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Paddock Laboratories, Inc v. Ethypharm S.A.

January 18, 2011


The opinion of the court was delivered by: Brown, Chief Judge



This matter comes before the Court upon the motion to dismiss based on lack of a justiciable controversy filed by Defendants Ethypharm S.A., Lupin Limited, and Lupin Pharmaceuticals, Inc. (Doc. No. 98; Doc. No. 99 (brief).) Plaintiff filed an opposition brief on October 20, 2010, (Doc. No. 104), and Defendants filed their reply brief on October 27, 2010. (Doc. No. 112.) In addition to the normal briefing, the Court permitted Plaintiff to file a sur-reply to address new matter contained in Defendant's reply brief. (Doc. Nos. 119, 120.) The motion was returnable November 15, 2010.

However, after the briefing was completed, Plaintiff sent an update to the Court stating that the FDA has required it to file a new Paragraph IV Certification based on its amended formulation. (Letter from Arnold Rady (Dec. 20, 2010)). Defendants then renewed their motion to dismiss, arguing that they now are entitled to bring suit within the 45 day period after service of the Paragraph IV Certification and that Paddock is unable to maintain suit during that 45 day period. (Letter from Karen Confoy (December 20, 2010)).

As explained in detail below, the Court exercises its discretion to decline jurisdiction under the Declaratory Judgment Act because such action reflects the Hatch-Waxman Act's intent to allow the branded drug company the first chance to sue under a Paragraph IV Certification. The Act did not intend for the branded pharmaceutical manufacturer to have to defend a declaratory judgment until after the expiration of the 45 day period.


Resolution of Ethypharm's motion requires an understanding of the complicated statutory scheme for the approval of new and generic drugs under the Hatch-Waxman Act.*fn1 The Hatch-Waxman Act aims to "balance two competing interests in the pharmaceutical industry: '(1) inducing pioneering research and development of new drugs and (2) enabling competitors to bring low-cost, generic copies of those drugs to market.'" Janssen Pharmaceutica, N.V. v. Apotex, Inc., 540 F.3d 1353, 1355 (Fed. Cir. 2008) (quoting Andrx Pharms., Inc. v. Biovail Corp., 276 F.3d 1368, 1371 (Fed. Cir. 2002)).

The Hatch-Waxman Act requires that before a drug manufacturer can market a new drug, it must submit a New Drug Application ("NDA") to the Food and Drug Administration ("FDA") for approval. 21 U.S.C. § 355(a). This process requires extensive safety testing and review. The manufacturer must also submit the patent number and expiration date of any patent that claims the drug or a method of using the drug for which the owner could reasonably assert a claim of patent infringement. 21 U.S.C. § 355(b)(1). The FDA lists this patent information with the approved drug in its Approved Drug Products with Therapeutic Equivalence Evaluations publication, commonly known as the "Orange Book." See 21 U.S.C. §§ 355(b)(1), 355(j)(2)(A)(II)(iii). This is designed to put potential generic manufacturers on notice of any patents that protect the drug.

The Hatch-Waxman Act makes the approval process easier for subsequent generic drug manufacturers. Generic drug manufacturers may obtain FDA approval for generic versions of previously-approved drugs by filing an Abbreviated New Drug Application ("ANDA"), without having to repeat the extensive safety testing required for a New Drug Application. See 21 U.S.C. § 355(j). Generic manufacturers are only required to show that the proposed generic is bioequivalent to the drug already tested in the NDA.

However, when submitting an ANDA for a drug to the FDA, the Hatch-Waxman Act requires a generic manufacturer to make one of the following four certifications for each of the patents listed in the Orange Book:

(1) that the branded manufacturer filed no patents that cover the drug (a "Paragraph I Certification");

(2) that the patent has expired (a "Paragraph II Certification");

(3) that the patent will expire on a specific date (a "Paragraph III Certification"); or

(4) that the patent "is invalid or will not be infringed by the manufacture, use, or sale of the drug for which the application is submitted" (a "Paragraph IV Certification"). 21 U.S.C. ยง 355(j)(2)(A)(vii)(I)-(IV). A company seeking to market a generic version of a listed drug prior to the expiration of the Orange Book-listed patents must file a Paragraph IV Certification. The Paragraph IV ...

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