United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 12, 2008 Decided November 7, 2008
No. 08-5141
TEVA PHARMACEUTICALS, USA, INC.,
APPELLEE
v.
MICHAEL O. LEAVITT, IN HIS OFFICIAL CAPACITY AS
SECRETARY OF HEALTH AND HUMAN SERVICES, ET AL.,
APPELLANTS
Appeal from the United States District Court
for the District of Columbia
(No. 1:08cv00395)
Gerald F. Masoudi, Associate General Counsel, U.S.
Department of Health and Human Services, argued the cause for
appellants. With him on the briefs were Gregory G. Katsas,
Acting Assistant Attorney General, U.S. Department of Justice,
C. Frederick Beckner III, Deputy Assistant Attorney General,
Eugene M. Thirolf, Director, Drake Cutini, Attorney, and Eric
M. Blumberg, Deputy Chief Counsel, U.S. Department of
Health and Human Services.
2
Jay P. Lefkowitz argued the cause for appellee. With
him on the brief were Michael D. Shumsky and Gregory L.
Skidmore.
Before: BROWN and KAVANAUGH, Circuit Judges, and
WILLIAMS, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge BROWN, in
which Circuit Judge KAVANAUGH joins.
Opinion concurring in the judgment filed by Senior Circuit
Judge WILLIAMS.
BROWN, Circuit Judge: The Hatch-Waxman Amendments
help to expedite the marketing of generic drugs. Drug Price
Competition and Patent Term Restoration Act of 1984, Pub. L.
No. 98-417, § 101, 98 Stat. 1585, 1585 (1984). Getting a new
“branded” drug to market is a time-consuming process. The
manufacturer must file a New Drug Application (NDA) with the
Food and Drug Administration (FDA), showing the new drug is
safe and effective and identifying the number and expiration
date of any patent or patents applicable to the drug. 21 U.S.C.
§§ 355(a), (b). FDA has to publish this information. Id.
§ 355(b)(1). It meets this obligation by publishing a directory of
Approved Drug Products with Therapeutic Equivalence
Evaluations (also known as the Orange Book), a printed
cumulative supplement to the Orange Book, and an electronic
version of the Orange Book.
A manufacturer preparing to market a generic bioequivalent
of a branded drug can take a short-cut: filing an Abbreviated
New Drug Application (ANDA) that piggybacks on the original
manufacturer’s evidence of safety and efficacy. Id. § 355(j). To
start the process, the ANDA applicant must certify—for each
patent claiming a drug for which the applicant is seeking
3
approval—under one of four paragraphs that (I) patent
information has not been filed; (II) the patent has expired;
(III) the patent will expire on a specified date; or (IV) the patent
is invalid or will not be infringed by the manufacture, use, or
sale of the new drug for which the application is submitted. Id.
§ 355(j)(2)(A)(vii). The first drug manufacturer to file an
approved ANDA, containing a paragraph IV certification, is
rewarded with a 180-day period of marketing exclusivity for the
manufacturer’s generic version of the drug. Id.
§ 355(j)(5)(B)(iv). Marketing exclusivity is valuable, designed
to compensate manufacturers for research and development
costs as well as the risk of litigation from patent holders. See 35
U.S.C. § 271(e)(2)(A) (stating a generic drug company
certifying under paragraph IV commits an act of infringement
for which the brand-name drug’s patent holder can sue). In this
case, we referee an unusual dispute between FDA and an
ANDA applicant about the effect of a paragraph IV certification
submitted after the patent had been withdrawn by the NDA
holder but before FDA deleted the patent information from the
hardcopy version of the Orange Book.
FDA insists reality matters. The point of paragraph IV, the
Agency argues, is to reward risk when an applicant challenges a
patent that would otherwise preclude price competition. Teva
Pharmaceuticals counters that FDA’s obligations to keep the
industry reliably informed is enforced—at least in part—by
punishing the Agency’s inadvertence when the Orange Book
does not reflect the Agency’s most current information.
I
Janssen Pharmaceuticals got FDA approval to market
Risperdal in 1993 and submitted information for two patents,
the ‘663 patent and the ‘952 patent. See Letter from Janet
Woodcock, M.D., Acting Director, CDER, FDA to D. Jaskot,
4
M.S., R.A.C., Teva Pharmaceuticals USA, regarding Docket
No. 2007P-0316/CP1 and CR1 (February 26, 2008) (“FDA
Letter”) at 4. FDA listed both patents in the Orange Book. On
April 4, 2001, Janssen withdrew the ‘952 patent for several
different strengths of the drug, and on June 11, 2001 sent FDA a
clarification requesting the withdrawal of remaining strengths.
Id. FDA modified its patent listing database on June 11, 2001
and updated the electronic Orange Book to reflect the delisting
sometime between June 29, 2001 and July 20, 2001. Id. FDA
conceded in its brief that neither the printed Orange Book nor its
printed cumulative supplement reflected the delisting until 2002.
Meanwhile, on August 28, 2001, Teva submitted an ANDA
for a generic version of Risperdal, containing a paragraph IV
certification to the ‘952 patent. Id. at 5. FDA promptly
informed Teva that the ‘952 patent had been delisted and asked
Teva to submit a revised ANDA. Id. Teva acquiesced. Id.
Approximately six years later, Teva filed a citizen petition
contesting FDA’s actions. Id. at 1. Teva asked FDA to relist
the ‘952 patent and confirm Teva’s eligibility for the 180-day
marketing exclusivity based on their original ANDA. Id. FDA
refused. Id.
Teva challenged the decision in district court and sought an
expedited preliminary injunction. The district court
consolidated the motion for preliminary injunction with the
merits case and granted judgment in favor of Teva. On
September 12, 2008, we issued an expedited mandate reversing
the decision of the district court granting judgment in favor of
Teva, and vacating the district court’s injunction.
5
II
At the outset, we reject Teva’s claim that FDA raises
arguments on appeal not presented to the district court. Teva’s
confusion is partially explained by its misreading of FDA’s
decision letter and its tendency to construe the statute’s
independent publication mandate as if it modified the
certification requirement. As explained more fully below, these
requirements remain separate. And that is the position
consistently asserted by FDA. FDA’s effort to refine and clarify
its analysis in light of the district court’s ruling cannot be
transmuted into a waiver of its arguments on appeal. See Yee v.
City of Escondido, 503 U.S. 519, 534 (1992) (“Once a federal
claim is properly presented, a party can make any argument in
support of that claim; parties are not limited to the precise
arguments they made below.”).
A
Turning to the merits, we review FDA’s interpretation of
the Act it administers under step one of the two-step analysis in
Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837, 842–43 (1984)
(“[T]he court, as well as the agency, must give effect to the
unambiguously expressed intent of Congress.”). The statute
provides that, in order to qualify for the 180-day marketing
exclusivity under paragraph IV, an ANDA must contain, inter
alia:
[A] certification . . . with respect to each patent which
claims the listed drug . . . or which claims a use for such
listed drug for which the applicant is seeking approval . . .
that such patent is invalid or will not be infringed by the
manufacture, use, or sale of the new drug for which the
application is submitted.
6
21 U.S.C. § 355(j)(2)(A)(vii) (emphasis added). The same
requirement appears, with slight variation, in the FDA
regulation. See 21 C.F.R. § 314.94(a)(12). How a manufacturer
triggers the 180-day marketing exclusivity is clear under the text
of the statute: no ANDA applicant can obtain exclusivity
without a proper paragraph IV certification. 21 U.S.C.
§ 355(j)(5)(B)(iv). A successful paragraph IV certification must
identify a patent that “claims the listed drug” or that “claims a
use for such listed drug for which the applicant is seeking
approval.” Id. § 355(j)(2)(A)(vii). In the absence of such a
patent, there can be no paragraph IV exclusivity.
Teva’s ANDA did not meet the clear and unambiguous
requirements of the statute because it did not and could not
include a certification to a patent that claimed Risperdal.1
According to Black’s Law Dictionary, a patent claim is “[a]
formal statement describing the novel features of an invention
and defining the scope of the patent’s protection.” BLACK’S
LAW DICTIONARY 1160 (8th ed. 2004). The statute requires
NDA holders to ascertain if, under substantive patent law, any
patents claim the drugs for which the NDA holder submitted an
application and then provide FDA with patent information for
any drug which falls within the scope of a patent’s protection.
21 U.S.C. § 355(b). The legislative purpose underlying
paragraph IV is to enhance competition by encouraging generic
drug manufacturers to challenge the patent information provided
by NDA holders in order to bring generic drugs to market
earlier. Thus, for paragraph IV purposes, a “claim” is simply a
description of the subject a patent purports to cover as
established by the NDA holder. See Engine Mfrs. Ass’n v. EPA,
1
Even if the meaning of “claims” were ambiguous, FDA adopted a
reasonable interpretation of the statute’s certification requirements
under Chevron step two. Therefore, employing either analysis, Teva
failed to meet the statutory prerequisites for marketing exclusivity.
7
88 F.3d 1075, 1088 (D.C. Cir. 1996) (recognizing if a statute
“clearly requires a particular outcome, then the mere fact that it
does so implicitly rather than expressly does not mean that it is
‘silent’ in the Chevron sense”). All patent claim information is
provided by the NDA holder. Therefore, as a practical matter, a
patent claims a drug when the NDA holder says it does.
When it comes to the veracity of the patent information
supplied by NDA holders, FDA operates in a purely ministerial
role, relying on the NDA holders to provide the Agency with
accurate patent information. See Am. Bioscience, Inc. v.
Thompson, 269 F.3d 1077, 1080 (D.C. Cir. 2001). This
approach is consistent with the statute, which requires FDA to
publish submitted patent information, but does not require FDA
to review the merits of the patent information provided. 21
U.S.C. § 355(b)(1). Several courts have affirmed this common-
sense policy choice. See, e.g., Am. Bioscience, 269 F.3d at
1080; Apotex, Inc. v. Thompson, 347 F.3d 1335, 1348–49 (Fed.
Cir. 2003); aaiPharma Inc. v. Thompson, 296 F.3d 227, 242–43
(4th Cir. 2002). Consequently, in determining what drugs a
patent claims or covers for purposes of a paragraph IV
certification, the patent’s actual scope is irrelevant. See, e.g.,
Purepac Pharm. Co. v. TorPharm, Inc., 354 F.3d 877, 883
(D.C. Cir. 2004). Rather, FDA must base its decision on what
the NDA holder asserts a patent claims. Id.
Here, the facts are undisputed. On August 28, 2001, when
Teva submitted its ANDA for a generic version of Risperdal, no
patent claimed Risperdal because Janssen had withdrawn the
‘952 patent. Moreover, FDA had removed the listing from the
electronic version of the Orange Book. FDA informed Teva of
the discrepancy and Teva withdrew its paragraph IV
certification. When Teva filed its citizen petition on August 3,
2007, asking FDA to confirm its eligibility for 180-day
exclusivity, the Agency refused. Its decision letter rejecting
8
Teva’s citizen petition accurately reiterated the sequence of
events. The letter noted FDA’s staff, conducting routine filing
reviews, always checks to see if “patent certifications contained
in the ANDA correspond to the patents actually listed for the
reference listed drug, as assessed by the most current patent
information the Agency has received.” See FDA Letter at 8.
B
Teva nevertheless claims its ANDA certification was valid
because one version of the Orange Book still listed the patent.
Neither this Court nor FDA has ever confronted the peculiar
factual circumstances present in this case. We have, however,
considered the vexed question of marketing exclusivity in other
contexts and held that FDA may not delist a patent once a valid
paragraph IV certification has been submitted, Ranbaxy Labs.
Ltd. v. Leavitt, 469 F.3d 120, 126 (D.C. Cir. 2006)(holding
“unlawful the FDA’s policy requiring that the first filer of a
paragraph IV certification be sued in order to preserve its
statutory exclusivity when the NDA holder seeks to delist the
patent rather than to litigate”), and that 21 U.S.C. §
355(j)(5)(B)(iv) precludes FDA from conditioning marketing
exclusivity upon an ANDA applicant prevailing in patent
litigation, Mova Pharmaceutical Corp. v. Shalala, 140 F.3d
1060, 1069 (D.C. Cir. 1998); see also Purepac Pharm. Co. v.
Friedman, 162 F.3d 1201, 1204–05 (D.C. Cir. 1998).
Unfortunately for Teva, an ANDA applicant’s right to a
period of marketing exclusivity does not vest merely because a
paragraph IV certification is filed. Only compliance with
paragraph IV triggers exclusivity, and compliance presupposes
the existence of a claiming patent. The claim is a prerequisite;
without it, there can be no valid certification. Inadvertent
failure by the agency to meet its separate publication
requirement cannot defeat facts. Indeed, for this Court to accept
9
Teva’s position, we would have to accept the proposition that
even partial inadvertence is sufficient. The electronic version of
the Orange Book reflected the withdrawal of the ‘952 patent at
least a month before Teva submitted its certification. Teva’s
argument goes beyond punishing Agency inadvertence; it would
reward willful blindness on the part of manufacturers—a
position clearly at odds with Hatch-Waxman’s focus on
fostering competition and lowering drug prices.
Teva argues the instructions prefacing the Orange Book and
its Cumulative Supplement constitute binding directives that
restrict both applicants and FDA from considering other sources
regarding listed patents. FDA counters that statements in the
Orange Book are not the law and cannot change the law
regarding whether a patent “claims” a drug. FDA is correct;
both the statute and the Agency’s policies compel FDA to rely
on the actual status of a patent (as indicated by the NDA holder)
and not on the varying contents of a published reference guide.
As FDA’s counsel conceded at oral argument, the Agency’s
failure to list a patent after the NDA holder provided the
information would not deprive the branded drug manufacturer
of its rights under paragraph IV. Furthermore, the Agency has
consistently required ANDA applicants to certify to patents
recently submitted to FDA, even if FDA had not yet published
the patent in any version of the Orange Book. FDA Letter at 8
n.14. In the end, none of Teva’s arguments can overcome one
critical lacuna: the lack of any patent claiming the drug.
III
The NDA holder asked FDA to remove the ‘952 patent
from the Orange Book listing in April and June of 2001—
months before Teva attempted to submit a paragraph IV
certification. Under the statutory and regulatory structure
governing marketing exclusivity, the company’s notification
10
was sufficient for FDA to consider the patent withdrawn.
Accordingly, under step one of Chevron, Teva did not submit a
valid paragraph IV certification and neither the Orange Book
nor any of its instructions—however faulty—trump the clear
requirements of the statute.
Therefore, in conformity with our mandate issued on
September 12, 2008, we reverse the decision of the district court
granting judgment in favor of Teva, vacate the district court’s
injunction, and direct the entry of judgment for FDA.
So ordered.
WILLIAMS, Senior Circuit Judge, concurring: I write
separately to clarify an ambiguity in the majority opinion.
The Hatch-Waxman Amendments refer in a number of places
to the obligation of a firm filing a “New Drug Application”
(“NDA”) to include certain information with regard to “any
patent which claims the drug” in question. 21 U.S.C.
§§ 355(b)(1), 355(c)(2) (emphasis added); see
§ 355(j)(2)(A)(vii). This case relates to the obligations of the
FDA in relation to that filing, and the opinion seems to me
ambiguous in its reading of the statute. The panel opinion
says on the one hand that “a ‘claim’ is simply a description of
the subject a patent purports to cover as established by the
NDA holder.” Maj. Op. at 6 (emphasis added). This seems to
imply that the statute requires the FDA to accept the NDA
holder’s listing and delisting decisions, imposing on it the
ministerial role that it has chosen for itself. On the other
hand, the majority opinion describes the FDA’s choice to
adopt a ministerial role as a “common-sense policy choice”
that is merely “consistent with the statute.” Id. at 7. I have
seen no reasoning either in this opinion or in those of other
courts that would support the idea that the statute mandates a
ministerial role; for this case, all that is needed is a conclusion
that the FDA’s adoption of that role is reasonable.
A Fourth Circuit decision, aaiPharma Inc. v. Thompson,
296 F.3d 227 (4th Cir. 2002), discusses the matter quite
comprehensively. There an NDA holder had refused to
include the plaintiff’s patent in the list of patents claiming the
drug. The plaintiff patent holder wanted the FDA to order the
NDA holder to list the patent. At stake was the plaintiff’s
right under Hatch-Waxman to delay FDA approval of an
“Abbreviated New Drug Application” (“ANDA”) by up to 30
months, by suing the ANDA applicant for patent
infringement. Id. at 236, 242; see 21 U.S.C.
§ 355(j)(5)(B)(iii).
2
The FDA’s position was that its role in the process was
purely ministerial, while the plaintiff insisted that in case of a
dispute the FDA had to make its own determination about a
patent’s eligibility for listing. Id. at 237. Both parties argued
that their view was clearly mandated by the statute. Id. at 238.
After a careful analysis, the court concluded that Congress
had “failed to express clearly its intent about the FDA’s role,”
id., but that the FDA’s construction of the statute was
“permissible.” Id. at 241.
Yet in reaching that conclusion the court noted specific
provisions and elements of the statutory scheme favoring the
plaintiff’s position. For example, it noted that §§ 355(d)(6)
and (e)(4) specifically authorize FDA disapproval, or
withdrawal of approval, of an NDA application if the NDA
applicant failed to fulfill its patent-listing obligations. Id. at
238. Moreover, it generally found “plausible” the plaintiff’s
argument that there must be a mechanism for enforcing those
obligations, so as to protect the third-party patent holder’s
Hatch-Waxman rights. Id. at 242. It found “some force,”
furthermore, in the plaintiff’s conclusion that since private
enforcement was unavailable, the FDA had to fill the
enforcement gap. Id. at 243. Against these elements, among
other things, were the FDA’s claim of severe resource
constraints and indications that in practice patent holders had
not been much jeopardized.
Two propositions flow from aaiPharma. First, the FDA’s
ministerial role in the Orange Book listing process is not
mandated by the statute. Second, third-party patent holders
have rights under Hatch-Waxman which are currently at the
mercy of the NDA holder and which the FDA could vindicate
by taking a more active role in the listing process. It seems
quite likely, then, that had the FDA adopted the plaintiff’s
position and sought to protect third-party patent holders, the
3
aaiPharma court would have viewed that construction of the
statute as reasonable too.
These considerations apply at least as strongly to the
present case, which concerns a dispute over a delisting rather
than a dispute over a failure to list. The statute has even less
to say about it; as the FDA has pointed out, the statute is
“silent with regard to the withdrawal of patent information
previously submitted for listing in the Orange Book.”
Ranbaxy Labs. Ltd. v. Leavitt, 469 F.3d 120, 124 (D.C. Cir.
2006). And the policy of protecting third-party patent holders
applies just as strongly.
The Federal Circuit adopted the aaiPharma approach in
Apotex, Inc. v. Thompson, 347 F.3d 1335 (Fed. Cir. 2003).
There, the plaintiff wanted the FDA to delist certain patents
which it contended did not claim the relevant drug. Id. at
1347. Citing aaiPharma, the court held that “[w]e agree with
the Fourth Circuit that the statute does not speak clearly to this
issue.” Id. at 1348. Ultimately, as in aaiPharma, the court
concluded that the FDA’s approach was reasonable. Id. at
1349.
This circuit’s cases are consistent with aaiPharma and
Apotex. They take the FDA’s choice of a ministerial approach
as a given, without implying that the choice was mandated by
the statute. Purepac Pharm. Co. v. Thompson, 354 F.3d 877,
883 (D.C. Cir. 2004) (noting that the FDA “leaves to the
courts” the issue of what patents actually cover); Am.
Bioscience, Inc. v. Thompson, 269 F.3d 1077, 1080 (D.C. Cir.
2001) (explaining that “[t]he FDA, pursuant to longstanding
practice and its own regulations, and based on its
acknowledged lack of expertise and resources, has refused to
become involved in patent listing disputes, accepting at face
value the accuracy of NDA holders’ patent declarations and
following their listing instructions”).
4
Thus, to read the majority opinion as implying that the
statute locks the FDA into a ministerial role would be
inappropriate. Such a reading would prevent the FDA from
taking a more active role in the listing process, thereby better
protecting third parties’ rights, and finds no support in the
cases cited by the majority opinion, Maj. Op. at 7. The statute
and the cases do, however, support the panel opinion’s view
that the FDA’s decision to adopt a ministerial role in the
listing process represents simply a permissible “common-
sense policy choice.” Id.