FDAalso moves to dismiss for f ailure to state a

claim. S ee Dk t
. # 30. Be cause matters 1 outside the pleading s have be en pre sented t o t h e C o u rt, the motion must be treated a s one for summary judgme nt. See Fe d. R. Civ. P . 12(d). The motion to di smiss wil l theref ore be denied. UNITED STAT ES DIS TRICT COURT F OR THE D ISTRIC T OF CO LU M BIA

) ACTAVIS ELIZABETH LLC , ) ) P laintif f, )

) v. ) Civil Action No. 09-362 (RM C) ) UNITED STAT ES FOOD & DR UG ADMIN ISTRATIO N, e t al . , )

) ) Defendan ts. ) )
M EM OR

AN DU M OP IN ION
Actavis Elizabeth L L C se eks judicial revie w of a decision of the United States Food and Dr ug Administration awa

rding five y ear s of marke t exclusi vity to I nterve nor-De fenda

nt Shire Pha rm a c e uti c a ls I nc . f

or the manu fa c tur e of

lis de xamf

e tamin e dim e syla te (“ L DX ” ), c ur re ntl y
mark e te d b y

Shi re ’s subs id iar y in t

he Un ite d St a te s und e r t he tr a de name Vy

va ns e ®. Ac tavis disag ree s with the ag ency ’s conc lusion that L DX is a “new chemica l e ntity ” within the meaningof the Fe dera l Food, Dr

ug , and C osmetic Act (“ Act”) , 21 U.S.C. § 301 et seq ., a s ame nd e d. Ac tavis , FDA , and Shire e ach move s for summary judgme nt. For

the re asons explained here in, the Court 1 will gr ant summary

judgme nt to FDA a

nd Shire, and will deny

summary judgme nt to Actavis. I. F AC TS On Fe bruar

y 23, 2007, FDA approve d Shire’s new drug application for L DX to treatA cova lent bond is formed whe n two atoms share a pair of electrons. A noncova lent bond 2 is a bond betwe en atoms that does not invol ve the sharing of pairs of elec trons. Esters conta in a ty pe of cova lent bond, called a n ester bond, that links an ox y g en atom to a c entra l atom, such as a c arbon a tom or a ph os ph or ou s atom , w he re in t he c e ntr a l a tom als o is do ub le bo nd e d to an o xy g e n atom
. Amides contain a ty

pe of covale nt bond, called a n amide bond, that links a nitrog en atom to a c entra l atom, such as a

car bon atom or a phosphor ous atom, where in the centr al atom also is double bonded to an oxy g en atom. See Pl.’s Mem. in S upp. of Mot. for Summ. J . [Dkt. # 18] at 5. -2- Atte nti on De fi c it H y

pe ra c tiv ity

Di so rd e r. F DAawa

rd e d Sh ir e fi ve y e ars of

mark e t e xclusivity pursuant to § 355(j)( 5)(F )(ii) of the Act and F DA’s inter preting regulations, 21 C.F.R. § 314.108. FDAdeter

mined that L DX is a “ new chemica l e ntity ” within the meaning of the Act be cause L DX
c on ta ins a pr e vio us ly a

pp ro ve d mol e c ule wi th a

c ov a le nt, no n- e ste r a

mid e de ri vativ e . Withc e rt a in 2 limit ed exceptions, FD A’s dete rmination prec ludes it from ac ceptingabbre viated new drug app lic atio ns fo r g e ne ri c ve rs ion s o f L DXfo r f ive y e ars fo llo wi ngF e br

ua ry 23 , 2 00 7, that is , unti l Fe bruar y 23, 2012. On J anuar

y 29, 2009, Actavis submitt ed an abbr eviated ne w drugapplication for a g ener ic ver sion of L DX. FDA declined rec eipt of Actavis’s a pplication on Fe bruar

y 6, 2009, based on its gra nt of five y ear s of marke t exclusi vity to Shire. That same da

y , Actavis submitted a position paper to FDA a rg uing that the ag ency should rec onsider it s decision t hat L DX is a “ new c hemical
e nti ty .” On

F e br ua ry 24 , 200 9, Ac tavis fi le d th is l aws uit a lle g ingthat F DAha d e rr on e ou sly de te rm ine d th a t L DXis a “ ne w c he mic a l ent it y ” an d th a t F DAsh ou ld n ot h a ve re fu se d it s application for

a g ener ic ver sion of L DX. FDAdeter

mined that the issues raise d by Actav i s s h o uld be consider ed administratively and opened a public docket on Apr il 13, 2009, to rece ive comments fr om interested parties on the r eleva

nt leg al and regulatory issues. On October 23, 2009, FDAissued a fina l decision“Prodrug s” are drug s that “ar e themselves pharma colog ically inactive c ompounds that are 3 conver ted into biologica lly

active substanc es in a va riety of wa y s, including by

hy droly sis of ester or amide linkag es, or by

other meta

bolic proce sses.” A.R. 1798-99.

-3- aff irming its orig inal deter

mination to gra

nt Shire five y ear s of marke t exclusi vity . FDAconclude d that the L DX molecule in Vy vanse® w as a “ new c hemical e ntity ” bec ause: L isd e xamf

e tamin e c on sis ts o f d e xtro a mph e t a m i n e b o n d e d

c o v a le ntl y to ly sine throug h an amide bond. L isdex amfe tamine i s a prodr ug that is m e ta bo lic a lly c on ve rt e d to pr od

uc e de xtro a mph e tamin e , w hic h is responsible for t h e drug’ s activity . Under FDA ’s re g ulation at 21 CFR § 314.108, a non-e ste r c o v a le ntl y

bonded molecule is considere d the ac tive moiety of a drug and, if not pre viously approve d, it will be c o n s i d e r e d

a n e w c h e m i c a l e n t i t y e n t i t l e d t o 5 ye ar s o f

e x c l u s i v i t y. A non-es t er t hat re quires metabolic c onversion to produc e a previously

approve d active moiety is considere d a new

chemica l e n ti ty
. B e c a

u s e li s d e xa mf

e ta mi n e is a n o n - e s te r c o v a le n tl y

b o nded molecule, a

nd beca use it require s met aboli c conve rsion to produce dextroamphetamine, l isdex amfe tamine i s a new chemica l entity

and i s t h u s e n t i t l e d

t o 5 ye ar s o f

e x c l u s i v i t y. A.R. 1782. 3 On Octobe r 6, 2009, Actavis amended it s complaint to challeng e F DA’s Oc tober 23, 2009, final dec ision. All pa rties move for summary

judgme nt. Oral a

rg ument on the motions was held on Fe bruar

y 17, 2010. II. LEGAL STANDARDS A. SUMMA RY JUDG MENT Under Rule 56 of t he Feder al Rules of C ivil Procedur e, sum mary judgme nt must be gra n t edwh en “t h e p l ea d i n gs , d ep o s i t i o n s , an s we rs t o i n t erro gat o ri es , an d admissions on file, toge ther with the aff

idavits, if any , show that there is no ge nu i n e issue as to a ny materia l fac t and that the
mov ingpa

rt y is e nti tle d to a jud g me nt a s a ma tte r o f l aw. ” F e d. R. C iv. P. 5 6( c ); An de rso n v . Li be rty Lobby, Inc. , 4 77 U. S. 2 42 , 24 7 (1 98 6)

. Mo re ov e r, su mma ry jud g me nt i s p ro pe rl y

g ra nte d a g a ins t-4-

a par ty wh o “af

ter a dequate time for discove ry and upon motion . . . fails to make a show ing sufficie nt to es t ab l i s h t h e ex istence of an ele ment essential to that par ty ’s ca se, and on w hich that party will bear the burden of

proof at trial.” Ce lot e

xCor p. v . Ca tre tt , 477 U.S. 317, 322 (1986). I n r uli ngon a mot ion fo r s um mar

y jud g me nt, the c ourt

mus t dr aw a ll j us tif

ia ble infere nces in the nonmoving part y ’s favor and ac cept the nonmovingparty ’s evidenc e as true
. Anderson , 477 U.S. at 255. A nonmoving pa rty , h o we v er , m ust establish more than “the mere exis tence of a scintilla of evide nce” in support of its posit ion. Id. at 252. I n addition, the nonmoving party may not r ely solely on alleg ations or conclusory statements. Gree ne v. D alton , 164 F.3d 671, 675 (D.C. Cir. 1999). R ather , the nonm oving party must prese nt specific fac ts that would enable a
rea sonable jury

to find in its favor. Id. at 675. I f t h e ev i d en ce “is mere ly colora ble, or is not signific antly

probative, summar

y judgme nt may

b e gra n ted.” Anderson , 477 U.S. at 249-50 (citations omitted).

B . APA Under the Admi nistrative P roce dure Act (“A PA”), 5 U.S.C . § 551 et seq. , “[a]genc y
a c tio n ma de re vie wa

ble by statut e and

fi na l a g e nc y

a c tio n f or wh ic h th e re is n o o the r ad e qu a te
reme dy in a cour t are subject to judicial revie w.” 5 U.S.C. § 704. The APA r equire s a re viewing
c ourt to s e t a sid e a

n ag e nc y a c tio n tha t is “ arb itr ary , ca pr ic iou s, an ab us e of dis c re tio n, or oth e rw ise not in accor dance with law.” Id. § 7 06 (2 )( A) ; Tourus Records, Inc. v . DEA , 259 F .3 d 7 31 , 7 36 (D .C. Cir

. 2 0 0 1 )

. H o w e v e r , a

r e v ie w in g c o u rt i s “ n o t t o s u b s ti tute it s ju d g me n t f

o r th a t o f th e a g e n c y .” Citi zens to Preserv e Ov erton Park v . Volpe , 401 U.S. 402, 416 (1971).

Whe n r e vie wi ngan ag e nc y ’s int e rp re ta tio n of i ts o wn or g anic statut e , a

c ourt mus t undertake a two- step ana ly sis as set forth in Ch evro n U .S .A . I nc . v . Na tural R eso ur c es D e fe ns e-5-

Council, Inc ., 46 7 U .S. 83 7 ( 19 84 ). F ir st, a c ourt mus t de te rm ine wh e the r “ Con g re ss h a s d ir e c tly sp ok e n to the pr e c ise qu e sti on a t iss ue ” and if so the c ourt mus t “ g ive e ff e c t to t he un a mbi g uo us ly expressed intent of Cong ress.” 467 U.S. at 842-43. To dec ide whethe r Cong ress ha s addre ssed the p r e c is e qu e s ti o n a t is s u e , a c o u rt mu s t an a ly ze th e te xt, p u r

p o s e , an d s tr

u c tu r e o f the statute. Ra nb ax yLab s. Ltd

. v . Le av itt , 469 F.3d 120, 124 ( D.C. Cir. 2006). I f the statute is silent or ambig uous o n t h e question, the c ourt must procee d to the second step of

the Chevron analy sis and determine whether the a g ency ’s interpre tation is based on a per missibl e construc tion of the statute. Chevron , 467 U.S. at 843. When an ag ency ’s int e rp re ta tio n o f a

sta tut e is c ha lle ng e d a t ste p tw o, its “ int e rp re ta tio n n e e d n ot b e the be st o r m os t natura l one by

g rammatica l or other standa rds . . . . Rather [ it] need be onl y rea sonable to wa rra nt defe renc e.” Pauley v . BethEn er g y Mines, Inc. , 501 U.S. 680, 702 (1991). “T he cour t need not
c on c lud e that th e a g e nc y ’s c on str uc tio n wa s th e on ly

on e it p e rm iss ibl y

c ou ld h a ve a do pte d to up ho ld the construc tion, or even the rea ding the court would have rea ched if the questi on initially had ar isen in a judicial proc eeding .” Chevron , 4 67 U. S. a t 84 4 n. 11
. I f the a g e nc y ’s statut or y c on str uc tio n is permissible, then the c ourt must defer to the ag ency ’s interpre tation. Id. III . A NA LY SIS T h e Ac t awa

rds five y ear s of marke t exclusi vity to drug s “no ac tive ingr edient (including any

ester or salt of the ac tive i n gre d i ent) of w hich has be en appr oved in any other application . . . .” 21 U .S.C. § 355(j)(5)(F )(ii). The term “a ctive ing redie nt” is n o t d efined in the statute. By regulation, F DA has interpre ted “no active ingr edient (including any ester or salt of the active ing redie nt) of which ha s been a pproved in a

ny other a pplication” to me an a “new chemica l entity .” See 21 C.F.R. § 314.108(a)

. “Ne w chemical entit y ” is define d by FDA to mean “a drug that-6-

contains no active moiety that has been approve d by FDA in any other application . . . .” Id. FDA de fi ne s “ a c tiv e moi e ty ” a s “ the mol e c ule or ion , e xclu din g tho se a pp e nd e d p or

tio ns of the mol e c ule that cause the drugto be an e ster, salt (includinga salt with hy drog en or c oordinat ion bonds), or oth e r n on c ov a le nt d e ri vativ e (s uc h a s c omp lex , chel ate , o r c la thr a te ) o f t he mol e c ule , r e sp on sib le for the phy siologica l or pharmaco logic al ac tion of the drugsubstance.” Id. Acc ording ly , under F DA ’s int e rp re ta tio n o f t

he Ac t, a pr e vio us ly

a pp ro ve d mo le c ule that di ff e rs on ly by an e ste r or

sa lt de ri vativ e is n ot a

“ ne w ch e mic a l ent ity” wh e re a s a pr e vio us ly a pp ro ve d mo le c ule wi th a

c ov a le nt, non-ester derivative is a “ne w che mical entity .” Applying this construc tion of the Act to L DX, F DA deter mined that L DX is a “ new c hemical e ntity ” bec ause L DX conta ins a p re v i ously approve d molecule with a c ovalent, non-e ster amide de rivative.

Actavis a rg ues that “F DA’s c ovalent/noncova lent derivative distinction is contra ry to Congre ssional intent because it effe ctively rea ds a structura l require ment into the statute” a nd that the term “ active ing redie nt” “must be interp re t ed to be the molecule that ac tually provides the thera peutic eff ect.” Pl.’s Me m. in Opp’n to Mots. for Summ. J
. (“Pl.’s Opp’n” ) [Dkt. # 32] at 3. Howeve r, Cong ress did not define “ac tive i n g redie nt” in the statute and A ctavis identifies no statutory lang uag e that compels its interpr etation of the term. I ndeed, the Court of Appea ls for the District of Columbi a Circuit a lrea dy has conclude d that the statutory lang uag e “no active ing redie nt (including any

ester or salt of the ac tive i n gre d i ent) of w hich has be en appr oved in any other application” is ambiguous. See Abbott Labs. v. Young , 920 F.2d 984, 987 ( D.C. Cir. 1990) (“The pare nthetical phra se (‘ i n cl u d i n g any ester or salt of the active ing redie nt’) ca n ref er to either

the
ac t i v e i n gre d i en to f t h e o ri gi n al ap p ro v eddru g or to the active ingredie nt in the new drug , depending on how ‘the’ in the pare nthetical and the wo rd s s urroundingthe par enthetica l — ‘no ac tive-7-

ingr edient . .

. of which has been approve d’ — [are] inter prete d.”) (empha sis in orig inal). While the
c ou rtw a s c o n c e r

n e d w i t h t h e a mb i g u i t y

o f t h e l an g u a g e i n s i d e t h e p ar e n t h e t i c a l , i ts p e c i f ic a lly
rec og nized that the m eaning of t he parenthetica l phrase depende d on how “the words surrounding the par enthetica l — ‘no active ing redie nt . . . of which ha s been a pproved’ — [are] interprete d.” Id. Thus, the cour

t acknowle dg ed that the wor ds surrounding the par enthetica l which are in contest here also are ambig uous. See, e.g., AFL-CIO v . FEC , 3 33 F .3 d 1 68 , 1 73 (D .C. Cir . 2 00 3) (“ A s ta tut e is
c on sid e re d ambi g uo us if

it c an b e re a d mo re tha

n o ne way .” ). At Chevron step one, this Court’s revie w is limi ted to deter mining whe t h er “the statute unambiguously fore closes the a g ency ’s interpre tation, and therefor e contains no g ap for the age ncy to fill . . . .” Nat ’l Cab le & Te le c om ms . As s’ n v . B ra nd

X I nte rn e t Se rv

s. , 545 U.S. 967, 982-83 (2005). The Act plai nly does not unambig uously

fore close F DA’s inter

pretation. Hav in g c o n c lu d e d th a t th e p h r a s e “ n o a c ti v e in g r e d ie n t
. . . o f w h ic h has bee n approve d” is ambig uous, the Court must “def er to [FDA’s] interpre tation of t he phrase if it ‘is based on a per missibl e construc tion of the statute.’” Nat’l Mining Ass’n v. Kem pthorne , 512 F.3d 702, 709 (D

. C
. C i r. 2 0 0 8 ) ( qu o t i n g Chevron , 46 7 U. S. a t 84 3) . A t Chevron step two, all that is “ask[ed] of the ag ency

is a rea sonable interpr etation.” Id. FDA ’s interpre tation easily satisfies this standard. FDAapplied its scientific e x pertise to identify structura l modifications to pr ev i o u s l y approve d molecule s that are likely

to chang e the a ctivity

of the drugand re prese nt a sig nificant innovation, such as non- ester, c ovalent der ivatives, and those that are not likely to r efle ct a sig nificant c hang e, such as sa lts a

nd esters. Actavis faults FDA for cre ating a brig ht-line rule on the ba sis of a che mical
e nti ty ’s str

uc tur e , b ut t

he statut e its e lf

dr aws dis tin cti on s b a se d o n s tr uc tur e — e ste rs and

sa lts — and the Court ca

nnot say that FDAwas unre asonable in also doing so. Nor is F DA’s inter pretation-8-

un re a so na

ble be c a us e Ac tavis a sse rt s th a t th e re are oth e r de ri vativ e s in a dd iti on to e ste rs and sa lts , su c h a s a mid e s, that of

te n d o n ot a lte r t

he pr op e rt ie s o f t

he a c tiv e moi e ty . T hat de te rm inatio n “ re sts
on the ‘a g e nc y ’s e va luatio ns of sc ie nti fi c data wi thi n it s are a

of e xpe rt ise ,’ and

he nc e is e nti tle d to a ‘hig h level of de fer ence ’ from this court.” Se ro no Lab s. v . S ha lal a , 158 F.3d 1313, 1320 ( D.C. Cir. 1 9 9 8 ) ( qu o t i n g A. L. Pha rm a, In c . v . S ha lal a , 62 F.3d 1484, 1490 (D.C. Cir. 1995)). Courts ar e not “scie ntists independe ntly capa ble of a ssessing the validity of the a g ency ’s deter

mination — bey ond holding it to the standar ds of rationality require d by

the Administrative P roce dure Act, 5 U.S.C. § 706(2)( A).” Id. a t 13 27 . A c tavis ha s f a ile d to sh owthat F DA ’s i nt erpr eta tion o f t he Ac t is imp e rm iss ibl e un de r t

his sta nd ard

. “ As lon g a s the a g e nc y sta y s wi thi n Con g re ss’ de le g a tio n, it i s fr e e to m a ke po lic y

c ho ice s in int e rp re tin g the statut e , a nd su c h in te rp re ta tio ns are e nti tle d to defe renc e.” Ariz. Pub. Serv. Co. v. E PA , 211 F.3d 1280, 1287 (D.C. C ir. 2000) (quotation marks and alteration omit ted).

Ac tavis a lso argue s that F DA ’s int e rp re ta tio n of the Ac t is un re a so na ble be c a us e it is contrar y to FDA’ s implementing re g ulations, which, acc ording to A ctavis, “re quire[] that ‘ac tive moiety ’ be c onstrued to re fer to the molecule that tra

vels to and ac ts on the s ite of drug action.” Pl.’s Opp’n at 8. Actavis a

rg ues that while L DX “is c omprised of de x troamphetamine bonded to ly sine throug h an a mi d e c o v a le n t b o n d , . . . th e mo le c u le p r o v id in g th e th e r a p e u ti c e f f e c t of lisdex amfe tamine at the sit e o f d ru g action — its active moiety — is previously

approve d dextroamphetamine.” Id. But that is not how FDA interpre ts its implementing regulations, a nd the Court “must give substa

ntial defe renc e to an a g ency ’s interpre tation of its own regulations.” Thomas J e ffe rso n U niv . v . S ha lal a , 512 U.S. 504, 512 (1994). As F DA itself explained:-9- FDAinterpre ts an d ap p l i es 21 CFR § 314.108 so that the re levant inq u i ry addre sses the structure of the molec ule that forms the dr ug substance, a

nd whether that molecule has been previously approve d as an a ctive moiety . Whether a molec ul e wi ll be considere d to be responsible for

the phy siologica l or pharma colog ical ac ti o n of the drug substance depends upon the chemica l structure of that molecule, which in turn depe nd s on cer tain rea sonable a ssumptions FDAhad adopted a bout the activity

of these c lasses of molec ules

. I f t he molecules in the drugs u b s t ance are salts or ester s or other non covale nt derivatives, the a ctive moiety will be the molecule minus the a pp e nd a g e . I f t

he dr ug su bs tanc e is c omp os e d of no n- e ste r c ov a le ntl y bonded molecule s, the cova lently bonded molecule is considere d the a c t i v e m o i e t y. A. R. 1 79 2. De fe re nc e to F DA ’s int e rp re ta tio n o f “ a c tiv e moi e ty ” with in the me anin g of its implementing r eg ulati o n s “i s all the more w arr anted whe n, as her e, the r eg ulation conce rns ‘a complex and highly

technica l regulatory

prog ram,’ in whic h the i dentification and cla ssification of rele vant ‘criteria ne cessa rily require signific ant expertise and e ntail the exercise of judgme nt g rounded in policy

conce rns.’” Thomas Jefferson Univ. , 5 1 2 U. S
. at 5 1 2 (q u o t i n g Pauley , 5 01 U. S. at 697). I ndeed, FDA noted the “diffic ulty in de termining prec isely which molecule, or portion of

a mol e c ule , is re sp on sib le fo r a dr ug ’s e ff e c ts” and that “ Ac tavis and

Shi re make c on fl ic tin g c la ims reg ardingwhich in vivo eff ects a re me an i ng ful and whic h molecules or por tions of molecules ar e
re sp on sib le fo r t

ho se e ff e c ts. ” A. R. 1 79 7- 98 . In li g ht o f t he dif fi c ult y in i de nti fy

ing th e pr e c ise
c he mic a l c omp on e nt r e sp on sib le fo r a dr ug ’s e ff e c ts a nd the ho tly dis pu te d s c ie nti fi c data

wi th
re sp e c t to that iss ue in t

his c a se , th e Cou

rt fi nd s th at F DAre a so na

bly a pp lie d it s in te rp re ta tio n o f i ts implementing r eg ulations and the Ac t to conclude that L DX wa s the “a ctive moiety .”

Finally , the Court can quickly dispose of Ac tavis’s contention that F DA’s de cision
was arbitra

ry and capr icious beca

us e a n o u tdated draft

version of F DA’s Ma

nual of Policy

and Procedur e 7500.3 purpor tedly contra dicts the structure -base d approa ch re flect ed i n the ag ency ’s-10-

formal r eg ulations. I t is bey ond cavil that “ne ither an unreasone d statement in the manua l nor alleg edly long- standing ag ency

prac tice ca

n trump a formal regulation with the procedura l history
nece ssary to take on the f orce of law.” Cent. Laborers’ Pension Fund v. H einz , 541 U.S. 739, 748 (2004). Actavis would have this Court set aside FDA ’s dec ision for not comply ing w ith an outdated draf t of an int erna l document not having the force of law and supersede d by formal r eg ulation. The Court de c lin e s to do so . A c tavi s comp la ins tha t F DAre lie d o n th e dr a ft manu a l pr ov isi on

wi th
re sp e c t to ano the r d

ru g a pp lic a tio n, bu t any

fo rc e tha t argume nt o the rw ise mig ht h a ve ha d is e nti re ly sapped by the fact that FDA rec og nized its err or i n that case and re verse d itself. Actavis make s too much of the dr aft manua l provision and FDA ’s allege d flip-flopping . The off icial policy

of the ag ency is e x presse d in the formal regulations, not in a ny draf t ma nual provision that pr ec ed es t he promulg ation of the re g ulations. IV. CONCLUSION

For the fore g oing r easons, the Court will g rant F DA ’s and Shi re’ s motions for
su mma ry jud g me nt [D kt. ## 28 & 30 ], and wi ll d e ny Ac tavis ’s mot ion

fo r s umm ary

jud g me nt [D kt. # 18]. FDA’s motion to dismi ss [ Dkt. # 30] wil l be denied. A memorializing Orde r ac companies this Memorandum Opinion.
Date : Ma rc h 4 , 2 01 0 /s/ ROSEMARY M. COL L YER Un i t edS t at es Di s t ri ct J u d ge