United States Court of Appeals for the Federal Circuit
2008-1062
JANSSEN PHARMACEUTICA, N.V.
and JANSSEN, L.P.,
Plaintiffs-Appellees,
v.
APOTEX, INC.,
Defendant-Appellant.
Scott B. Howard, Patterson Belknap Webb & Tyler LLP, of New York, New York,
argued for plaintiffs-appellees. With him on the brief were Gregory L. Diskant and Irena
Royzman.
Amy D. Brody, Rakoczy Molino Mazzochi Siwik LLP, of Chicago, Illinois, argued
for defendant-appellant. With her on the brief were William A. Rakoczy, Christine J.
Siwik, and Robert M. Teigen. Of counsel on the brief was Shashank Upadhye, Apotex,
Inc., of Weston, Ontario, Canada.
Appealed from: United States District Court for the District of New Jersey
Judge Dennis M. Cavanaugh
United States Court of Appeals for the Federal Circuit
2008-1062
JANSSEN PHARMACEUTICA, N.V.
and JANSSEN, L.P.,
Plaintiffs-Appellees,
v.
APOTEX, INC.,
Defendant-Appellant.
Appeal from the United States District Court for the District of New Jersey in case no.
06-CV-1020, Judge Dennis M. Cavanaugh.
___________________________
DECIDED: September 4, 2008
___________________________
Before MICHEL, Chief Judge, RADER and MOORE, Circuit Judges.
MOORE, Circuit Judge.
Defendant-Appellant Apotex, Inc. (Apotex) appeals the order of the United States
District Court for the District of New Jersey dismissing its declaratory judgment action
for noninfringement against Plaintiffs-Appellees Janssen Pharmaceutica, N.V. and
Janssen, L.P. (collectively Janssen). We affirm.
BACKGROUND
I.
This case arises under the Hatch-Waxman Act (Act), 1 which governs the Food
and Drug Administration’s (FDA) approval of new and generic drugs. The goal of the
Act is to better balance two competing interests in the pharmaceutical industry: “(1)
inducing pioneering research and development of new drugs and (2) enabling
competitors to bring low-cost, generic copies of those drugs to market.” Andrx Pharms.,
Inc. v. Biovail Corp., 276 F.3d 1368, 1371 (Fed. Cir. 2002).
Under the Act, a pioneering or brand name drug company seeking to
manufacture a new drug must prepare, file, and have approved a new drug application
(NDA) with the FDA. 21 U.S.C. § 355(a), (b). As part of its NDA, the applicant must
submit information regarding the new drug’s safety and efficacy obtained from clinical
trials. 21 U.S.C. § 355(b)(1). The applicant must also identify all patents that “could
reasonably be asserted if a person not licensed by the owner engaged in the
manufacture, use, or sale of the drug,” 21 U.S.C. § 355(b)(1), (c)(2). The FDA
publishes a list of those patents in the “Orange Book.” Drugs approved by the FDA are
known as “listed drugs.” 21 U.S.C. § 355(j)(2)(A)(i).
To encourage the development of generic versions of listed drugs, the Act
created an expedited approval process known as an Abbreviated New Drug Application
(ANDA). 21 U.S.C. § 355(j). Generic drug companies are not required to conduct their
1
The Hatch-Waxman Act is the name commonly used to refer to the Drug
Price Competition and Patent Term Restoration Act of 1984, Pub. L. No. 98-417, 98
Stat. 1585 (1984) (codified at 21 U.S.C. §§ 355, 360(cc) (2000), 35 U.S.C. §§ 156, 271,
282 (2000)), as amended by the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003, Pub. L. No. 108-173, 117 Stat. 2066 (2003).
2008-1062 2
own independent clinical trials to prove safety and efficacy, but can instead rely on the
research of the pioneer pharmaceutical companies. 21 U.S.C. § 355(j)(2)(A)(iv),
(j)(8)(B). However, in order to rely on the research of the pioneer pharmaceutical
companies, an ANDA applicant is required to show bioequivalence of its generic drug to
the NDA drug. 21 U.S.C. § 355(j)(2)(A)(iv), (j)(8)(B). The ANDA applicant must also
include a certification to each patent listed in the Orange Book covering the listed drug
that either (I) no patent information has been filed with the FDA; (II) the patent has
expired; (III) the patent will expire on a particular date and approval of the ANDA should
be deferred until expiration; or (IV) in the opinion of the ANDA applicant, the patent is
invalid or will not be infringed by the manufacture, use, or sale of the generic drug. 21
U.S.C. § 355(j)(2)(A)(vii). These options are respectively referred to as Paragraph I, II,
III, and IV Certifications. The timing of ANDA approval is tied to the type of certification
contained in the ANDA. For Paragraph IV ANDAs, the timing of approval depends upon
two events: (1) whether the pioneer drug company brings an infringement action within
45 days of learning of the Paragraph IV ANDA filing, and (2) whether the company
seeking approval was the first one to file an ANDA containing a Paragraph IV
Certification to a listed patent (hereinafter first Paragraph IV ANDA filer).
In order to bring about early resolution of patent disputes between generics and
pioneering drug companies, the Act provides that the filing of a Paragraph IV
Certification is an act of patent infringement. 35 U.S.C. § 271(e)(2)(A); Eli Lilly & Co. v.
Medtronic, Inc., 496 U.S 661, 678 (1990). The ANDA filer must provide notice to the
patentee and NDA holder of the factual and legal bases for the Paragraph IV
Certification. 21 U.S.C. § 355(j)(2)(B). Upon such notice, the patentee and NDA holder
2008-1062 3
have the option of suing on all, some, or none of the patents included in the Paragraph
IV Certification. If the patentee or NDA holder does not bring suit within 45 days of
receiving notice, the FDA may issue final approval of the ANDA once its approval
requirements have been satisfied. 21 U.S.C. § 355(j)(5)(B)(iii). If, however, the brand
name company brings suit within 45 days, the FDA may not approve the ANDA for 30
months. 21 U.S.C. § 355(j)(5)(B)(iii). The FDA may approve the ANDA after that
period, or earlier if a court has decided the patent(s)-in-suit are invalid or not infringed.
21 U.S.C. § 355(j)(5)(B)(iii).
As an incentive for generic pharmaceutical companies to challenge suspect
Orange Book listed patents, the Hatch-Waxman Act grants the first company to submit
a Paragraph IV ANDA a 180-day period of generic marketing exclusivity during which
time FDA will not approve a later-filed Paragraph IV ANDA based on the same NDA
(hereinafter subsequent Paragraph IV ANDA). 21 U.S.C. § 355 (j)(5)(B)(iv); see Minn.
Mining & Mfg. Co. v. Barr Labs., Inc., 289 F.3d 775, 778 (Fed. Cir. 2002). Significantly,
the first Paragraph IV ANDA filer is entitled to the 180-day exclusivity period regardless
of whether it establishes that the Orange Book patents are invalid or not infringed by the
drug described in its ANDA. All that is required for the first Paragraph IV ANDA filer to
receive the 180-day exclusivity period is that it submits a substantially complete ANDA
that contains a Paragraph IV Certification. 21 U.S.C. § 355 (j)(5)(B)(iv)(II)(bb).
The start of the 180-day exclusivity period is triggered by the earlier of two
events: (1) the first Paragraph IV ANDA filer’s commercial marketing of a drug product;
2008-1062 4
or (2) a court decision of noninfringement or invalidity. 2 21 U.S.C. § 355(j)(5)(B)(iv)
(2000). Only the first Paragraph IV ANDA filer can trigger its 180-day exclusivity period
via the commercial-marketing trigger. 21 U.S.C. § 355(j)(5)(B)(iv)(I) (2000). However,
the subsequent Paragraph IV ANDA filers can trigger the first Paragraph IV ANDA filer’s
180-day exclusivity period via a successful court judgment. Minn. Mining, 289 F.3d at
780.
On December 8, 2003, the Hatch-Waxman Act was amended by Title XI of the
Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA), Pub.
L. No. 108-173, § 1102(a), 117 Stat. 2066, 2457-60. Prior to the MMA, NDA holders
employed several methods of delaying the early resolution of patent disputes. See
Teva Pharms. USA, Inc. v. Novartis Pharms. Corp., 482 F.3d 1330, 1342 & n.7 (Fed.
Cir. 2007). The MMA ameliorates these situations by authorizing a “a civil action” under
28 U.S.C. § 2201 “for a declaratory judgment that the [listed] patent is invalid or will not
be infringed by the drug for which the applicant seeks approval . . .” 21 U.S.C.
§ 355(j)(5)(C)(i)(II). Specifically, the MMA allows a Paragraph IV ANDA filer a right to
bring a declaratory judgment action for noninfringement or invalidity of the relevant
2
In 2003, Congress replaced the provisions governing the triggering of the
180-day exclusivity period with a regime in which the 180-day exclusivity period could
be forfeited for various reasons, including the failure of the first Paragraph IV ANDA filer
to launch its generic product within a certain time period. 21 U.S.C. § 355(j)(5)(D). This
amendment was part of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (MMA), Pub. L. No. 108-173, 117 Stat. 2066 (2003).
However, the MMA contained a grandfather provision specifying that the amendments
do not apply to Paragraph IV ANDAs filed before the date of the enactment of the MMA
or to subsequent Paragraph IV ANDAs filed after the enactment of the MMA if the first
Paragraph IV ANDA was filed prior to enactment of the MMA. See MMA § 1102(b).
Here, a generic pharmaceutical company, Teva Pharmaceuticals USA, Inc., filed the
first Paragraph IV ANDA in 2002, before the December 2003 enactment of the MMA.
Thus, the MMA amendments governing the commencement and forfeiture of the 180-
day exclusivity period are inapplicable to this case.
2008-1062 5
listed patents against the patentee and NDA holder, if the patentee has not brought an
infringement action within the 45-day notice period. 21 U.S.C. § 355(j)(5)(C). Congress
extended federal court jurisdiction over these declaratory judgment actions “to the
extent consistent with the Constitution.” 35 U.S.C. § 271(e)(5). Therefore, federal
courts have jurisdiction over these declaratory judgment actions to the extent that they
present an Article III case or controversy. Caraco Pharm. Labs. v. Forest Labs., 527
F.3d 1278, 1285 (Fed. Cir. 2008) (citation omitted).
II.
Janssen holds an approved NDA for its drug Risperdal® Oral Solution. The
Orange Book originally listed U.S. Patent Nos. 4,804,663 (’663 patent), 5,453,425 (’425
patent) and 5,616,587 (’587 patent) in connection with this NDA. The ’663 patent
covers the compound risperidone, which is the active compound in the drug Risperdal®
Oral Solution. The ’425 and ’587 patents cover specific aqueous solutions of
risperidone and methods for preparing these solutions. The ’663 patent expired on
December 29, 2007. However, the FDA granted Janssen an additional six months of
pediatric exclusivity pursuant to 21 U.S.C. § 355a, making June 29, 2008 the effective
expiration date of the ’663 patent. 3 The ’425 and ’587 patents expire in 2014.
The ’663 patent has been the subject of prior litigation. Following a bench trial, it
was found to be infringed, valid, and enforceable. On May 11, 2007, this court affirmed
the judgment of the district court. Janssen Pharmaceutica, N.V. v. Mylan Pharm., Inc.,
456 F. Supp. 2d 644, 671 (D.N.J. 2006), aff’d, 233 Fed. Appx. 999 (Fed. Cir. 2007).
While Apotex was not a party to that trial, Apotex stipulated to infringement, validity, and
3
Hereinafter this opinion refers to the expiration of the ’663 patent’s
pediatric exclusivity period as the expiration of the ’663 patent.
2008-1062 6
enforceability of the ’663 patent based on the Federal Circuit opinion. Therefore, this
stipulation took effect on May 11, 2007.
Prior to September 2002, Teva Pharmaceuticals USA, Inc. (Teva) filed an ANDA
to make a generic version of risperidone oral solution. In filing its ANDA, Teva
respected the validity of the ’663 patent by filing a Paragraph III Certification on that
patent. Teva was the first ANDA applicant to file a Paragraph IV Certification on the
’425 and ’587 patents. As such, Teva is entitled to 180 days of generic market
exclusivity, during which the FDA will not approve a later-filed Paragraph IV ANDA
based on the same NDA. Teva’s 180-day exclusivity period will begin either the day it
begins marketing its drug, or on the date a court determines that the ’425 and ’587
patents are invalid or not infringed—whichever comes first. 21 U.S.C. § 355(j)(5)(B)(iv)
(2000). As Teva filed a Paragraph III Certification with respect to the ’663 patent, the
FDA will not approve Teva’s generic product before the expiration of the ’663 patent.
Because Janssen did not sue Teva for infringing the ’425 and ’587 patents, the FDA will
be able to approve Teva’s generic version of risperidone oral solution upon the
expiration of the ’663 patent. Teva will be able to commercially market its generic
product immediately upon receiving FDA approval.
Apotex subsequently submitted an ANDA application to the FDA seeking
approval to market its generic version of risperidone oral solution, in which Apotex also
filed Paragraph IV Certifications on the ’425 and ’587 patents. In January 2006, Apotex
amended its ANDA and provided Janssen with an additional Paragraph IV Certification
directed to the ’663 patent. On March 3, 2006, Janssen sued Apotex for infringing the
’663 patent in the United States District Court for the District of New Jersey, but
2008-1062 7
Janssen did not sue Apotex on the ’425 and ’587 patents (collectively, the unasserted
patents). In its Answer to Janssen’s Complaint on April 25, 2006, Apotex asserted four
counterclaims, including claims for declaratory judgment of noninfringement of the two
unasserted patents. Specifically, Apotex sought a declaratory judgment of
noninfringement with respect to the two unasserted patents under the Declaratory
Judgment Act, 28 U.S.C. § 2201, and the MMA to the Hatch-Waxman Act, 21 U.S.C. §
355(j)(5)(C) and 35 U.S.C. § 271(e)(5). 4 On June 28, 2006, Janssen moved to dismiss
these two counterclaims on the ground that the action did not present a case or
controversy as required by Article III of the Constitution.
On December 8, 2006, Janssen provided Apotex with a covenant-not-to-sue with
respect to the ’425 and ’587 patents. After granting the covenant, Janssen requested
that Apotex withdraw its counterclaims. Apotex refused. On October 11, 2007, the
district court granted Janssen’s motion to dismiss Apotex’s counterclaims for lack of
subject matter jurisdiction. The district court found “no case or controversy” regarding
the ’425 and ’527 patents. This appeal followed.
DISCUSSION
Whether an “actual controversy” exists that is sufficient to sustain federal subject
matter jurisdiction is a question of law this court reviews de novo. Teva Pharms. USA,
Inc. v. Novartis Pharms. Corp., 482 F.3d 1330, 1335-36 (Fed. Cir. 2007). In the ANDA
context, Congress extended federal court jurisdiction under the Declaratory Judgment
Act, 28 U.S.C. § 2201, to ANDA Paragraph IV disputes, 21 U.S.C. § 355(j)(5)(C).
4
Because Apotex’s counterclaims on the ’425 and ’587 patents were
pending “on or after” the enactment of the MMA (December 8, 2003), Apotex can rely
upon the declaratory judgment provision of that legislation. See MMA § 1101(c)(1).
2008-1062 8
Congress also directed federal courts to exercise jurisdiction over these ANDA
Paragraph IV declaratory judgment actions “to the extent consistent with the
Constitution,” 35 U.S.C. § 271(e)(5). The relevant text of the Declaratory Judgment Act
reads:
In a case of actual controversy within its jurisdiction . . . any court of the
United States, upon the filing of an appropriate pleading, may declare the
rights and other legal relations of any interested party seeking such
declaration, whether or not further relief is or could be sought.
28 U.S.C. § 2201(a). The Declaratory Judgment Act’s “actual controversy” requirement
“refers to the type of ‘Cases’ and ‘Controversies’ that are justiciable under Article III.”
MedImmune, Inc. v. Genetech, Inc., 127 S. Ct. 764, 771 (2007).
In MedImmune, the Supreme Court stated that a justiciable declaratory judgment
action exists when:
the facts alleged, under all the circumstances, show that there is a
substantial controversy, between parties having adverse legal interests, of
sufficient immediacy and reality to warrant the issuance of a declaratory
judgment.
Id. at 771 (citation omitted). The Court emphasized that the dispute must be:
“definite and concrete, touching the legal relations of parties having
adverse legal interests;” and that it be “real and substantial” and “admi[t] of
specific relief through a decree of a conclusive character, as distinguished
from an opinion advising what the law would be upon a hypothetical state
of facts.”
Id.
Apotex argues that it is suffering three actual and continuing injuries which create
a substantial controversy of sufficient immediacy to warrant the issuance of a
declaratory judgment. Specifically, Apotex argues that (1) it is unable to promptly
launch its generic risperidone product and compete in the market immediately upon the
expiration of the ’663 patent; (2) its approval of its noninfringing generic risperidone
2008-1062 9
product is being indefinitely delayed; and (3) its affiliates, suppliers, and downstream
customers face patent uncertainty because Janssen’s covenant-not-to-sue does not
cover them. We address each alleged injury in turn.
A. Prompt Launch
Apotex argues that absent a declaratory judgment with respect to the ’425 and
’587 patents and regardless of Janssen’s grant of a covenant-not-to-sue, it continues to
suffer a cognizable harm of being unable to launch its generic risperidone product
immediately upon the expiration of the ’663 patent. Apotex contends that this injury
creates a substantial controversy of sufficient immediacy to warrant the issuance of a
declaratory judgment. Without a declaratory judgment, Teva’s 180-day exclusivity
period will commence when it commercially launches its generic risperidone product
after the expiration of the ’663 patent. Therefore, the earliest Apotex will be able to
enter the market is 181 days after the expiration of the ’663 patent. However, if Apotex
is successful on its declaratory judgment action, Teva’s 180-day exclusivity period will
be triggered at a time that Teva will be unable to launch its generic product. If Teva’s
180-day exclusivity period is exhausted prior to the expiration of the ’663 patent, Apotex
will be able to enter the market immediately upon the expiration of the ’663 patent. 5
5
As Teva was the first Paragraph IV ANDA filer with respect to the ’425 and
’587 patents, it is entitled to a 180-day exclusivity period. Teva’s 180-day exclusivity
period can be triggered by one of two events: (1) Teva’s commercial launch of its
product; or (2) a favorable court judgment with respect to both the ’425 and ’587
patents. Because Teva filed a Paragraph III Certification for the ’663 patent, the FDA
cannot approve Teva’s ANDA until the ’663 patent expires. As Teva cannot launch prior
to FDA approval, the earliest Teva can market its generic product is at the expiration of
the ’663 patent. Moreover, because Teva failed to obtain a favorable court judgment
with respect to the ’425 and ’587 patents, Teva will only be able to trigger its 180-day
exclusivity period by commercially launching its generic product. A subsequent
Paragraph IV ANDA filer can trigger Teva’s 180-day exclusivity period by obtaining a
2008-1062 10
Apotex contends that Caraco Pharm. Labs. v. Forest Labs., 527 F.3d 1278 (Fed.
Cir. 2008), in which this court held that despite the existence of a covenant-not-to-sue, a
declaratory judgment claim brought under the Hatch-Waxman Act presents a justiciable
Article III controversy, is controlling. We disagree.
Jurisdiction over a declaratory judgment action must be present “at all stages of
review, not merely at the time the complaint is filed." Steffel v. Thompson, 415 U.S.
452, 459 n.10 (1974); see Benitec Austl., Ltd. v. Nucleonics, Inc., 495 F.3d 1340, 1344
(Fed. Cir. 2007) (“The burden is on the party claiming declaratory judgment jurisdiction
to establish that such jurisdiction existed at the time the claim for declaratory relief was
filed and that it has continued since.”); Int’l Med. Prosthetics Research Assocs., Inc. v.
Gore Enter. Holdings, Inc., 787 F.2d 572, 575 (Fed. Cir. 1986) (“[J]urisdiction over [] a
declaratory judgment action [must have] existed at, and has continued since, the time
the complaint was filed.”). We agree with the parties that if Apotex had not stipulated to
the validity of the ’663 patent, then Caraco would have been controlling. However,
Apotex stipulated to the validity, infringement, and enforceability of the ’663 patent on
May 11, 2007. Therefore, while the harm that created a justiciable Article III controversy
in Caraco was present when Apotex filed its counterclaims on April 25, 2006, that harm
ceased to exist upon Apotex’s stipulation. As such, the harm that gave rise to
jurisdiction over the declaratory judgment claims in Caraco was no longer present on
October 11, 2007—the date the district court dismissed the instant case. Further, we
court judgment that both the ’425 and ’587 patents are invalid or noninfringed.
Therefore, if Apotex obtains a favorable court judgment on the ’425 and ’587 patents,
Teva’s 180-day exclusivity period will begin immediately—regardless of whether the
’663 patent has expired. This would result in Teva’s 180-day exclusivity period
beginning during a time when it cannot secure FDA approval and therefore cannot
launch its product.
2008-1062 11
conclude that the harm that has continuously existed in the present case—Apotex’s
inability to launch its generic product immediately upon the expiration of the ’663
patent—is not sufficient to give rise to declaratory judgment jurisdiction.
In Caraco, Forest Laboratories Inc., et al. (Forest) was the pioneer
pharmaceutical company, Ivax Pharmaceuticals, Inc. (Ivax) was the first Paragraph IV
ANDA filer, and Caraco Pharmaceutical Laboratories, Ltd. (Caraco) was the subsequent
Paragraph IV ANDA filer. 527 F.3d at 1286, 1288. Forest listed two patents in the
Orange Book in relation to its NDA. Id. at 1286. Both Ivax and Caraco filed Paragraph
IV ANDAs with respect to both of the listed patents. Id. at 1286, 1288. Forest chose to
sue Ivax on only one of the two listed patents. Id. at 1286. Forest’s patent was found
valid, infringed, and enforceable. Id. (citing Forest Labs., Inc. v. Ivax Pharms., Inc., 501
F.3d 1263 (Fed. Cir. 2007)). After Caraco filed its Paragraph IV ANDA, Forest sued
Caraco on only the previously litigated patent and granted a covenant-not-to-sue on the
unlitigated, unasserted patent. Id. at 1288. Caraco brought a declaratory judgment
action for noninfringement of the unlitigated, unasserted patent. Id. Caraco wanted to
be able to challenge both patents and if successful, this would trigger Ivax’s 180-day
exclusivity period at a time when Ivax could obtain FDA approval and then launch its
product. Hence, if Caraco was successful, Ivax would get its 180-day exclusivity period
sooner and Caraco would be able to obtain FDA approval earlier—resulting in greater
competition at an earlier time. Without a declaratory judgment, Caraco could be
excluded from selling a noninfringing product even if the asserted patent was proven to
be invalid. See id. at 1287, 1296 n.14. Therefore, Caraco could have been blocked
from entering the market by an invalid patent. Id.
2008-1062 12
The key difference between Caraco and this case is that the harm that gave rise
to the jurisdiction over the declaratory judgment claim in Caraco ceased to exist once
Apotex stipulated to the validity, infringement, and enforceability of the ’663 patent.
Therefore, unlike Caraco, Apotex cannot claim that at the time of the district court’s
dismissal it was being excluded from selling a noninfringing product by an invalid
patent—it stipulated to the validity of the ’663 patent. Even if Apotex successfully
invalidates the ‘425 and ‘527 patents, it cannot obtain FDA approval until the expiration
of the ‘663 patent because of its stipulations with respect to that patent. Instead, the
harm to Apotex that has continuously existed is its exclusion from selling its alleged
noninfringing product during Teva’s statutorily entitled 180-day exclusivity period.
Apotex is being excluded from the market by Teva’s 180-day exclusivity period—a
period which Teva is entitled to under the Hatch-Waxman Act. This is a different injury
than that alleged in Caraco.
Apotex’s inability to promptly launch its generic risperidone product because of
Teva’s 180-day exclusivity period is not a cognizable Article III controversy, but a result
envisioned by the Hatch-Waxman Act. As noted above, the Hatch-Waxman Act struck
a careful balance between encouraging the development of new drugs and enabling the
marketing of low-cost generic drugs. See Andrx Pharms., 276 F.3d at 1371. To this
end, Congress decided to give generic pharmaceutical companies a 180-day exclusivity
period as an incentive to challenge suspect Orange Book listed patents. The 180-day
exclusivity period is important to generic pharmaceutical companies as it promotes
patent challenges by enabling a generic company a period to recover its investment in
these challenges. See C. Scott Hemphill, Paying for Delay: Pharmaceutical Patent
2008-1062 13
Settlement as a Regulatory Design Problem, 81 N.Y.U. L. Rev. 1553, 1605 (2006)
(noting the importance of the 180-day exclusivity period for decreasing the free-rider
problem and concomitantly incentivizing challenges of Orange Book listed patents); see
also Purepac Pharm. Co. v. TorPharm, Inc., 354 F.3d 877, 879 (D.C. Cir. 2004) (“In
order to encourage paragraph IV challenges, thereby increasing the availability of low-
cost generic drugs . . . [the first Paragraph IV ANDA filer] has the right to sell its drug
without competition [from other generic entrants] for 180 days.”). As the import of the
180-day exclusivity period is clear, we hold that Apotex’s exclusion from the market
because of Teva’s entitlement to this statutory exclusionary period does not present a
justiciable Article III controversy.
B. Indefinite Delay
Second, Apotex argues that absent a declaratory judgment action, its approval
of its noninfringing generic risperidone product will be indefinitely delayed until Teva’s
180-day exclusivity period is triggered. Apotex contends that Teva does not have to
commercially launch immediately after the expiration of the ’663 patent, and that Teva
may indefinitely delay launching for various reasons (i.e., substantive problems with its
applications which may prevent FDA approval; stock-piling drug product; or concerns
over brand patents). 6
Apotex filed its counterclaims seeking declaratory judgment of noninfringement of
the ’425 and ’587 patents on April 25, 2006. At this time, Teva could not launch its
6
In 2003, Congress eliminated the possibility that the first Paragraph IV
ANDA filer may indefinitely delay launching its generic product. See supra note 2.
2008-1062 14
generic product for at least another two years. 7 The district court dismissed the
counterclaims on October 11, 2007 more than six months before Teva could have
launched. Final judgment was entered on November 2, 2007. At the time of the final
judgment dismissing the counterclaims, the harm alleged by Apotex was too speculative
because Teva could not yet have launched. We heard oral arguments in this case on
July 7, 2008, approximately a week after Teva could have launched its generic
product. 8 However, we are not deciding whether the facts alleged on July 7, 2008—the
date we heard oral arguments—give rise to a justiciable Article III case or controversy. 9
We hold that at the time when the district court entered final judgment in this case,
Apotex’s alleged harm of indefinite delay of approval was too speculative to create an
actual controversy to warrant the issuance of a declaratory judgment.
7
The earliest Teva could have launched its generic product was on June
29, 2008—the expiration of the ’663 patent pediatric exclusivity period.
8
At the time we heard oral argument, both parties agreed that Teva had not
yet launched its generic risperidone oral solution.
9
Jurisdiction over a declaratory judgment action must be present “at all
stages of review, not merely at the time the complaint is filed." Steffel, 415 U.S. at 459
n.10. As noted above, the court was divested of jurisdiction on May 11, 2007 the date
that Apotex’s stipulated to the validity, enforceability, and infringement of the ’663
patent. In limited circumstances, temporary jurisdictional defects—defects that arise
after the filing date of the complaint—may be cured before the district court enters final
judgment. See Mars, Inc. v. Coin Acceptors, Inc., 527 F.3d 1359, 1370 (Fed. Cir. 2008)
(holding that patentee must reacquire title to a patent prior to final judgment to correct
the jurisdictional defect that arises when the plaintiff loses title to the patent during
litigation); Schreiber Foods, Inc. v. Beatrice Cheese, Inc., 402 F.3d 1198, 1203 (Fed.
Cir. 2005) (“In circumstances where dismissal for lack of initial standing is not required,
the Supreme Court held in Caterpillar Inc. v. Lewis, 519 U.S. 61 (1996),] that
jurisdictional defects can be cured before judgment.”); Insituform Tech., Inc. v. Cat
Contracting, Inc., 385 F.3d 1360, 1371-72 (Fed. Cir. 2004) (holding that temporary loss
of jurisdiction during patent litigation can be cured before final judgment). As Apotex
failed to cure the jurisdictional defect by the time the district court entered final
judgment, we need not reach the issue of whether this case constitutes one of the
limited circumstances in which temporary jurisdictional defects can be cured.
2008-1062 15
At no time between the filing of the counterclaims through the final judgment was
there any basis to conclude that Teva will, or is likely to, delay in bringing its generic
product to market in the future. In Caraco, this court considered the same harm that
Apotex alleges and concluded that it was insufficient to create a justiciable Article III
case or controversy. See Caraco, 527 F.3d 1296 n.14 (noting possible delay of the first
Paragraph IV ANDA filer launching after the expiration of a patent is too speculative to
create a justiciable Article III case or controversy). Our decision in Caraco is supported
by Supreme Court precedent which has emphasized that the dispute must be “definite
and concrete” and be “real and substantial” in order to give rise to justiciable Article III
case or controversy. MedImmune, 127 S. Ct. at 771; see Prasco, LLC v. Medicis
Pharm. Corp., No. 2007-1523, slip op. at ___ (Fed. Cir. ___ 2008) (noting MedImmune
“did not change the bedrock rule that a case or controversy must be based on a real
and immediate injury . . . an objective standard that cannot be met by a purely
subjective or speculative fear of future harm”). Therefore, we hold that a possible delay
in the future of a first Paragraph IV ANDA filer in launching its generic product does not
give rise to declaratory judgment jurisdiction.
C. Covenant-Not-to-Sue
Finally, Apotex argues that Janssen’s covenant-not-to-sue is deficient as it does
not protect Apotex’s affiliates, suppliers, and downstream customers. We disagree.
The relevant portion of Janssen’s covenant-not-to-sue states:
Janssen unconditionally covenants not to sue or otherwise seek to hold
Apotex liable based on its manufacture, having manufactured, importation,
distribution, use, sale and/or offering for sale of the risperdal oral solution,
1 mg/ml that are described in and the subject of Abbreviated New Drug
Application No. 77-719, as filed and as provided to counsel for Janssen on
or about July 13 and 25, 2006 (“the ANDA”), for infringement of United
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States Patents Nos. 5,453,425 (“the ’425 patent”) [and] 5,616,587 (“the
’587 patent”) . . . . Similarly, Janssen would not sue or otherwise seek to
hold Apotex’s customers or distributors liable based upon the importation,
distribution, use, sale and/or offering for sale of the risperdal oral solution,
1 mg/ml that are described in and the subject of the ANDA for
infringement of the ’425 patent [and] the ’587 patent . . . .
The covenant expressly gives Apotex protection from suit for “manufacture [and/or]
having manufactured” the claimed product. The “having manufactured” language
expressly covers all suppliers and affiliates involved in the manufacturing process. See
Cyrix Corp. v. Intel Corp., 77 F.3d 1381, 1388 (Fed. Cir. 1996) (“ST acted within the
scope of its ‘have made’ right under the ST-Intel agreement when it had ST-Italy make
the microprocessors and then sold them to Cyrix.”). Similarly, the covenant protects all
of Apotex’s customers without any distinction between direct and downstream
customers as it states “[s]imilarly, Janssen would not sue or otherwise seek to hold
Apotex’s customers and distributors liable . . . .” Therefore, we hold Janssen’s
covenant-not-to-sue is not deficient, as it protects Apotex’s affiliates, suppliers and
downstream customers.
CONCLUSION
As we conclude no jurisdiction existed for Apotex’s declaratory judgment action,
we need not address the remainder of the parties’ arguments. For the foregoing
reasons, we affirm the district court’s dismissal of Apotex’s declaratory judgment action.
AFFIRMED
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