Lannett Company, Inc. v. United States Food and Drug Administration, Civil Action No. 2016-1350

Background

Lannett sought FDA approval via an ANDA to market generic temozolomide capsules and identified Chongqing Lummy Pharmaceutical Co. (Lummy) as the API manufacturer.
FDA conducted a pre‑approval inspection in 2013 that found Lummy acceptable; FDA later performed a routine inspection in March 2016 that uncovered alleged serious cGMP and data‑integrity problems at Lummy and a related unregistered site.
Due to an internal communication omission, the FDA’s electronic system still showed Lummy as acceptable and on March 23, 2016 the FDA inadvertently issued Lannett an ANDA approval letter.
After discovering the discrepancy, the FDA entered an OAI (Official Action Indicated) alert, informed Lannett of the inspection findings, and on May 16, 2016 rescinded the ANDA approval and returned the ANDA to pending status, issuing a cGMP Complete Response Letter outlining regulatory options (resubmit/supplement, withdraw, or request hearing).
Lannett filed suit seeking to set aside the rescission as unlawful and to enjoin future revocation without a hearing; the FDA moved to dismiss or for summary judgment arguing the rescission was not a final agency action and that Lannett failed to exhaust administrative remedies.
The court held the rescission was not a final agency action for APA review and that Lannett failed to exhaust the administrative remedies available under 21 C.F.R. § 314.110(b); judgment for defendants.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether FDA's rescission of the ANDA approval is a final agency action under the APA	The rescission consummated agency decision‑making and definitively deprived Lannett of the right to market temozolomide, so it is final and reviewable	The rescission returned the ANDA to pending status, outlined remedial regulatory options, and thus was not a final, reviewable action	Not final: rescission left application in administrative process and did not produce a final, reviewable determination
Whether Lannett was required to exhaust administrative remedies before suing	Lannett contends exhaustion was not required because the rescission was final and caused concrete injury (citing Darby and Bennett)	FDA contends exhaustion is required; Lannett must use 21 C.F.R. § 314.110(b) options (supplement, withdraw, or hearing) before judicial review	Required to exhaust: Lannett failed to pursue available administrative remedies, so judicial review is premature
Whether FDA may rescind an ANDA approval based on new information or inherent authority	Lannett argued procedural protections under 21 U.S.C. § 355(e) applied and FDA erred in rescinding without pre‑rescission hearing	FDA asserted authority to withdraw approvals for new information under § 355(e) and inherent reconsideration authority to correct mistakes within a reasonable time	Court did not reach merits (no finality/exhaustion); acknowledged FDA authority to rescind unlawful approvals and that immediate rescission corrected an invalid approval
Whether court should review extra‑record materials or strike them	Lannett relied on some extra‑record document arguments	FDA moved to strike extra‑record materials	Denied as moot: court did not reach merits; motion to strike was denied as moot because case dismissed on non‑merits grounds

Key Cases Cited

Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (agency deference framework)
Bennett v. Spear, 520 U.S. 154 (final agency action test: consummation and legal consequences)
Darby v. Cisneros, 509 U.S. 137 (exhaustion and finality principles)
Woodford v. Ngo, 548 U.S. 81 (exhaustion doctrine and its purposes)
Motor Vehicle Mfrs. Ass’n v. State Farm, 463 U.S. 29 (arbitrary and capricious standard)
Ivy Sports Med., L.L.C. v. Burwell, 767 F.3d 81 (D.C. Cir. 2014) (agency inherent authority to revisit decisions)
Sw. Airlines Co. v. U.S. Dep’t of Transp., 832 F.3d 270 (D.C. Cir. 2016) (look to subsequent agency treatment when assessing finality)
Rhea Lana, Inc. v. U.S. Dep’t of Labor, 824 F.3d 1023 (D.C. Cir. 2016) (agency action not final when adverse effects depend on future administrative action)
Am. Therapeutics, Inc. v. Sullivan, 755 F. Supp. 1 (D.D.C. 1990) (agency allowed to correct promptly discovered approval errors)