Court Dismisses Natco's REMS-Based Antitrust Suit

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Sept. 30 — A federal district court dismissed Natco Pharma Ltd.'s complaint claiming that Gilead Sciences, Accredo Health Group Inc. and Express Scripts Holding Inc. violated the Sherman Act by refusing to give Natco access to samples of the drug Letairis to use in research (Natco Pharma Ltd. v. Gilead Scis, Inc., D. Minn., No. 0:14-cv-03247-DWF-JSM, 9/29/15).

Judge Donovan W. Frank agreed with the defendants that Natco, an Indian pharmaceutical company, failed to follow the regulatory protocols to obtain Letairis in order to perform tests needed to show that its generic ambrisentan drug is bioequivalent. Because Natco never actually properly requested the drug through any of the defendants, consistent with Food and Drug Administration rules, the court dismissed Natco's claims that Gilead rebuffed requests for the drug for the anticompetitive purpose of excluding a potential generic competitor.

Because Letairis, used in treating pulmonary arterial hypertension, can cause serious birth defects if taken during pregnancy, the FDA mandates that it is only available through its risk evaluation and mitigation strategy (REMS) program. Therefore, Natco needed a prescription from a REMS approved physician to get Letairis through any commercial channel.

The court held that Natco failed to plead facts supporting its refusal to deal claim. Requiring Natco to follow FDA regulations in getting its hands on Letairis is not a refusal to deal, the court stated. Also, Letairis is not completely unavailable to Natco—it just has to get a script from a REMS approved physician to procure any. Accordingly, Natco did not state an actionable claim underSherman Act §2, 15 U.S.C. §2.

Natco's allegations of a conspiracy fail to plausibly allege that the defendants have an agreement or conspiracy to restrain trade, the court ruled. Accordingly, the court also dismissed Natco's claims underSherman Act §1, 15 U.S.C. §1.

The dismissals are without prejudice. Given that Natco has only now figured out how to lawfully obtain Letairis under the FDA's regulations, the court left the door open to Natco to refile its complaint if a fully FDA-compliant request for Letairis samples meets with unsurmountable hurdles.

The plaintiff is represented by Carlson Caspers Vandenburgh Lindquist & Schuman PA, Minneapolis.

Defendant Gilead Sciences is represented by Quinn Emanuel Urquhart & Sullivan LLP, New York; and Faegre Baker Daniels LLP, Minneapolis.

Defendants Express Scripts and Accredo are represented by Latham & Watkins LLP, San Francisco and Washington; and by Gaskins Bennett Birrell Schupp LLP, Minneapolis.

Text of the court's decision is athttp://www.bloomberglaw.com/public/document/Natco_Pharma_Ltd_v_Gilead_Sciences_Inc_et_al_Docket_No_014cv03247/2.