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Purepac Pharmaceutical Company v. Thompson

January 20, 2004


Appeals from the United States District Court for the District of Columbia (No. 02cv01657) (No. 03cv00254)

Before: Ginsburg, Chief Judge, and Edwards and Tatel, Circuit Judges.

The opinion of the court was delivered by: Tatel, Circuit Judge

Argued November 25, 2003

To encourage the marketing of lowcost generic drugs, the 1984 Hatch-Waxman amendments to the Food, Drug, and Cosmetic Act grant companies that successfully challenge drug patents the right to sell their generic drugs without competition for 180 days. In this case, two companies, each seeking to market a generic drug, competed for the right to exclusivity. The Food and Drug Administration ruled that neither company could earn exclusivity by challenging the first of two patents, but it awarded exclusivity to one of the companies based on that company's challenge to the second patent. The district court rejected challenges to these two decisions, and the company denied exclusivity now appeals. Finding no error in the district court's two thorough and well-reasoned opinions, we affirm in all respects.


The Food, Drug, and Cosmetic Act, 21 U.S.C. §§ 301-99 (FDCA), provides that a company wishing to market a new brand-name drug must submit a New Drug Application, known as an NDA, to the Food and Drug Administration. See id. § 355(b)(1) (2000 & Supp. III 2003). Usually quite lengthy, NDAs must include, among other things, evidence of the drugs' safety and effectiveness, as well as information about patents that cover or might cover the drugs. Id.

In 1984, Congress passed the "Hatch-Waxman" amendments to the FDCA. See The Drug Price Competition and Patent Term Restoration Act of 1984, Pub. L. No. 98-417, 98 Stat. 1585 (1984) (codified in scattered sections of titles 21, 35, and 42 U.S.C.). Enacted to expedite the process by which companies gain approval to sell generic versions of alreadyapproved brand-name drugs, the amendments allow companies seeking such approval to submit Abbreviated New Drug Applications, known as ANDAs, that "piggyback" on the safety-and-effectiveness information that the brand-name manufacturers submitted in their NDAs. See 21 U.S.C. § 355(j)(2)(A); 21 C.F.R. § 314.94(a)(3) (2003). "The result [is] to make practical the manufacture of generic copies which theretofore had been uneconomical." Mead Johnson Pharm. Group v. Bowen, 838 F.2d 1332, 1333 (D.C. Cir. 1988).

Like NDAs, ANDAs must address patents that cover or might cover the relevant drugs. For each patent, companies can satisfy this requirement by including in their ANDAs one of several "certifications" that explain why the FDA should approve the application despite the patent's claim on the drug. 21 U.S.C. § 355(j)(2)(A)(vii). The certification at issue in this case -- a "paragraph IV certification," named for the subsection of the law that describes it -- states "that such patent is invalid or will not be infringed by the manufacture, use, or sale of the new drug." Id. § 355(j)(2)(A)(vii)(IV). In essence, applicants use paragraph IV certifications to challenge the validity of brand-name manufacturers' patents.

An applicant that includes one or more paragraph IV certifications in its ANDA must inform both the patent holder and the company that submitted the NDA on which the ANDA "piggybacks." Id. § 355(j)(2)(B)(i). Once an applicant gives notice, the FDA must wait forty-five days before approving the ANDA, thereby giving the patent holder that much time to file a patent-infringement suit. Id. § 355(j)(5)(B)(iii); 21 C.F.R. § 314.107(f)(2). If the patent holder sues, the FDA must wait thirty months from the notice date before approving the ANDA unless the applicant wins the suit sooner or the court hearing the suit shortens the thirty-month period. 21 U.S.C. § 355(j)(5)(B)(iii).
In order to encourage paragraph IV challenges, thereby increasing the availability of low-cost generic drugs, the FDCA provides that the first company to win FDA approval of an ANDA containing a paragraph IV certification has the right to sell its drug without competition for 180 days. Id. § 355(j)(5)(B)(iv). The statute and the implementing regulation create this exclusivity period by prohibiting the FDA from approving any other ANDA that contains a paragraph IV challenge to the same patent until 180 days after the first company markets its drug or 180 days after the first company wins a patent-infringement suit involving that patent, whichever comes first. Id.; 21 C.F.R. § 314.107(c)(1).

Paragraph IV certifications are not the only way for ANDA applicants to satisfy their obligation to address all relevant patents. Applicants can instead submit one or more "section viii statements," named, again, after the relevant FDCA subsection -- section 505(j)(2)(A)(viii). A section viii statement indicates that a patent poses no bar to approval of an ANDA because the applicant seeks to market the drug for a use other than the one encompassed by the patent. See 21 U.S.C. § 355(j)(2)(A)(viii). For example, if a brand-name manufacturer's patent covers a drug's use for treating depression, and the ANDA applicant seeks approval to use the drug to treat any other condition, then a section viii statement would be appropriate. Thus, whereas applicants use paragraph IV certifications to challenge the validity of admittedly applicable patents, they use section viii statements to assert that patents do not apply. The FDA has long required that for every patent ANDA applicants use either a paragraph IV certification or a section viii statement -- they may not use both. As the FDA puts it, "either the applicant is seeking approval for the use claimed in the patent, or it is not." TorPharm, Inc. v. Thompson, 260 F. Supp. 2d 69, 77 (D.D.C. 2003) (quoting the record in that case) (internal quotation marks omitted).

Paragraph IV certifications and section viii statements have quite different consequences. Applicants submitting section viii statements have no obligation to provide notice, nor must they wait thirty months for FDA approval. As the district court explained, "the FDA may [thus] approve a section viii application immediately, making it an attractive route for generic manufacturers, even though a section viii statement does not entitle a successful applicant to the 180-day period of exclusivity bestowed on paragraph IV applicants." Purepac Pharm. Co. v. Thompson, 238 F. Supp. 2d 191, 195 (D.D.C. 2002).

In order to determine what patents cover existing brandname drugs and hence whether any paragraph IV certifications or section viii statements are needed, applicants look in the "Orange Book," an FDA publication that includes all patent information that companies have submitted to the agency. "Method-of-use patents" -- which cover specific uses for drugs -- can be included in the Orange Book only if they cover drug uses that the FDA has approved. 21 C.F.R. § 314.53(b). In other words, companies cannot use the Orange Book to claim protection for uses that the FDA has not approved. The FDA, however, does not evaluate patent information that companies submit to it; it just passively publishes information it receives. This means that if one company submits patent information that a second company believes is false or violates the FDA's regulation prohibiting the listing of unapproved-use patents, the second company --after having the FDA verify the information's accuracy with the first company -- must go to court to resolve the dispute.

Meanwhile, the second company must, if it submits an ANDA, treat the disputed patent as valid. In other words, it must include in its ANDA either a paragraph IV certification or a section viii statement.

This case involves gabapentin, a drug sold by Pfizer, Inc. that the FDA has approved for treating epilepsy. In 1998, appellee Purepac Pharmaceutical Company submitted an ANDA seeking permission to sell a generic version of Pfizer's brand-name drug, Neurontin. Purepac's ANDA listed three patents that Warner-Lambert Company, which later assigned Pfizer the rights to the drug, had included in its gabapentin NDA. One of the three -- the only one relevant to this case --was No. 5,084,479 (the '479 patent), a method-of-use patent. Seeking to sell its drug as a treatment for epilepsy, Purepac submitted a section viii statement about this patent because as it read the Orange Book, the patent covered gabapentin's unapproved use for treating neurodegenerative diseases. That is, Purepac asserted that the '479 patent posed no bar to FDA approval of its ANDA because the patent covered a use other than the one for which Purepac sought permission. Given that under FDA regulations, only approved-use method-of-use patents may be listed in the Orange Book, Purepac's interpretation of the '479 patent would, if true, have meant that the patent's inclusion in the Orange Book was improper.

About a month after Purepac submitted its ANDA, appellant TorPharm, Inc. filed its own ANDA, similarly seeking permission to market a generic version of Neurontin. Unlike Purepac, TorPharm submitted both a paragraph IV certification and a section viii statement regarding the '479 patent. By doing so, TorPharm effectively hedged its bets on whether the information that Warner-Lambert had submitted to the FDA showed that the patent covered gabapentin's use for treating epilepsy or for treating neurodegenerative diseases. TorPharm's notice to Warner-Lambert, however, indicated that TorPharm agreed with Purepac's interpretation of what use the '479 patent covered: the notice stated that TorPharm's generic drug posed no danger of infringement because "[a]ll of the claims of the '479 patent are directed to a method of using gabapentin and its derivatives in the treatment of neurodegenerative diseases." Warner-Lambert Co. v. Apotex Co., No. 98 C 4293, 2001 WL 1104618, at *2 (N.D. Ill. Sept. 14, 2001) (quoting the record in that case) (internal quotation marks omitted).

The FDA initially informed Purepac that because Warner-Lambert claimed that the '479 patent covered gabapentin's use for treating epilepsy, Purepac should have filed a paragraph IV certification. Purepac protested that this represented a reversal by the FDA, pointing out that when the agency first listed the patent in the Orange Book, the concomitant "use code" -- the code the FDA assigns to identify the use that a patent covers -- bore the title "treatment of neurodegenerative diseases." By contrast, the use code that the FDA gave to another of the patents that Warner-Lambert had mentioned in its NDA was entitled "epilepsy." Since the FDA acknowledges that "in assigning use codes it relies exclusively on the NDA holder's statements regarding a patent's coverage," Purepac, 238 F. Supp. 2d at 198 n.10, Purepac argued that the FDA's choice of use code indicated that the agency had previously decided that according to Warner-Lambert, the '479 patent covered gabapentin's use for treating neurodegenerative diseases rather than epilepsy. According to Purepac, it therefore needed to file a section viii statement.

Unconvinced, the FDA informed Purepac that the company would have to add a paragraph IV certification before its ANDA could be approved. Purepac did not follow this instruction. Instead, perhaps recognizing that complying with the FDA's demand would mean that TorPharm would receive the 180-day exclusivity as the first company to submit an approvable ANDA containing all necessary paragraph IV certifications, Purepac sued the FDA in the United States District Court for the District of Columbia, arguing that the FDA's rejection of its section viii statement and the agency's insistence that the company submit a paragraph IV certification were arbitrary and capricious.

The district court, through Judge Huvelle, ruled for Purepac, holding that the FDA should have concluded on the basis of the evidence before it that the '479 patent covered gabapentin's use for treating neurodegenerative diseases. Because Purepac sought approval for a different use, the district court directed the FDA to accept the company's section viii statement. See Purepac, 238 F. Supp. 2d at 212. The court's ruling did not entitle Purepac to exclusivity, however, as only paragraph IV certifications can earn exclusivity. It simply required the FDA to accept Purepac's ANDA as of the date the company originally submitted it, which occurred before TorPharm filed its ANDA. That was important because both Purepac's and ...

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