Court Opinion

ID: 185570
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:33:31+00
Date Added: 2024-06-11T09:29:00.992260
License: Public Domain

276 F.3d 627 (D.C. Cir. 2002)
Pharmachemie B.V., Appelleev.Barr Laboratories, Inc., Appellant
No. 00-5206 Consolidated with No. 00-5207
United States Court of Appeals  FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued December 5, 2001Decided January 18, 2002

Appeals from the United States District Court  for the District of Columbia (No. 99cv00801)  (No. 99cv00862)
James F. Hurst argued the cause for appellant.  With him  on the briefs was Christine J. Siwik.
John F. Cooney argued the cause and filed the brief for  appellee.
Before:  Sentelle and Rogers, Circuit Judges, and  Williams, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge Rogers.
Rogers, Circuit Judge:

1
Barr Laboratories, Inc. ("Barr")  appeals the district court's grant of summary judgment,  interpreting the Hatch-Waxman Amendments of the Federal  Food, Drug, and Cosmetic Act, 21 U.S.C.  301 et seq., and  regulations promulgated thereunder, 21 C.F.R.  314.94,  314.107, to Pharmachemie, B.V., a potential competitor of  Barr's.  Barr contends that the district court erred in vacating an administrative ruling of the Food and Drug Administration ("FDA") that Barr, as the first company to file a  paragraph IV certification for tamoxifen, a breast cancer  drug, as part of its application for FDA review and approval  of its generic version of tamoxifen, had a statutory right to  180 days of generic exclusivity.  After the district court  granted summary judgment, Pharmachemie lost its court  challenge to the underlying patent of the pioneer drug manufacturer's tamoxifen.  As a result, Pharmachemie cannot market its generic version of tamoxifen until the patent expires. Because the FDA's ruling no longer causes any redressible  harm to Pharmachemie, we conclude that the case is moot  and, accordingly, we dismiss the appeal for lack of jurisdiction, vacate the judgment of the district court, and remand  the case to the district court with instructions to dismiss the  complaint.

I.

2
The Hatch-Waxman Amendments simplified the procedure  for obtaining approval of generic drugs.  See Pub. L. No.  98-417, 98 Stat. 1585 (1984).  While a pioneer drug manufacturer must file a New Drug Application with safety and  effectiveness data, subsequent applicants who want to manufacture generic versions of the original drug need only file an  Abbreviated New Drug Application ("ANDA"), which relies  on the FDA's previous determination that the drug is safe and effective.  See 21 U.S.C.  355(a), (j).  As relevant here,  the Hatch-Waxman Amendments establish an ANDA certification process that enables generic drug manufacturers to  obtain expedited approval of their ANDAs before expiration  of the pioneer's patent.  See id.  355(j)(2)(A)(vii), (5)(b). The ANDA must include a paragraph certification that (I) no  patent information has been filed, (II) the patent has expired,  (III) the patent will expire on a date certain, or (IV) the  patent is invalid or will not be infringed by the drug for which  the applicant seeks approval.  See id.  355(j)(2)(A)(vii).  Relevant here is the paragraph IV certification, which triggers a  complex process that potentially allows the ANDA applicant  to market its generic drug before the pioneer's patent expires.  See id.  355(j)(5)(b).  The FDA can approve a paragraph IV certification ANDA immediately unless the patent  holder files suit within forty-five days of receiving notice of  the paragraph IV certification.  See id.  355(j)(5)(B)(iii);  21  C.F.R.  314.107(f)(2).  If a patent infringement action is  timely brought, the ANDA can be approved only upon the  expiration of a thirty-month period, unless this period is  altered by the court or a decision of that court.  See 21 U.S.C.   355(j)(5)(B)(iii).  As an incentive to the first generic maker  to risk costly patent litigation by filing an ANDA with a  paragraph IV certification, the Hatch-Waxman Amendments  provide that the first to file a paragraph IV certification for a  particular drug is eligible for a 180-day period of marketing  protection (i.e., exclusivity from competition from subsequent  generic drug manufacturers), beginning from the earlier of  the first filer's commercial marketing of the drug or a decision of a court holding the patent invalid or not infringed. See id.  355(j)(5)(B)(iv).

3
In 1985, Barr submitted an ANDA containing a paragraph  III certification for the drug tamoxifen, which was patented  by Imperial Chemical Industries, PLC ("Imperial") under  U.S. Patent No. 4,536,516 (" '516 patent"), which is due to  expire on August 20, 2002.  Barr amended its ANDA in 1987  to a paragraph IV certification, making it the first company to  file an ANDA with a paragraph IV certification for tamoxifen. Imperial sued Barr for patent infringement, triggering the thirty-month statutory stay.  In 1992, a district court ruled in  favor of Barr.  Imperial Chem. Indus., PLC v. Barr Labs.,  795 F. Supp. 619 (S.D.N.Y. 1992), appeal dismissed and  vacated pursuant to settlement sub nom. Imperial Chem.  Indus., PLC v. Heumann Pharma GmbH & Co., 991 F.2d 811, No. 92-1403, 1993 WL 118931 (Fed. Cir. Mar. 19, 1993)  (Table).  While Imperial's appeal to the United States Court  of Appeals for the Federal Circuit was pending, Imperial and  Barr entered into a settlement agreement, in which Imperial  licensed Barr to sell its tamoxifen product and Barr agreed  not to pursue efforts to obtain final approval of its ANDA  prior to the expiration of the '516 patent.  As a result of the  settlement, on March 19, 1993, the Federal Circuit dismissed  Imperial's appeal and vacated the district court's judgment. Imperial Chem. Indus., PLC v. Heumann Pharma GmbH &  Co., 991 F.2d 811, No. 92-1403, 1993 WL 118931 (Fed. Cir.  Mar. 19, 1993) (Table).  Barr subsequently amended its  ANDA from a paragraph IV certification to a paragraph III  certification, delaying approval of its ANDA until the expiration of the '516 patent.

4
In 1996, Pharmachemie filed its own ANDA for tamoxifen  with a paragraph IV certification, amending its 1994 paragraph III certification ANDA.  Zeneca Limited ("Zeneca"),  which obtained the patent rights of the '516 patent from  Imperial, its former parent company, filed a paragraph IV  patent infringement suit against Pharmachemie, triggering  the thirty-month statutory stay.  Zeneca Ltd. v. Pharmachemie B.V. (No. 96-12413).  On April 3, 1997, the FDA tentatively approved Pharmachemie's ANDA, to be effective at the  earlier of the expiration of the statutory thirty-month stay  period (or the period set forth by the court), the date of a  final court decision, or the date of the expiration of the  patent.  On March 2, 1999, the FDA granted Barr's June 26,  1998 petition, which was filed shortly before the thirty-month  statutory stay of Pharmachemie's ANDA was to expire and  which sought enforcement of Barr's 180-day exclusivity period.  The FDA imposed a stay on approval of all other  ANDAs for tamoxifen until 180 days after the date of Barr's  first commercial marketing of the drug or the date of a final decision of a court holding the '516 patent invalid or not  infringed.

5
Pharmachemie then sought injunctive and declaratory relief in the district court, challenging the FDA's March 2, 1999  decision as contrary to the statute and FDA regulations. Barr intervened.  On March 31, 2000, the district court (after  consolidating the case with a similar suit brought by Mylan  Pharmaceuticals, Inc.) granted summary judgment to Pharmachemie.  Mylan Pharm. Inc. v. Henney, 94 F. Supp. 2d 36  (D.D.C. 2000).

6
Thereafter, two relevant events occurred.  First, the FDA  did not appeal the district court's decision, but rather, on July  13, 2000, issued an interim rule amending its regulations that  interpreted the meaning of "court decision," 21 C.F.R.   314.107(e)(1)-(2)(iii), on which it had relied in granting  Barr's petition.  Court Decisions, ANDA Approvals, and  180-Day Exclusivity, 65 Fed. Reg. 43,233, 43,233 (2000).  In  view of recent judicial decisions, the FDA defined a "decision  of a court" to include a district court opinion regardless of  whether that opinion is appealed.  Id. at 43,234.  This rule is  prospective only.  FDA, Guidance for Industry, Court Decisions, ANDA Approvals, and 180-Day Exclusivity Under the  Hatch-Waxman Amendments to the Federal Food, Drug,  and Cosmetic Act 4 (2000).  Second, Pharmachemie lost its  patent suit against Zeneca, and the district court in that case  ordered that Pharmachemie's ANDA would become effective  no earlier than the expiration of the '516 patent.  Zeneca Ltd.  v. Pharmachemie, B.V., Order (Oct. 27, 2000).

II.

7
Pharmachemie contends that the case is moot on appeal  because it can no longer obtain the relief it sought in its  complaint in light of the adverse final judgment on the  validity of the patent.  Barr responds that the appeal is not  moot because the district court's decision stripping Barr of its  statutory right to generic exclusivity continues to harm Barr. Alternatively, pointing to Teva Pharmaceuticals, USA, Inc. v.  FDA, No. 99-5287, 2000 WL 1838303, at *1 (D.C. Cir. Nov. 15, 2000), Barr contends that the issues on appeal are capable  of repetition, yet evade review because there are only 180  days in which to obtain judicial review of challenges to the  statutory exclusivity period.

8
The mootness doctrine limits Article III courts to deciding  "actual, ongoing controversies."  Clarke v. United States, 915 F.2d 699, 700-01 (D.C. Cir. 1990) (quoting Honig v. Doe, 484 U.S. 305, 317 (1988)).  A case is moot if "events have so  transpired that the decision will neither presently affect the  parties' rights nor have a more-than-speculative chance of  affecting them in the future."  Id. at 701 (quoting Transwestern Pipeline Co. v. FERC, 897 F.2d 570, 575 (D.C. Cir. 1990)); accord Pub. Util. Comm'n of the St. of Cal. v. FERC, 236 F.3d 708, 714 (D.C. Cir. 2001).  Thus, "Article III denies  federal courts the power to decide questions that cannot  affect the rights of litigants in the case before them, and  confines them to resolving real and substantial controversadmitting of specific relief through a decree of a conclusive  character, as distinguished from an opinion advising what the  law would be upon a hypothetical state of facts."  Lewis v.  Cont'l Bank Corp., 494 U.S. 472, 477 (1990) (quoting N.C. v.  Rice, 404 U.S. 244, 246 (1971)) (internal quotation marks  omitted).

9
The district court in Zeneca Ltd. ruled in favor of the  patent holder Zeneca, rejecting Pharmachemie's challenges to  the '516 patent and ordering that the effective date of Pharmachemie's ANDA be no earlier than the expiration of the  '516 patent.  Pharmachemie did not appeal, and the judgment  upholding the patent became final.  Pharmachemie also  amended its ANDA, changing the patent certification from  paragraph IV to III, delaying approval of its ANDA until the  expiration of the '516 patent.  In view of the final judgment  upholding the '516 patent, Pharmachemie no longer suffers a  redressible harm in this case.  Whether it wins or loses on  appeal, it will be prevented from marketing its generic drug  before the patent expires--thus, making the case moot on  appeal.  Cf. In re Highway Truck Drivers & Helpers Local  Union #107, 888 F.2d 293, 297-98 (3d Cir. 1989);  In re  Cantwell, 639 F.2d 1050, 1054 (3d Cir. 1981).  To the extent  Pharmachemie's failure to appeal the judgment upholding the '516 patent constitutes voluntary action bringing about mootness, "a court may conclude that voluntary cessation has  rendered a case moot if the party urging mootness demonstrates that (1) 'there is no reasonable expectation that the  alleged violation will recur,' and (2) 'interim relief or events  have completely or irrevocably eradicated the effects of the  alleged violations.' "  Nat'l Black Police Ass'n v. D.C., 108 F.3d 346, 349 (D.C. Cir. 1997) (quoting County of Los Angeles  v. Davis, 440 U.S. 625, 631 (1979)).  Pharmachemie meets this  test because it is precluded from further challenging Barr's  180-day exclusivity period by the judgment upholding the '516  patent;  again, Pharmachemie no longer suffers a redressible  harm in this case, and Pharmachemie would have no standing  to make a future challenge.  See Lujan v. Defenders of  Wildlife, 504 U.S. 555, 560-61 (1992).

10
Barr's contentions that the case is not moot on appeal are  unpersuasive.  First, as between Pharmachemie and Barr,  the value of Barr's exclusivity has no potential of being  harmed because Pharmachemie is precluded from marketing  tamoxifen before the expiration of the '516 patent.  Contrary  to Barr's suggestion, the instant appeal does not present the  issue whether the 180-day exclusivity period extends beyond  the expiration of the patent.  This issue was neither addressed in the FDA's decision nor raised in Pharmachemie's  complaint in the district court.  The issue in the instant  appeal as to the trigger of the 180-day exclusivity period is  limited to whether any court decision is sufficient to trigger   355(j)(5)(B)(iv)(II)'s court-decision trigger.  The court is  therefore not called upon to decide whether the exclusivity  period extends beyond the expiration of the patent.  In  addition, the risk that other drug manufacturers might intrude upon the value of Barr's 180-day exclusivity as to  tamoxifen is unrelated to the present controversy, and to rule  here, in an effort to avoid that risk is precisely the type of  advisory decision-making that Article III courts are constitutionally required to avoid.

11
Second, fatal to most of Barr's contentions, including that  the district court decision guts its marketing strategy of  challenging suspect drug patents under the Hatch-Waxman Amendments, is the fact that an adverse decision in the  district court is insufficient to create a case or controversy on  appeal.  City of Erie v. Pap's A.M., 529 U.S. 277 (2000), on  which Barr relies, is distinguishable;  in that case, the case  was not moot, in part, because of the harm to the losing party  that would result from the unvacated decision below, which  the Supreme Court could not vacate due to federalism concerns.  Id. at 288;  see also id. at 305 (Scalia, J., concurring in  the judgment).  There is no similar risk here because the  appropriate procedure upon concluding that this case is moot  is to vacate the district court decision.  United States v.  Munsingwear, Inc., 340 U.S. 36, 39 & n.2 (1950);  Columbian  Rope Co. v. West, 142 F.3d 1313, 1317-18 & n.5 (D.C. Cir.  1998).  Vacatur of the district court decision will have no  future adverse effect on Barr's marketing strategy.  Moreover, to conclude that the instant case is not moot solely  because of the district court's adverse judgment would create  a case or controversy with only one interested party.  City of  Erie, 529 U.S. at 307 (Scalia, J., concurring in the judgment). Any implication that the court should now rule on Barr's  contentions on the merits because of the possibility that an  adverse decision in the district court will remain is, again, a  request for an advisory opinion as to other potential cases,  with no effect on the present parties.

12
Finally, Barr's contention that the issues raised are capable  of repetition, yet evading review fails to recognize the limits  of this exception to the mootness doctrine.  The Supreme  Court set forth the familiar test for the "capable of repetition,  yet evading review" exception to the mootness doctrine in  Weinstein v. Bradford, 423 U.S. 147 (1975):

13
[I]n the absence of a class action, the "capable of repetition, yet evading review" doctrine [is] limited to the situation where two elements combine[]:  (1) the challenged action was in its duration too short to be fully litigated prior to its cessation or expiration, and (2) there was a reasonable expectation that the same complaining party would be subjected to the same action again.

14
Id. at 149.  Barr has failed to demonstrate that the present  issues satisfy both prongs of this narrow exception.  See City  of Los Angeles v. Lyons, 461 U.S. 95, 109 (1983).

15
Under the evading review prong, the question is whether  "the challenged activity is by its very nature short in duration, so that it could not, or probably would not, be able to be  adjudicated while fully live."  LaRouche v. Fowler, 152 F.3d 974, 978 (D.C. Cir. 1998) (quoting Conyers v. Reagan, 765 F.2d 1124, 1128 (D.C. Cir. 1985)) (internal quotation marks  omitted).  Barr contends that judicial review is limited by the  duration of the 180-day exclusivity period.  Yet it is not the  180-day limit on exclusivity that has mooted the instant case,  but rather the outcome of Pharmachemie's patent suit.  The  court need not resolve whether this intervening cause of  mootness makes irrelevant Barr's contentions that the  180-day period inherently evades review, however, because  Barr must still meet the second prong for this exception to  apply, and it cannot.

16
Under the capable of repetition prong, there must be a  "reasonable expectation that the same complaining party  would be subjected to the same action again."  Weinstein, 423 U.S. at 149 (emphasis added);  see also Liu v. INS, No.  00-5345, 2001 WL 1657298 (D.C. Cir. Dec. 28, 2001).  This  prong requires that the same parties will engage in litigation  over the same issues in the future.  Norman v. Reed, 502 U.S. 279, 288 (1992);  Burlington N. R.R. Co. v. Bhd. of  Maint. of Way Employes, 481 U.S. 429, 436 n.4 (1987);  Cruz  v. Farquharson, 252 F.3d 530, 534 (1st Cir. 2001);  Columbian  Rope, 142 F.3d at 1317;  Meyers v. Jay St. Connecting R.R.,  288 F.2d 356, 359 (2d Cir. 1961).  As the Second, Seventh,  and Ninth Circuits have explicitly held, relying on constitutional grounds, "there must be a reasonable degree of likelihood that th[e] issue will be the basis of a continuing controversy between these two parties" in "order to ensure the  existence of an ongoing controversy."  Cent. Soya Co. v.  Consol. Rail Corp., 614 F.2d 684, 689 (7th Cir. 1980);  accord  Video Tutorial Servs., Inc. v. MCI Telecomms. Corp., 79 F.3d 3, 6 (2d Cir. 1996);  Lee v. Schmidt-Wenzel, 766 F.2d 1387, 1390 (9th Cir. 1985) (quoting 13 C. Wright, A. Miller & E.  Cooper, Federal Practice and Procedure  3533, at 291-92  (1975)).

17
Unlike Teva, the FDA is no longer a party in the instant  case;  the only parties on appeal are Barr and Pharmachemie. For this case to be grounded in a live case or controversy, the  only question is what is the likelihood that Barr and Pharmachemie will engage in this same litigation.  Barr has not  contended that it and Pharmachemie are frequent rival litigants.  But assuming that Barr and Pharmachemie may  again be rival ANDA applicants, several contingencies would  have to occur for the same issues to arise again:  (1) Barr  must be the first to have filed an ANDA for a particular drug  with a paragraph IV certification;  (2) Pharmachemie must  later file an ANDA with a paragraph IV certification for the  same drug;  and (3) there must be some basis for a dispute as  to the exclusivity period because, for example, Barr wins a  judgment invalidating the patent and the judgment is vacated, or Pharmachemie is able to market its generic version  while an appeal of Barr's judgment invalidating the patent is  pending, or Barr voluntarily converts its paragraph IV certification to a paragraph III certification.  While the combination of all of these contingencies is possible, Barr has not  demonstrated a reasonable likelihood that they will occur. See James v. U.S. Dep't of Health & Human Servs., 824 F.2d 1132, 1136 (D.C. Cir. 1987);  Bois v. Marsh, 801 F.2d 462,  466-67 (D.C. Cir. 1986).

18
Because the issues are moot on appeal, vacatur of the  district court decision granting summary judgment to Pharmachemie is appropriate.  Where happenstance has made a  matter moot, the standard practice is to vacate the decision of  the district court.  Columbian Rope, 142 F.3d at 1317.  The  exception that is applied when mootness results from voluntary action of a party, see Nat'l Black Police Ass'n, 108 F.3d  at 351, is inappropriate here because Pharmachemie, the only  party to whose actions mootness could be attributed, prevailed in the district court.  U.S. Bancorp Mortgage Co. v.  Bonner Mall P'ship, 513 U.S. 18, 25 (1994).  Although, generally, when the court declines review of an agency order on the  ground of intervening mootness as a result of happenstance, vacatur of the agency order is appropriate, Columbian Rope, 142 F.3d at 1318 & n.5;  see also A.L. Mechling Barge Lines,  Inc. v. United States, 368 U.S. 324, 329 (1961);  Am. Family  Life Assurance Co. of Columbus v. FCC, 129 F.3d 625, 630  (D.C. Cir. 1997), we do not vacate FDA's ruling;  Pharmachemie did not request such vacatur and its failure to appeal the  judgment upholding the patent constituted voluntary action  that led to the mootness of the instant case, see Nat'l Black  Police Ass'n, 108 F.3d at 351.  Accordingly, we dismiss the  appeal as moot, vacate the judgment of the district court, and  remand the case to the district court with instructions to  dismiss the complaint.