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In re Adderall XR Antitrust Litig.

United States Court of Appeals, Second Circuit

June 9, 2014

In re ADDERALL XR ANTITRUST LITIGATION; LOUISIANA WHOLESALE DRUG COMPANY, INC., on behalf of itself and all others similarly situated, VALUE DRUG COMPANY, on behalf of itself and all others similarly situated, Plaintiffs-Appellants,
v.
SHIRE LLC, SHIRE U.S., INC., Defendants-Appellees. [*]

Argued March 17, 2014.

Page 129

Appeal from a judgment of the United States District Court for the Southern District of New York (Victor Marrero, Judge), dismissing the plaintiffs' complaint under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted. The plaintiffs, wholesale dealers in pharmaceutical products, brought this putative class action asserting that the defendant drug manufacturers violated the Sherman Act by breaching their contracts to supply competing manufacturers with an unbranded version of the defendants' widely prescribed patented drug. The plaintiffs argue that these contracts gave rise to a " duty to deal" enforceable by third-party customers such as themselves under the antitrust laws. We disagree. The judgment of the district court is therefore AFFIRMED.

JOSEPH OPPER (Bruce E. Gerstein, Elena K. Chan, Kimberly Hennings, on the brief), Garwin Gerstein & Fisher LLP, New York, NY, for Plaintiffs-Appellants.

MICHAEL F. BROCKMEYER, Frommer Lawrence & Haug LLP, Washington, DC (Edgar H. Haug, John F. Collins, Frommer Lawrence & Haug LLP, New York, NY, on the brief), for Defendants-Appellees.

Before: JACOBS, SACK, and LOHIER, Circuit Judges.

OPINION

Page 130

Sack, Circuit Judge :

The plaintiffs are wholesale dealers in pharmaceutical products including Adderall XR, a widely prescribed drug manufactured by the defendants. They brought this putative class action alleging that the defendants violated the anti-monopolization provision of the Sherman Act by breaching defendants' contracts to supply two of their competitors--who in turn supply the plaintiffs--with an unbranded version of the defendants' patented drug for resale under the competitors' own labels. Although the contracts were executed in connection with settlements of patent litigation, the plaintiffs disclaim any reliance on that fact. They argue instead that the contracts themselves gave rise to a " duty to deal" under antitrust law. We disagree and therefore affirm the judgment of the United States District Court for the Southern District of New York (Victor Marrero, Judge ) dismissing the complaint.

BACKGROUND

Defendants Shire LLC and Shire U.S., Inc. (together, " Shire" ) hold patents covering Adderall XR (" AXR" ), a drug approved by the U.S. Food and Drug Administration (" FDA" ) in 2001 to treat attention-deficit/hyperactivity disorder. AXR enjoyed significant commercial success. In 2002, Teva Pharmaceuticals USA, Inc.,[1] sought FDA approval to produce a generic equivalent. Compl. ¶ ¶ 2-3. Impax Laboratories, Inc., followed suit in 2003. Id. ¶ 3.

Teva and Impax took advantage of the streamlined drug approval process established by a 1984 amendment to the Federal Food, Drug, and Cosmetic Act generally referred to as the " Hatch--Waxman Amendments." See 21 U.S.C. § 355(b), (j). The Act allows a generic maker to piggyback on the efforts of an approved drug's manufacturer by filing an Abbreviated New Drug Application (" ANDA" ) showing, among other things, that its proposed product is biologically equivalent to the approved drug. Id. § 355(j)(2)(A)(iv). An ANDA must also include a certification that the proposed generic does not infringe the approved drug's patents. Id. § 355(j)(2)(A)(vii).

If an ANDA contains a certification that an approved drug's patents are " invalid or will not be infringed by the manufacture, use, or sale of the new drug for which the application is submitted," the applicant must notify the drug's patent holder of the pending application. Id. § 355(j)(2)(A)(vii), (B)(iii). The patent holder then has forty-five days to file suit against the applicant for patent infringement. If the patent holder acts within this window, any FDA action on the ANDA is stayed for thirty months. Id. § 355(j)(5)(B)(iii). That is what happened here.

In their applications to the FDA, both Teva and Impax certified that Shire's patents for AXR were either " invalid or will not be infringed by the manufacture, use, or sale" of their proposed generic equivalents. See Compl. ¶ 39; 21 U.S.C. § 355(j)(2)(A)(vii). Shire responded ...


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