BAYER SCHERING PHARMA AG v. Sandoz, Inc.
813 F. Supp. 2d 569
S.D.N.Y.2011Background
- Sandoz asserted four Sherman Act claims (monopolization, conspiracy to monopolize, conspiracy in restraint of trade, attempted monopolization) regarding Yasmin and Yaz.
- Court previously dismissed Sandoz’s original counterclaims and granted leave to amend.
- Amended counterclaims define the relevant product market as oral contraceptives commonly prescribed to treat PMDD and associated symptoms, allegedly including Yasmin and Yaz and other products with the drospirenone/ethinylestradiol combination.
- Bayer moves to dismiss the amended counterclaims under Rule 12(b)(6) for failure to plead a plausible market and claims.
- Court analyzes whether the proposed product market is plausible and whether Sandoz pleads facts showing dangerous probability of monopoly power for attempted monopolization.
- Court ultimately grants Bayer’s motion and dismisses the amended counterclaims with prejudice without leave to replead.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is Sandoz’s amended product market plausible? | Sandoz defines a narrow PMDD-related market including Yasmin/Yaz and substitutes. | Sandoz alleges PMDD-associated substitutes exist only in limited forms. | No; the market is implausible and lacks rational basis. |
| Do Sandoz’s claims for monopolization and conspiracy to monopolize survive? | Yang claims Bayer monopolizes U.S. oral contraceptives. | Plaintiff fails to plead plausible market and monopoly power. | Dismissed for failure to plead a plausible market and monopoly power. |
| Does Sandoz plead a dangerous probability of monopoly for attempted monopolization? | Bayer controls a large share and would likely monopolize. | Allegations are speculative and fail to show dangerous probability. | Dismissed; no plausible dangerous probability shown. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (pleading standards; plausibility required)
- Arista Records LLC v. Lime Group LLC, 532 F. Supp. 2d 556 (S.D.N.Y. 2007) (relevant market must be plausible and defined by interchangeability)
- Geneva Pharma. Tech. Corp. v. Barr Laboratories, Inc., 386 F.3d 485 (2d Cir. 2004) (definition of relevant market in pharma context)
- Intellective, Inc. v. Massachusetts Mut. Life Ins. Co., 190 F. Supp. 2d 600 (S.D.N.Y. 2002) (interchangeability and cross-elasticity in market definition)
- PepsiCo, Inc. v. Coca-Cola Co., 315 F.3d 101 (2d Cir. 2002) (relevance of interchangeability and substitutes in market definition)
- AD/SAT, a Div. of Skylight, Inc. v. Associated Press, 181 F.3d 216 (2d Cir. 1999) (market definition and competitive pressures)
- United States v. Grinnell Corp., 384 U.S. 563 (U.S. 1966) (monopoly power elements)
- Syncsort Inc. v. Sequential Software, Inc., 50 F.Supp.2d 318 (D.N.J. 1999) (market power and monopoly power discussion in pleadings)
- Todd v. Exxon Corp., 275 F.3d 191 (2d Cir. 2001) (context for market definition and interchangeability)