Apotex Tries Again for DJ Jurisdiction Based on Patent Listing in Orange Book

Undeterred by the Supreme Court's denial of its cert petition in Apotex v. Pfizer last year, Apotex has filed yet another lawsuit asserting that listing a patent in the Orange Book establishes a justiciable controversy and therefore declaratory judgment jurisdiction.  This argument failed at least twice before, in Teva v. Pfizer (relating to generic Zoloft) and Apotex v. Pfizer (concerning generic Accupril).  This time around, Apotex is targeting GlaxoSmithKline and its antiulcer medication Zantac Syrup (ranitidine HCl).

Apotex's complaint against Glaxo alleges as follows:

• Glaxo submitted U.S. Patent No. 5,068,249, covering aqueous ranitidine formulations, for listing in the Orange Book.
• "As a consequence of such Orange Book listing, Glaxo maintains, and has affirmatively represented to the world, that the '249 patent claims the approved drug, Zantac Syrup, or a method of using that drug, and that a claim for patent infringement could reasonably be asserted against any generic ANDA applicant, including Apotex, attempting to market a generic ranitidine product before patent expiration."
• Glaxo already has successfully enforced the '249 patent against other companies seeking to market a generic ranitidine product prior to the expiration of the '249 patent.
• Apotex submitted a paragraph IV certification to the '249 patent.
• Apotex's approval to market generic ranitidine is delayed due to the '249 patent, Apotex "also faces potentially enormous infringement liability if it markets its generic product prior to expiration of the '249 patent," and "only a declaratory judgment from this Court can alleviate this harm and allow Apotex to obtain approval of its product."
• "Apotex is entitled by law to bring and maintain this action for declaratory judgment of patent non-infringement under the Declaratory Judgment Act and the MMA where, as here, Glaxo did not sue Apotex within 45 days of receipt of Apotex's notice of paragraph IV certification to the '249 patent, and Apotex has offered Glaxo an Offer of Confidential Access to Apotex's ANDA for generic ranitidine oral solution."

While Apotex acknowledges in its complaint that NDA applicants are required by statute to submit patent information in their NDAs, Apotex incredibly states, "Thus, the NDA-holder/patent owner necessarily puts all prospective generic ANDA applicants on notice that a suit for infringement can and will be asserted against any ANDA applicant that attempts to seek approval for and market a generic version of the NDA drug before patent expiration."  Of course, Apotex knows full well that Glaxo's submission of patent information for listing in the Orange Book does not obligate it to sue anyone on the patent.

It appears that Apotex's arguments in this case are no better than Teva's arguments were in its case against Pfizer, where the Federal Circuit concluded that Teva failed to satisfy the "reasonable apprehension of suit" test for declaratory judgment jurisdiction, and therefore did not meet the "actual case or controversy" requirement of Article III of the Constitution.  Glaxo will undoubtedly file a motion to dismiss.  Apotex filed this case in the Eastern District of Virginia (known for its "rocket docket") and may be hoping for a speedy path back to the Federal Circuit and, if necessary, the Supreme Court.

Appeal to the Supreme Court may not be necessary, however, depending on how the Federal Circuit interprets the Court's recent MedImmune decision.  As an alert reader pointed out, J. Scalia (writing for the majority) strongly criticized the Federal Circuit's "reasonable apprehension of suit" test in dicta, and even cited Teva v. Pfizer.  In footnote 11, J. Scalia suggested that the test is in conflict with no fewer than four Supreme Court cases regarding declaratory judgment jurisdiction.  Apotex may have had this in mind when it filed its recent DJ action against Glaxo.

Comments

[JD]

After Medimmune v. Genentech, Apotex has a better chance at convincing the CAFC to change its "reasonable apprehension" test. But I doubt Apotex will succeed... I cannot see how they overcome the Art. III "case or controversy". It is clear from the complaint that Glaxo decided not to sue Apotex within 45 days, because Apotex successfully designed a work-around.

[Robert Dailey]

The issues here differ substantially from those raised in Medimmune. It seems to me that Medimmune answers a rather narrow question: If a contracting party has not bargained away its right to contest the validity of the patent, must that party breach the contract to have standing under the DJ Act? Of course, contracts generally emerge as a product of intense negotiations between the parties (including threats, counter-threats, etc.) Therefore, an accused infringer would typically have already met the DJ standing requirements before the parties entered the contract. So how does an accused infringer act on its right to sue under the DJ Act if it did not bargain that right away in the contract? Medimmune tells us how.

Nowhere does Medimmune grant DJ standing to diffuse defendants. At most, an NDA filing stands as a diffuse threat to a broad class of unidentified plaintiffs. Placing the general public on notice of one's IP rights has never been sufficient to grant a potential infringer DJ standing.

Furthermore, no reasonsble method of statutory construction would seem to yield the result that Apotex wants. Congress has provided a detailed protocol for dispute resolution within the H-W Act itself, especially in regards to standing. The text of H-W gives no indication that Congress intended to import provisions of the DJ Act into H-W. In fact, H-W appears to contemplate the opposite: ANDA filers would not have standing during the 45-day window.

If Medimmune gives Apotex anything, it is probably the ability to avoid being sanctioned for filing this DJ complaint.