Free Reply Brief - District Court of Delaware - Delaware

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE __________________________________________ IN RE: METOPROLOL SUCCINATE ) END-PAYOR ANTITRUST LITIGATION ) _________________________________________ ) ) THIS DOCUMENT RELATES TO: ) ALL ACTIONS ) __________________________________________) C.A. No. 06-71 (GMS)

DEFENDANTS' REPLY BRIEF IN FURTHER SUPPORT OF THEIR MOTION TO DISMISS THE CONSOLIDATED CLASS ACTION COMPLAINT OR, IF THAT MOTION IS DENIED, TO STAY THIS ACTION

MORRIS, NICHOLS, ARSHT & TUNNELL LLP Jack B. Blumenfeld (#1014) Karen Jacobs Louden (#2881) 1201 N. Market Street P.O. Box 1347 Wilmington, Delaware 19899 (302) 658-9200 Attorneys for Defendants OF COUNSEL: Arthur F. Golden Ronan P. Harty Joshua D. Liston DAVIS POLK & WARDWELL 450 Lexington Avenue New York, NY 10017 (212) 450-4000 October 10, 2006

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TABLE OF CONTENTS PAGE TABLE OF AUTHORITIES .............................................................................................. ii INTRODUCTION ...............................................................................................................1 ARGUMENT.......................................................................................................................4 I. PLAINTIFFS ARE UNABLE TO ESTABLISH ANTITRUST STANDING ...................................................................................................4 A. Plaintiffs Cannot Establish That the Alleged Conduct Delayed Tentative FDA Approval .....................................................................4 1. 2. 3. B. C. D. II. The Resources of the FDA.........................................................6 The Generic Manufacturers' Resources.....................................9 Hypothetical Competitors Should Not Be Considered ............10

Plaintiffs Misperceive the Causation Requirement............................11 The Case Law Favors Dismissal........................................................12 Plaintiffs' Policy Argument Is Misplaced..........................................14

PLAINTIFFS' OTHER PURPORTED FEDERAL ANTITRUST CLAIMS ARE WITHOUT BASIS .............................................................15 A. There Is No Antitrust Claim in a Patent Case Absent Enforcement.......................................................................................15 No Generic Is Currently Entitled to an 180-day Exclusivity Period..............................................................................16

B.

III.

IF THERE IS JURISDICTION FOR THE STATE LAW CLAIMS, THOSE CLAIMS SHOULD BE DISMISSED ...........................................17 IF THE MOTION TO DISMISS IS DENIED, THE COURT SHOULD STAY THIS ACTION .................................................................................19

IV.

CONCLUSION..................................................................................................................20

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TABLE OF AUTHORITIES CASES PAGE Andrx Pharms., Inc. v. Biovail Corp., 276 F.3d 1368 (Fed. Cir. 2002).......................................................................................7 Axis v. Micafil, 870 F.2d 1105 (6th Cir. 1989) ......................................................................................12 Barton & Pittinos, Inc., v. SmithKline Beecham Corp., 118 F.3d 178 (3d Cir. 1997)..........................................................................................11 Boulware v. Nevada, 960 F.2d 793 (9th Cir. 1992) ........................................................................................18 Bristol-Myers Squibb Co. v. Ben Venue Labs., 90 F. Supp. 2d 540 (D.N.J. 2000) ..............................................................9-10,12-13,15 Bristol-Myers Squibb Co. v. Copley Pharm., Inc., 144 F. Supp. 2d 21 (D. Mass. 2000) .............................................................................14 Byre v. City of Chamberlain, 362 N.W.2d 69 (S.D. 1985) ..........................................................................................18 In re Cardizem CD Antitrust Litig., 332 F.3d 896 (6th Cir. 2003) ..........................................................................................7 City of Madison v. Hyland, Hall & Co., 243 N.W.2d 422 (Wis. 1976)........................................................................................18 City of Milwaukee v. Illinois, 451 U.S. 304 (1981)......................................................................................................18 City of Pittsburgh v. West Penn Power Co., 147 F.3d 256 (3d Cir. 1998)................ passim Commonwealth v. Mass. CRINC, 392 Mass. 79 (1984) .....................................................................................................18 DKH Corp. v. Rankin-Patterson Oil Co., 131 N.C. App. 126 (N.C. Ct. App. 1998) .....................................................................18 Daniel v. Am. Bd. of Emergency Med., 428 F.3d 408 (2d Cir. 2005)..........................................................................................11

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Double D Spotting Serv. v. Supervalu, Inc., 136 F.3d 554 (8th Cir. 1998) ........................................................................................18 Elan Corp., PLC v. Andrx Pharms., Inc., 272 F. Supp. 2d 1325 (S.D. Fla. 2003) ...........................................................................7 Elkins v. Microsoft Corp., 174 Vt. 328 (2002)........................................................................................................18 Empire Volkswagen, Inc. v. World-Wide Volkswagen Corp., 814 F.2d 90 (2d Cir. 1987)............................................................................................18 FMC Corp. v. Manitowoc Corp., 835 F.2d 1411 (Fed. Cir. 1987).....................................................................................16 FTC v. Mylan Labs, Inc., 62 F. Supp. 2d 25 (D.D.C. 1999) ..................................................................................18 Illinois Brick Co. v. Illinois, 431 U.S. 720 (1977)......................................................................................................18 In re K-Dur Antitrust Litig., 338 F. Supp. 2d 517 (D.N.J. 2004) ...............................................................................18 LePage's, Inc. v. 3M, 324 F.3d 141 (3d Cir. 2003)..........................................................................................16 Meghrig v. KFC Western, Inc., 516 U.S. 479 (1996)......................................................................................................18 Michigan Ass'n of Psychotherapy Clinics v. Blue Cross & Blue Shield of Michigan, 118 Mich. App. 505 (Mich. Ct. App. 1982) .................................................................18 Partee v. San Diego Chargers Football Co., 34 Cal.3d 378 (1983) ....................................................................................................18 In re Pharmastem Therapeutics, Inc. Patent Litigation, No. 05-md-1660 GMS (D. Del. Oct. 6, 2005) ...........................................................4,19 Orr v. Beamon, 77 F. Supp. 2d 1208 (D. Kansas 1999) .........................................................................18 In re Relafen Antitrust Litig., 286 F. Supp. 2d 56 (D. Mass. 2003).....................................7

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Rockholt Furniture, Inc. v. Kincaid Furniture Co., No. 1:96CV00588, 1998 WL 1661384 (E.D. Tenn. July 6, 1998), aff'd, 188 F.3d (6th Cir. 1999)......................................................................................18 Schuylkill Energy Res., Inc. v. Pa. Power & Light Co., 113 F.3d 405 (3d Cir. 1997).........................................................................................2,5 St. Petersburg Yacht Charters, Inc. v. Morgan Yacht, Inc., 457 So.2d 1028 (Fla. 1984)...........................................................................................18 State v. Alpine Air Prods., Inc., 490 N.W.2d 888 (Minn. Ct. App. 1992) aff'd, 500 N.W.2d 788 (Minn. 1993) ..........18 State v. Gannett Pac. Corp., 99 F. Supp. 2d 1241 (D. Haw. 1999) ............................................................................18 State v. Ray Bell Oil Co., 101 N.M. 368 (N.M. Ct. App. 1984) ............................................................................18 State ex rel. Palumbo v. Graley's Body Shop, Inc., 425 S.E.2d 177 (W. Va. 1992)......................................................................................18 In re Tamoxifen Citrate Antitrust Litig., 277 F. Supp. 2d 121 (E.D.N.Y. 2003), aff'd, 429 F.3d 370 (2d Cir. 2005)..................14 In re Terazosin Hydrochloride Antitrust Litig., 160 F. Supp. 2d 1365 (S.D. Fla. 2001) .........................................................................18 Tri-State Rubbish, Inc. v. Waste Mgmt. Inc., 998 F.2d 1073 (1st Cir. 1993).......................................................................................18 Unitherm Food Sys. v. Swift-Eckrich, Inc., 375 F.3d 1341 (Fed. Cir. 2004).....................................................................................16 Vinci v. Waste Mgmt. Inc., 80 F.3d 1372 (9th Cir. 1996) ..................................................11 Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172 (1965)...................................................................................................3,16 In re Warfarin Sodium Antitrust Litig., 214 F.3d 395 (3d Cir. 2000)..........................................................................................14 Washington v. Niagara Mohawk Power Corp., 103 F. Supp. 2d 517 (N.D.N.Y. 2000)..........................................................................18

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Wedgewood Inv. Corp. v. Int'l Harvestor Co., 613 P.2d 620 (Ariz. Ct. App. 1979)..............................................................................18 In re Wellbutrin SR/Zyban Antitrust Litig., 281 F. Supp. 2d 751 (E.D. Pa. 2003) ................................................................... 9-10,12 STATUTES & RULES

15 U.S.C. § 26....................................................................................................................18 21 U.S.C. § 355.................................................................................................... 8,11-12,17 28 U.S.C. § 1367(a) ...........................................................................................................17 D.C. Code § 28-4515 .........................................................................................................18 Fed. R. Civ. P. 12(b)(6)........................................................................................................5 Neb. Rev. Stat. § 59-829....................................................................................................18

OTHER AUTHORITIES 2 Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law ¶ 338b (2d ed. 2000) ............................................................................................................12,14 Class Action Fairness Act of 2005.....................................................................................17 FDA, Center for Drug Evaluation & Research, Drugs@FDA ­ Glossary of Terms, http://www.fda.gov/cder/drugsatfda/glossary.htm..........................................................6 FDA Center for Drug Evaluation and Research, 2004 Report to the Nation, available at http://www.fda.gov/cder/reports/rtn/2004/Rtn2004.pdf ..........................6,8 Improving Access to Generic Drugs: Hearing Before the Senate Special Comm. on Aging, 109th Congress (July 20, 2006)...........................................................................7 Op. N.D. Att'y Gen., No. 81-35, 1981 WL 156902 (Apr. 2, 1981) ..................................18

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INTRODUCTION Plaintiffs, in their brief in opposition to AstraZeneca's motion to dismiss, fail to come to terms with the fundamental principle that an independent bar to competition in the relevant market breaks the causal connection between an alleged antitrust violation and plaintiffs' alleged injuries. In its opening brief, AstraZeneca showed that such an "independent bar" exists in this case ­ the lack of Food and Drug Administration ("FDA") tentative approval of an Abbreviated New Drug Application ("ANDA") from any generic manufacturer while the automatic 30-month stay was in effect. That lack of tentative approval ­ which plaintiffs admit ­ means that the 30-month stay triggered by the filing by AstraZeneca of the patent litigation against the generic pharmaceutical companies did not adversely affect competition in the alleged relevant market. That is so because the FDA is unrestricted in its ability to grant tentative approval while the stay is in effect. If an ANDA actually met the requirements for FDA approval during the pendency of the stay, the FDA could have granted it tentative approval. Had any of the generic filers in this case received tentative approval while the stay was in effect, plaintiffs would have an argument that AstraZeneca's lawsuit caused their alleged injuries. However, the lack of tentative FDA approval created an independent bar to competition in the market, regardless of AstraZeneca's alleged conduct. The principle that an independent bar breaks the causal connection has been squarely recognized by the Third Circuit, and it governs this case. City of Pittsburgh v. West Penn Power Co., 147 F.3d 256 (3d Cir. 1998). In response, plaintiffs argue that the difference here is that AstraZeneca's conduct delayed the possibility of FDA tentative approval. Under plaintiffs' theory, both the generic manufacturers who filed ANDAs and the FDA itself effectively take a "time-out" when patent litigation is filed by a brand-name manufacturer and direct their resources away from the ANDA approval process.

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As AstraZeneca showed in its opening brief, this allegation is unsupportable and belied by case law showing that generic manufacturers do receive tentative approval while the automatic stay is in effect. Although plaintiffs fall back on the refrain that this Court must accept their allegations as true, the Court need not credit unsupportable allegations. See, e.g., Schuylkill Energy Res., Inc. v. Pa. Power & Light Co., 113 F.3d 405, 417 (3d Cir. 1997) (court need not credit "unsupported conclusions and unwarranted inferences" or allegations that are belied by other factual allegations and the law). Plaintiffs' allegations are unsupportable for several reasons. First, the FDA has stated that the tentative approval process contemplates approval irrespective of whether a stay is in effect. Second, the FDA generally prioritizes ANDAs based on the timing they are submitted by generic manufacturers. Third, there are numerous examples of the FDA granting tentative approval of an ANDA while a 30-month stay is in effect. Fourth, the 2003 amendments to the Hatch-Waxman Act compel ANDA filers to pursue tentative approval and the FDA to consider and grant tentative approval to qualifying ANDAs even when a stay is in effect. Finally, plaintiffs submit a

document, as Exhibit B to their opposition brief, showing that on July 31, 2006, well after the stay had been lifted and the district court patent litigation completed, the FDA granted final approval to the ANDA of Sandoz, Inc. (the successor of Eon Labs, Inc.), which sought to market generic metoprolol succinate at the 25 mg dosage level.1 That document suggests that, in this case, at least one of the generic manufacturers did pursue tentative FDA approval during the stay.
1

Despite having final FDA approval at the 25 mg dosage level, Sandoz has still not launched its generic version. Thus, it is Sandoz's decision not to enter the market that currently prevents plaintiffs from purchasing generic metoprolol succinate. Moreover, in the same July 31, 2006 FDA letter, the FDA granted tentative approval to Sandoz at other dosage levels, but those approvals cannot become final because the first ANDA filers at those dosage levels, Andrx and KV, still have not obtained FDA approval. Andrx's and KV's continuing failure to receive FDA approval prevents Sandoz from entering those markets.

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Plaintiffs also float the notion that unknown generic manufacturers were dissuaded from developing and seeking approval of generic metoprolol succinate. Of course, these hypothetical manufacturers would also need FDA approval for their hypothetical ANDAs. This highly

speculative allegation ­ which would apply equally to any Hatch-Waxman case ­ is precluded by West Penn Power, which held that "the appellants cannot foist their version of what might have been on the court under the rubric of antitrust injury. The presence of the regulatory scheme and need for approval . . . cuts the causal chain and converts what might have been deemed antitrust injury in a free market into only a speculative exercise." 147 F.3d at 267-68. Plaintiffs also argue that there are two "facets" of their claims ­ independent of their allegations regarding the 30-month stay ­ that require denial of the motion to dismiss. Plaintiffs are mistaken. First, they contend that AstraZeneca's procurement of the relevant patents and the listing in the Orange Book provide a basis for the antitrust claim. This argument is foreclosed by Walker-Process Equipment, Inc. v. Food Machinery & Chemical Corp., 382 U.S. 172 (1965), which permits suits against patent holders only where there is an attempt to enforce the patent. Here, without the patent litigation, and the attendant 30-month stay, there is no antitrust claim, and plaintiffs do not cite any case holding otherwise. Plaintiffs' second argument is that there would be no 180-day period of exclusivity in the absence of AstraZeneca's alleged conduct. But this claim is not ripe. Currently, only one generic manufacturer has received FDA approval to market a generic version of metoprolol succinate at one dosage level, and that manufacturer is not entitled to the 180-day exclusivity period and is not yet on the market in any event. Because the 180-day exclusivity period has not been granted to any generic company, the plaintiffs could not have been damaged by the possibility that the period will exist in the future for any dosage level. 3

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In the absence of any supportable allegations that AstraZeneca's conduct actually delayed FDA tentative approval, the FDA's failure to provide tentative approval is an independent cause that fully accounts for the absence of a generic version of metoprolol succinate from the market. Because plaintiffs' allegations are contradicted by the plaintiffs' own evidence and are otherwise insufficient as a matter of law, the Complaint should be dismissed. If it is not dismissed, this action certainly should be stayed until the entry of a final decision in the patent litigation. AstraZeneca demonstrated in its opening brief that there are compelling reasons for a stay under the criteria this Court employed in In re Pharmastem Therapeutics, Inc. Patent Litigation, No. 05-md-1660 GMS (D. Del. Oct. 6, 2005). Plaintiffs do not argue that they would suffer undue prejudice from a stay and do not challenge the fact that a stay is favored where, as here, the litigation is at an early stage. Instead, they claim that

AstraZeneca has not established its chances of success on the patent litigation appeal. The merits of the case will be fully addressed on appeal. Here, as in Pharmastem, the outcome of the appeal ­ which has been fully briefed and awaits only oral argument and a decision ­ may resolve or simplify the issues in this case, and thus the action should be stayed if the motion to dismiss is denied. ARGUMENT I. PLAINTIFFS ARE UNABLE TO ESTABLISH ANTITRUST STANDING A. Plaintiffs Cannot Establish That the Alleged Conduct Delayed Tentative FDA Approval

Plaintiffs' Complaint acknowledges that a company may not begin selling a drug without FDA approval. (Compl., D.I. 13, ¶¶ 41, 55.) Plaintiffs also agree that the FDA was empowered to grant tentative FDA approval during the pendency of the 30-month stay. The question this motion 4

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to dismiss raises is: does the Complaint reasonably allege facts that could support allegations that AstraZeneca is responsible for the lack of tentative FDA approval of any generic drug application while the 30-month stay was in effect? If not, then the lack of tentative FDA approval is an independent and absolute bar on competition in the alleged relevant market which "cuts the causal chain" between AstraZeneca's alleged antitrust violations and plaintiffs' alleged injuries. See West Penn Power, 147 F.3d at 268. Plaintiffs' attempts to hold AstraZeneca responsible are without foundation, legally insufficient, and contradicted by plaintiffs' own documents. Plaintiffs point to three allegations that supposedly describe the ways in which AstraZeneca specifically delayed the FDA approval process. First, as a result of the 30-month stay, the FDA allegedly shifted its limited resources away from the pending ANDAs for metoprolol succinate. Second, also because of the stay, the generic manufacturers allegedly redirected their attention and resources away from their ANDAs. Finally, other unknown generic competitors were allegedly dissuaded from filing ANDAs. This Court should not accept as true "unsupported conclusions and unwarranted inferences," Schuylkill Energy Res., 113 F.3d at 417, and all of the plaintiffs' allegations are unsupportable.2 Moreover, where plaintiffs' antitrust standing is at issue, the Third Circuit has said that the "courts have an obligation in matters before them to view the complaint as a whole and to base rulings not upon the presence of mere words but, rather, upon the presence of a factual situation which is or is not justiciable." West Penn Power, 147 F.3d at 263.

Contrary to plaintiffs' repeated complaints, AstraZeneca is not asking this Court to accept its own facts. (See, e.g., D.I. 28 at 22.) As plaintiffs are no doubt aware, the Court must determine whether the alleged facts include unsupported conclusions or unwarranted inferences and also whether the allegations are contradicted by other allegations in the Complaint or documents on which plaintiffs rely. Where, as here, the allegations are not supported or contradicted, the Complaint is not legally sufficient and should be dismissed under Rule 12(b)(6).

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1.

The Resources of the FDA

Plaintiffs contend that AstraZeneca's prosecution of the patent litigation, and the ensuing automatic 30-month stay, caused the FDA to divert its attention and resources away from the ANDAs for generic metoprolol succinate. (D.I. 28 at 17-18.) But it is well-recognized that the Court need not accept baseless allegations, Schuylkill Energy Res., 113 F.3d at 417, or ones contradicted by information the Court can consider on a motion to dismiss, see D.I. 28 at 8 n.2. There are several reasons why this allegation cannot be credited. First, the FDA's own explanation of the tentative approval process contemplates approval irrespective of whether a stay is in effect. As the FDA has stated publicly, "If a generic drug product is ready for approval before the expiration of any patents or exclusivities accorded to the reference listed drug product, FDA issues a tentative approval letter to the applicant. The tentative approval letter details the circumstances associated with the tentative approval. FDA delays final approval of the generic drug product until all patent or exclusivity issues have been resolved." See FDA, Center for Drug Evaluation & Research, Drugs@FDA ­ Glossary of Terms,

http://www.fda.gov/cder/drugsatfda/glossary.htm. (Ex. A.) Second, a document plaintiffs cite reveals that the FDA does not discriminate between ANDAs eligible only for tentative approval and those that could received final approval. In a published report, the FDA emphasized that "[t]he only difference between a full approval and a tentative approval is that the final approval of these applications is due to existing patent or exclusivity on the innovator drug product." FDA Center for Drug Evaluation and Research, 2004 Report to the Nation, at 29 [hereinafter "2004 Report to the Nation"], available at http://www.fda.gov/cder/reports/rtn/2004/Rtn2004.pdf. (D.I. 28 at 17 n.8.) This explanation is 6

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consistent with AstraZeneca's argument and contradicts the notion that the FDA acts differently depending on whether a litigation stay is in place. See Improving Access to Generic Drugs: Hearing Before the Senate Special Comm. on Aging, 109th Congress (July 20, 2006) ("[The Office of Generic Drugs] generally maintains a `first-in, first-reviewed' policy for ANDAs. FDA

instituted this generic drug review priority to ensure the integrity of the approval process." (emphasis added)), available at http://www.hhs.gov/asl/testify/t060720.html (Ex. B). Third, consistent with the FDA's statements, and as AstraZeneca demonstrated in its opening brief (D.I. 25 at 20-21), there are numerous examples of the FDA granting tentative approval of an ANDA while a 30-month stay is in effect. See, e.g., In re Cardizem CD Antitrust Litig., 332 F.3d 896, 902 (6th Cir. 2003) ("On September 15, 1997, the FDA tentatively approved Andrx's ANDA, indicating that it would be finally approved as soon as it was eligible, either upon expiration of the thirty-month waiting period in early July 1998, or earlier if the court in the patent infringement action ruled that the `584 patent was not infringed."); Andrx Pharms., Inc. v. Biovail Corp., 276 F.3d 1368, 1372 & n.2 (Fed. Cir. 2002) ("In September 2000 Andrx had received tentative approval of its ANDA from the FDA" pending the February 25, 2001 expiration of the stay.); Elan Corp., PLC v. Andrx Pharms., Inc., 272 F. Supp. 2d 1325, 1330 (S.D. Fla. 2003) ("The FDA granted the Andrx ANDA tentative approval on March 17, 2000" while patent litigation continued.); In re Relafen Antitrust Litig., 286 F. Supp. 2d 56, 60 (D. Mass. 2003) ("On August 8, . . . the FDA issued tentative approval to Eon's . . . generic nabumetone product[], but the FDA withheld final approval until the conclusion of the thirty-month stay period."). Plaintiffs suggest that, in these cases, "other, unknown factors must have influenced [the] FDA in those particular instances" (D.I. 28 at 19 n.11), but this explanation is hollow. If the FDA is distracted 7

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or otherwise delays the FDA approval process while the stay is in effect, as plaintiffs suggest, then there would be no reason for the FDA to have tentatively approved the ANDAs in these (and other) cases. See 2004 Report to the Nation, at 29 (reporting that, in 2004, FDA gave tentative approval to 95 ANDAs). Fourth, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 compels the FDA to consider and grant tentative approval to qualifying ANDAs even when a stay is in effect. Among other provisions, the 2003 Act amended the Hatch-Waxman Act to provide that a first ANDA filer will forfeit the 180-day exclusivity period if the ANDA filer fails to receive tentative approval within 30 months of filing its ANDA. See 21 U.S.C. § 355(j)(5)(B)(iv). This is a substantial penalty for a generic company, and the possibility of such penalty compels the FDA to give consideration to ANDAs during this period. In this case, Sandoz's ANDA filing was subject to the 2003 amendments, and the FDA recognizes that Sandoz is subject to the forfeiture provision. According to the FDA, although Sandoz was the first ANDA filer at the 25 mg dosage level, "Sandoz failed to obtain tentative approval of this ANDA within 30 months after the date on which the ANDA was filed." (D.I. 28, Ex. B, at 3.) Therefore, as explained by the FDA in its letter to Sandoz, if another generic receives FDA approval at the 25 mg dosage level, Sandoz may not enjoy the 180-day period of exclusivity (assuming Sandoz ever actually launches a generic version of metoprolol succinate). (Id.) Because the law penalizes ANDA filers who do not obtain tentative approval during the 30 months, it is illogical to assume, as plaintiffs do, that the FDA will not give appropriate consideration to ANDAs while a stay is in effect.

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Finally, the FDA approval letter to Sandoz further suggests that AstraZeneca did not delay FDA approval.3 That letter reveals that Sandoz made four amendments to its original ANDA and sent the FDA five letters prior to final FDA approval. (D.I. 28, Ex. B, at 1.) One amendment and four letters were submitted well before the stay was lifted, which suggests that both the FDA and Sandoz were devoting resources and attention to the approval process while the stay was in effect. 2. The Generic Manufacturers' Resources

Plaintiffs next allege that the generic manufacturers who filed ANDAs shifted resources away from the FDA approval process as a result of the 30-month stay. (D.I. 28 at 16-17.) However, as described above, there are several reasons that this allegation is unsupportable. First, ANDA filers actually do pursue ­ and receive ­ tentative approval while a stay is in effect. See supra pp. 7-8. Second, generic filers such as Sandoz that are subject to the 2003 amendments to Hatch-Waxman must receive tentative approval to secure a 180-day period of generic exclusivity. See supra p. 8. Third, the FDA approval letter sent to Sandoz suggests that, in this case, Sandoz did pursue FDA approval during the 30-month stay period. See supra p. 9. AstraZeneca's opening brief contains additional reasons this allegation should not be credited. (D.I. 25 at 19-21). Plaintiffs point to two cases which they argue adopted their view of the implications of patent litigation on generic manufacturer incentives. (D.I. 28 at 16-17 (citing Bristol-Myers Squibb v. Ben Venue Labs., 90 F. Supp. 2d 540, 545 (D.N.J. 2000); In re Wellbutrin SR/Zyban Antitrust Litig., 281 F. Supp. 2d 751, 757 & n.8 (E.D. Pa. 2003)).) In Wellbutrin, the court did not refer to or discuss the incentives of generic manufacturers to obtain tentative approval during the

AstraZeneca explained in its opening brief that FDA approval subsequent to lifting of the stay has no impact on the analysis because post-stay approval means that something other than the alleged conduct caused the lack of approval in the interim. (D.I. 25 at 9.)

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30-month stay, and is therefore inapposite.

In Ben Venue, the court credited the generic

company's representation at oral argument that "generic manufacturers have had little practical incentive to pursue even conditional [FDA] approval." 90 F. Supp. 2d at 545. As AstraZeneca explained in its opening brief, there are several reasons why generic manufacturers have every incentive to pursue tentative FDA approval during the litigation. (D.I. 25 at 19-21.)4 In addition, Ben Venue was decided before the enactment of the 2003 amendments to the Hatch-Waxman Act, which, among other things, provide for the forfeiture of the 180-day exclusivity period in the event the ANDA filer does not receive tentative approval during the 30-month stay. That is the

provision the FDA refers to in the Sandoz approval letter and explains why Sandoz was highly motivated to obtain tentative FDA approval. See supra p. 8. Because Ben Venue pre-dated this change to the law, the reference to the lack of incentives for generic manufacturers is, at best, outdated. And because the Sandoz letter contradicts plaintiffs' allegations that the generic

companies do not pursue tentative FDA approval while a stay is in effect, those allegations should not be credited. 3. Hypothetical Competitors Should Not Be Considered

In a footnote, plaintiffs also allege that certain unknown generic manufacturers might have been dissuaded from developing and seeking approval of generic metoprolol succinate. (D.I. 28 at

Plaintiffs take issue with AstraZeneca's argument that generic ANDA applicants would prefer to obtain tentative FDA approval expeditiously so they will not potentially lose any portion of the 180-day period of generic exclusivity. (D.I. 28 at 19.) AstraZeneca's original argument is correct. Each of the three ANDA applicants in this case are the first ANDA filers at different dosage levels, so all are in line to obtain exclusivity if FDA approval is secured. That does not mean that the 180 days would be free from competition. For Sandoz, which is subject to the 2003 amendments, the exclusivity period may be forfeited because it did not receive tentative approval during the 30month stay period. See supra p. 8. That is a tremendous incentive to obtain tentative approval as expeditiously as possible. If the exclusivity period is forfeited, Sandoz will have "exclusivity" only to the extent no other generics are approved at that dosage level. Thus, Sandoz was further incentivized to obtain approval as soon as possible, to enter the market before other potential competitors could, even though it was the first filer.

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21 n.12.) This allegation is far too speculative to support antitrust standing. West Penn Power, 147 F.3d at 267-68; Barton & Pittinos, Inc. v. SmithKline Beecham Corp., 118 F.3d 178, 181 (3d Cir. 1997); Daniel v. Am. Bd. of Emergency Med., 428 F.3d 408 (2d Cir. 2005); Vinci v. Waste Mgmt., Inc., 80 F.3d 1372, 1375 (9th Cir. 1996). Of course, these hypothetical manufacturers would need FDA approval for their hypothetical ANDAs, and because there is no allegation that these "filers" ever received FDA approval (nor could there be), plaintiffs' allegation is unsupportable. This Court is bound to follow West Penn Power, a case in which the Third Circuit held that if the court can "determine from the face of the complaint" that the potential competitor did not have regulatory approval to enter the market, then the claimed antitrust violation is not actionable. 147 F.3d at 266. West Penn Power also held that "the appellants cannot foist their version of what might have been on the court under the rubric of antitrust injury. The presence of the regulatory scheme and need for approval . . . cuts the causal chain and converts what might have been deemed antitrust injury in a free market into only a speculative exercise." 147 F.3d at 267-68. B. Plaintiffs Misperceive the Causation Requirement

Plaintiffs also argue that, separate from the specific allegations of delay in the FDA approval process, AstraZeneca caused the alleged injuries because AstraZeneca itself triggered the regulatory process (D.I. 28 at 13-14) and because AstraZeneca's conduct is at least a material cause of the alleged injuries. Neither argument withstands scrutiny. First, the relevant part of the regulatory process at issue is FDA approval. Plaintiffs do not argue ­ nor could they ­ that AstraZeneca's conduct triggered the need for FDA approval. Under 21 U.S.C. § 355(a), "[n]o person shall introduce or deliver for introduction into interstate 11

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commerce any new drug, unless an approval of an application filed pursuant to subsection (b) or (j) is effective with respect to such drug." Subsection (b), in turn, concerns New Drug Under either section, FDA approval is

Applications, and subsection (j) concerns ANDAs. required before a drug may be marketed.

Second, plaintiffs argue that, even if FDA approval were the cause of their injuries, AstraZeneca could still be liable because its alleged conduct is a "material cause" of plaintiffs' injuries. (D.I. 28 at 22-23.) The alleged conduct cannot be a material cause of an injury, however, if an independent cause fully accounts for the claimed injury. Here, the lack of tentative FDA approval while the stay was in place is such an independent cause. See, e.g., West Penn Power, 147 F.3d at 256. According to the leading treatise, "[A] plaintiff cannot be injured in fact by private conduct excluding it from the market when a statute prevents the plaintiff from entering that market in any event." 2 Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law ¶ 338b, at 320 (2d ed. 2000); see also Axis v. Micafil, 870 F.2d 1105 (6th Cir. 1989) (no standing for plaintiff unable to obtain government-required license to enter market from which defendant allegedly excluded him). C. The Case Law Favors Dismissal

Plaintiffs place significant reliance on two district court cases from other courts in the Third Circuit, Ben Venue and In re Wellbutrin. As discussed earlier, supra pp. 9-10, those cases are inapposite. Wellbutrin does not even discuss tentative FDA approval and Ben Venue predates the 2003 amendments to the Hatch-Waxman Act, which provide significant incentives for generic manufacturers to obtain, and potential penalties for the failure to obtain, tentative FDA approval. In addition, because the Sandoz approval letter demonstrates that a generic manufacturer in this 12

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case actively sought tentative FDA approval, the Ben Venue court's acceptance of a general allegation that generics are disincentivized from seeking such approval is irrelevant here. Plaintiffs attempt to distinguish West Penn Power, where the Third Circuit held that the plaintiff could not show antitrust injury because state regulations barred one of the defendant utility companies from competing in certain areas at that time without regulatory approval. Id. at 263. The lack of approval was an intervening cause, the court reasoned, which "cuts the causal chain" between the alleged injury and the alleged antitrust violation. Id. Plaintiffs do not and cannot successfully attack this core holding of the Third Circuit. Instead, they try to distinguish the case and limit it to its facts. For example, plaintiffs point out that the West Penn Power court noted that there were no allegations in the complaint which would permit the court to speculate as to the likelihood of regulatory approval. (D.I. 28 at 26 n.15 (citing West Penn Power, 147 F.3d at 267-68).) Plaintiffs point to allegations in their Complaint which claim there would have been earlier regulatory approval here absent the alleged conduct. (Id.) Plaintiffs' argument does not work, however, because it is clear there would not have been earlier approval absent the challenged conduct, because there was no tentative FDA approval while the stay was in effect. The lack of tentative FDA approval during the stay is conclusive evidence that the alleged conduct had no bearing on the timing of the approval. Plaintiffs also attempt to limit West Penn Power's holding to heavily regulated electric utility monopolies. (D.I. 28 at 24-25.) The selective passages plaintiffs include distort the Third Circuit's holding. Rather than limiting the case to utilities, the Court made clear that if the utilities were deregulated as then planned, the antitrust standing analysis would be different. The

difference between the two scenarios is that deregulated utilities would no longer need 13

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government approval to enter a market. As the court wrote, "Had the ability of the utilities to serve various customers in various regions not been subject to approval of the [regulatory commission], our standing analysis would be radically different." 147 F.3d at 269. Thus, the court did not limit its holding to utilities, but to industries in which government approval is required for market entry. The Third Circuit has subsequently read West Penn Power to stand for the broader proposition that "because an intervening regulatory scheme precluded the companies from competing, . . . the [alleged conduct] was not the cause of the injury." In re Warfarin Sodium Antitrust Litig., 214 F.3d 395, 401 (3d Cir. 2000). Similarly, West Penn Power has been cited numerous times as support for the proposition that "[a]ntitrust injury . . . must be caused by something other than the regulatory action limiting entry to the market." In re Tamoxifen Citrate Antitrust Litig., 277 F. Supp. 2d 121 (E.D.N.Y. 2003), aff'd, 429 F.3d 370 (2d Cir. 2005); accord Bristol-Myers Squibb Co. v. Copley Pharm., Inc., 144 F. Supp. 2d 21, 23-25 (D. Mass. 2000); 2 Areeda & Hovenkamp, Antitrust Law ¶ 338b, at 320. West Penn Power cannot be distinguished or limited in the ways plaintiffs suggest. It controls this case and requires dismissal of the plaintiffs' Complaint. D. Plaintiffs' Policy Argument Is Misplaced

In last-ditch effort to save their Complaint, plaintiffs argue that a decision in favor of AstraZeneca would make antitrust standing a matter of chance. (D.I. 28 at 23-24.) In reality, AstraZeneca is simply asking the Court to dismiss a complaint where the allegations and documents on which plaintiffs rely demonstrate that the lack of tentative FDA approval during the pendency of the stay is a reason independent of any alleged conduct by AstraZeneca for the 14

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plaintiffs' alleged injuries. Such a decision is consistent with fundamental principles of antitrust law. Indeed, adopting plaintiffs' generic arguments about what could happen differently in the FDA approval process would eviscerate the causation requirement in every Hatch-Waxman Act case. Plaintiffs cite Ben Venue Labs in support (D.I. 28 at 23), but the passage from that case suggests that the Court was concerned about the interplay between FDA approval and the antitrust litigation itself. The court was concerned that if "the patentee beat the applicant to the punch by filing a motion to dismiss before FDA approval, the generic maker would be denied antitrust standing." 90 F. Supp. 2d at 545. Here, there is no similar concern because the litigation stay was lifted well in advance of any FDA approval, and AstraZeneca's only argument is that the generic manufacturers' failure to obtain tentative approval during that stay compels the conclusion that plaintiffs lack antitrust standing. II. PLAINTIFFS' OTHER PURPORTED FEDERAL ANTITRUST CLAIMS ARE WITHOUT BASIS Plaintiffs argue that there are two "facets" of their claims ­ independent of their allegations regarding the 30-month stay ­ that require denial of the motion to dismiss. First, they contend that AstraZeneca's procurement of the relevant patents and the listing in the Orange Book provide a basis for an antitrust claim. Second, plaintiffs claim that no generic manufacturer would be entitled to an 180-day period of market exclusivity in the absence of AstraZeneca's alleged conduct. Neither argument states an antitrust claim. A. There Is No Antitrust Claim in a Patent Case Absent Enforcement

Without citing a single case, plaintiffs assert an antitrust claim based solely on AstraZeneca's alleged pre-enforcement conduct ­ its procurement of the relevant patents and the 15

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listing in the Orange Book. (D.I. 28 at 31-32.) But the law is well established that there is no antitrust liability for pre-enforcement conduct. The Supreme Court has held that the fraudulent acquisition of a patent followed by a suit to enforce it can, in certain circumstances, provide the basis for a claim under § 2 of the Sherman Act. Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172, 174 (1965). As the Federal Circuit has said, "Mere procurement of the patent, whatever the conduct of the Applicant in the procurement, cannot without more affect the welfare of the consumer and cannot itself violate the anti-trust laws." FMC Corp. v. Manitowoc Corp., 835 F.2d 1411, 1418 n.16 (Fed. Cir. 1987); see also LePage's, Inc. v. 3M, 324 F.3d 141, 152-53 (3d Cir. 2003) (en banc) ("Numerous cases hold that the enforcement of the legal monopoly provided by a patent procured through fraud may violate § 2."). Moreover, while threatened enforcement is likely sufficient to state a claim under Walker Process, see Unitherm Food Sys. v. Swift-Eckrich, Inc., 375 F.3d 1341, 1357-58 (Fed. Cir. 2004), plaintiffs have not alleged any threatened enforcement by AstraZeneca prior to the time the patent litigation was filed. Therefore, plaintiffs have no viable antitrust claim under this theory because it is based on pre-enforcement conduct. B. No Generic Is Currently Entitled to an 180-Day Exclusivity Period

Plaintiffs' second argument is that they "may still recover for overcharges they must pay for the 180-day period during which, due to Astra's alleged misconduct, all but one generic competitor will be barred from the market." (D.I. 28 at 33.) The fundamental problem with this argument is that there is currently no 180-day period of exclusivity, and there may never be. The 180-day exclusivity period is granted to the first ANDA filer at each dosage level once it receives FDA approval. Here, the first ANDA filers at the 50 mg, 100 mg, and 200 mg dosage levels have 16

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not received FDA approval, and thus there is no 180-day exclusivity period. Sandoz received FDA approval at the 25 mg dosage level after the litigation stay was lifted, but Sandoz is not enjoying the statutory 180-day period of marketing exclusivity for three reasons. First, Sandoz has not begun selling its product. Second, no other ANDA has been approved at the 25 mg dosage level, so once Sandoz begins marketing its product, it will have exclusivity not because of the statutory 180-day period, but because no other generic manufacturer has FDA approval to enter the market. Finally, even if the 25 mg ANDAs are approved in the future, Sandoz has likely forfeited the 180-day period because, as described in the Sandoz approval letter (D.I. 28, Ex. B, at 3), it failed to obtain FDA approval during the 30-month period. Under 21 U.S.C.

§ 355(j)(5)(B)(iv), this failure results in a forfeiture of the 180-day period. Therefore, because there is no ­ and may never be ­ a 180-day period of marketing exclusivity, plaintiffs do not state a claim under this theory. III. IF THERE IS JURISDICTION FOR THE STATE LAW CLAIMS, THOSE CLAIMS SHOULD BE DISMISSED According to the Complaint, "This Court has supplemental jurisdiction over the state law claims pursuant to 28 U.S.C. § 1367(a)." (D.I. 17 ¶ 14.) In its opening brief, AstraZeneca demonstrated that the Court should decline to exercise supplemental jurisdiction over the state law claims if the federal claim is dismissed. (D.I. 25 at 23-24.) In response, plaintiffs abandon § 1367(a), and now rely only on the Class Action Fairness Act of 2005 ("CAFA"). However, even assuming jurisdiction is proper under CAFA, the state law claims should be dismissed for the same reasons the federal antitrust claim must be dismissed. AstraZeneca cannot

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be liable under state law for monopolization (Count II),5 unfair and deceptive trade practices (Count III),6 or unjust enrichment (Count IV),7 because its alleged conduct is not the cause of plaintiffs' alleged injuries.

The state antitrust laws cited by plaintiffs are to be construed to reach the same conduct covered by the federal antitrust laws. Wedgewood Inv. Corp. v. Int'l Harvestor Co., 613 P.2d 620, 623 (Ariz. Ct. App. 1979); Partee v. San Diego Chargers Football Co., 34 Cal.3d 378, 382 (1983); D.C. Code § 28-4515; St. Petersburg Yacht Charters, Inc. v. Morgan Yacht, Inc., 457 So.2d 1028, 1032 (Fla. 1984); State v. Gannett Pac. Corp., 99 F. Supp. 2d 1241, 1248 (D. Haw. 1999); Double D Spotting Serv. v. Supervalu, Inc., 136 F.3d 554, 561 (8th Cir. 1998); Orr v. Beamon, 77 F. Supp. 2d 1208, 1211-12 (D. Kansas 1999), aff'd, No. 00-3135, 2001 WL 135439 (10th Cir. Feb. 16, 2001); Tri-State Rubbish, Inc. v. Waste Mgmt. Inc., 998 F.2d 1073, 1081 (1st Cir. 1993); Commonwealth v. Mass. CRINC, 392 Mass. 79, 88 (1984); Michigan Ass'n of Psychotherapy Clinics v. Blue Cross & Blue Shield of Michigan , 118 Mich. App. 505, 513 (Mich. Ct. App. 1982); State v. Alpine Air Prods., Inc., 490 N.W.2d 888, 894 (Minn. Ct. App. 1992), aff'd, 500 N.W.2d 788 (Minn. 1993); Neb. Rev. Stat. § 59-829; Boulware v. Nevada, 960 F.2d 793, 800 (9th Cir. 1992); State v. Ray Bell Oil Co., 101 N.M. 368, 370 (N.M. Ct. App. 1984); Empire Volkswagen, Inc. v. World-Wide Volkswagen Corp., 814 F.2d 90, 98 n.4 (2d Cir. 1987); DKH Corp. v. Rankin-Patterson Oil Co., 131 N.C. App. 126, 129 (N.C. Ct. App. 1998); Op. N.D. Att'y Gen., No. 81-35, 1981 WL 156902, at *1 (Apr. 2, 1981) (Ex. C); Byre v. City of Chamberlain, 362 N.W.2d 69, 74 (S.D. 1985); Rockholt Furniture, Inc. v. Kincaid Furniture Co., No. 1:96CV00588, 1998 WL 1661384, at *7 (E.D. Tenn. July 6, 1998) (Ex. D), aff'd, 188 F.3d (6th Cir. 1999); Elkins v. Microsoft Corp., 174 Vt. 328, 336 (2002); State ex rel. Palumbo v. Graley's Body Shop, Inc., 425 S.E.2d 177, 183 (W. Va. 1992); City of Madison v. Hyland, Hall & Co., 243 N.W.2d 422, 428 (Wis. 1976). Plaintiffs allege that AstraZeneca's conduct caused their injuries under various state unfair competition laws. D.I. 17 ¶¶ 164-165. These claims must be dismissed for the same reasons the plaintiffs have failed to state a claim under federal antitrust laws. See In re K-Dur Antitrust Litig., 338 F. Supp. 2d 517, 543 (D.N.J. 2004) (using the standards of federal antitrust standing to evaluate whether plaintiffs state a claim under state consumer protection statutes). Because AstraZeneca's alleged conduct is not the cause of plaintiffs' injuries, there can be no "unjust" enrichment. There are four additional reasons such a claim cannot succeed. First, because the injunctive relief provisions of the Clayton Act authorize only "forward-looking" remedies, 15 U.S.C. § 26, the grant of retrospective relief such as disgorgement and restitution would contravene the explicit language of the statute, see FTC v. Mylan Labs, Inc., 62 F. Supp. 2d 25, 41 (D.D.C. 1999); cf. Meghrig v. KFC Western, Inc., 516 U.S. 479, 488 (1996) (statute permitting injunctive relief does not authorize claims for restitution). Second, under Illinois Brick and its progeny, claims for disgorgement and restitution fail because indirect purchasers such as plaintiffs here lack standing to bring a federal antitrust claim and principles of disgorgement and restitution cannot create indirect purchaser standing in a manner that the antitrust laws forbid. See Illinois Brick Co. v. Illinois, 431 U.S. 720, 730-746 (1977); Mylan, 62 F. Supp. 2d at 41-42. Third, these claims cannot be brought under federal common law because federal common law cannot nullify the Clayton Act's explicit foreclosure of claims for disgorgement and restitution. See City of Milwaukee v. Illinois, 451 U.S. 304, 319 (1981) (no federal common law remedy where federal statutes already address and forbid the purported federal law remedy). Finally, plaintiffs make no reference to state law, much less to the law of any particular state. In the absence of such specificity, it is impossible to determine whether Count IV meets the requirements in any state for an unjust enrichment claim. See In re Terazosin Hydrochloride Antitrust Litig., 160 F. Supp. 2d 1365, 1380 (S.D. Fla. 2001); Washington v. Niagara Mohawk Power Corp., 103 F. Supp. 2d 517, 524 (N.D.N.Y. 2000).
7 6

5

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IV.

IF THE MOTION TO DISMISS IS DENIED, THE COURT SHOULD STAY THIS ACTION AstraZeneca has also asked this Court to stay the action if it is not dismissed. As

AstraZeneca argued in its opening brief, this litigation will be costly and burdensome, which plaintiffs do not, and cannot, dispute. (D.I. 25 at 24-30.) AstraZeneca also demonstrated that a stay would be an appropriate exercise of this Court's discretion under the three-factor test on which this Court relied in In re Pharmastem Therapeutics, Inc. Patent Litigation, No. 05-md-1660 GMS (D. Del. Oct. 6, 2005). (D.I. 25 Ex. A.) That test looks to "`(1) whether a stay would unduly prejudice or present a clear tactical disadvantage to a the non-moving party; (2) whether a stay will simplify the issues in question and trial of the case; and (3) whether discovery is complete and whether a trial date has been set.'" Id. at 4 (quoting Xerox Corp. v. 3 Comm Corp., 69 F. Supp. 2d 404, 406 (W.D.N.Y. 1999)). Plaintiffs summarily contend that AstraZeneca has "made no showing concerning its chance of success" on appeal. (D.I. 28 at 39.) In essence, the plaintiffs want the parties to argue the merits of the case in a motion for a stay. But this is exactly backwards. The very purpose of a stay is to postpone the merits argument until the appropriate time. As in Pharmastem, the question is whether the outcome of the pending appeal before the Federal Circuit has the potential to narrow or moot the issues in this case. There is no question that it does, and plaintiffs do not seriously contend otherwise.

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Therefore, if the Court denies AstraZeneca's motion to dismiss, it should stay the action pending entry of a final decision in the patent litigation.8 The appeal of the patent case has been fully briefed and only awaits oral argument and a decision. CONCLUSION For the reasons set forth above and in its opening brief, AstraZeneca respectfully requests that this Court enter an order dismissing plaintiffs' Complaint or, if the motion to dismiss is denied, an order staying all proceedings in this action, including any motions, pleadings, and discovery, pending the entry of a final decision in the patent litigation. MORRIS, NICHOLS, ARSHT & TUNNELL LLP /s/ Karen Jacobs Louden ______________________________________ Jack B. Blumenfeld (#1014) Karen Jacobs Louden (#2881) [email protected] 1201 N. Market Street P.O. Box 1347 Wilmington, Delaware 19899 (302) 658-9200 Attorneys for defendants

OF COUNSEL: Arthur F. Golden Ronan P. Harty Joshua D. Liston DAVIS POLK & WARDWELL 450 Lexington Avenue New York, NY 10017 (212) 450-4000 October 10, 2006
540859

Plaintiffs ask the Court to permit them to obtain the discovery produced in the underlying patent case if the stay motion is granted. (D.I. 28 at 37.) Because the outcome of the case before the Federal Circuit may dispose of all the issues in this case, no discovery should be permitted if a stay is ordered.

8

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CERTIFICATE OF SERVICE I, the undersigned, hereby certify that on October 10, 2006 I electronically filed the foregoing with the Clerk of the Court using CM/ECF which will send notification of such filing to Gary F. Taynor and A. Zachary Naylor. I further certify that on October 10, 2006 I caused that copies of the foregoing be served on the following counsel in the manner indicated: By Hand Gary F. Traynor Prickett Jones P.O. Box 1328 Wilmington, DE 19899 By Federal Express Richard S. Schiffrin Joseph H. Meltzer Schiffrin & Barroway, LLP 280 King of Prussia Road Radnor, PA 19087 Jeffrey S. Istavan Fine, Kaplan and Black, R.P.C. 1835 Market Street, 28th Flr. Philadelphia, PA 19103 Michael M. Buchman J. Douglas Richards Milberg Weiss Bershad & Schulman, LLP One Pennsylvania Plaza New York, NY 10119

A. Zachary Naylor Chimicles & Tikellis, LLP One Rodney Square P.O. Box 1035 Wilmington, DE 19899

/s/ Karen Jacobs Louden Karen Jacobs Louden (#2881) [email protected]

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EXHIBIT A

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F,~ dr1~gA' ~

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·

Drugs@FDA Glossary of Terms ABCDEFGHIJKLMNOPQRSTUVWXYZ Abbreviated New Drug Application (ANDA)
An Abbreviated New Drug Application (ANDA) contains data that, when submitted to FDA's Center for Drug Evaluation and Research, Office of Generic Drugs, provides for the review and ultimate approval of a generic drug product. Generic drug applications are called "abbreviated" because they are generally not required to include preclinical (animal) and clinical (human) data to establish safety and effectiveness. Instead, a generic applicant must scientifically demonstrate that its product is bioequivalent (i.e., performs in the same manner as the innovator drug). Once approved, an applicant may manufacture and market the generic drug product to provide a safe, effective, low cost alternative to the American public. Abbreviated New Drug Application (ANDA) Number This six digit number is assigned by FDA staff to each application for approval to market a generic drug in the United States. Active Ingredient An active ingredient is any component that provides pharmacological activity or other direct effect in the diagnosis, cure, mitigation, treatment, or prevention of disease, or to affect the structure or any function of the body of man or animals. Approval History The approval history is a chronological list of all FDA actions involving one drug product having a particular FDA Application number (NDA). There are over 50 kinds of approval actions including changes in the labeling, a new route of administration, and a new patient population for a drug product.

Application
See New Drug Application (NDA), Abbreviated New Drug Application ANDA), or Biologic License Application (BLA) Approval Letter An official communication from FDA to a new drug application (NDA) sponsor that allows the commercial marketing of the product. Application Number See FDA Application Number Biologic License Application (BLA) Biological products are approved for marketing under the provisions of the Public Health Service (PHS) Act. The Act requires a firm who manufactures a biologic for sale in interstate commerce to hold a license for the product. A biologics license application is a submission that contains specific information on the manufacturing processes, chemistry, pharmacology, clinical pharmacology and the medical affects of the biologic product. If the information provided meets FDA requirements, the application is approved and a license is issued allowing the firm to market the product.

Biologic Product

A biologic product is any virus, serum, toxin, antitoxin, vaccine, blood, blood component or derivative, allergenic product, or analogous product applicable to the prevention, treatment, or cure of diseases or injuries. Biologic products are a subset of "drug products" distinguished by their manufacturing processes (biological process vs. chemical process). In general, the term "drugs" includes biologic products. Brand Name Drug A brand name drug is a drug marketed under a proprietary, trademark-protected name. Company The company (also called applicant or sponsor) submits an application to FDA for approval to market a drug product in the United States. Discontinued Drug A discontinued drug is a drug product that has been removed from the market in the United States for reasons other than safety or effectiveness. Dosage Form A dosage form is the physical form in which a drug is produced and dispensed, such as a tablet, a capsule, or an injectable. Drug A drug is defined as: · A substance recognized by an official pharmacopoeia or formulary. · A substance intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease. · A substance (other than food) intended to affect the structure or any function of the body. · A substance intended for use as a component of of a medicine but not a device or a component, part or accessory of a device. · Biologic products are included within this definition and are generally covered by the same laws and regulations, but differences exist regarding their manufacturing processes (chemical process vs. biological process.) Drug Product The finished dosage form that contains a drug substance, generally, but not necessarily in association with other active or inactive ingredients. FDA Action Date The action date tells when any FDA regulatory action, such as an original or supplemental approval took place. FDA Application Number This number, also known as the NDA (New Drug Application) number, is assigned by FDA staff to each application for approval to market a new drug in the United States. One drug can have more than one application number if it has different dosage forms or routes of administration Generic Drug A generic drug is the same as a brand name drug in dosage, safety, strength, how it is taken, quality, performance, and intended use. Before approving a generic drug product, FDA requires many rigorous tests and procedures to assure that the generic drug can be substituted for the brand name drug. The FDA bases evaluations of substitutability, or "therapeutic equivalence," of generic drugs on scientific evaluations. By law, a generic drug

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product must contain the identical amounts of the same active ingredient(s) as the brand name product. Drug products evaluated as "therapeutically equivalent" can be expected to have equal effect and no difference when substituted for the brand name product. Label The FDA approved label is the official description of a drug product which includes indication (what the drug is used for); who should take it; adverse events (side effects); instructions for uses in pregnancy, children, and other populations; and safety information for the patient. Labels are often found inside drug product packaging. Marketing Status Marketing status indicates how a drug product is sold in the United States. Drug products in Drugs©FDA are identified as: · Prescription · Over-the-counter · Discontinued Drug products that have been removed from the market for reasons other than safety or effectiveness · None Drug products that have been tentatively approved
-

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Medication Guide A medication guide contains information for patients' understanding of how to safely use a drug product. NDA (see New Drug Application) New Drug Application (NDA) When the sponsor of a new drug believes that enough evidence on the drug's safety and effectiveness has been obtained to meet FDA's requirements for marketing approval, the sponsor submits to FDA a new drug application (NDA). The application must contain data from specific technical viewpoints for review, including chemistry, pharmacology, medical, biopharmaceutics, and statistics. If the NDA is approved, the product may be marketed in the United States. For internal tracking purposes, all NDA's are assigned an NDA number. New Drug Application (NDA) Number This six digit number is assigned by FDA staff to each application for approval to market a new drug in the United States. A drug can have more than one application number if it has different dosage forms or routes of administration. In Drugs~FDA, ou can find the NDA y number under the column named "FDA Application." Over-the-Counter Drugs (OTC) FDA defines OTC drugs as safe and effective for use by the general public without a doctors prescription. Patient Package Insert (PPI) A patient package insert contains information for patients' understanding of how to safely use a drug product. Pharmaceutical Equivalents FDA considers drug products to be pharmaceutical equivalents if they meet these three criteria: · they contain the same active ingredient(s), · they are of the same dosage form and route of administration · they are identical in strength or concentration Pharmaceutically equivalent drug products may differ in characteristics such as

· · · · ·

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shape release mechanism labeling (to some extent) scoring excipients (including colors, flavors, preservatives)

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Prescription Drug Product A prescription drug product requires a doctor's authorization to purchase. Product Number A product number is assigned to each drug product associated with an NDA (New Drug Application). If a drug product is available in multiple strengths, there are multiple product numbers. Reference Listed Drug (see RLD) Review A review is the basis of FDA's decision to approve an application. It is a comprehensive analysis of clinical trial data and other information prepared by FDA drug application review