In re Xyrem (Sodium Oxybate) Antitrust Litigation, 3:20-md-02966

Background

Xyrem (sodium oxybate) is a narcolepsy drug sold by Jazz (acquired Orphan Medical). Plaintiffs allege Jazz blocked timely generic (ANDA/AB-rated) entry and kept prices supracompetitive; Hikma later launched an authorized generic (AG) in Jan 2023 and Amneal in Jul 2023.
Multiple generics filed ANDAs or signaled intent (2010–2017); none launched as standard generics during the alleged conspiracy period; several settled with Jazz (Hikma, Par, Lupin, Amneal) with provisions plaintiffs challenge.
Central factual disputes involve Jazz’s REMS/ single-central-pharmacy advocacy and shared-REMS negotiations, settlement terms (implicit no-AG, royalties, acceleration clauses, volume caps), and factual barriers to generic launch (dimer impurity, DEA quota, REMS operationalization, willingness to launch at risk).
Plaintiffs bring claims for state-law conspiracies, state monopolization, and a Sherman Act §2 declaratory/injunctive claim; several summary- judgment motions were filed (Jazz, Defendants jointly, Plaintiffs partial).
The court granted summary judgment in part and denied in part: key rulings include denying summary judgment on most REMS- and settlement-based antitrust theories (factual disputes remain) but granting SJ on some discrete issues (sham litigation dropped, Xywav damages for Opt-Outs, ASO providers’ claims for non-party clients, injunctive relief, and certain state-law unilateral-monopolization theories).

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
REMS-related petitioning (single-central-pharmacy)	Jazz petitioned FDA and later opposed multiple-pharmacy REMS to delay generics; conduct was a sham and anticompetitive	Jazz had reasonable legal/factual basis and FDA approval forecloses sham; Noerr-Pennington immunity applies	Denied SJ — factual dispute whether petitions were objectively baseless and FDA approval was merely "passive"; sham-litigation allegations, however, were dismissed (Plaintiffs abandoned them)
Shared-REMS negotiations	Jazz used voting/consent and liability terms to stall/weaponize shared REMS and impede generics	Failure to reach terms with brand is not anticompetitive; negotiation positions were lawful	Denied SJ — record permits a jury to find shared-REMS conduct part of anticompetitive scheme
Reverse-payment settlements (implicit no-AG, royalties, acceleration clauses, volume caps)	Settlements transferred value to generics (implicit no-AG, below-market royalties, acceleration clauses deter rivals) and collectively allocated the market	Settlements reflect ordinary considerations (royalties, litigation savings, common terms); some payments mirror saved litigation costs or legitimate licenses	Denied SJ in large part — genuine disputes exist on implicit no-AG, royalty-rate valuation, acceleration clauses, and volume-limited licenses; but SJ granted as to cash payments claimed solely as avoided litigation fees where plaintiff evidence was conclusory
Market-allocation conspiracy (sequenced, coordinated settlements)	Jazz coordinated terms ("Calculated Value Adjustment," shared info, market-decline triggers) to ensure harmonized settlements and preserve prices	Settlements were bilateral, sequential, and reflect parallel, lawful incentives; no direct proof of a multi-party agreement	Denied SJ — circumstantial and direct evidence suffices to present conspiracy claim to jury
Causation / launch feasibility (dimer, DEA quota, REMS operationalization, at-risk launch)	A law-abiding Hikma would have launched earlier (possibly at-risk); other ANDAs could then enter (forfeiture theory) and lower prices	Hikma’s API dimer impurity, repeated DEA quota denials, REMS constraints, and unwillingness to launch at risk made earlier entry impossible	Denied SJ — material disputes over dimer significance, quota/operational REMS timing, and whether Hikma would have launched at risk
Xywav damages (Opt-Out Plaintiffs)	Lack of generic Xyrem forced payors to reimburse higher-priced Xywav; chain of causation links Jazz conduct to Xywav payments	Xywav is a distinct product; plaintiffs lack sufficient causal link tying Jazz’s Xyrem conduct to Opt-Out Xywav reimbursements	Granted SJ — Opt-Out Plaintiffs cannot recover Xywav reimbursements as antitrust damages
State-law unilateral-monopolization (CA, KS, NY, TN)	State statutes permit monopolization claims based on Jazz’s unilateral REMS petitioning/positions	These states require concerted action; unilateral conduct is not actionable under their statutes	Granted SJ as to claims predicated on unilateral REMS petitioning under California, Kansas, New York, and Tennessee law
Standing of ASO providers & injunctive relief	ASO payors may recover on behalf of non-party clients and seek injunctions to restore competition	ASOs did not pay alleged overcharges for some non-party clients and lack authority; requested injunctive remedies are unspecified and not shown to redress	Granted SJ for ASO claims on behalf of non-party clients (lack of antitrust standing and capacity); injunctive-relief claims dismissed for lack of specificity/redressability

Key Cases Cited

Prof. Real Estate Investors, Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49 (1993) (Noerr-Pennington doctrine and sham exception)
E.R.R. Presidents Conf. v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961) (petitioning government generally immune from antitrust liability)
FTC v. Actavis, Inc., 570 U.S. 136 (2013) (rule of reason scrutiny for reverse-payment patent settlements)
Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary-judgment standard; factual disputes resolved for nonmovant)
Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (movant’s burden on summary judgment and shifting burden to nonmovant)
Rebel Oil Co. v. Atlantic Richfield Co., 51 F.3d 1421 (9th Cir. 1995) (direct and indirect proofs of market power)
In re Dynamic Random Access Memory (DRAM) Antitrust Litig., 546 F.3d 981 (9th Cir. 2008) (proximate-cause requirement in antitrust damages)
In re Citric Acid Litig., 191 F.3d 1090 (9th Cir. 1999) (requiring evidence tending to exclude independent action for conspiracy claims)
FTC v. AbbVie, Inc., 976 F.3d 327 (3d Cir. 2020) (sham petitioning and subjective motive analysis)
A.D. Bedell Wholesale Co. v. Philip Morris Inc., 263 F.3d 239 (3d Cir. 2001) (government approval can be passive and insufficient for Noerr immunity)
Epic Games, Inc. v. Apple, Inc., 67 F.4th 946 (9th Cir. 2023) (rule-of-reason and market-power considerations)
City of Oakland v. Oakland Raiders, 20 F.4th 441 (9th Cir. 2021) (antitrust standing/antitrust-injury framework)