By James DeGiulio --
Sham Litigation Claims against Par and Paddock Continue in AndroGel Litigation
Par Pharmaceutical and Paddock Laboratories received clarification that their agreements with Solvay not to release competing versions of the testosterone supplement AndroGel are still subject to sham litigation claims brought by direct purchasers.
In August 2003, Solvay filed patent infringement actions against Watson and Paddock in the U.S. District Court for the Northern District of Georgia following their Abbreviated New Drug Application (ANDA) filings, accusing the two companies of infringing U.S. Patent No. 6,503,894. Before the District Court reached the infringement issue, Solvay, Watson, and Paddock settled. The settlements prompted an investigation by the Federa Trade Commission (FTC) for violations of antitrust laws. In 2009, the FTC and a number of private parties filed antitrust actions against Solvay, Watson, Par, and Paddock. The suits alleged that settlements Solvay reached with Watson and Paddock in 2006 were anti-competitive because the companies received compensation in exchange for keeping generic competition for AndroGel off the market until 2015, thus constituting reverse payments and sham litigation. In February, Judge Thomas W. Thrash, Jr. threw out the FTC's reverse payment claims, finding the settlements legal because they did not extend Solvay's monopoly on AndroGel past the expiration of its patent on the supplement. In March, Par and Paddock filed motions seeking to clarify whether the ruling applied to the sham litigation claims as well.
On September 16, Judge Thrash issued an order indicating that the sham litigation claims remain intact, noting the allegations by the private direct purchasers were sufficient to survive a motion to dismiss. Judge Thrash cited Schering-Plough Corp. v. F.T.C. (11th Cir. 2005), where the appellate court indicated that reverse payment patent infringement settlements may restrain trade if they are made in the context of sham litigation. Judge Thrash's clarifying order can be found here.
Taro and Shire Settle Carbatrol Patent Dispute
Shire and Taro have quickly settled the infringement suit over the epilepsy drug Carbatrol after reaching a licensing agreement this week.
On July 23, Shire brought suit in the U.S. District Court for the Southern District of New York alleging that Taro infringed U.S. Patent Nos. 5,326,570 and 5,912,013 by filing an ANDA for generic Carbatrol (see "Court Report," August 1, 2010). Shire also sought an injunction, claiming that Taro's efforts to make the generic drug would cause it irreparable harm.
Under the September 16 agreement, Shire granted Taro a covenant not to sue and will license the patents to Taro in exchange for Taro's dropping any challenge to their validity. Taro admitted that it infringed the patent by filing its ANDA and that the '570 patent was valid and enforceable. Judge Gardephe's order approving the settlement and granting the permanent injunction can be found here.
Apotex and Wyeth Settle Effexor Patent Suit
Apotex and Wyeth have settled and thus concluded Wyeth's infringement suit over Apotex's generic version of the antidepressant Effexor.
In August 2008, Wyeth brought suit in the U.S. District Court for the Southern District of Florida, accusing Apotex of infringing U.S. Patent Nos. 6,274,171, 6,403,120, and 6,419,958 by submitting an ANDA for production of generic Effexor (see "Court Report," August 24, 2008). In March 2010, both parties filed summary judgment motions on the issue of infringement.
On August 11, Apotex and Wyeth reached a licensing agreement for the drug. According to the agreement, Apotex will not sell a generic version of Effexor until after the expiration of the three at-issue patents, and both parties agreed to drop all claims and pay their own litigation costs. Judge Frederico A. Moreno signed off on the settlement on September 15, 2010.
James DeGiulio has a doctorate in molecular biology and genetics from Northwestern University and is a graduate of Northwestern University School of Law. Dr. DeGiulio is a member of MBHB's 2010 associate class and he can be contacted at degiulio@mbhb.com.
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