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Teva Suit Over Generic Version of Restasis Comes Up Short

Feb. 27, 2019, 8:22 PM

Generic drug giant Teva Pharmaceuticals Ltd. lost its bid to get a court to rule on its first-to-file exclusivity rights on a generic version of the blockbuster dry eye drug Restasis.

Judge Randolph D. Moss of the U.S. District Court for the District of Columbia tossed the case because Teva didn’t have standing to maintain the suit against the government because it hadn’t shown evidence it would suffer an imminent injury.

The decision means Teva must wait to challenge the Food and Drug Administration’s interpretation of first-to-file exclusivity rights until after the FDA acts acts on any of the generic Restasis applications that are pending.

The first generic applicant to challenge the patent on a branded drug is eligible for six months of market exclusivity on the generic. And that right is very valuable: Teva estimates the 180-day exclusivity period for the generic version of Restasis is worth more than $50 million dollars in net revenues.

Mylan Pharmaceuticals Inc., Deva Holding AS and Famy Care Private Ltd. all have generic cyclosporine applications pending at the FDA and intervened in the case. The FDA hasn’t given tentative or final approval to any generic cyclosporine application.

Teva sued the government, seeking to obtain an immediate ruling barring the FDA from depriving the company of its statutory right to 180 days of generic drug exclusivity.

It challenged the FDA’s interpretation of “first applicant” in a letter decision in an unrelated matter, arguing that interpretation would deprive Teva of its statutory right to 180 days of generic exclusivity for cyclosporine. Teva asked the court to order that decision set aside because it ran afoul of the Administrative Procedure Act.

Teva also wanted the court to bar the FDA from approving any other company’s application for a generic version of Restasis.

But Moss said he didn’t even need to address Teva’s administrative law argument because Teva couldn’t show the FDA’s interpretation of “first applicant” in another case would cause it an immediate and concrete injury.

No Property Interest

As a threshold matter, Moss said, Teva didn’t have a protectable property right to 180-day exclusivity.

"[N]either history nor statutory text suggests that Congress intended to confer first applicants an immediate property interest,” Moss wrote. Generic drug applicants may not know for years after filing their applications whether they ultimately will obtain the 180 days of generic exclusivity.

There is no support, he said, for “Teva’s sweeping view that an ANDA applicant obtains an immediate property interest in its first applicant status.” An ANDA is an abbreviated new drug application to make or sell a generic version of a brand-name drug.

And, although Teva alleged the FDA is poised to grant final approval to Mylan’s ANDA, the court said, Teva’s allegations are speculative because the FDA’s deliberations are confidential, the opinion said.

Teva had no comment on the ruling “at this time,” Doris Saltkill of the company’s corporate communications department told Bloomberg Law. Bloomberg Law also reached out to Mylan for comment but no one was available to respond. Mylan acquired Famy Care in 2015.

Hurdles Swept Away

But one of the lawyers for generic Restasis applicant Deva Holding told Bloomberg Law said the decision was a positive one.

“We are obviously happy with the decision as it allows all eligible ANDA sponsors to launch, when finally approved,” Shashank Upadhye of Amin Talati Upadhye LLP, who represents Deva said. “We are also happy that the court impliedly rejected the ‘180-Day Exclusivity As Vested Property’ theory, as it never has been said by Congress, FDA, nor the courts.”

“With many of the overall legal hurdles being swept away,” Upadhye said, the FDA is now free to make decisions on the various companies’ pending applications.

Hyman Phelps & McNamara PC and Kirkland & Ellis LLP represented Teva.

The Department of Justice represented the Department of Health and Human Services and the FDA.

Zuckerman Spaeder represented intervenor-defendant Mylan Pharmaceuticals Inc.

Amin Talati Updahye LLP represented intervenor-defendant Deva Holding AS.

Rakoczy Molino Mazzochi Siwik LLP and Knobbe Martens Olson & Bear LLP represented intervenor-defendant Famy Care Private Ltd.

The case is Teva Pharm. USA, Inc. v. Azar, 2019 BL 63877, D.D.C., No. 18-2394 (RDM), 2/26/19.

To contact the reporter on this story: Dana A. Elfin in Washington at delfin@bloomberglaw.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloomberglaw.com; Brent Bierman at bbierman@bloomberglaw.com