Pharmaceutical manufacturers are increasingly finding themselves defending decisions to list in the U.S. Food and Drug Administration's (FDA) Orange Book patents that they assert are associated with their products. The Federal Trade Commission (FTC) issued a policy statement in September 2023 announcing an evaluation of whether improper Orange Book listings "may constitute an unfair method of competition in violation of Section 5 of the FTC Act." Two months later, the FTC sent letters to pharmaceutical manufacturers identifying more than 100 patents that the FTC believed had been improperly listed and added concerns with more than 300 patents in another round of letters sent in April 2024.
In addition to facing questions from the federal government, pharmaceutical manufacturers have been forced to defend themselves in court. On June 10, 2024, Judge Stanley Chesler of the U.S. District Court for the District of New Jersey in Teva Branded Pharmaceutical Products R&D, Inc. v. Amneal Pharmaceuticals of New York, LLC, No 2:23-cv-20964 (D.N.J.) denied a motion to dismiss filed by Teva and granted Amneal's motion for judgment on the pleadings, ordering Teva to correct or delist five asthma inhaler patents the court found that Teva had improperly listed in the FDA's Orange Book. This decision serves not only as a blow to Teva, but also a significant win for the FTC, which had weighed in on the dispute via amicus brief.
Listing Requirements
Pharmaceutical manufacturers are required to list in the Orange Book for each product they manufacture any patents that the manufacturers claim would be infringed in the production of the drug by a generic manufacturer. Teva listed in the Orange Book a number of patents it believes are required to produce its ProAir HFA Inhalation Aerosol inhaler. After Amneal sought to make and sell a generic version of the ProAir HFA, Teva filed suit against Amneal asserting infringement of those patents. Amneal, in turn, filed counterclaims under Section 2 of the Sherman Act challenging Teva's improper assertion of those patents to block its entry and seeking to require Teva to delist patents from the Orange Book.
In ruling on the pleadings, the court first rejected Teva's motion to dismiss Amneal's antitrust claims. Teva sought to rely on the U.S. Supreme Court's decision in Verizon Communications, Inc. v. Trinko, LLP, 540 U.S. 398 (2004), which rejected a Section 2 claim brought against Verizon based on Verizon's failure to meet its obligation under the Telecommunications Act of 1996 to share its network with a competitor. Teva argued that just as a violation of the Telecommunications Act could not give rise to an antitrust claim, its alleged improper Orange Book listings also provided no grounds for a Sherman Act claim by its competitor, Amneal. The court rejected Teva's argument, finding that the statute requiring it to list its patents in the Orange Book "says nothing about competitors or other drug companies; it speaks only about certain information that must be submitted" to the FDA with a new drug application.
Next, the court agreed with Amneal's claim that Teva's Orange Book listings were improper. The court found that Teva's patents did not "claim the drug" for which Teva had submitted the Orange Book listings, because the patents were "directed to components of a metered inhaler device, but do not claim or even mention albuterol sulfate or the ProAir® HFA." Because the court found that "a patent claims only that subject matter that it has particularly pointed out as the invention, and no more," it found Teva's Orange Book listings improper and ordered Teva to correct or delete the listings.
Conclusion
Pharmaceutical manufacturers should consider this decision and its implications for their patents and Orange Book listings. They not only face an FTC that is ready and willing to act on its view that improper Orange Book listings might violate Section 5 of the FTC Act, they also face headwinds in litigation.
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