In re Loestrin 24 Fe Antitrust Litigation
45 F. Supp. 3d 180
D.R.I.2014Background
- MDL consolidation transferred to this Court following Actavis decision on reverse payments in patent settlements.
- Plaintiffs allege Warner Chilcott paid Watson and Lupin to delay Loestrin 24 generic entry, sustaining brand monopoly and higher consumer prices.
- Defendants are Warner Chilcott, Watson (Actavis) and Lupin; Loestrin 24 is FDA-approved since 2006 with patents including the ’394 patent.
- Watson and Lupin pursued Paragraph IV ANDAs; Hatch-Waxman 30-month stay triggered by patent litigation led to Exclusive delay arrangements (EPA) delaying generic entry.
- Earlier patent dispute over the ’394 patent involved EVMS studies and the patent expiration in July 2014; EPA agreements tied to delaying entry to 2014.
- Court agrees Actavis applies only to cash reverse payments; non-cash settlements are not governed by Rule of Reason under current pleading; grants motions to dismiss.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Actavis extends to non-cash settlements | Plaintiffs contend Actavis governs all reverse payments, cash or not. | Defendants argue Actavis targets cash settlements; non-cash arrangements fall outside its scope. | Actavis applies to cash settlements; non-cash not covered under rule of reason. |
| Whether plaintiffs pled a reverse payment under Actavis | Plaintiffs allege non-cash consideration with substantial value. | Non-cash value cannot be quantified as cash; lacks explicit reverse payment. | Plaintiffs fail to plead a cash reverse payment, so no antitrust claim under Actavis. |
| Whether plaintiff states Sherman Act claim despite Actavis limitation | Twombly pleading shows explicit restraint and antitrust injury. | Actavis requires cash payment to trigger scrutiny; non-cash not actionable. | Due to cash-payment requirement under Actavis, claims fail. |
Key Cases Cited
- F.T.C. v. Actavis, Inc., 133 S. Ct. 2223 (U.S. 2013) (established rule-of-reason framework for reverse-payment settlements; cash-focused)
- In re Nexium (Esomeprazole) Antitrust Litig., 968 F. Supp. 2d 367 (D. Mass. 2013) (addressed Actavis scope and non-cash settlements)
- Lamictal Direct Purchaser Antitrust Litig., 18 F. Supp. 3d 560 (D.N.J. 2014) (applied Actavis factors to reverse payments)
- In re Ciprofloxacin Hydrochloride Antitrust Litig., 544 F.3d 1323 (2d Cir. 2008) (scope-of-the-patent approach vs. quick-look)
- In re Tamoxifen Citrate Antitrust Litig., 466 F.3d 187 (2d Cir. 2006) (antitrust analysis in pharma settlements)
- Arizona v. Maricopa Cnty. Med. Soc’y, 457 U.S. 332 (1982) (rule-of-reason framework guiding antitrust analysis)
- Stop & Shop Supermarket Co. v. Blue Cross & Blue Shield of R.I., 373 F.3d 57 (1st Cir. 2004) (three-factor framework for evaluating restraints)