Contempt Proceedings Against Apotex for Filing Second Depakote ANDA

Abbott v. Torpharm & Apotex (Fed. Cir. 2007)

Depakote is one of the most popular anti-seizure medications on the market. In an ANDA dispute, Apotex was ordered from commercially manufacturing, using, selling, or importing generic versions of the drug that would violate Abbott’s patents.

Apotex was found in contempt of court after the generic manufacturer guided another company (Nu-Pharm) through the process of filing an ANDA on an allegedly non-infringing form of the drug. Sitting by designation, Judge Richard Posner issued the contempt order after finding no difference between the new product and the old product.

Remember here — Apotex is not being held in contempt for actually making or selling the drug. Rather, the contempt stems from filing the Nu-Pharm ANDA — which is a form of infringement under 35 USC 271.

On appeal, Apotex argued that district courts have no jurisdiction to hold contempt proceedings when the accused action is filing an ANDA.

In its opinion, the CAFC agreed with the patent holder that ANDA filings are infringement. As a form of infringement, the district court has the power to issue injunctions to stop the infringement and to issue contempt orders for violations of any injunction.

In this case, however, the appellate panel found that Judge Posner’s contempt proceedings made an error in law — because the original injunction did not include an express order not to “infringe” or not to “file an ANDA”, Apotex could not be held in contempt for those actions. Furthermore, Apotex cannot be held in contempt for foreign manufacturing or sales.

Judge Dyk in dissent argues that the contempt proceeding was improper. Rather, Nu-Pharm should receive a full hearing in court to determine whether the new product is infringing.

DDC Notes on EBay: Although not discussed by the CAFC panel, I cannot see how an injunction against filing an ANDA would qualify for injunctive relief under eBay v. MercExchange.  This is an important issue because it is unclear at this point whether eBay applies to ANDA injunctions issued under 271(e)(4)(B). Additionally, the CAFC failed to provide any analysis on whether an injunction against ANDA filings is permissible under that statute. (I would argue that it is not permissible).

Comments

[anonymous]

The injunction issue was raised at oral argument -- listen to the mp3 recording at fedcir.gov.

[metoo]

Dennis said: "Additionally, the CAFC failed to provide any analysis on whether an injunction against ANDA filings is permissible under that statute. (I would argue that it is not permissible)."

As usual, Dennis, I believe you are correct in your interpretation of the statute. The statute is rather explicit in that regard.

[ohmy]

Hey Dennis. I noticed you have deleted my posting characterizing your case brief as mental masturbation that misses the point of the majority opinion.

If I offended you with my use of the term "mental masturbation," I apologize. I was mistaken when I thought as a law professor you are big into academic freedom and free speech. You have clearly demonstrated that you are the master of your own domain! ;-)

[Dazed and confused]

For those who have been left scratching your heads, Apotex filed an Abbreviated New Drug Application (ANDA) for Generic Drugs with the Food and Drug Administration (FDA). An Abbreviated New Drug Application (ANDA) contains data which when submitted to FDA's Center for Drug Evaluation and Research, Office of Generic Drugs, provides for the review and ultimate approval of a generic drug product. Once approved, an applicant may manufacture and market the generic drug product to provide a safe, effective, low cost alternative to the American public. For reasons which are not clear, Apotex's mere filing of the ANDA supposedly is a form of making-using-selling infringement under 35 USC 271, even though Apotex never made, used, or sold the infringing product. So what's with the secret information left out. Are we talking contributory infringement here or what?

[Dazed but slightly less confused]

D&C, you're correct that Apotex's submission of an ANDA to the FDA doesn't constitute making, using, selling or offering to sell the patented drug. But 271(e)(2)(A) makes the *filing* of an ANDA an act of infringement:

(2) It shall be an act of infringement to submit -
(A) an application under section 505(j) of the Federal Food, Drug, and Cosmetic Act or described in section 505(b)(2) of such Act for a drug claimed in a patent or the use of which is claimed in a patent * * *

Hence the original litigation against Apotex and the resulting injunction - which didn't prohibit Apotex from filing another ANDA or helping someone else to file its own ANDA. As Dennis points out, under 271(e)(4)(B), the prong of the statute under which the injunction issued, the injunction probably *couldn't* have prohibited Apotex from aiding someone else in the filing of an ANDA or even from filing its own follow-on ANDA, but the CAFC didn't take this opportunity to clarify that question.

Dennis, it seems to me that equitable considerations would dictate that such a follow-on ANDA could not challenge the validity of the patent: Apotex already got one bite at the apple, and it wouldn't be fair to allow them to again initiate a challenge to that validity. On the other hand, if Apotex wanted to file (or help someone to file) a paragraph III ANDA (promise not to sell until the patent expires) or to reformulate their product and file a paragraph IV ANDA which would only state that the new product would not infringe, without challenging the patent's valdity, that should be ok. What do you think?