In re Actos End-Payor Antitrust Litig.
United States District Court for the Southern District of New York
February 12, 2018, Decided; February 12, 2018, Filed
No. 13-CV-9244 (RA)
OPINION AND ORDER
RONNIE ABRAMS, United States District Judge:
At issue in this case is whether Defendants Takeda Pharmaceutical Company Limited, Takeda America Holdings, Inc., Takeda Pharmaceuticals U.S.A., Inc., and Takeda Development Center Americas, Inc. (collectively "Takeda") are liable to Plaintiffs, the indirect purchasers of Takeda's diabetes medication called ACTOS, for unlawfully inflating that drug's prices in violation of state antitrust, consumer protection, and unjust enrichment laws. In September 2015, this Court granted Defendants' motion to dismiss. See Op. & Order re: Mot. to Dismiss ("2015 Op.") at 51 (Dkt. 221), available at 2015 U.S. Dist. LEXIS 127748, 2015 WL 5610752. On appeal from that decision, the Second Circuit largely affirmed the dismissal but also vacated and remanded a small part of the case for additional proceedings. See In re Actos End-Payor Antitrust Litig., 848 F.3d 89, 102 (2d Cir. 2017). Now before the Court is Plaintiffs' motion to amend their complaint in light of the Second Circuit's decision. For the reasons explained below, Plaintiffs' motion is granted in part and denied in part.
Both this Court and the Second Circuit have recounted [*10] this case's factual background and explained the relevant regulatory scheme at length. See In re Actos, 848 F.3d at 93-97; 2015 Op. at 1-16. For the purposes of this Opinion, the Court assumes the reader's familiarity with the case and will restate only the basics relevant to this motion.
I. Regulatory Background
This case involves a complicated set of rules set forth in the Hatch-Waxman Act that controls how and when manufacturers of generic drugs can begin competing with brand-name drug producers. Drug inventors may file patents on drug substances, drug products, and methods of using different drugs. Those inventors must also get FDA approval to sell their drugs, however, and thus must file New Drug Applications (NDAs) with the FDA. When the FDA approves such applications, it requires inventors to place the patents related to their NDAs in the FDA's so-called "Orange Book," which lists patents associated with different brand-name drugs. For each patent listed, the Orange Book allows the inventor to describe the patent as involving a drug substance, drug product, or method of use. See In re Actos, 848 F.3d at 98-99. If generic-drug manufacturers wish to sell a generic version of a brand-name drug, they must first file an Abbreviated New Drug [*11] Application (ANDA) and explain why their generic will not infringe the brand's patents.
There are several ways for generics to show that they will not infringe a brand's unexpired patents under the Act, but two are particularly relevant here. First, if generics are prepared to risk a patent-infringement lawsuit, they can challenge the validity or applicability of the patent by certifying that the brand's patents are "invalid or will not be infringed by" their generic, 21 U.S.C. § 355(j)(2)(A)(vii)(IV) ("Paragraph IV certification"). To incentivize generic manufacturers to challenge invalid patents (and therefore run the risk of being sued by patent holders), the first generic to file a Paragraph IV certification may receive a 180-day period during which it has the exclusive right to market a generic version of the drug. See id. § 355(j)(5)(B)(iv). This exclusivity period can be very lucrative for the generics who successfully challenge patents. Second, if the generic is seeking to market only a new method of using a particular drug, it can "carve out" the patented methods of use and proceed with a lower risk of a patent-infringement lawsuit, id. § 355(j)(2)(A)(viii) ("Section viii statement"). Successful applications to carve out methods of use under Section [*12] viii allow generics to enter the market even during the 180-day exclusivity period held by the first successful Paragraph IV filer. See In re Actos, 848 F.3d at 95.Read The Full CaseNot a Lexis Advance subscriber? Try it out for free.
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2018 U.S. Dist. LEXIS 23455 *; 2018-1 Trade Cas. (CCH) P80,283; 2018 WL 840099
IN RE ACTOS END-PAYOR ANTITRUST LITIGATION
Subsequent History: Motion denied by In re Actos End-Payor Antitrust Litig., 2019 U.S. Dist. LEXIS 170178 (S.D.N.Y., Sept. 30, 2019)
Prior History: United Food & Commer. Workers Local 1776 & Participating Emplrs. Health & Welfare Fund v. Crosby Tugs, LLC (In re Actos End-Payor Antitrust Litig.), 848 F.3d 89, 2017 U.S. App. LEXIS 2291 (2d Cir., Feb. 8, 2017)
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