Mallinckrodt Inc. v. United States Food and Drug Administration, 8:14-cv-03607

Background

Mallinckrodt obtained FDA approval (ANDA 202608) for methylphenidate ER tablets as AB-rated bioequivalent to Concerta and launched the first generic in late 2012.
FDA received adverse-event reports and conducted a Tracked Safety Issue (TSI) review finding concerns about late-phase (12-hour) therapeutic equivalence and issued a TSI memorandum summarizing those concerns.
On November 13, 2014 FDA changed Mallinckrodt’s Orange Book rating from AB to BX, issued a press release and Q&A, and asked Mallinckrodt to confirm bioequivalence under revised draft guidance or voluntarily withdraw its product.
Mallinckrodt sued under the APA and the Fifth Amendment alleging (inter alia) the reclassification was final agency action, FDA violated notice-and-comment by issuing draft guidance, and FDA deprived Mallinckrodt of due process by not providing a hearing.
Court considered jurisdictional challenge to APA claims (finality) and converted certain dismissal arguments into summary-judgment review for Count IV and the due-process Count II; parties had access to the TSI memo and public FDA materials.
Court: (1) held reclassification to BX was not a final agency action reviewable under the APA (Counts I, III, V); (2) held the 2014 Draft Guidance is interpretive, not legislative, so no notice-and-comment required (Count IV); (3) entered summary judgment for defendants on Mallinckrodt’s procedural due process claim (Count II) because Mallinckrodt showed no deprivation of its ANDA approval.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether FDA’s Orange Book TE reclassification is reviewable final agency action under the APA	Reclassification is a consummated, final decision that effectively withdraws marketability and is judicially reviewable like an ANDA withdrawal	TE ratings are advisory, non-binding, intermediate; agency retained discretion and the BX rating invites further data submission so action is not final	Not final; no subject-matter jurisdiction over APA claims challenging reclassification (Counts I, III, V)
Whether FDA’s 2014 Draft Guidance was a legislative rule requiring notice-and-comment under the APA	Guidance functioned as binding norm because FDA required compliance to regain AB status	Guidance is interpretive: explains existing bioequivalence standards and makes non-binding recommendations; alternatives allowed	Guidance is interpretive; no notice-and-comment required (Count IV resolved for defendants)
Whether Mallinckrodt’s ANDA approval was a protected property interest and whether FDA deprived it without due process	ANDA is a license-like property interest; TE reclassification effectively takes product off market (partial deprivation), requiring notice and hearing	ANDA remains approved; BX rating causes market effects from third parties but does not revoke the right to market; no direct deprivation	No due process violation; Mallinckrodt not deprived of its ANDA (summary judgment for defendants on Count II)
Whether FDA needed to provide a hearing prior to changing TE rating	FDA must provide notice and an opportunity to be heard before impairing ANDA-derived rights	Statutory hearing procedures (for withdrawal) apply only to formal revocations; TE rating change is not a withdrawal and does not trigger §355(e) hearing rights	No hearing required here; potential withdrawal would trigger §355(e), but FDA had not instituted such proceedings

Key Cases Cited

Caraco Pharm. Labs., Ltd. v. Novo Nordisk A.S., 132 S. Ct. 1670 (Sup. Ct. 2012) (explains ANDA/Orange Book framework under Hatch–Waxman)
Bennett v. Spear, 520 U.S. 154 (U.S. 1997) (defines final agency action for APA review)
Norton v. Southern Utah Wilderness Alliance, 542 U.S. 55 (U.S. 2004) (§551(13) categories of agency action and limits on mandamus-style relief)
American Mining Con. v. Mine Safety & Health Admin., 995 F.2d 1106 (D.C. Cir. 1993) (tests to distinguish legislative vs. interpretive rules)
National Mining Ass’n v. McCarthy, 758 F.3d 243 (D.C. Cir. 2014) (focus on practical legal effect to determine whether guidance is legislative)
Holistic Candlers & Consumers Ass’n v. FDA, 664 F.3d 940 (D.C. Cir. 2012) (warning letters and similar agency communications typically not final)
Perez v. Mortgage Bankers Ass’n, 135 S. Ct. 1199 (U.S. 2015) (clarifies that interpretive rules are categorically exempt from notice-and-comment)
Industrial Safety Equip. Ass’n v. EPA, 837 F.2d 1115 (D.C. Cir. 1988) (agency guidance that changes market perception does not equal revocation or deprivation for due process purposes)
Mathews v. Eldridge, 424 U.S. 319 (U.S. 1976) (balancing test for procedural due process)
Bd. of Regents v. Roth, 408 U.S. 564 (U.S. 1972) (property interests for due process are created by law or rules)