VIROPHARMA, INC., Plаintiff, v. Margaret A. HAMBURG, M.D., in her official capacity as Commissioner, Food and Drug Administration, et al., Defendants, and Akorn, Inc., et al., Defendants-intervenors.
Civil Action No. 12-0584 (ESH)
United States District Court, District of Columbia.
April 23, 2012
ELLEN SEGAL HUVELLE, District Judge.
Andrew E. Clark, U.S. Department of Justice, Washington, DC, for Defendants.
John Robert Fleder, Jennifer McVey Thomas, Hyman, Phelps & McNamara, PC, Chad A. Landmon, Axinn, Veltrop & Harkrider LLP, Edward Anthony Figg, Glenn E. Karta, Sharon Lynch Davis, Rothwell, Figg, Ernst & Manbeck, PC, Washington, DC, Elizabeth P. Retersdorf, Axinn, Veltrop & Harkrider LLP, Hartford, CT, Evan S. Storm, Nicholas E.O.
MEMORANDUM OPINION
ELLEN SEGAL HUVELLE, District Judge.
ViroPharma, Inc., manufactures the antibiotic Vancocin®. On April 13, 2012, ViroPharma sued Margaret Hamburg, in her official capacity as the Commissioner of the Food and Drug Administration; Kathleen Sebelius, in her official capacity as the Secretary of the Department of Health and Human Services; and the agencies themselves (collectively, the “FDA“) to challenge the FDA‘s approval, on April 9, 2012, of three Abbreviated New Drug Applications (“ANDAs“) permitting the marketing of generic versions of Vancocin (vancomycin hydrochloride capsules or “vancomycin“). (See Complaint, April 13, 2012 [Dkt. No. 1] (“Compl.“).) ViroPharma alleges that the FDA approved the three ANDAs (1) in violation of ViroPharma‘s statutory right under the Federal Food, Drug, and Cosmetic Act (“FFDCA“),
Before the Court is ViroPharma‘s motion for a preliminary injunction to require the FDA to withdraw its approval of the three vancomycin ANDAs and to refuse to approve any additional vancomycin ANDAs until ViroPharma‘s claims are adjudicated on the merits. (See Motion for a Temporary Restraining Order and/or Preliminary Injunction, April 13, 2012 [Dkt. No. 4] (“Pl.‘s Mot.“).1) The FDA has opposed ViroPharma‘s motion (see Federal Defendants’ Memorandum in Opposition to Plaintiff‘s Motion for Temporary Restraining Order and/or Preliminary Injunction, April 17, 2012 [Dkt. No. 22] (“FDA Opp‘n“)), as have defendants-intervenors, the three generic manufacturers whose vancomycin ANDAs have been approved. (See Intervenor-Defendant Akorn‘s Memorandum in Opposition to ViroPharma Incorporated‘s Motion for a Temporary Restraining Order, April 17, 2012 [Dkt. No. 23] (“Akorn Opp‘n“); Alvogen, Inc.‘s Memorandum in Opposition to Plaintiff ViroPharma Inc.‘s Motion for Temporary Restraining Order and/or Preliminary Injunction, April 17, 2012 [Dkt. No. 24] (“Alvogen Opp‘n“); Opposition of Defendant-Intervenor Watson Laboratories, Inc. to Plaintiff‘s Motion for Temporary Restraining Order and/or Preliminary Injunction and Expedited Hearing, April 17, 2012 [Dkt. No. 25] (“Watson Opp‘n“).)
Following a hearing held on April 19, 2012, and having considered all of the parties’ arguments and pleadings, including the reply filed by plaintiff after the hearing (see Reply, April 20, 2012 [Dkt. No. 32] (“Pl.‘s Reply“)), the Court concludes that ViroPharma has not demonstrated that it is entitled to a preliminary injunction. Therefore, its motion will be denied.
BACKGROUND
Prior opinions of this Court and others describe the background relevant to ViroPharma‘s
I. STATUTORY AND REGULATORY FRAMEWORK
A. ViroPharma‘s Statutory Exclusivity Claim
Prior to 1997 and the passage of the [Food and Drug Modernization Act of 1997 (“FDAMA“), Pub. L. No. 105-115, 111 Stat. 2296], “antibiotic” drugs were approved under Section 507 of the FFDCA,
Two key consequences arose from these different treatments. Applicants for generic versions of antibiotic drugs were only requested to show conformance with statutorily-mandated, published standards of identity, strength, quality, and purity for the antibiotic substance, as reflected in antibiotic “monographs” published by FDA. Pharmaceutical companies did not have to submit the safety and efficacy data that was required for pioneer and generic non-antibiotic drugs. Therefore, generic antibiotics were developed and marketed fairly readily. See Glaxo, Inc. v. Heckler, 623 F. Supp. 69, 72 (E.D.N.C. 1985); Abbreviated New Drug Applications, Proposed Rule, 54 Fed. Reg. 28,872, 28,878 (July 10, 1989). However, antibiotic drugs did not receive the patent listing, patent сertification, and marketing exclusivity benefits available to pioneer and non-antibiotic drugs after enactment of the Drug Price Competition and Patent Term Restoration Act (“Hatch-Waxman“), Pub. L. No. 98-417, 98 Stat. 1585 (1984).
The significance of the Hatch-Waxman Amendments to FFDCA cannot be understated. Prior to 1984, all applicants seeking to market pioneer drugs or generic non-antibiotic drugs had to file [a new drug application (“NDA“)] containing, inter alia, extensive scientific data demonstrating the safety and effectiveness of the drug. See
Because Congress still wanted to provide incentives for new drug development, alongside the ANDA process that eased the marketing of generic drugs, Hatch-Waxman entitles an NDA applicant to a period of market exclusivity (3 or 5 years, depending on the degree of innovation reflected in the NDA) which bars FDA approval of a generic ANDA for the NDA product. See
Thus, pursuant to Hatch-Waxman‘s provisions, “pioneer drug companies аre entitled to certain periods of marketing exclusivity during which they are protected from generic competition.” AstraZeneca Pharm. LP v. FDA, 850 F. Supp. 2d 230, 234 (D.D.C. 2012). “Included among these various exclusivity periods is what is sometimes referred to as a ‘new patient population’ or ‘new indication’ exclusivity because it frequently arises when a pioneer drug company conducts post-approval clinical studies, submits a supplemental application to the FDA [(an “sNDA“)], and secures the FDA‘s approval to market an approved drug to a new population or for a new indication.” Id. Specifically, if an sNDA is approved and it
contains reports of new clinical investigations (other than bioequivalence studies) essential to the approval of the [sNDA] and conducted or sponsored by the person submitting the [sNDA], the [FDA] may not make the approval of an [ANDA] submitted for a change approved in the supplement effective before the expiration of three years from the date of the approval of the [sNDA].
Although referred to as “new indication exclusivity,” this provision applies beyond situations where an existing drug is approved for the treatment of a disease for which it had not been approved before. “The FDA has interpreted [§ 355(j)(5)(F)(iv)] as establishing a relationship between the information obtained from the clinical investigation, the change approved through the pioneer drug company‘s [sNDA], and the scope of the information relied upon by a generic competitor in a specific ANDA.” AstraZeneca, 850 F. Supp. 2d at 235. Therefore, labeling changes approved in an sNDA can qualify for exclusivity under
As described above, however, when Hatch-Waxman was enacted, its exclusivity provisions did not apply to antibiotics such as Vancocin. In 1997, with the enactment of the FDAMA, Congress extended Hatch-Waxman to antibiotics by repealing Section 507 of the FFDCA and requir[ing] that all applications for antibiotic drugs be submitted under Section
any application for marketing in which the drug that is the subject of the application contains an antibiotic drug and the antibiotic drug was the subject of any application for marketing received by the Secretary of Health and Human Services under section 507 of such Act (21 U.S.C. § 357 [Section 507]) before the date of enactment of this Act.
Pub. L. No. 105-115, 111 Stat. 2327 (1997), § 125(d)(2) (reprinted in
Congress closed this gap when it enacted the QI Program Supplemental Funding Act of 2008, Pub. L. No. 110-379, 122 Stat. 4075 (the “QI Act“). Section 4 of the QI Act, entitled “Incentives for the Development of, and Access to, Certain Antibiotics,” amended the FFDCA to make Old Antibiotics eligible for exclusivity. Id. § 4. Thus, the FFDCA now provides:
Notwithstanding any provision of the [FDAMA] or any other provision of law, a sponsor of [an Old Antibiotic] shall be eligible for, with respect to the drug, the 3-year exclusivity period referred to under clauses (iii) and (iv) of subsection (c)(3)(E) and under clauses (iii) and (iv) of subsection (j)(5)(F), subject to the requirements of such clauses, as applicable.
B. ViroPharma‘s Bioequivalence Claim
Under the FFDCA, in order for a generic applicant to rely on the record of safety and effectiveness demonstrated by a pioneer drug, known as the “reference listed drug” (“RLD“) for purposes of the process by which a generic copy gains approval,
an ANDA must include information demonstrating that the generic drug is the same as the RLD in a number of specified ways.
Depending on the circumstances and the particular drug in question, the FDA may require an applicant [to] use one or more of a variety of different methodologies in order to demonstrate bioequivalence. In general, however, methodologies for demonstrating bioequivalence may be classified as either in vivo (i.e., through human testing) or in vitro (i.e., laboratory testing). ViroPharma, Inc. v. Hamburg, 777 F. Supp. 2d 140, 143 (D.D.C. 2011) (”ViroPharma I“) (some alterations in the original; citations and some internal quotation marks omitted), aff‘d, 471 Fed. Appx. 1 (D.C. Cir. 2012); see
II. FACTUAL AND PROCEDURAL BACKGROUND
A. ViroPharma and Vancocin
ViroPharma, founded in September 2004, is a small pharmaceutical company headquartered in Exton, Pennsylvania. (Compl. ¶ 6; Pl.‘s Mot., Ex. A (“Rowland Decl.”4) ¶ 4.) In addition to Vancocin, ViroPharma currently sells three other drugs and biologic products: Cinryze™, Buccolam®, and Diamorphine. (Pl.‘s Mot. at 2; Rowland Decl. ¶ 7.) Prior to the FDA‘s approval of generic vancomycin ANDAs, Vancocin represented “roughly half” of ViroPharma‘s revenue. (Compl. ¶ 18; see Rowland Decl. ¶ 8 (“In 2011, Vancocin sales were $389 million and accounted for 53% of ViroPharma‘s total revenue.“).)
Vancocin was developed by Eli Lilly and Company and approved by the FDA in April 1986 for the treatment of, inter alia, “a dangerous gastrointestinal infection” called Clostridium difficile associated diarrhea (or “CDAD“).5 ViroPharma Inc. v. Dep‘t of Health & Human Servs., 839 F. Supp. 2d 184, 186-87 (D.D.C. 2012) (”Vi
In November 2004, ViroPharma “exclusively licensed from Eli Lilly the right to manufacture, market, and sell Vancocin in the United States and its territories.” (Rowland Decl. ¶ 22.) However, Vancocin‘s last core patent expired in 1996. (Id. ¶ 23.) Therefore, “absent statutory exclusivity, the market for Vancocin is open to generic substitutes upon FDA approval.” (Id.)
B. ViroPhаrma‘s Efforts To Forestall the Approval of a Generic Vancomycin
ViroPharma presented its statutory exclusivity and bioequivalence claims to the FDA in a series of filings commencing in 2006. As the basis for its statutory exclusivity claim, ViroPharma cited the fact that on December 14, 2011, the FDA approved an sNDA for Vancocin that, according to plaintiff, “fundamentally changed the labeling” for the drug by adding “new conditions of use relating to Clinical Studies, Adverse Reactions: Clinical Trials, Nephrotoxicity, and Geriatric Use, by modifying Vancocin‘s indication, and by specifying a recommended dosing regimen.” (Id. ¶ 24.) These changes “were based on new clinical safety and efficacy data to which ViroPharma has exclusive rights.”8 (Id.) Accordingly, ViroPharma argued that Vancocin is entitled to a three-year period of exclusivity to run through December 15, 2014. See
ViroPharma‘s bioequivalence claim relies on a more complicated regulatory backdrop. Because Vancocin is the only RLD for vancomycin, any ANDA for generic vancomycin must establish bioequivalence to Vancocin to gain approval from the FDA. (CP Response at 8.) “Prior to 2006 the FDA recommended using in vivo studies ... to establish the bioequivalence of generic versions of vancomycin.” ViroPharma II, 839 F. Supp. 2d at 187. (See CP Response at 9 (“FDA‘s initial recommendation for sponsors to establish bioequivalence to [Vancocin] was to conduct in vivo studies with clinical endpoints.“)). However, generic manufacturers told the FDA
In February of that year, the FDA “changed its bioequivalence recommendation for vancomycin” and began to permit generic applicants “to establish bioequivalence with certain in vitro dissolution studies in lieu of in vivo data.” (CP Response at 9.) The FDA maintains that its revised recommendation was based on 1) guidance it had issued in August 2000 which provided for the waiver of in vivo data requirements for RLDs which were rapidly dissolving, highly soluble, and highly permeable (the “BCS Guidance“); 2) draft guidance it issued shortly thereafter noting “that bioequivalence for orally administered drugs intended for local action in the GI tract” could be demonstrated by in vitro studies in certain circumstances; 3) an ANDA for vancomycin submitted in late 2004 which “purported to show” that Vancocin was ” ‘rapidly dissolving’ under the BCS Guidance definition thereby justifying waiver of the in vivo clinical data requirement in place at that time;” and 4) independent FDA analysis confirming that vancomycin is highly soluble.10 (CP Response at 9-11.) The revised recommendation provided “that [v]ancomycin is a highly soluble drug and [Vancocin] is rapidly dissolving. Waivers of in vivo bioequivalence testing can be requested in [ANDAs], provided that the test product is rapidly dissolving at the conditions specified in the [BCS Guidance].” (Id. at 12 (some alterations in the original) (quoting a letter from the FDA to an interested party).) The “FDA did not publicly announce the change in policy, but provided information to companies that submitted inquiries regarding the bioequivalence standards for vancomycin.” ViroPharma II, 839 F. Supp. 2d at 187. (See Pl.‘s Mot. at 7; CP Response at 9, 11.) When one company publicized the new standards, the value of ViroPharma‘s stock dropped by “roughly 40%.” ViroPharma II, 839 F. Supp. 2d at 186-88. (See Compl. ¶ 41.)
On March 17, 2006, ViroPharma filed a citizen petition11 to stay the approval of any vancomycin ANDA under the FDA‘s new bioequivalence testing method. (See McCalips Decl. ¶ 2; id., Ex. 1 (ViroPharma‘s Petition for Stay of Action, Docket No. FDA-2006-P-007 (as amended, “Citizen Petition“)).) Shortly thereafter, ViroPharma supplemented its petition to
Nonetheless, on December 16, 2008, and while ViroPharma‘s Citizen Petition remained pending, the FDA issued a “draft guidance for industry entitled ‘Bioequivalence Recommendation for Vancomycin HC1,’ ” Notice, 73 Fed. Reg. 76,362, 76,362 (Dec. 16, 2008), that allowed generic applicants to demonstrate bioequivalence through in vitro testing if their proposed vancomycin capsules contained inactive ingredients which were qualitatively and quantitatively the same as Vancocin. See ViroPharma II, 839 F. Supp. 2d at 186-88. ViroPharma alleges that “[n]either the notice of the Draft Guidance published in the Federal Register, nor the Draft Guidance itself, identified the regulatory authority for the recommendation.” (Pl.‘s Mot. at 8; see Compl. ¶ 50.)
“[T]wo key factors” led the FDA to the conclusion “that notwithstanding that vancomycin capsules are not ‘rapidly dissolving’ under the BCS Guidance, in vitro dissolution studies still are an appropriate method of demonstrating bioequivalence for vancomycin capsules“:
First, vancomycin acts primarily in the colon, and GI transit times for drugs to reach the colon average 3 to 4 hours. Dissolution even at 60 minutes, which all but one Vancocin lot demonstrated in [a 2008 study conducted by the FDA], ensures that even in patients with faster transit times than healthy subjects, vancomycin will be completely dissolved when it reaches the colon. Second, ... similar dissolution profiles across the pH ranges recommended in the bioequivalence recommendation ensure that generic and reference products will have equivalent release even in patients with extremely short GI transit times or in conditions that would not permit either the [RLD] or the generic product to completely dissolve.
(CP Response at 14.) However, in noticing the 2008 Draft Guidance in the Federal Register, the FDA stressed that it represented only the agency‘s “current thinking on this topic” and stated that “an alternate approach” to bioequivalence may be used if the approach satisfied “the requirements of the applicable statutes and regulations.” 73 Fed. Reg. at 76,363.
According to the FDA, it then “received and carefully considered comments” on the Draft Guidance “from a variety of parties,” including ViroPharma, other innovator drug manufacturers, generic drug manufacturers, doctors, patients, patient advocacy groups, and concerned citizens. (CP Response at 16.13) In 2009, FDA convened its Advisory Committee for Pharmaceutical Science to consider the Draft Guidance. (Id. at 17.) The FDA and industry representatives, including representatives of ViroPharma, presented materials at the meeting, and members of the public also had an opportunity to comment. (Id. at
C. The FDA‘s Response to ViroPharma‘s Citizen Petition
On April 9, 2012, the FDA denied ViroPharma‘s Citizen Petition in a comprehensive letter ruling, concluding that Vancocin was not entitled to statutory exclusivity (see id. at 66-73; infra Section II.C.1) and that ViroPharma‘s bioequivalence claims failed. (See CP Response at 52-60; infra Section II.C.2.)
1. ViroPharma‘s Statutory Exclusivity Claim
In denying ViroPharma‘s Citizen Petition, the FDA determined that Vancocin was not entitled to statutory exclusivity under
Noting that “[t]he QI Act does not expressly define what constitutes a ‘condition of use ... approved before the date of enactment,’ ” the FDA first concluded that Congress must have intended for the limitation to have some meaning; it “must exclude from exclusivity some applications and supplements containing new clinical studies that otherwise would qualify a non-Old Antibiotic product for 3-year Hatch-Waxman exclusivity,” for, “[t]o conclude otherwise would render [it] meaningless” by “exclud[ing] from” exclusivity “оnly those studies that already do not qualify for” it. (Id.) “To give content to this limitation,” the FDA concluded that it “must find that there is a higher hurdle for exclusivity for an Old Antibiotic than there is for another kind of product seeking 3-year exclusivity.” (Id.)
Turning to the QI Act‘s legislative history, the FDA determined that the Act was passed “to encourage development of truly novel antibiotics and novel uses of Old Antibiotics.” (Id. (emphasis added); see id. at 69-70 & nn. 333-36 (surveying the legislative history).) Accordingly, the FDA announced that it would interpret
Applying its interpretation, the FDA then determined that Vancocin was not eligible for Hatch-Waxman exclusivity because the December 2011 approval of ViroPharma‘s sNDA did not constitute approval of a significant new use for the drug. (Id. at 70-73.) With respect to the three changes to the Vancocin label on
The agency stated that it encouraged pioneer manufacturers’ efforts “to modify labeling to provide doctors and patients with current information based on clinical data” and “to bring their labels into compliance with the PLR.” (Id. at 73.) However, it concluded that “[r]evising the labeling and providing clinical data that supports or, at most, refines information about already approved conditions of use ... does not give rise to an approval for a condition of use that has not been previously approved and therefore merits the limited 3-year exclusivity available for аn Old Antibiotic product.” (Id.)
2. ViroPharma‘s Bioequivalence Claim
The FDA also rejected ViroPharma‘s bioequivalence claim. (See CP Response at 52-56, 59.) ViroPharma had argued that
In the alternative, the FDA found that even if it lacked this discretion, it had “determined that [it] would waive [any in vivo data] requirement for generic vancomycin applicants that meet the criteria for in vitro data set forth” in
On the same day that it issued its response to ViroPharma‘s Citizen Petition, the FDA approved ANDAs for generic vancomycin submitted by Akorn, Alvogen, and Watson Laboratories. (Id. at 2 n. 6.) ViroPharma brought this action four days later, on April 13, 2012. ViroPharma claims that the FDA‘s rejection of its statutory exclusivity claim violated the FFDCA, and that the agency‘s rejection of
ANALYSIS
The Supreme Court has described the relief sought by ViroPharma as “an extraordinary and drastic remedy.” Munaf v. Geren, 553 U.S. 674, 689-90 (2008) (internal quotation marks and citation omitted). To obtain a preliminary injunction, a plaintiff “must establish that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.” Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7, 20 (2008) (citing, inter alia, Munaf, 553 U.S. at 689-90). The movant “bears the burden of persuasion and must demonstrate, ‘by a clear showing,’ that the requested relief is warranted.” McGinn, Smith & Co., Inc. v. Fin. Indus. Regulatory Auth., 786 F. Supp. 2d 139, 144 (D.D.C. 2011) (quoting Chaplaincy of Full Gospel Churches v. England, 454 F.3d 290, 297 (D.C. Cir. 2006)).18
While the four factors Winter cites “have typically been evaluated on a sliding scale,” Davis v. Pension Benefit Guaranty Corp., 571 F.3d 1288, 1291 (D.C. Cir. 2009) (internal quotation marks and citation omitted), “[i]t is particularly important for [the movant] to demonstrate a substantial likelihood of success on the merits.” McGinn, 786 F. Supp. 2d at 144 (quoting Barton v. Dist. of Columbia, 131 F. Supp. 2d 236, 242 (D.D.C. 2001)); see Sherley v. Sebelius, 644 F.3d 388, 393 (D.C. Cir. 2011) (“[W]e read Winter at least to suggest if not to hold ‘that a likelihood of success is an independent, free-standing requirement for a preliminary injunction.’ ” (quoting Davis, 571 F.3d at 1296 (Kavanaugh, J., concurring))). Moreover, the movant must demonstrate an actual “likelihood” of success, not merely the existence of “questions so serious, substantial, difficult and doubtful, as to make them fair ground for litigation.” Munaf, 553 U.S. at 690 (internal quotation marks and citation omitted).
III. LIKELIHOOD OF SUCCESS ON THE MERITS
Because the FDA‘s denial of ViroPharma‘s Citizen Petition is subject to review under the Administrative Procedure Act,
A. ViroPharma‘s Statutory Exclusivity Claim
ViroPharma‘s statutory exclusivity claim, which alleges that the FDA‘s letter ruling denying ViroPharma‘s Citizen Petition and its approval of vancomycin ANDAs are inconsistent with the FFDCA, presents an issue of first impression. To address it, the Court begins “with the first step of the two-part framework announced in Chevron ... and asks[s] whether Congress has ‘directly addressed the precise question at issue.’ ” Mayo Found. for Med. Educ. & Research v. United States, 131 S. Ct. 704, 711 (2011) (quoting Chevron, U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837, 843 (1984)). If the statutory language in
Despite these bedrock principles, ViroPharma states, without elaboration, that the FDA‘s interpretation of
Finally, ViroPharma is wrong to suggest that Chevron deference should not apply because the FDA issued its interpretation “after the commencement of litigation with ViroPharmа.” (Pl.‘s Mot. at 19 n.9.) Neither Vancocin‘s eligibility for 3-year statutory exclusivity in general nor the FDA‘s specific interpretation of
Therefore, the Court proceeds to Chevron‘s step one and applies “the traditional tools of statutory construction in order to discern whether Congress has spoken directly to the question at issue.” Eagle Broad. Grp., Ltd. v. FCC, 563 F.3d 543, 552 (D.C. Cir. 2009). The Court finds it likely that the statute is ambiguous. The FFDCA does not address what constitutes a “condition of use ... approved before” the date of the QI Act‘s enactment.
More importantly, although it is true that “[w]hen Congress uses the same [phrase] in different parts of a statute, it usually means the same thing,” the Circuit has instructed that “statutory interpretation is not just about logic” and a statute‘s terms “should be read in context, the statute‘s place in the overall statutory scheme should be considered, and the problem Congress sought to solve should be taken into account.” PDK Labs. Inc. v. DEA, 362 F.3d 786, 796 (D.C. Cir. 2004) (internal quotation marks and citations omitted). With respect to this final admonition, the FDA has demonstrated that when
Furthermore, ViroPharma provides scant support for its contention that the “ordinary and natural meaning [of ‘conditions of use‘] plainly encompasses any qualifications concerning the proper usage of the drug for its intended purpose, most obviously in the form of instructions or recommendations to the users of the drug.” (Pl.‘s Mot. at 14 (emphasis added).) Where courts address a complex statutory regime, laden with scientific language and other terms of art, dictionary definitions do not suffice to show an unambiguous meaning. See, e.g., Emerson v. Steffen, 959 F.2d 119, 121 (8th Cir. 1992) (holding that a provision of Title XIX of the Social Security Act remained ambiguous even though a key phrase was defined by Webster‘s Third New International Dictionary because, “[w]hile we do not dispute the correctness of this definition, we do not believe that our agreement with the dictionary necessitates agreement with the plaintiffs“).23 And the fact “[t]hat a statute
Nor would an examination of the QI Act‘s purpose and legislative history undercut the FDA‘s interpretation. See Nat‘l Cable & Telecomms. Ass‘n v. FCC, 567 F.3d 659, 663 (D.C. Cir. 2009) (instructing courts to use ” ‘all traditional tools of statutory interpretation,’ including ‘text, structure, purpose, and legislative history,’ to ascertain Congress’ intent at Chevron step one” (quoting Pharm. Research & Mfrs. of Am. v. Thompson, 251 F.3d 219, 224 (D.C. Cir. 2001))); PDK Labs., 362 F.3d at 798 n. 4. To the contrary, as the Court‘s Chevron step-two analysis demonstrates, the FDA‘s interpretation is reasonable in large part because it furthers Congress‘s express purpose.
Having concluded that
First, the legislative history supports the FDA‘s conclusion that Congress‘s purpose in the QI Act was to “balance the need to encourage development of new antibiotic drugs to combat the growing number of disease-resistant bacterial infections and the desire to ensure access to previously approved antibiotics through approval of generic versions of such antibiotics.” (CP Response at 69.) See, e.g., 154 Cong. Rec. S9638, 9638 (daily ed. Sept. 26, 2008) (statement of Sen. Burr) (“Section 4 of [the bill which eventually became the QI Act], entitled ‘Incentives for the Development of and Access to Certain Antibiotics,’ is an important step forward to help spur research on new antibiotics and provide incentives for the creation of additional generic antibiotics.“); 153 Cong. Rec. S5759, 5823 (daily ed. May 9, 2007) (statement of Sen. Kennedy) (in discussing what is now codified at
Second, especially in light of this legislative history, the FDA was within its discretion to apply a limiting principle so that Hatch-Waxman‘s exclusivity provisions do not apply to all approved changes that are “new” (in that they derive from new clinical investigations). As the FDA explained (see CP Response at 69), the general exclusivity period provided in
Third, once the FDA reasonably determined that
interprets [§] 355(v)(3)(B) to permit 3-year Hatch-Waxman exclusivity for Old Antibiotics only for a significant new use for an Old Antibiotic (such as a new indication for a previously approved antibiotic, or a new approval for a submitted but never previously approved antibiotic), not for refinements in labeling related to previously approved uses for Old Antibiotics.
(CP Response at 70.) ViroPharma has not demonstrated that this interpretation of “conditions of use,”
ViroPharma protests that the agency has gone too far, that the statute contemplates some limitation on exclusivity but not one with this much bite. In particular, ViroPharma argues at length that the FDA‘s letter ruling shows that the agency will only allow exclusivity where an sNDA specifies a new indication for an Old Antibiotic. (See Pl.‘s Mot. at 19-24; Pl.‘s Reply at 1-2.) But the Court “need not decide whether a construction [of
Finally, given this Court‘s conclusion that the FDA‘s interpretation of
B. ViroPharma‘s Bioequivalence Claim
The “FDA‘s ‘judgment[ ] as to what is required to ascertain the safety
Rather, ViroPharma argues that the FDA violated its regulations in approving vancomycin ANDAs without in vivo bioequivalence testing. This Court described the dispute in ViroPharma I:
According to ViroPharma,
21 C.F.R § 320.21(b) sets forth a general requirement that bioequivalence be demonstrated through in vivo testing, unless the drug product meets one of the waiver criteria set forth in21 C.F.R. § 320.22 .... The FDA, however, argues that there is no such default requirement for in vivo data to establish bioequivalence.... Instead, the FDA relies on language in21 C.F.R. § 320.24(a) , which states that “FDA may require in vivo or in vitro testing, or both, to ... establish the bioequivalence of specific drug products.” [The] FDA therefore asserts that it has discretion to determine, on а case-by-case basis, whether it will require in vivo testing, in vitro testing, or both in order to establish the bioequivalence of a drug product. According to ViroPharma, however,21 C.F.R. § 320.24 merely lists the various methods for establishing either in vivo or in vitro bioequivalence, depending on which of those two types of testing is otherwise required by the regulations.
ViroPharma I, 777 F. Supp. 2d at 143.
As described above (see supra Section II.C.2), in denying ViroPharma‘s Citizen Petition, the FDA rejected each of plaintiff‘s arguments. (See CP Response at 52-56.) The agency set forth its interpretation of its regulations and justified that interpretation with reference to the regulatory text, structure, and history. The FDA carefully explained why the regulations contain no default requirement for in vivo bioequivalence data, and therefore why no waiver was required for the vancomycin ANDAs. (Id.) The agency then stated that, in the alternative, even if such a waiver were required, it would issue it to generic vancomycin applicants “for good cause” and in order to “protect[] ... the public health.”
An agency‘s interpretation of its own regulations is “controlling” unless it is “plainly erroneous or inconsistent with the regulation.” Auer, 519 U.S. at 461 (internal quotation marks and citation omitted). Especially given the scientific expertise driving the FDA‘s well-reasoned decision in this matter, see Serono Labs., 158 F.3d at 1320, the Court concludes that ViroPharma is unlikely to prevail on the merits of its bioequivalence claim. The FFDCA and a number of the FDA‘s own regulations grant the agency wide discretion in “determin[ing] whether bioequivalence has been established.” Bristol-Myers Squibb Co. v. Shalala, 923 F. Supp. 212, 217 (D.D.C. 1996).27 Furthermore, in addition to the provision on which the agency specifically relied,
IV. IRREPARABLE HARM
ViroPharma‘s showing of irreparable injury is especially unpersuasive. “The irreparable injury requirement erects a very high bar for a movant.” Coal. for Common Sense in Gov‘t Procurement v. United States, 576 F. Supp. 2d 162, 168 (D.D.C. 2008).29 The injury must “be both certain and great; it must be actual and not theoretical.” Wis. Gas Co. v. FERC, 758 F.2d 669, 674 (D.C. Cir. 1985) (per curiam). Of relevance here, economic loss qualifies only if it “threatens the very existence of the movant‘s business,” id.,30 or where the movant, in addition to making a very strong showing of likely success on the merits, “has little hope of obtaining ‘adequate compensatory or other corrective relief at a later date’ if the injunction does not issue.” O‘Donnell Constr. Co. v. Dist. of Columbia, 963 F.2d 420, 428 (D.C. Cir. 1992) (quoting Va. Petroleum Jobbers Ass‘n v. Fed. Power Comm‘n, 259 F.2d 921, 925 (D.C. Cir. 1958)); cf. Chaplaincy, 454 F.3d at 297 (to be irreparable, an injury “must be beyond remediation,” and “[t]he possibility that adequate compensatory ... relief will be available at a later date, in the ordinary course of litigation weighs heavily against a claim of irreparable harm” (quoting Wis. Gas Co., 758 F.2d at 674)); accord Nat‘l Med. Care, Inc. v. Shalala, No. 95-860, 1995 WL 465650, at *3 (D.D.C. June 6, 1995) (concluding that, where plaintiffs had demonstrated an “overwhelming likelihood that” they would prevail on the merits, they had also demonstrated irreparable injury despite alleging threatened economic harms because upon prevailing they would not be able to “bring an action to recover” their damages). Where a plaintiff cannot recover money damages from the government owing to sovereign immunity, for example, some courts have held that “any loss of income suffered by a plaintiff is irreparable per se.” Feinerman v. Bernardi, 558 F. Supp. 2d 36, 51 (D.D.C. 2008) (citing United States v. New York, 708 F.2d 92, 93-94 (2d Cir. 1983)); accord Woerner v. U.S. Small Bus. Admin., 739 F. Supp. 641, 650 (D.D.C. 1990) (finding economic loss constituted irreparable harm “because the government is immune from damage suits“).
Yet, irreparability aside, it remains incumbent on plaintiffs to demonstrate, first, that they are threatened with serious injury. See, e.g., N. Air Cargo v. USPS, 756 F. Supp. 2d 116, 125 n. 6 (D.D.C. 2010) (“While the Court agrees that irrecoverable financial loss may constitute irreparable injury in some cases, this Court is of the opinion that a party asserting such a loss is not relieved of its obligation to demonstrate that its harm is ‘great.’ ” (quoting Wis. Gas Co., 758 F.2d at 674)); Gulf Oil Corp. v. Dep‘t of Energy, 514 F. Supp. 1019, 1026 (D.D.C. 1981) (to qualify, injury must be “more than simply irretrievable; it must also be serious in terms of its effect on the plaintiff“).
ViroPharma has not made the requisite showing here. It alleges that “if injunctive relief is not granted,” its “revenue from Vancocin will likely be significantly and rapidly eroded, as its share of the market for vancomycin capsules is taken over by generic competition.” (Pl.‘s Mot. at 41 (citing Rowland Decl. ¶¶ 26-32); see Rowland Decl. ¶ 26 (“If FDA approval to market generic copies of Vancocin is not immediately enjoined and, as a result, if the generic companies continue marketing generic copies of Vancocin, ViroPharma will suffer immediate and irreparable injury from a substantial decrease in ViroPharma‘s sales of Vancocin.“)). Courts have consistently held, however, that such vague allegations do not satisfy the high irreparable injury standard. See Astellas Pharma, 642 F. Supp. 2d at 21-23 (concluding that plaintiff pioneer drug company had not established irreparable injury where sales of the RLD constituted “approximately half of its total U.S. revenue for [a given] fiscal year” (collecting cases)).31 ViroPharma cannot escape the fact that ” [t]he mere existence of competition is not irreparable harm, in the absence of substantiation of severe economic impact.” Bristol-Myers Squibb Co., 923 F. Supp. at 221 (quoting Wash. Metro. Area Tran. Comm‘n v. Holiday Tours, Inc., 559 F.2d 841, 843 n. 3 (D.C. Cir. 1977)).
ViroPharma also claims that it will suffer reputational injury if the approved vancomycin
Most importantly, as to both its alleged economic and reputational harms, ViroPharma‘s claims are belied by its own statements. The day after the vancomycin ANDAs were approved, ViroPharma announced to investors that three other drugs, not Vancocin, were the company‘s “growth drivers.” (See FDA Opp‘n, Ex. A at 9 (transcript of April 10, 2012 call with ViroPharma Chairman, President, and CEO Vin Milano, other ViroPharma officials, and investor representatives); see id. at 13 (stating that Cinryze in particular is “the anchor and remains the anchor with or without Vancocin in the mix“); see also Rowland Decl. ¶ 31 (reporting that 2011 sales of Cinryze amounted to “approximately $251 million and ... 46% of ViroPharma‘s revenue).)
The company also announced that it would “be launching [its] own authorized generic” of Vancocin “soon.” (FDA Opp‘n, Ex. A at 6.32) Indeed, ViroPharma‘s CEO stated that the company had been “prepar[ing] an authorized generic for years” and that “the work [is] in place and essentially on the shelf waiting for the need to deploy it” and, in response to a question, clarified that “[t]here is no need to file an[] ANDA for an authorized generic.” (Id. at 7.) He further stated that the company‘s оfficials had “spent [their] entire lives assuming Vancocin was going to go away” and had “been building the company expecting it someday to go away.” (Id. at 8.33) In fact, not a day later—and two days before filing the present lawsuit—ViroPharma launched an authorized generic version of Vancocin to be sold by Prasco Laboratories. (See Watson Opp‘n at 10; id., Ex. 3 (April 11, 2012 press release
Perhaps most damning to ViroPharma‘s position is its CEO‘s rosy description, at the end of the April 10 call, of the company‘s immediate future:
[W]e have a very strong balance sheet. We have cash flow from the Cinryze business. We have a credit facility that allows us a low cost of capital ... to pursue the acquisition of things that we believe fit the strategic intent of the company. And we still have Vancocin cash flow[;] it doesn‘t go to zero.
(Id. at 13.34)
ViroPharma has failed to demonstrate irreparable injury.
V. BALANCE OF EQUITIES
In considering whether the balance of equities favors granting a preliminary injunction, courts consider whether an injunction would “substantially injure other interested parties.” McGinn, 786 F. Supp. 2d at 144 (quoting Chaplaincy, 454 F.3d at 297); see Winter, 555 U.S. at 24 (courts ” ‘must balance the competing claims of injury and must consider the effect on each party of the granting or withholding of the requested relief.’ ” (quoting Amoco Prod. Co. v. Village of Gambell, 480 U.S. 531, 542 (1987))). Here, defendants-intervenors have all demonstrated thаt they would suffer serious harm were the Court to grant the injunction that ViroPharma requests.
First, the FFDCA entitles generic drug companies to FDA approval of their ANDAs when all requisite conditions have been met, see
Finally, the “effect of an injunction on [defendants-intervenors] would be dramatically greater than the harm to [ViroPharma].” Bristol-Myers Squibb Co., 923 F. Supp. at 221. Regardless of whether this Court grants plaintiff the relief it requests, ViroPharma will be able to continue selling both Vancocin and its authorized generic version. The same cannot be said for defendants-intervenors, all of whоm expect to earn substantial revenues from vancomycin. (See Akorn Opp‘n, Bonaccorsi Decl. ¶¶ 7, 19; Alvogen Opp‘n, Hill Decl. ¶ 24, 30-34; Watson Opp‘n, Boyer Decl. ¶ 7.)
VI. THE PUBLIC INTEREST
In exercising their ” ‘sound discretion’ ” when deciding a motion for a preliminary injunction, courts are instructed to ” ‘pay particular regard for the public consequences in employing the extraordinary remedy of injunction.’ ” Winter, 555 U.S. at 24 (quoting Weinberger v. Romero-Barcelo, 456 U.S. 305, 312 (1982)). Here, as in Serono Laboratories, the public interest factor “is inextricably linked with the merits of the case.” Serono Labs., 158 F.3d at 1326. ViroPharma may be correct that “the public always has an interest in agency compliance with the law.” (Pl.‘s Mot. at 44.) However, because this Court has held that ViroPharma “is not likely to establish that” the FDA erred in denying its Citizen Petition and approving ANDAs for generic vancomycin, “public interest considerations weigh against an injunction.” Serono Labs., 158 F.3d at 1326. As discussed above, Hatch-Waxman and the QI Act aim to increase competition in the drug industry and ” ‘to make available more low cost generic drugs.’ ” Id. (quoting H.R. Rep. No. 98-857, pt. 1, at 14 (1984), 1984 U.S.C.C.A.N. 2647, 2647). “Congress’ purpose is directly implicated here,” id., as generic vancomycin sells for considerably less than Vancocin. (See Watson Opp‘n, Boyer Decl. ¶ 9 (providing, under seal, proprietary, comparative pricing data for Watson‘s vancomycin generic); Rowland Decl. ¶ 27 (“generics typically cost 50-70% less than the brand-name drug“); see also Akorn Opp‘n, Bonaccorsi Decl. ¶ 26 (“Publicly available documents reveal that ViroPharma has increased the price of Vancocin seven times since January 2009 to the present, from approximately $442 to $1284 per 20-unit box for 250 mg Vancocin ....“).36) The public “has a wеll-recognized interest in receiving generic competition to brand-name drugs as soon as possible ... and a delay in the marketing of [the generic] drug could easily be against the public interest in reduced prices.” Biovail Corp. v. FDA, 519 F. Supp. 2d 39, 50 (D.D.C. 2007)
CONCLUSION
For these reasons, it is clear that ViroPharma is not entitled to a preliminary injunction. ViroPharma has not demonstrated that it is likely to succeed on the merits of its claims; it has not shown irreparable injury; and the balance of the equities and the public interest both tilt against injunctive relief. The Court will deny ViroPharma‘s motion. A separate Order accompanies this Memorandum Opinion.
State of SOUTH CAROLINA, Plaintiff, v. UNITED STATES of America, and Eric Himpton Holder, Jr. in his official capacity as Attorney General of the United States, Defendants, and James Dubose, et al., Defendant-Intervenors.
Civil Action No. 12-203 (BMK)(CKK)(JDB).
United States District Court, District of Columbia.
Oct. 10, 2012.
Notes
(CP Response at 59-60. But see infra n.26.)[V]ancomycin is one of only two FDA-approved treatments for the fast-moving, life-threatening colitis associated with CDAD. ... [I]ncreased incidence of CDAD infections as well as more severe instances of the disease have been extensively reported in the medical literature and general media. Medical literature also indicates that in light of the high demand and high cost of Vancocin ... doctors and hospitals have begun administering vancomycin parenteral solution[, an alternative formulation of the antibiotic that is injectable,] to patients orally to treat CDAD. This formulation has never been approved for oral use or for use in this fashion, and thus raises potential public health concerns including a risk of dosage errors. The availability of safe and effective generic vancomycin capsules would mitigate these concerns consistent with the fundamental purposes of Hatch-Waxman: to make available to consumers safe and effective generic drug products.
57 Fed. Reg. at 17,972. In the end, these dueling passages do little to illuminate the Secretary‘s intent, and only underscore the fact that the regulations allow the FDA significant leeway to make decisions about bioequivalence based on its particular expertise.Bioequivalence can be established by pharmacodynamic measurement as well as by in vitro techniques and bioequivalence studies with clinical endpoints. The preferred method for establishment of bioequivalence ... is determined on a case-by-case basis, depending on the drug under study.