The Court of Appeals for the D.C. Circuit recently affirmed a district court decision finding that the Food and Drug Administration (FDA) wrongly delisted two Merck patents, thereby unlawfully depriving Teva and Ranbaxy of 180 days of marketing exclusivity on generic simvastatin. Ranbaxy Laboratories Ltd. v. Leavitt, Case No. 06-5154 (D.C. Cir., Nov. 14, 2006) (Ginsburg, J.).
In 2000 and 2001, Ivax and Ranbaxy filed Abbreviated New Drug Applications (ANDAs) for generic versions of Zocor, a blockbuster statin drug, certifying under Paragraph IV that two of Merck’s patents then listed in the FDA’s Orange Book were invalid, unenforceable or not infringed. Merck did not sue the generic drug companies for patent infringement, but sent a letter to the FDA requesting that the two patents be removed from the Orange Book. The FDA delisted the two patents. In 2005, Ivax and Ranbaxy submitted citizen petitions asking the FDA to relist the patents, and for confirmation that, as the first ANDA filers, they were still entitled to 180 days of marketing exclusivity for generic Zocor. The FDA denied the petitions, stating that it would not relist the patents and that no generic applicant would be entitled to a 180-day exclusivity period. The district court subsequently held that the FDA improperly denied Ivax’s and Ranbaxy’s citizen petitions to relist the two Merck patents on Zocor. The FDA appealed the district court decision but did not request a stay. The FDA then granted final approval of the ANDAs from Teva (the owner of Ivax) and Ranbaxy in June, after which the two companies launched their generic simvastatin products.
On appeal the U.S. Court of Appeals for the D.C. Circuit unanimously affirmed the district court’s finding that FDA’s interpretation of the statue was contrary to the clear intent of Congress. The FDA’s policy was to allow delisting when a generic drug maker had filed an ANDA containing a paragraph IV certification and the NDA holder had not filed a lawsuit to contest the certification, as occurred in the Zocor case. The court framed the issue as "whether the FDA may delist a patent upon the request of the NDA holder after a generic manufacturer has filed an ANDA containing a paragraph IV certification so that the effect of delisting is to deprive the applicant of a period of marketing exclusivity." In striking down the FDA’s policy, the court reasoned that the FDA’s policy conditioning a generic applicant’s period of marketing exclusivity upon the generic applicant being sued for patent infringement by the NDA holder is inconsistent with the text and structure of the Act because it diminishes the incentive the Congress gave manufacturers of generic drugs. Therefore, the court concluded that the FDA improperly denied Ranbaxy and Teva a period of marketing exclusivity by delisting Merck’s patents. The court admonished the FDA that it may not change the incentive structure adopted by Congress.
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