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In re Nexium (Esomeprazole) Antitrust Litigation

United States Court of Appeals, First Circuit

November 21, 2016

IN RE: NEXIUM (ESOMEPRAZOLE) ANTITRUST LITIGATION
v.
ASTRAZENECA LP; ASTRAZENECA AB; AKTIEBOLAGET HASSLE; RANBAXY PHARMACEUTICALS INC.; RANBAXY INC.; RANBAXY LABORATORIES LTD., Defendants, Appellees. AMERICAN SALES COMPANY, LLC, on behalf of itself and all others similarly situated; VALUE DRUG COMPANY; BURLINGTON DRUG COMPANY INC.; ROCHESTER DRUG CO-OPERATIVE, INC., on behalf of itself and others similarly situated; MEIJER, INC.; MEIJER DISTRIBUTION, INC.; ALLIED SERVICES DIVISION WELFARE FUND; LABORERS INTERNATIONAL UNION OF NORTH AMERICA LOCAL 17 HEALTH CARE FUND; LABORERS INTERNATIONAL UNION OF NORTH AMERICA LOCAL 35 HEALTH CARE FUND; A.F. OF L. - A.G.C. BUILDING TRADES WELFARE PLAN; FRATERNAL ORDER OF POLICE MIAMI LODGE 20 INSURANCE TRUST FUND; NEW YORK HOTEL TRADES COUNCIL AND HOTEL ASSOC. OF NEW YORK CITY, INC. HEALTH BENEFITS FUND; UNITED FOOD & COMMERCIAL WORKERS UNIONS AND EMPLOYERS MIDWEST HEALTH BENEFITS FUND; MICHIGAN REGIONAL COUNCIL OF CARPENTERS EMPLOYEE BENEFITS FUND; INTERNATIONAL UNION OF MACHINISTS AND AEROSPACE WORKERS DISTRICT NO. 15 HEALTH FUND; INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS LOCAL HEALTH AND WELFARE FUND; WALGREEN CO.; THE KROGER COMPANY; SAFEWAY INCORPORATED; SUPERVALU, INC.; HEB GROCERY CO. LP; GIANT EAGLE, INC.; RITE AID CORPORATION; RITE AID HEADQUARTERS CORPORATION; JCG (PJC) USA, LLC; MAXI DRUG, INC., d/b/a BROOKS PHARMACY; ECKERD CORPORATION; CVS, INC., Plaintiffs, Appellants,

         APPEALS FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS [Hon. William G. Young, U.S. District Judge]

          Thomas M. Sobol, with whom David S. Nalven, Kristen A. Johnson, James J. Nicklaus, Kristie A. LaSalle, Hagens Berman Sobol Shapiro LLP, Bruce E. Gerstein, Joseph Opper, Elena K. Chan, Ephraim R. Gerstein, Garwin Gerstein & Fisher, LLP, David F. Sorensen, Ellen Noteware, Daniel C. Simons, Caitlin G. Coslett, Berger & Montague, P.C., Linda P. Nussbaum, Nussbaum Law Group, P.C., Steve D. Shadowen, Hilliard & Shadowen LLP, Kenneth A. Wexler, Bethany R. Turke, Justin N. Boley, Wexler Wallace LLP, J. Douglas Richards, Sharon K. Robertson, Donna M. Evans, Cohen Milstein Sellers & Toll, PLLC, Jayne A. Goldstein, Pomerantz LLP, Matthew Wessler, and Gupta Wessler PLLC were on brief, for direct purchaser and end-payor class appellants.

          Barry L. Refsin, Monica L. Rebuck, Maureen S. Lawrence, Hangley Aronchick Segal Pudlin & Schiller, Bernard D. Marcus, Moira Cain-Mannix, Marcus & Shapira LLP, Richard A. Arnold, Scott E. Perwin, Lauren C. Ravkind, Anna T. Neill, and Kenny Nachwalter, P.A. on brief for individual retailer appellants.

          Kannon K. Shanmugam, with whom Dane H. Butswinkas, Paul B. Gaffney, John E. Schmidtlein, and Williams & Connolly LLP were on brief, for appellees AstraZeneca LP, AstraZeneca AB, and Aktiebolaget Hassle.

          Jay P. Lefkowitz, P.C., with whom Steven J. Menashi, Amanda Elbogen, Jonathan D. Janow, Kirkland & Ellis LLP, James Douglas Baldridge, Lisa Jose Fales, Danielle R. Foley, Vincent E. Verrocchio, and Venable LLP were on brief, for appellees Ranbaxy Inc., Ranbaxy Pharmaceuticals Inc., and Ranbaxy Laboratories Ltd.

          Mark S. Hegedus, Attorney, Office of the General Counsel, Federal Trade Commission, Deborah L. Feinstein, Director, Markus H. Meier, Acting Deputy Director, Bradley S. Albert, Deputy Assistant Director, Elizabeth R. Hilder, Attorney, Bureau of Competition, Daniel W. Butrymowicz, Attorney, Bureau of Competition, Jonathan E. Nuechterlein, General Counsel, and Joel Marcus, Director of Litigation, on brief for Federal Trade Commission, amicus curiae.

          Before Lynch, Stahl, and Thompson, Circuit Judges.

          LYNCH, Circuit Judge.

         This appeal arises from the first pharmaceutical-settlement antitrust action tried before a jury since the Supreme Court's decision in FTC v. Actavis, Inc., 133 S.Ct. 2223 (2013). The jury found that although the plaintiffs had proved an antitrust violation in the form of a large and unjustified reverse payment from AstraZeneca to Ranbaxy, the plaintiffs had not shown that they had suffered an antitrust injury that entitled them to damages.

         Defendant AstraZeneca is a brand-name drug manufacturer that owns the patents covering Nexium, a prescription heartburn medication that has grossed billions of dollars in annual sales. After defendant Ranbaxy notified the Food and Drug Administration ("FDA") that it sought to market a generic version of Nexium, AstraZeneca sued Ranbaxy for patent infringement. The two companies reached a settlement agreement, under which Ranbaxy agreed to delay the launch of its generic until a certain date in return for various promises from AstraZeneca. AstraZeneca similarly sued and subsequently settled two patent infringement suits with generic manufacturers Teva and Dr. Reddy's, who were (but no longer remain) defendants in this case. The plaintiffs -- various pharmaceutical retail outlets and certified classes of direct purchasers and end payors -- brought suit, arguing that the terms of these settlement agreements violated federal antitrust laws and state analogues.

         After summary judgment proceedings that winnowed down the number of causal mechanisms through which the plaintiffs could attempt to prove antitrust violation and injury, the case proceeded to a jury, which found as we have described. Following the verdict, the district court denied the plaintiffs' motions for a permanent injunction and for a new trial.

         The plaintiffs appeal, raising four categories of claims. First, they challenge various evidentiary rulings. Second, they argue that the district court erroneously granted judgment as a matter of law in the defendants' favor on the issue of overarching conspiracy. Third, they argue that the special verdict form and jury instructions contained reversible error. The final argument, which lies at the heart of this appeal, is that the district court, at summary judgment, impermissibly cut down the number of causal mechanisms through which the plaintiffs could make their case to the jury. See In re Nexium (Esomeprazole) Antitrust Litig. ("In re Nexium [Summary Judgment]"), 42 F.Supp.3d 231 (D. Mass. 2014). This error at summary judgment pervaded the entire trial, the plaintiffs argue, and constitutes grounds to vacate the jury verdict and award a new trial.

         We find no reversible error in the district court's evidentiary rulings, the formulation of the special verdict form and jury instructions, or its judgment as a matter of law on overarching conspiracy. In fact, many of the plaintiffs' objections have been forfeited or mooted by the jury's findings. We further hold that the jury verdict, finding an antitrust violation but not an antitrust injury, coupled with developments at trial on the issue of patent invalidity, renders harmless any error that may have occurred during the summary judgment proceedings. Accordingly, we need not, and indeed should not, review the summary judgment order for error. We affirm.

         I. REGULATORY FRAMEWORK

         An overview of the intricate pharmaceutical regulatory framework is necessary to understand the issues presented. A manufacturer that seeks to market a new brand-name drug must file a New Drug Application ("NDA") with the FDA and "undergo a long, comprehensive, and costly testing process." Actavis, 133 S.Ct. at 2228. Generic-drug manufacturers formerly underwent similarly rigorous processes to obtain FDA approval to market generic versions of the brand-name drug. In order to accelerate the entry of generic competitors into the market and decrease healthcare costs, Congress enacted the Drug Price Competition and Patent Term Restoration Act of 1984 ("Hatch-Waxman Act"), Pub. L. No. 98-417, 98 Stat. 1585. The Hatch-Waxman Act has three regulatory components that are relevant here.

         First, the Act permits generic manufacturers to file the notably less costly Abbreviated New Drug Application ("ANDA"), "specifying that the generic has the 'same active ingredients as, ' and is 'biologically equivalent' to, the already-approved brand-name drug." Actavis, 133 S.Ct. at 2228 (quoting Caraco Pharm. Labs., Ltd. v. Novo Nordisk A/S, 132 S.Ct. 1670, 1676 (2012)). "[B]y allowing the generic to piggy-back on the pioneer's approval efforts, [the Hatch-Waxman Act] 'speed[s] the introduction of low-cost generic drugs to market, ' thereby furthering drug competition." Id. (third alteration in original) (quoting Caraco, 132 S.Ct. at 1676).

         Second, the Act requires brand-name manufacturers to list the numbers and expiration dates of all relevant patents in their NDAs, which are then published in the FDA's "Orange Book, " an annual publication of all approved drugs and the reported patents or statutory exclusivities that cover those drugs. In turn, generic manufacturers filing ANDAs must "'assure the FDA' that the generic 'will not infringe' the brand-name's patents, " and may provide this assurance in one of four ways. Id. (quoting Caraco, 132 S.Ct. at 1676). The generic manufacturer may (1) certify that the brand-name manufacturer has failed to list any relevant patents; (2) certify that any relevant patents have expired; (3) request the FDA's approval to market its generic upon the expiration of any still active patents covering the brand name; or (4) certify that "any listed, relevant patent 'is invalid or will not be infringed by the manufacture, use, or sale' of the drug described in the [ANDA]." Id. (quoting 21 U.S.C. § 355(j)(2)(A)(vii)(IV)).

         This last route, known as a "paragraph IV certification, " usually triggers an immediate patent infringement suit from the brand-name manufacturer. If that suit is brought within 45 days of the paragraph IV certification, the FDA must withhold approval of the generic ANDA, usually for a 30-month period, during the course of litigation on patent validity or infringement. Id. If the court decides the patent matter within 30 months, the FDA follows the court's determination. But if the court does not, the FDA may approve an ANDA before a court rules on patent validity or infringement. Id. (citing 21 U.S.C. § 355(j)(5)(B)(iii)). This pre-ruling approval, in turn, allows the generic manufacturer to launch its product "at risk" -- that is, "with the risk of losing the infringement case against it hanging over its head. Losing an infringement case after launching at risk can result in significant liability for the generic manufacturer, as damages typically are calibrated by the amount of its at-risk sales." In re Nexium [Summary Judgment], 42 F.Supp.3d at 245.

         The final relevant component of the Hatch-Waxman Act is that it rewards the first generic manufacturer to file an ANDA with a paragraph IV certification by granting that first filer a 180-day period of exclusivity. Actavis, 133 S.Ct. at 2228-29. During that 180-day window, the FDA cannot approve ANDAs from competing manufacturers for the same generic, leaving only the first filer with the ability to market its generic. Accordingly, this period of exclusivity can be "worth several hundred million dollars." Id. at 2229 (quoting Hemphill, Paying for Delay: Pharmaceutical Patent Settlement as a Regulatory Design Problem, 81 N.Y.U. L. Rev. 1553, 1579 (2006)). In fact, the "vast majority of potential profits for a generic drug manufacturer materialize during the 180-day exclusivity period." Id. From the market perspective, however, the first filer may create a bottleneck, as all other generic manufacturers must wait for the exclusivity period to end before launching their own generics.

         Significantly, this lucrative 180-day exclusivity period is not absolute. Under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, Pub. L. No. 108-173, 117 Stat. 2066, a first filer may forfeit its exclusivity period if it fails to come to market within 75 days of a final, nonappealable court judgment that the first filer's product does not infringe the brand-name's patents. 21 U.S.C. §§ 355(j)(5)(D)(i)(I)(bb), (D)(ii). Alternatively, first-filer exclusivity can be forfeited if another generic manufacturer successfully challenges the brand-name patents at issue and if the first filer fails to market its generic within 75 days of a final, nonappealable judgment in that other manufacturer's suit. Id.; see also In re Nexium [Summary Judgment], 42 F.Supp.3d at 246.

         In 2013, the Supreme Court held that reverse payment settlements in paragraph IV litigation "can sometimes violate the antitrust laws." Actavis, 133 S.Ct. at 2227. A reverse payment refers to an arrangement in which the brand-name manufacturer and patent holder compensates the generic manufacturer and alleged patent infringer to settle the paragraph IV litigation and delay the generic's market entry. Id. at 2229. When a brand-name manufacturer pays to delay the first filer's generic launch, that reverse payment postpones not only the first filer's product but also those of all other generic manufacturers, who must wait out the 180-day exclusivity period before going to market. Given that "a reverse payment, where large and unjustified, can bring with it th[is] risk of significant anticompetitive effects, " the Supreme Court held that the potential anticompetitive effects of a reverse payment are subject to the antitrust "rule of reason" test. Id. at 2237.

         Earlier this year, in In re Loestrin 24 Fe Antitrust Litigation, 814 F.3d 538 (1st Cir. 2016), this circuit ruled that improper reverse payments may take the form of "non-monetary" advantages. Id. at 549. The language and logic of Actavis dictated that outcome. See id. ("[T]he Supreme Court recognized that a disguised above-market deal, in which a brand manufacturer effectively overpays a generic manufacturer for services rendered, may qualify as a reverse payment subject to antitrust scrutiny and militates against limiting the Supreme Court's decision to pure cash payments."). Under this functional approach, "no-AG" provisions -- in which the brand-name manufacturer agrees not to market an "authorized generic" version of the drug for a certain period of time -- and other settlement provisions in which some advantage is transferred from the patent holder to the alleged infringer may constitute a reverse payment subject to antitrust scrutiny.

         II. FACTS

         Nexium is a proton-pump inhibitor whose active ingredient is esomeprazole magnesium. The FDA approved AstraZeneca's NDA to market Nexium in 2001. Between 2008 and 2014, Nexium grossed at least $3 billion annually in U.S. sales and joined the ranks of "blockbuster" drugs -- those that generate annual sales of at least $1 billion. In 2001, AstraZeneca held fourteen active patents covering Nexium. As relevant here, two medical patents expired on May 27, 2014, two other patents expired in February 2015 and July 2015, and two more are set to expire in May 2018.

         In August 2005, Ranbaxy first filed an ANDA with a paragraph IV certification in order to market a generic version of Nexium. The filing stated that Ranbaxy's launch would await the 2007 expiration of some of AstraZeneca's Nexium patents, but certified that other patents were either not infringed or invalid. As to patent invalidity, Ranbaxy contended that there was "nothing new" about Nexium, as the active compound in Nexium was effectively "one-half" of the compound in Prilosec, another blockbuster drug for stomach-acid treatment that AstraZeneca had marketed prior to Nexium.

         AstraZeneca promptly brought suit, alleging that Ranbaxy had violated six of its patents: two that would expire on May 27, 2014, two that would expire in 2015, and two that would expire in May 2018. The suit stayed FDA approval of Ranbaxy's ANDA until April 2008. Meanwhile, Teva filed its ANDA for generic Nexium in November 2005, and Dr. Reddy's filed in December 2007. AstraZeneca sued Teva and Dr. Reddy's as well, and all three patent infringement suits were consolidated in the U.S. District Court for the District of New Jersey.

         A. Settlement Agreements

         Ranbaxy was the first defendant to settle after reaching an agreement with AstraZeneca in April 2008. Under the settlement agreement, Ranbaxy received a license to all relevant Nexium patents starting on May 27, 2014. The settlement also contained a no-AG clause, under which AstraZeneca agreed not to market an authorized generic version of Nexium during Ranbaxy's 180-day period of exclusivity. The clause thus ensured that Ranbaxy's generic would be the only one on the market if it could launch in time to avoid triggering the statutory forfeiture provisions. AstraZeneca could still continue to market its brand-name drug during that period. In return, Ranbaxy stipulated to patent validity and infringement and consented to the entry of an injunction against the sale of its generic before the license took effect on May 27, 2014.

         AstraZeneca and Ranbaxy also executed three other agreements, under which Ranbaxy would serve as AstraZeneca's subcontractor and manufacture certain quantities of branded Nexium, and would also serve as AstraZeneca's distributor for authorized generic versions of two other AstraZeneca drugs, Prilosec and Plendil. For the distribution agreement, Ranbaxy would receive 20% of AstraZeneca's profits.

         After litigating for a few more years, Teva settled with AstraZeneca in January 2010. Like Ranbaxy, Teva received a license to the Nexium patents starting on May 27, 2014 and also consented to an injunction barring the sale of its generic before that license took effect. Simultaneously, AstraZeneca and Teva agreed to settle another pending patent infringement lawsuit regarding Prilosec. In that multiyear litigation, AstraZeneca had succeeded in establishing Teva's liability, but Teva had been contesting the damages amount based on its past infringing sales. Teva paid AstraZeneca $9 million to resolve that suit.

         Dr. Reddy's settled with AstraZeneca in January 2011. Like Ranbaxy and Teva, Dr. Reddy's received a license for the Nexium patents starting on May 27, 2014 and also consented to an injunction barring sales before that date. Simultaneously, AstraZeneca and Dr. Reddy's settled another pending patent infringement lawsuit in which AstraZeneca agreed to drop its appeal of the entry of summary judgment in Dr. Reddy's favor.

         The three settlement agreements contained parallel contingent launch provisions under which each generic manufacturer agreed to delay launching its generic in the United States until (1) May 27, 2014; (2) a hypothetical date prior to May 27, 2014 on which any third party launched generic Nexium pursuant to a final, nonappealable court order that AstraZeneca's Nexium patents were invalid, unenforceable, or not infringed by the generic; or (3) a hypothetical date prior to May 27, 2014 on which AstraZeneca authorized any third party to manufacture a generic Nexium. In re Nexium [Summary Judgment], 42 F.Supp.3d at 249 (citing ¶ 5.2 in the three settlement agreements).

         B. Ranbaxy's Regulatory Troubles

         Throughout Ranbaxy's paragraph IV litigation challenging AstraZeneca's Nexium patents, Ranbaxy faced serious issues with the FDA. Specifically, Ranbaxy had filed its ANDA for generic Nexium out of its manufacturing facility in Paonta Sahib, India, which meant that any FDA approval to launch generic Nexium would extend only to that facility. In February 2009, after issuing several warnings about quality control problems with the India facility, the FDA ultimately invoked its Application Integrity Policy ("AIP") against Paonta Sahib. The AIP "halted FDA's substantive review and approval of all pending ANDAs, including amendments and post-approval supplements that relied on supporting data from the Paonta Sahib site -- including the generic Nexium ANDA." Id. at 266. The agency then rejected Ranbaxy's proposed Corrective Action Operating Plan and further turned down Ranbaxy's request that it grant a public health exception to the AIP and continue the approval process for the generic Nexium ANDA. Meanwhile, the FDA granted a public health exception for generic Lipitor, another Ranbaxy product manufactured out of the Paonta Sahib facility.

         In 2010, Ranbaxy and the FDA began negotiating a Consent Decree, which they finalized on January 25, 2012. Under its terms, Ranbaxy could meet "several onerous and time-consuming milestones" to obtain potential FDA approval for generic Nexium or to obtain a site-transfer amendment to change the manufacturing site for the drug. The Consent Decree also contained a "key relinquishment date" of September 30, 2014. Id. at 274. If Ranbaxy could not meet the requisite milestones before that date, it would forfeit its 180-day exclusivity period. Id. Ranbaxy took over two and a half years to prepare a site-transfer amendment, and the manufacturer failed to receive final FDA approval for its generic Nexium ANDA prior to May 27, 2014.

         On November 4, 2014, the FDA rescinded its tentative approval of Ranbaxy's generic Nexium ANDA, and Ranbaxy promptly sued the FDA in the U.S. District Court for the District of Columbia. See Ranbaxy Labs, Ltd. v. Burwell, 82 F.Supp.3d 159, 163 (D.D.C. 2015). Subsequently, in January 2015, the FDA notified Ranbaxy that it had forfeited its first-filer exclusivity period by failing to obtain approval for its generic within 30 months of submitting its ANDA. The FDA simultaneously approved Teva's ANDA for generic Nexium, which launched on February 17, 2015.

         C. Dispute over Teva's Readiness to Launch Generic Nexium

         The plaintiffs' evidence at summary judgment and at trial showed that Teva was closer than Ranbaxy to obtaining FDA approval and launching generic Nexium before May 27, 2014. An internal Teva email from February 2007 approximated Teva's "Launch Readiness date" as July 2008. And by 2009, Teva had passed FDA review in two out of the three categories necessary for tentative approval of its generic Nexium.

         The parties vehemently disagreed at summary judgment on whether the third remaining category for FDA approval was "a significant hurdle or a minor one, " an issue material to determine whether Teva was indeed close to FDA approval. In re Nexium [Summary Judgment], 42 F.Supp.3d at 288-89. The jury heard evidence from both sides on this issue.

         III. PROCEDURAL HISTORY

         A. Pretrial Proceedings

         Plaintiffs commenced six different actions in three different federal district courts, alleging that AstraZeneca made improper reverse payments to Ranbaxy, Teva, and Dr. Reddy's in order to delay the market entry of generic Nexium. On December 7, 2012, the U.S. Judicial Panel on Multidistrict Litigation consolidated and assigned the six pending actions to the U.S. District Court for the District of Massachusetts. See 28 U.S.C. § 1407. This appeal arises from that consolidated case.

         On appeal, plaintiffs are a class of wholesale drug distributors (the "Direct Purchasers"); a class of individual consumers, third-party payors, union plan sponsors, and certain insurance companies (the "End Payors"); and numerous pharmaceutical retail outlets.[1] In January 2015, a panel of this circuit affirmed the certification of the End Payors damages class over a dissent. See In re Nexium Antitrust Litig., 777 F.3d 9 (1st Cir. 2015). The original defendants in this litigation were AstraZeneca, Ranbaxy, Teva, and Dr. Reddy's. Teva and Dr. Reddy's have settled, leaving only AstraZeneca and Ranbaxy as defendants on appeal.

         Consistent with In re Loestrin 24 Fe, the plaintiffs' complaints identified aspects of AstraZeneca's settlements with each of the three generic manufacturers that allegedly were reverse payments in violation of the antitrust laws. In the Ranbaxy settlement, the plaintiffs pointed to the no-AG clause, as well as the side manufacturing and distribution agreements. In the Teva settlement, the plaintiffs argued that Teva's payment of only $9 million to settle the Prilosec lawsuit, rather than the higher amount that Teva actually owed AstraZeneca, constituted the reverse payment. In the Dr. Reddy's settlement, the plaintiffs cited AstraZeneca's agreement to drop its appeal challenging Dr. Reddy's summary judgment win in another patent infringement lawsuit.

         In December 2013, the defendants collectively filed eleven motions for summary judgment. Following the court's initial rulings from the bench, both parties filed various motions for reconsideration. In a September 4, 2014 opinion, the district court memorialized its rationale as to each summary judgment motion that it decided. See In re Nexium [Summary Judgment], 42 F.Supp.3d 231. This opinion grouped the motions into five categories:

         First, the district court denied the defendants' motions for partial summary judgment on the existence of an overarching antitrust conspiracy, among all four original defendants, to restrain trade in the market for generic Nexium. Id. at 248-60. At the pretrial stage, the court found that the plaintiffs had "met their burden of establishing a reasonable inference of overarching conspiracy, " id. at 249, as the evidence demonstrated that each generic "manufacturer's calculus [on its entry date into the generic Nexium market] changed . . . when it received assurance that it would only have to restrict its business if its competitors did the same, " id. at 258. The denial of summary judgment to the defendants imposed no restrictions on the plaintiffs' ability to produce evidence at trial. Following the plaintiffs' case in chief, the district court granted judgment as a matter of law in the defendants' favor on this overarching conspiracy claim.

         Second, although the district court denied the defendants' motion for summary judgment as to the existence of an improper reverse payment from AstraZeneca to Ranbaxy, the court granted the motion as to the argument that such a reverse payment caused the plaintiffs' injury. Id. at 260. The court elaborated that the no-AG clause in the AstraZeneca-Ranbaxy settlement agreement "may be considered part of an illegal reverse payment, " id. at 265, while the lucrative "side" agreements granting Ranbaxy supply and distribution contracts likewise "raise[] enough suspicions to support a reasonable inference [of] improper reverse payments to induce Ranbaxy to delay its generic launch, " id. at 264.

         Nonetheless, in light of the quality control issues that Ranbaxy's Paonta Sahib facility had experienced, the court found that the plaintiffs did not show how Ranbaxy could still have obtained final FDA approval and launched its generic before May 27, 2014. Id. at 270-75. The court was skeptical of the plaintiffs' analogy to generic Lipitor, which had been manufactured out of Paonta Sahib and had faced similar regulatory issues but had nonetheless launched after Ranbaxy reached a compromise with the FDA. Id. at 273-74.

         "The net effect of these rulings [wa]s that the Ranbaxy Settlement [could] not [be] a basis for imposing antitrust liability." Id. at 279. However, later at trial, the court acknowledged its error as to this ruling and reversed course.

         Third, the court denied the defendants' motions for summary judgment based on the Teva settlement. The court found that the plaintiffs' evidence -- that Teva's $9 million payment to AstraZeneca to settle the Prilosec lawsuit was so low a sum that it "constituted a significant forgiveness of debt" by AstraZeneca to delay the launch of Teva's generic -- was sufficient to proceed to trial. Id. at 286. The court next found that the plaintiffs had also met their burden as to, what it called, antitrust causation because they showed (1) that Teva was close to obtaining tentative FDA approval but slowed down its efforts toward that goal after settling with AstraZeneca, and (2) that Teva could have entered the market before May 2014, notwithstanding Ranbaxy's first-filer exclusivity period, by partnering with Ranbaxy on a joint launch. Id. at 288-89.[2] In sum, the plaintiffs could pursue the Teva settlement as a basis for antitrust liability at trial.

         Fourth, the district court granted the defendants' motion for summary judgment based on the Dr. Reddy's settlement, finding that the plaintiffs had proffered insufficient evidence both on the existence of an improper reverse payment and on "antitrust causation." Id. at 291-95.

         Finally, the district court denied three miscellaneous motions for summary judgment that AstraZeneca had filed: (1) a motion against the Direct Purchaser and Individual Retailer plaintiffs for lack of actual injury and seeking exclusion of testimony from two experts; (2) a motion barring assigned claims; and (3) a motion on the basis of the statute of limitations. Id. at 295-300.

         In sum, after the summary judgment proceedings, the plaintiffs were allowed to present evidence on AstraZeneca's improper reverse payment to Teva and any antitrust liability flowing from that payment, as well as the existence of an overarching antitrust conspiracy among AstraZeneca, Ranbaxy, Teva, and Dr. Reddy's. That evidence would include testimony from the plaintiffs' expert, Dr. Thomas McGuire. The court further directed the plaintiffs to present all evidence supporting an antitrust violation arising out of the Teva settlement first, before presenting any other evidence.

         After summary judgment, at a January 21, 2014 pretrial motion hearing, the district court granted the defendants' motion in limine to exclude testimony from Shashank Upadhye, a former in-house lawyer at a nondefendant generic manufacturer. The plaintiffs sought Upadhye's testimony to "augment Dr. McGuire's economic testimony with a real world business perspective on settlement negotiations for drug patent lawsuits." The court reasoned that Upadhye, along with another proposed expert witness (John Thomas), could not testify because they were "lawyers, not economists, and . . . they d[id] not have the requisite qualifications to testify." At an October 15, 2014 charge conference, the court reminded both parties that its decisions regarding motions in limine were "not rulings" and that the parties "must make [their] objections known during the course of the trial." Dr. Reddy's settled and dropped out of the lawsuit shortly before trial.

         B. Trial

         A six-week trial commenced on October 20, 2014. The trial transcript, exhibits, and filings comprise thousands of pages in the record. We summarize only the aspects of trial that are relevant to the arguments on appeal.

         1. Plaintiffs' Statement on Patent Invalidity and Evidence ...


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