Reuters reported that Teva Pharmaceuticals Industries Ltd. lost its bid to keep 180 days of exclusivity for its generic version of Pfizer Inc.’s popular Zoloft antidepressant. The U.S. Court of Appeals for the Federal Circuit, in Teva Pharmaceuticals, Inc v. Pfizer Inc., 04-1186, rejected Teva’s bid to overturn a lower court ruling over whether the company can seek a court ruling that it does not infringe on Pfizer’s brand-name patent before it releases its generic version. Teva had sued Pfizer after the drug giant made a deal with Ivax Pharmaceuticals, a subsidiary of Ivax Corp., to sell a different generic version of the drug, whose chemical name is sertraline.

Pfizer, has already made a deal with Ivax Pharmaceuticals to sell a generic version of Zoloft. Under the law, the first generic company to seek approval for a drug gets 180 days to sell it exclusively after the brand-name patents expire. However, major drug companies could use a legal loophole to make deals with the exclusive generic maker and delay sales. The move, known as "parking," delays the 180-day period and prevents competition. The only way around the potential delay is to seek a pre-emptive, or declaratory, court order.

The Court of Appeals stated upheld the lower court’s ruling Teva appealed the lower court holding claiming that the court erred as a matter of law in holding that there was no actual controversy between it and Pfizer. The court determined that Teva failed to show that Pfizer had taken actions giving rise to a reasonable apprehension on its part that Pfizer would sue it for infringement of the ?699 patent.

Teva submitted an ANDA to the FDA for its generic version of Zoloft?. Like Ivax, Teva filed a paragraph III certification as to the ?518 patent and a paragraph IV certification as to the ?699 patent. Pfizer elected not to file suit against Teva for infringement of the ?699 patent within the forty-five days following receipt of notice of Teva?s paragraph IV certification, and to date no such suit has been filed.

Teva argued that Pfizer had created a reasonable apprehension of suit based upon the following considerations: (1) Pfizer had listed the ?699 patent in the Orange Book; (2 ) Pfizer had refused to grant Teva a covenant not to sue; (3) Pfizer had aggressively asserted its patent rights against alleged infringers of other patents; (4) Pfizer sued Ivax, the first generic manufacturer of sertraline hydrochloride; and (5) it was in Pfizer?s self-interest to leave a "cloud of litigation" hanging over Teva. With respect to the final consideration, Teva argued that Pfizer?s settlement with Ivax gave Pfizer a vested interest in seeing Ivax preserve its 180-day exclusivity period. The district court rejected Teva?s contentions.

Teva argued that Pfizer had created a reasonable apprehension of suit based upon the following considerations: (1) Pfizer had listed the ?699 patent in the Orange Book; (2 ) Pfizer had refused to grant Teva a covenant not to sue; (3) Pfizer had aggressively asserted its patent rights against alleged infringers of other patents; (4) Pfizer sued Ivax, the first generic manufacturer of sertraline hydrochloride; and (5) it was in Pfizer?s self-interest to leave a "cloud of litigation" hanging over Teva. With respect to the final consideration, Teva argued that Pfizer?s settlement with Ivax gave Pfizer a vested interest in seeing Ivax preserve its 180-day exclusivity period. The district court rejected Teva?s contentions.

Teva asserts that the only way a patentee in Pfizer?s situation can defeat jurisdiction over an ANDA filer?s declaratory judgment action is by affirmatively representing that it will not sue the filer. Teva?s reliance on Pfizer?s listing of the ?699 patent in the Orange Book is misplaced. The listing of a patent in the Orange Book by an NDA filer is the result of a statutory requirement . Without more, Pfizer?s compliance wit h the Hatch-Wax man listing requirement should not be construed as a blanket threat to potential infringers as far as Pfizer?s patent enforcement intentions are concerned. The Orange Book is a listing of patents with respect to which claims of infringement " could be reasonably asserted . . . ." 21 U.S.C. ? 355(b)(1), (c)(2 ) (emphasis added). More is required for an actual controversy than the existence of an adversely held patent, however. See Capo, Inc. v. Dioptics Med. Prods., 387 F.3d 1352, 1355 (Fed. Cir. 2004) ("More is needed than knowledge or notice of an adversely held patent. . . . The standard is objective, and focuses on whether the patentee manifested the intention to enforce the patent, and would be reasonably expected to enforce the patent against the declaratory plaintiff."

The Court of Appeals refused to hold that listing a patent in the Orange Book evinces an intent to sue any ANDA filer who submits a paragraph IV certification with respect to the patent.

See appellate ruling here.

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