Opinion ID: 788070
Heading Depth: 3
Heading Rank: 1

Heading: Defendant Barr's Relationship with Defendant ACIC/Brantford

Text: 14 In the early 1990's Barr identified warfarin sodium as a product with high barriers to entry because of the difficulty in procuring commercial quantities of clathrate. Barr began to research potential suppliers, and in 1991 it discussed purchasing clathrate from ACIC/Brantford. ACIC/Brantford confirmed that it would be able to produce commercial quantities of clathrate. In February 1991 Barr placed a small order for it. On March 15, 1995 ACIC/Brantford filed a Master File for clathrate, and on April 3, 1995, it provided a reference letter to the FDA in support of Barr's warfarin sodium Abbreviated New Drug Application. On May 10, 1995 Barr filed its application, listing ACIC/Brantford as its supplier of clathrate.
15 In September 1995 the defendants entered into an exclusive supply agreement pursuant to which ACIC/Brantford would supply Barr with clathrate. The agreement obligated Barr to purchase $1.8 million worth of clathrate. It also provided that ACIC/Brantford would supply Barr exclusively with commercial quantities of clathrate until another manufacturer began selling generic warfarin sodium. Barr agreed to purchase 100 percent of its supply from ACIC/Brantford during the exclusivity period. One week after they entered into the supply agreement, the defendants executed a confidentiality agreement that for five years prohibited either party from disclosing valuable, proprietary, technical, commercial and other confidential information. 16 This agreement only covered commercial quantities of clathrate. Hence, it did not prohibit ACIC/Brantford from selling small samples or developmental quantities, or from acting as a broker between manufacturers and other suppliers. The agreement also permitted Barr to purchase small quantities of clathrate from other sources in order to qualify that supplier as an alternate source.
17 From September 1995 through September 1996, Barr ordered larger shipments of clathrate from ACIC/Brantford, the last of which was shipped in February 1997. On March 26, 1997, the FDA approved Barr's application and authorized it to begin marketing, which it did starting in July 1997. The FDA determined that Barr's warfarin sodium tablets were bioequivalent, and therefore therapeutically equivalent to the name brand drug Coumadin. 18 Barr continued to place orders for large quantities of clathrate from ACIC/Brantford. In a September 1997 document Barr referred to ACIC/Brantford as the only source [of clathrate] available to the generic industry. The district court found that Barr had attempted to secure a back-up producer, but as of March 1998 had not succeeded.