Mylan Asks Third Circuit to Rehear Doryx Product Hopping Case

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By Dana A. Elfin

Oct. 18 — Mylan Pharmaceuticals Inc. has asked a federal appeals court to rehear its appeal in a case alleging that other drugmakers tried to monopolize the market for its branded antibiotic Doryx ( Mylan Pharm., Inc. v. Warner Chilcott Pub. Ltd. , 3d Cir., No. 15-2236, rehearing sought 10/14/16 ).

The case involves product hopping, a practice in which branded pharmaceutical companies extend a branded drug’s patent protection by patenting minor modifications to the drug, then move the market to the reformulated version of the drug.

In a petition for rehearing filed with the U.S. Court of Appeals for the Third Circuit Oct. 17, Mylan said the appeals court panel’s September decision, finding that Mylan’s product-hopping claim against Mayne Pharma and Warner Chilcott (now part of Allergan) didn't allege an antitrust violation, conflicts with prior Third Circuit and U.S. Supreme Court precedent.

If the panel’s decision is allowed to stand, Mylan says, it could cost prescription drug purchasers billions of dollars by delaying consumer access to cheaper generic drugs.

In September, the panel affirmed a district court’s dismissal of Mylan’s product-hopping claim, finding no antitrust violation. Even though Mayne and Warner engaged in “hops” to exclude generics from the market, the Third Circuit panel said Mylan failed to show their behavior harmed competition or even kept Mylan from making “generous profits” on generic Doryx (doxycycline hyclate).

The panel also expressed reservations about the validity of product-hopping as an antitrust claim, putting itself at odds with a recent Second Circuit opinion upholding similar claims involving Namenda, an Alzheimer’s treatment drug.

Petitions Rarely Granted

While petitions for rehearing aren’t granted very often, David Balto, an antitrust lawyer in private practice, and former policy director at the Federal Trade Commission, told Bloomberg BNA Oct. 18 that Mylan’s petition “hit a grand slam.”

Mylan’s petition addresses all the essential points the Third Circuit would care about, Balto said. Those points include Mylan’s argument that the panel’s decision is inconsistent with its own precedent and precedent in other circuits and the significant financial impact of the decision on consumers.

Balto, who filed a consumer groups’ amicus brief in the case supporting Mylan, says the Third Circuit will probably decide whether to require a reply brief in the case in the next week or so. He’s optimistic that the Third Circuit might rehear the case, especially given that court's expertise in pharmaceutical antitrust cases and the split between the Third Circuit and the Second Circuit on the viability of product-hopping claims.

Antitrust lawyer John W. Treece with Sidley Austin LLP’s Chicago office had a different take, telling Bloomberg BNA Oct. 18 that “it’s unlikely the Third Circuit will agree to rehear a case in which the decision was unanimous and turns on the specific detailed factual findings of the district court.”

Moreover, Treece said, even if the appellate court agrees to rehear the case, the evidentiary record in the case “suggests it would not change the outcome.”

To contact the reporter on this story: Dana A. Elfin in Washington at delfin@bna.com

To contact the editor responsible for this story: Brian Broderick at bbroderick@bna.com

For More Information

The petition is available at http://src.bna.com/jsE.

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