Court Opinion

ID: 1004615
Source: CourtListenerOpinion
Date Created: 2013-07-04 18:43:39.320673+00
Date Added: 2024-06-11T12:39:15.318608
License: Public Domain

UNPUBLISHED

UNITED STATES COURT OF APPEALS
                FOR THE FOURTH CIRCUIT

MICROBIX BIOSYSTEMS, INCORPORATED,     
                Plaintiff-Appellant,
                 v.
BIOWHITTAKER, INCORPORATED;                   No. 00-2262
BIOWHITTAKER HOLDINGS,
INCORPORATED; ABBOTT
LABORATORIES,
              Defendants-Appellees.
                                       
           Appeal from the United States District Court
            for the District of Maryland, at Baltimore.
                 Marvin J. Garbis, District Judge.
                        (CA-97-2525-MJG)

                      Argued: May 7, 2001

                      Decided: June 4, 2001

     Before WILKINSON, Chief Judge, and WILLIAMS and
                  MOTZ, Circuit Judges.

Affirmed by unpublished per curiam opinion.

                           COUNSEL

ARGUED: Matthew Forte Pawa, COHEN, MILSTEIN, HAUSFELD
& TOLL, P.L.L.C., Washington, D.C., for Appellant. Jeffrey Ira
Weinberger, MUNGER, TOLLES & OLSON, L.L.P., Los Angeles,
California, for Appellees. ON BRIEF: Michael Z. Hausfeld, Ann E.
2         MICROBIX BIOSYSTEMS, INC. v. BIOWHITTAKER, INC.
Yahner, COHEN, MILSTEIN, HAUSFELD & TOLL, P.L.L.C.,
Washington, D.C., for Appellant. David M. Rosenzweig, MUNGER,
TOLLES & OLSON, L.L.P., Los Angeles, California; John Henry
Lewin, Jr., Maria F. Howell, VENABLE, BAETJER & HOWARD,
Baltimore, Maryland, for Appellees.

Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

                             OPINION

PER CURIAM:

   In this antitrust action, Microbix Biosystems, Inc. sued BioWhit-
taker, Inc., BioWhittaker Holdings, Inc., and Abbott Laboratories
under §§ 1 and 2 of the Sherman Act, 15 U.S.C. § 1, 2 (1994). Micro-
bix also asserted a state law claim for tortious interference with eco-
nomic relations against the defendants. The district court granted
summary judgment to the defendants on all claims. We affirm.

                                  I.

   Microbix, a small Canadian company, manufactures and distributes
"anitgens used to diagnose diseases such as rubella." Abbott, an "in-
dustry giant," manufactured, among other products, urokinase, which
"is a broad category of thrombolytics used for treating clinical condi-
tions caused by blood clots." BioWhittaker formerly supplied Abbott
with Human Neonatal Kidney ("HNK") cells, a raw material neces-
sary to produce urokinase.

   Beginning in the late 1970s, Abbot manufactured urokinase under
the trade names Abbokinase and OpenCath. Abbott purchased the
necessary HNK cells from the only FDA-approved producer,
BioWhittaker, who obtained the cells from a source in Cali, Colum-
bia. BioWhittaker’s procedures were governed by a Drug Master File
          MICROBIX BIOSYSTEMS, INC. v. BIOWHITTAKER, INC.           3
approved by the FDA. Abbott had an exclusive patent for Abboki-
nase, until it expired in 1993.

   In 1994, Microbix began an experimental program to develop com-
mercial quantities of a generic urokinase. Soon thereafter, Microbix
approached BioWhittaker to discuss the purchase of HNK cells, and
did in fact obtain small quantities of the cells from BioWhittaker. In
March 1996, Microbix audited BioWhittaker’s Maryland facility to
determine if it would serve as an adequate long-term cell source. The
audit did not identify any deficiencies, and Microbix purchased addi-
tional experimental lots of HNK cells from BioWhittaker. Microbix
alleges that BioWhittaker agreed to be a long-term supplier of HNK
cells in August 1996, but no such agreement was ever formalized.

   Because Microbix was a small company with limited financial
resources, it also entered into negotiations with Gensia Laboratories,
Inc. to have Genesia provide Microbix with financial, developmental,
and regulatory assistance. In September 1996, Microbix formalized a
Development and License Agreement with Gensia.

   Upon learning of Microbix’s urokinase project, Abbott formed an
"anti-generics task force," to find "defense strategies" aimed at
responding to Microbix’s potential threat to its monopoly. Shortly
thereafter, in October 1996, Abbott and BioWhittaker began discuss-
ing an exclusive supply contract for HNK cells. The Exclusive Supply
Agreement was formalized in July 1997, retroactive to January 1997,
and prevented BioWhittaker from providing HNK cells to anyone but
Abbott, even cell lots that Abbott rejected.

   In May 1997, BioWhittaker notified Microbix that it would no lon-
ger supply HNK cells to Microbix. Even so, Gensia and Microbix
continued development of the urokinase project. In August 1997,
Microbix filed the instant action; in April 1998, it sought a prelimi-
nary injunction to obtain a three-year supply of HNK cells from
BioWhittaker. The district court granted this injunction in May 1998.
However, when Microbix began negotiating with Creative BioMo-
lecules ("CBM") to obtain a facility to manufacture urokinase, Gensia
refused to make financial outlays or sign an indemnity agreement
with CBM, possibly due in part to the lack of a long-term cell supply.
4          MICROBIX BIOSYSTEMS, INC. v. BIOWHITTAKER, INC.
In June 1998, CBM withdrew from the urokinase project, leaving
Microbix without a manufacturing facility.

   During July and August 1998, FDA inspectors conducted a current
Good Management Practices audit of BioWhittaker’s HNK cell oper-
ation, which resulted in the filing of a Form 483, listing six categories
of deficiencies in BioWhittaker’s operation. On September 18, 1998,
the FDA issued a Warning Letter to BioWhittaker, in which it stated
that failure to meet these concerns would result in a ban on importa-
tion of cells from Columbia. Shortly thereafter, Gensia and Microbix
terminated their agreement.

   Without financial backing, a manufacturing facility, or the neces-
sary HNK cells, Microbix never engaged in large-scale commercial
production of generic urokinase. And because of further prohibitive
action by the FDA, neither BioWhittaker nor Abbott are currently
permitted to produce urokinase. As a result, urokinase is not commer-
cially available at present.

                                   II.

   The district court granted summary judgment to the defendants on
all of Microbix’s claims. The court rejected the antitrust claims
because it found that Microbix failed to present evidence that the
exclusive supply agreement between BioWhittaker and Abbott was a
material cause of Microbix’s "alleged injury" and that Microbix’s
claims for loss of future profits was "too speculative." The district
court held that the interference with economic relationship claims suf-
fered from "the same defects as those of the antitrust claims." The
court also refused to order return of funds expended by Microbix in
conjunction with procurement of the preliminary injunction.

   We have carefully considered the parties’ briefs, oral arguments,
the record in the case, and the relevant legal authorities, and conclude
that the district court properly granted summary judgment to the
defendants, and properly denied Microbix return of the funds related
to the preliminary injunction. Accordingly, we affirm essentially on
the reasoning of the distict court. See Microbix Biosystems, Inc. v.
           MICROBIX BIOSYSTEMS, INC. v. BIOWHITTAKER, INC.               5
BioWittaker, Inc., Civ. Action No. MJG-97-2525 (March 28, 2000),
(May 26, 2000), and (Aug. 22, 2000).*

                                                             AFFIRMED

   *Microbix maintains that the district court erred in granting the defen-
dants summary judgment on the tortious interference claims without pro-
viding Microbix with an opportunity to present pertinant material,
including its argument that more favorable Canadian (rather than Mary-
land) law applied to the claims. We need not reach this question because
we agree with the district court’s conclusion, in considering the issue on
Microbix’s motion for reconsideration, that even under Canadian law its
tortious interference claims fail.