ordered.

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