Source: http://www.fdalawblog.net/2010/03/teva-prevails-in-generic-cozaarhyzaar-180day-exclusivity-forfeiture-litigation-the-decision-is-a-gam/
Timestamp: 2019-04-20 14:41:40+00:00

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Earlier today, the U.S. Court of Appeals for the District of Columbia Circuit handed Teva Pharmaceuticals USA, Inc. (“Teva”) a significant victory in the company’s lawsuit against FDA concerning the availability of 180-day exclusivity for generic versions of Merck & Co., Inc.’s (“Merck’s”) blockbuster angiotensin II receptor antagonist drugs COZAAR (losartan potassium) Tablets and HYZAAR (hydrochlorothiazide; losartan potassium) Tablets. Although FDA has made no determination with respect to generic COZAAR and HYZAAR 180-day exclusivity, Teva believes that FDA’s interpretation of the statute, as previously applied in the Agency’s adjudications concerning generic PRECOSE (acarbose) Tablets and generic COSOPT (dorzolamide hydrochloride; timolol maleate), will result in a forfeiture of 180-day exclusivity for both products. The D.C. Circuit's decision is the culmination of several years of debate concerning the proper interpretation of the “failure to market” 180-day exclusivity forfeiture provisions at FDC Act § 505(j)(5)(D)(i)(I), beginning with FDA's so-called "bookend approach" described in the Agency's generic KYTRIL (granisetron HCl) Injection 180-day exclusivity decision.
As we previously reported (here, here, and here), Teva’s lawsuit challenged FDA’s interpretation of the “failure to market” 180-day exclusivity forfeiture provisions at FDC Act § 505(j)(5)(D)(i)(I), which were added to the FDC Act in December 2003 by the Medicare Modernization Act (“MMA”), and in particular FDA’s interpretation of the patent information withdrawal provision at FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC). That provisions states that one of the dates for calculating a forfeiture is the date that is 75 days after which “[t]he patent information submitted under [FDC Act § 505(b) or (c)] is withdrawn by the holder of the application approved under [FDC Act § 505(b)].” FDA has interpreted the provision such that a request to withdraw patent information from the Orange Book is a forfeiture event under FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC). In discussing its interpretation of FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC), FDA determined that the U.S. Court of Appeals for the District of Columbia Circuit’s 2006 decision in Ranbaxy Labs. Ltd. v. Leavitt (a pre-MMA case) holding that FDA may not condition the delisting of a patent on the existence of patent litigation and deprive an ANDA applicant eligible for 180-day exclusivity of such exclusivity does not apply to the version of the FDC Act amended by the MMA.
. . . takes the form of linguistic analysis focused almost entirely on the text of the “failure to market” forfeiture event and a related provision. The [MMA], Teva explains, introduced a new procedure, a counterclaim in the brand manufacturer’s patent infringement suit, through which generic companies can force brand companies to delist an improperly asserted patent. See 21 U.S.C. § 355(j)(5)(C)(ii)(I). This counterclaim provision is the only portion of the statute that explicitly provides for the delisting of a patent after it has been challenged in an ANDA. In the company’s view, that singular reference requires the conclusion that the counterclaim provision describes the only scenario in which the FDA may delist a challenged patent.
Id. at 126 (emphasis added, citation omitted). Nothing in the [MMA] altered that essential incentive structure, says Teva, so the preceding portion of Ranbaxy remains applicable even under the new regime. Indeed, it is true that the 2003 amendments say nothing specific to undermine our prior understanding of the statute’s intended incentive structure.
The real issue, then, is whether the FDA is right that the 2003 addition of the “failure to market” forfeiture provision, 21 U.S.C. § 355(j)(5)(D)(i)(I), altered the statute’s incentive structure to the point that Ranbaxy’s reasoning no longer controls the agency’s treatment of a delisting request in the wake of a paragraph-IV filing.
The terms of § 355(j)(5)(D)(i)(I) . . . create five possible dates on which a generic manufacturer otherwise entitled to exclusivity can forfeit it: (1) 75 days after the agency finally approves the relevant ANDA; (2) 30 months after the generic submits the relevant ANDA; (3) 75 days after a court judgment that the challenged patent is invalid or not infringed; (4) 75 days after a suit over the challenged patent is settled favorably to the ANDA filer; and (5) 75 days after the challenged patent is delisted. No forfeiture occurs, however, unless one of dates (1)-(2) and one of dates (3)-(5) have come to pass. . . . Setting aside the subsection at issue in this case—listed as (5) above, and codified as (bb)(CC)—the “failure to market” forfeiture provision does not permit a brand manufacturer to vitiate a generic’s exclusivity without the generic manufacturer’s having had some say in the matter. No forfeiture can take place unless the brand manufacturer brings an infringement suit against the generic and either loses on the merits or enters an unfavorable settlement agreement. The latter necessarily entails some participation by the generic; the former invariably involves significant expense for the brand manufacturer, and affords the victorious generic the opportunity to ask the court to delay entering final judgment until a date that would not trigger forfeiture prematurely— before the agency grants final approval to the relevant ANDA.
The FDA’s view turns the last alternative among events (3)-(5) into a fundamentally different forfeiture trigger: it is satisfied when the patent targeted in a paragraph-IV filing “is withdrawn by the” brand manufacturer, full stop—meaning that Congress has now explicitly provided for a scenario in which the brand maker can unilaterally deprive the generic of its exclusivity. The agency, however, offers not a single cogent reason why Congress might have permitted brand manufacturers to trigger subsection (CC) by withdrawing a challenged patent, outside the counterclaim scenario identified by Teva.
The argument that the plain language of the statute imposes no limit on the circumstances in which the agency may effectuate delisting requests fails. Precisely the same could have been said of the version of the statute that Ranbaxy addressed, and we nevertheless concluded that its structure precluded an FDA rule allowing the agency “to delist a patent upon the request of the [brand manufacturer]” when the delisting would rob the generic maker of earned exclusivity. . . .
As Congress deliberately created the 180-day exclusivity bonus, the FDA cannot justify its interpretation by proudly proclaiming that it has eviscerated that bonus.
So, under the D.C. Circuit's opinion, the patent delisting counterclaim provision at FDC Act § 505(j)(5)(C)(ii)(I) added by the MMA must be read together with the patent delisting forfeiture provision at FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC).
Judge Henderson filed a dissenting opinion in the case on the basis that Teva’s lawsuit is not ripe until FDA issues an exclusivity decision. The case was remanded to the district court for further proceedings “as the court has yet to address the appropriateness of each form of relief that Teva has sought. . . .” Teva's Complaint requested declaratory and injunctive relief.
There could very well be a flurry of activity in this case until April 2010, when FDA is expected to approve generic losartan products, as interested parties decide whether or not to seek to overturn the D.C. Circuit’s decision.

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