Monday, August 3, 2020

Federal Circuit Affirms Denial of Preliminary Injunction

The decision, handed down this past Friday, is Takeda Pharmaceuticals U.S.A., Inc. v. Mylan Pharmaceuticals Inc., precedential majority opinion by Chief Judge Prost, dissent by Judge Newman. (There is also a nonprecedential opinion in a companion case,  Takeda Pharmaceuticals U.S.A., Inc. v. Alkem Laboratories Ltd., announcing the same result with the same judicial lineup.)  To make a long story short, Mylan filed an ANDA covering a generic version of colchicine; Takeda filed suit for infringement; and the parties settled, on terms that allowed Mylan to sell a generic product on:
The date that is [a specified time period] after the date of a Final Court Decision (as defined in Exhibit A) holding that all unexpired claims of the Licensed Patents that were asserted and adjudicated against a Third Party are either (i) not infringed, or (ii) any combination of not infringed and invalid or unenforceable[.]
In addition, "[a]ccording to Section 1.10 of the License Agreement, if Mylan breaches Section 1.2, the parties stipulate that such breach “would cause Takeda irreparable harm.”

Takeda thereafter sued Hikma for the infringement of eight of the Licensed Patents referenced above.  (Hikma had filed an NDA covering its own colchicine product.)  Takeda voluntarily dismissed with prejudice five of the patents, and the district court granted summary judgment that Hikma's product did not infringe the other three.  Mylan then entered the market, relying on its right to do so under the settlement--specifically, because all unexpired claims of the three Licensed Patents that were asserted and adjudicated against Hikma were found to be noninfringing.  Takeda argued, however, that because it had voluntarily dismissed its claims against Hikma under five of the Licensed Patents, the conditions that would allow Mylan to enter the market were not satisfied:  in other words, that because five of the Licensed Patents were asserted but not adjudicated, the settlement did not permit Mylan's entry.  

Takeda moved for a preliminary injunction, which the district court denied, and the Federal Circuit affirms.  First, the majority agrees with the district court that Takeda did not show a likelihood of success on the merits, because as a matter of law Mylan's interpretation of the settlement agreement appears likely to succeed on the merits.  Second, the majority agrees that Takeda is not faced with irreparable harm:
. . . Takeda states generally that each sale by Mylan reduces the units sold by Takeda and that Mylan’s sustained launch “likely will cause” Takeda to incur irreversible price erosion and long-term loss of market share. . . . Though we have recognized that price erosion and loss of market share may in some cases be irreparable injuries, see Aria Diagnostics, Inc. v. Sequenom, Inc., 726 F.3d 1296, 1304 (Fed. Cir. 2013), a bare assertion of irreparable harm is never sufficient to prove such harm or justify the “extraordinary remedy” of a preliminary injunction, see Winter, 555 U.S. at 24. . . . See also Frank’s GMC Truck Ctr., Inc. v. Gen. Motors Corp., 847  F.2d 100, 102–03 (3rd Cir. 1988) (“The availability of adequate monetary damages belies a claim of irreparable in-jury. . . . [S]ince Frank’s GMC has failed to articulate and adduce proof of actual or imminent harm which cannot otherwise be compensated by money damages, it has failed to sustain its substantial burden of showing irreparable harm”). Takeda’s nonspecific and unsupported assertion that Mylan’s sales “likely will cause” irreparable harm falls far short of establishing that irreparable harm has occurred, or will likely occur, absent a preliminary injunction.
Judge Newman, dissenting, disagrees that the settlement condition had been met:
I cannot agree, for the cited event relates to a different product of a different provider having a different FDA approval for different uses, and is not a generic counterpart of Colcrys®. That product . . . and the then ongoing litigation is not mentioned in the License Agreement as possibly providing an accelerating event.

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