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In re Solodyn (Minocycline Hydrochloride) Antitrust Litigation

United States District Court, D. Massachusetts

October 16, 2017



          Denise J. Casper, United States District Judge

         I. Introduction

         This is a putative class action in which the Direct Purchaser Plaintiffs (“DPPs” or “direct purchasers”) allege that Defendants Medicis Pharmaceutical Corporation (“Medicis”), Impax Laboratories, Inc. (“Impax”), Sandoz Inc. (“Sandoz”) and Lupin Limited and Lupin Pharmaceuticals, Inc. (collectively, “Lupin”) (collectively, “Defendants”), violated Section 1 of the Sherman Act, 15 U.S.C. § 1. D. 91. Additionally, putative class representatives of End-Payor Plaintiffs (“EPPs” or “end-payors”) allege that Defendants have violated various state laws. D. 92. EPPs have moved for class certification, D. 569, and DPPs have also moved for class certification, D. 574. For the reasons set forth below, the Court ALLOWs DPPs' motion for class certification under Fed.R.Civ.P. 23(b)(3) and ALLOWS EPPs' motion for class certification under Fed.R.Civ.P. 23(b)(3), but DENIES EPPs' motion for certification under Fed.R.Civ.P. 23(b)(2).

         II. Factual Background

         Solodyn is a drug-a minocycline hydrochloride extended release tablet-that treats inflammatory lesions resulting from acne in patients age twelve and older, and is manufactured, marketed and sold by Medicis. See, e.g., D. 570 at 11; D. 575 at 10; D. 576-1 ¶ 6; D. 577 ¶ 7; D. 611 at 6. Medicis received a patent on the brand Solodyn from the FDA in 1999, and in 2006, the FDA approved Medicis's New Drug Application (“NDA”) for three dosages of Solodyn: 45mg, 90mg and 135mg (“Legacy Strengths”). D. 570 at 11; D. 576-2 ¶ 14; D. 611 at 6. In October 2007, Impax submitted an Abbreviated New Drug Application (“ANDA”) to the FDA, seeking to market generic versions of Legacy Strength Solodyn. D. 570 at 11. On November 26, 2008, Medicis and Impax entered into two agreements, by which Impax agreed to abandon its challenge to Medicis's patent, and Medicis paid Impax approximately $40 million. D. 570 at 12; D. 575 at 11. On February 3, 2009, Impax received FDA approval on its ANDA. D. 570 at 12; D. 575 at 13. Impax did not begin selling generic Solodyn until November 2011. D. 570 at 13; D. 575 at 13.

         In the interim, Teva, Sandoz and Mylan launched generic Solodyn “at risk”-without having received FDA approval-for brief periods. D. 570 at 12; D. 575 at 13; D. 598 at 7; D. 611 at 7. “[W]ithin days” of launching, each generic manufacturer entered into an agreement with Medicis and stopped selling generic Solodyn. D. 575 at 13; see D. 570 at 12; D. 598 at 7; D. 611 at 7. The generic manufacturers then re-launched sales of generic Legacy Strength Solodyn in November 2011. D. 570 at 13; D. 575 at 14.

         Between March 2009, when Teva launched its generic Solodyn at-risk, and November 2011, Medicis also launched a series of promotion programs including co-pay card and coupon programs, in which patients participated “at high rates.” D. 598 at 8. In 2009 and 2010, Medicis launched sales of additional dosages of Solodyn: 55mg, 65mg, 80mg, 105mg and 115mg (“AddOn Strengths”). D. 575 at 16. Medicis ceased sale of Legacy Strengths in July 2011. Id. According to their respective agreements with Medicis, generic manufacturers will delay launch of generic Add-On Strength Solodyn until at least February 2018. D. 570 at 12.

         III. Procedural History

         In July 2013, DPPs, direct purchasers of Solodyn, brought the first antitrust suit against Defendants in the United States District Court for the Eastern District of Pennsylvania. Rochester Drug Co-Operative, Inc. v. Medicis Pharm. Corp., No. 2:13-cv-04270-JCJ (E.D. Pa. July 23, 2013). Shortly thereafter, various EPPs, consumers and third-party payors who indirectly purchased, paid for or provided reimbursement for Solodyn other than for resale, filed suit. See D. 2. On February 25, 2014, the Judicial Panel on Multidistrict Litigation ordered all Solodyn antitrust actions centralized and transferred those and two subsequent actions to this Court. D. 2; D. 153; D. 156. The DPPs and EPPs filed their respective consolidated amended complaints on September 15, 2014. D. 91; D. 92. On August 14, 2015, this Court allowed in part and denied in part Defendants' motion to dismiss, D. 110. D. 184; D. 203. EPPs have now filed a motion for class certification. D. 569. DPPs have also filed a motion for class certification. D. 574. The Court heard the parties on the pending motions and took the matters under advisement. D. 645.

         IV. Discussion

         A. Burden of Proof and Standard of Review

         A class action may be certified only if “(1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class.” Fed R. Civ. P. 23(a); In re New Motor Vehicles Canadian Export Antitrust Litig., 522 F.3d 6, 18 (1st Cir. 2008). Where, as here, both putative classes have moved to certify the class under Fed.R.Civ.P. 23(b)(3), the Court must also determine whether “questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.” Fed R. Civ. P. 23(b)(3); New Motor Vehicles, 522 F.3d at 18-19. “[T]he district court must undertake a ‘rigorous analysis' to determine whether plaintiffs me[e]t the four threshold requirements of Rule 23(a) (numerosity, commonality, typicality, and adequacy of representation) and Rule 23(b)(3)'s two additional prerequisites.” In re Nexium Antitrust Litig., 777 F.3d 9, 17 (1st Cir. 2015) (“Nexium III”)[1] (quoting Comcast Corp. v. Behrand, 569 U.S. 27, 33 (2013)).

         EPPs also move for class certification under Rule 23(b)(2). D. 570 at 28. To certify the class under Rule 23(b)(2), the Court must determine whether defendants have “acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole.” Fed.R.Civ.P. 23(b)(2); see New Motor Vehicles, 522 F.3d at 12 n.8. This form of class certification “ordinarily is used when broad, class-wide injunctive or declaratory relief is appropriate.” McKenna v. First Horizon Home Loan Corp., 475 F.3d 418, 427 (1st Cir. 2007). It “does not extend to cases in which the appropriate final relief relates exclusively or predominantly to money damages.” Fed.R.Civ.P. 23(b)(2) advisory committee's note to 1966 amendment; see DeRosa v. Mass. Bay Commuter Rail Co., 694 F.Supp.2d 87, 95 (D. Mass. 2010).

         The plaintiffs bear the burden of showing that all the prerequisites for a class action have been met. Makuc v. Am. Honda Motor Co., Inc., 835 F.2d 389, 394 (1st Cir. 1987). Plaintiffs “need not make that showing to a degree of absolute certainty. It is sufficient if each disputed requirement has been proven by a preponderance of the evidence.” Nexium III, 777 F.3d at 27 (quoting Messner v. Northshore Univ. HealthSystem, 669 F.3d 802, 811 (7th Cir. 2012)) (internal quotation marks omitted). The “rigorous analysis” required under Rule 23(b) does not “require raising the bar for plaintiffs higher than they would have to meet in individual suits.” Id. at 20 (emphasis in original). “Once plaintiffs have made their initial showing, defendants have the burden of producing sufficient evidence to rebut the plaintiff's showing.” Id. at 27. The Court will address each putative class in turn.

         B. The Direct Purchasers

         DPPs allege that the Defendants have unreasonably restrained trade in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1, by perpetuating reverse-payment settlements. D. 91. For such claims, guided by FTC v. Actavis, Inc., ___ U.S. ___, 133 S.Ct. 2223 (2013), courts apply the “rule-of-reason” analysis to determine “whether under all the circumstances of the case the restrictive practice imposes an unreasonable restraint on competition, ” Arizona v. Maricopa Cnty. Med. Soc'y, 457 U.S. 332, 343 (1982). The rule-of-reason analysis is a burden-shifting test: first, the plaintiff must show “that the challenged action has had an actual adverse effect on competition as a whole in the relevant market”; if shown, the defendant must then show “that the agreement was formed for legitimate business purposes which outweigh any anti-competitive effects”; and if that is shown, the plaintiff must then show “that the legitimate ends of the agreement could have been accomplished through less restrictive alternatives.” Addamax Corp. v. Open Software Found., Inc., 888 F.Supp. 274, 279 (D. Mass. 1995) (emphasis in original).

         DPPs seek to certify a class with forty-eight members, [2] defined as follows:

All persons or entities in the United States and its territories, including Puerto Rico, who purchased (a) 45mg, 55mg, 65mg, 80mg, 90mg, 105mg, 115mg, and/or 135mg brand or generic Solodyn tablets directly from any Defendant or other manufacturer at any time during the period July 23, 2009 through and including November 25, 2012 and/or (b) 55mg, 65mg, 80mg, 105mg, and/or 115mg brand Solodyn tablets directly from Medicis at any time from November 26, 2012 until November 30, 2015. Excluded from the Class are Defendants, and their officers, directors, management, employees, subsidiaries, or affiliates, and all federal government entities.
  1. 575 at 9.[3] The DPPs argue that the putative class meets all of the required factors established by Rule 23. D. 575 at 19-31. The Defendants do not dispute that the DPPs meet Rule 23's requirements of typicality, commonality and adequate representation.[4] See D. 598; D. 611. Rather, Defendants argue only that this putative class is not “so numerous that joinder would be impractical, ” Fed.R.Civ.P. 23(a)(1), and that even if numerosity is satisfied, the Plaintiffs have failed to show that issues common to the class predominate over individual questions, as required by Rule 23(b)(3). D. 611 at 10-28. The Court thus focuses on those factors in dispute.

         1. Numerosity Is Satisfied Here

         To certify a class action, the class must b] so numerous that joinder of all members would be “impracticable.” Fed.R.Civ.P. 23(a)(1). “‘Impracticability' does not mean ‘impossibility, ' but only the difficulty or inconvenience of joining all members of the class.” Advert. Specialty Nat. Ass'n v. FTC, 238 F.2d 108, 119 (1st Cir. 1956). “No minimum number of plaintiffs is required” to demonstrate impracticability, “but generally if the named plaintiff demonstrates that the potential number of plaintiffs exceeds 40, the first prong of Rule 23(a) has been met.” García- Rubiera v. Calderón, 570 F.3d 443, 460 (1st Cir. 2009) (quoting Stewart v. Abraham, 275 F.3d 220, 226-27 (3d Cir. 2001)); see In re Relafen Antitrust Litig., 218 F.R.D. 337, 342 (D. Mass. 2003). The Court may also take into account such “subjective factors” as the “geographic location of proposed class members, the nature of the action, and matters of judicial economy.” Nexium II, 296 F.R.D. at 52. Impracticability is a matter of discretion for the Court, see Advert. Specialty, 238 F.2d at 119, and courts have certified smaller classes in generic suppression cases where judicial economy favors proceeding as a class action, see, e.g., Nexium II, 296 F.R.D. at 53 (certifying class of twenty-four or twenty-nine); Dale Elecs., Inc. v. R.C.L. Elecs., Inc., 53 F.R.D. 531, 535-36 (D.N.H. 1971) (certifying class of thirteen).

         DPPs propose a class of forty-eight members and argue joinder is impracticable due to both the size of the class and the geographic dispersion of the members. D. 575 at 19-20. Defendants argue that DPPs' calculations of class membership at forty-eight members does not account for corporate ownership structure, which-by limiting class members to their common parent- results in a class of less than forty, namely thirty-nine members. D. 598 at 25-26; D. 598-1 at 66-156 (“Dr. Johnson Report”) ¶ 35; D. 611 at 25. For one example, Defendants point to a press release stating that HD Smith, a putative class member, acquired Valley Wholesale Drug, another putative class member, in 2012. Dr. Johnson Report ¶ 35 n.48. Additionally, Defendants argue that the class should also exclude “five purchasers who have manifested, through filing individual lawsuits, their intention to opt out of the proposed class, ” resulting in a direct purchasers class that is “more appropriately viewed as having 34 members.” D. 598 at 26; D. 611 at 26.

         The Court rejects Defendants' consolidation of class members based upon corporate structure. Defendants have provided no legal support for their argument that class members with common corporate parents should not be considered distinct entities for class certification purposes. On the other hand, DPPs argue that separately incorporated companies are distinct entities that should be treated as separate class members to vindicate their own antitrust injuries. D. 631 at 24 (citing Nichols & Co. v. Sec'y of Agric., 131 F.2d 651, 655 (1st Cir. 1942), vacated on rehr'g on other grounds, 136 F.2d 503 (1943)). They argue that here, the putative class members are separately incorporated companies that each suffered injury. D. 631 at 24. For example, using one but-for scenario prepared by DPPs' expert-and the jury will ultimately decide which but-for scenario is appropriate, as is explained in further detail below-Valley Wholesale Drug suffered $95, 600 in overcharges and H.D. Smith Wholesale suffered $15, 147, 800 in overcharges. D. 632 at 59. Dr. Leitzinger identified putative class members by using transactional sales data, in which each member appeared as separate direct purchasers. D. 632 ¶ 30. Other courts have held that absent evidence that the putative class is attempting to inflate the number of plaintiffs by including corporate subsidiaries, “subsidiaries should be considered as potential class members to vindicate their own antitrust injury.” Am. Sales Co., LLC v. Pfizer, Inc., No. 2:14-cv-361, 2017 U.S. Dist. LEXIS 137222, at *25 (E.D. Va. July 28, 2017). The Court finds this analysis persuasive, particularly in light of the DPPs' expert's showing of individual injury sustained by each member of the class. The Court thus holds that their corporate relationship does not defeat their status as individual class members here.

         The Court also declines to adopt Defendants' position that five purchasers' filing separate complaints compels the conclusion that they would opt-out of the class, if certified. Regardless, even if these putative class members ultimately do opt out of the class, the remaining class of forty-three would still satisfy the numerosity requirement. After all, “[n]umerosity is established if the size of a proposed class, even if inexactly determined, is sufficiently large as to make joinder impracticable.” Overka v. Am. Airlines, Inc., 265 F.R.D. 14, 17 (D. Mass. 2010) (quoting Relafen, 221 F.R.D. at 266) (internal quotation marks omitted). The size of this class alone demonstrates that joinder would be impracticable here.

         Moreover, the “subjective” factors in the numerosity inquiry weigh in favor of certifying the DPP class, showing that joinder, even if not impossible, is impracticable here, even where the class includes corporate entities, certain of which share common corporate parents. Defendants rely upon In re Modafinil Antitrust Litig., 837 F.3d 238 (3d Cir. 2016) and King Drug Co. of Florence, Inc. v. Cephalon, Inc., No. 2:06-cv-1797, 2017 U.S. Dist. LEXIS 137601 (E.D. Pa. Aug. 28, 2017), in support of their argument that joinder would not be impracticable here. D. 611 at 28; D. 638. Neither case compels the conclusion Defendants seek. In Modafinil, the Third Circuit focused on the impracticability inquiry regarding a putative class consisting of far less than forty members, stating that under those circumstances, the inquiry is “particularly rigorous.” Modafinil, 837 F.3d at 250. In King Drug, the putative class consisted of only twenty-two to twenty-four direct purchasers, and the small class size played a key part of the court's analysis of the “subjective” impracticability factors. King Drug, 2017 U.S. Dist. LEXIS 137601, at *23-40.[5]

         DPPs have demonstrated that joinder would be impracticable here. First, geographic dispersion suggests joinder is impracticable, even when putative class members are corporate entities. See Lidoderm, 2017 U.S. Dist. LEXIS 24097, at *72; Am. Sales. Co., 2017 U.S. Dist. LEXIS 137222, at *31; Nexium II, 296 F.R.D. at 52; see also 5-23 James Wm. Moore et al., Moore's Federal Practice § 23.22(1)(a) (3d ed. 2017). As DPPs have shown, putative class members are based throughout the country. D. 576-1 at 53; D. 632 at 54. Defendants do not dispute that the proposed class is geographically dispersed. See D. 611 at 27.

         Second, judicial economy and the ability and motivation to litigate as joined plaintiffs- the two factors of “primary importance” in Modafinil, 837 F.3d at 253-weigh in favor of class certification here. Here, a class action serves judicial economy because all putative class members seek damages stemming from the same allegedly illegal activity. See Am. Sales Co., 2017 U.S. Dist. LEXIS 137222, at *30; Wilson, 2017 U.S. Dist. LEXIS 572, at *15; Nexium II, 296 F.R.D. at 53. Even accepting the Third Circuit's definition of judicial economy-focused on “the administrative burden that multiple or aggregate claims place upon the courts, ” which “primarily involves considerations of docket control, ” Modafinil, 837 F.3d at 254, 257-the factor weighs in DPPs' favor due to the difficulty of coordinating attorneys, scheduling and docketing for forty-eight clients. See Wilson, 2017 U.S. Dist. LEXIS 572, at *14-15.

         Finally, the Court is persuaded that the ability and motivation of these putative class members to litigate as joined plaintiffs supports class certification. DPPs argue that Defendants' assertions that all direct purchasers here would join in a common suit “ignore the formidable business realities and legal hurdles standing in the way of such a strategy.” D. 631 at 26. The competitive relationship among some class members serves “as a significant business obstacle” to joinder. D. 631 at 26; see Am. Sales Co., 2017 U.S. Dist. LEXIS 137222, at *31. To illustrate this, DPPs conducted an empirical analysis of approximately 20, 000 federal case filings from the last fifteen years involving one or more members of this class, finding that in only five cases- were these members plaintiffs in pharmaceutical antitrust cases that were not class actions.[6] DPPs explain that such cases are so infrequent because the nature of the litigation makes ascertaining damages difficult at the outset and many cases mirror this one, where DPPs have demonstrated that approximately half of the putative class members have negative value claims. D. 631 at 27; see Lidoderm, 2017 U.S. Dist. LEXIS 24097, at *72; Applegate v. Formed Fiber Techs., LLC, No. 2:10-cv-00473-GZS, 2012 U.S. Dist. LEXIS 105264, at *15 n.6 (D. Me. July 27, 2012) (explaining that the “relatively small size of each plaintiff's claim would discourage many” putative class members from pursuing claims individually). Such cases are the reason why the class action mechanism exists: there is no incentive for these parties to join in light of the litigation costs as compared to the damages at stake. See Amchem Prods. v. Windsor, 521 U.S. 591, 617 (1997).

         The Court thus finds that the DPPs have met their burden of proving numerosity under Rule 23(a)(1).

         2. Rule 23(b)(3) Predominance

         Rule 23(b)(3) requires the Court to find that “the questions of law or fact common to class members predominate over any questions affecting only individual members.” Fed.R.Civ.P. 23(b)(3).[7] The focus of the predominance inquiry is “whether proposed classes are sufficiently cohesive to warrant adjudication by representation.” Amchem, 521 U.S. at 623. When conducting such Rule 23(b)(3) analysis, the Court must determine whether there is “reason to think that [individualized] questions will overwhelm common ones and render class certification inappropriate.” Halliburton Co. v. Erica P. John Fund, Inc., ___ U.S. ___, 134 S.Ct. 2398, 2412 (2014). A district court must “formulate some prediction as to how specific issues will play out in order to determine whether common or individual issues predominate in a given case.” Waste Mgmt. Holdings, Inc. v. Mowbray, 208 F.3d 288, 298 (1st Cir. 2000). This may “entail some overlap with the merits of the plaintiff's underlying claim, ” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 351 (2011), but “Rule 23 grants courts no license to engage in free-ranging merits inquiries at the certification stage, ” Amgen Inc. v. Conn. Ret. Plans & Trust Funds, 568 U.S. 455, 466 (2013).

         In antitrust actions, “[p]redominance is a test readily met.” Amchem, 521 U.S. at 625; see Comcast, 569 U.S. at 41 (Ginsburg, J., dissenting). Nevertheless, the Court must conduct a thorough analysis of the facts and expert opinions provided to ensure predominance has been shown here. See Nexium III, 777 F.3d at 21. “To meet the predominance requirement, the party seeking certification must show that ‘the fact of antitrust impact can[] be established through common proof' and that ‘any resulting damages would likewise be established by sufficiently common proof.'” Id. at 18 (quoting New Motor Vehicles, 522 F.3d at 20) (emphasis and alteration in original). DPPs argue that questions of law and fact predominate because proof of violation of Section 1 of the Sherman Act, the unlawful conduct alleged here, will not vary among class members. D. 575 at 25-26. Defendants do not dispute, however, that proof of illegal activity will not vary among class members; they instead argue that individual questions will overwhelm common ones with respect to common impact and damages. D. 611 at 11-25. The Court thus takes each question in turn.

         a) Common Proof of Antitrust Impact

         “[A]t class certification, plaintiffs must only show that ‘antitrust impact is capable of proof at trial through evidence that is common to the class rather than individual members.'” Nexium III, 777 F.3d at 24 n.20 (quoting In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305, 311 (3d Cir. 2008)).

         DPPs allege injury in the form of overcharges. D. 575 at 26-27. As the First Circuit recently reaffirmed, “antitrust injury occurs the moment the purchaser incurs an overcharge.” Nexium III, 777 F.3d at 27; see Hanover Shoe, Inc. v. United Mach. Corp., 392 U.S. 481, 489 (1968). DPPs argue that “were it not for the unlawful Medicis-Impax Agreement, unimpaired generic Solodyn competition would have begun in 2009, and all or nearly all Class members would have paid less for their requirements of minocycline hydrochloride extended release tablets by substituting less-expensive generic minocycline hydrochloride extended release tablets for more-expensive brand Solodyn.” D. 575 at 27. DPPs allege that they will be able to provide “mostly or exclusively common” proof at trial, “including testimony from Defendants' employees, Defendants' business records, and expert testimony” to show antitrust impact common to class members. D. 575 at 24-25.

         DPPs proffer the opinion of Dr. Jeffrey Leitzinger, an economist with a career focus on industrial organization, D. 576-1 ¶¶ 1-2, to argue common injury or impact among class members.[8] Dr. Leitzinger concludes that “Medicis and Impax's allegedly unlawful conduct, if proven, had a direct, market-wide effect on minocycline hydrochloride extended release tablet prices generally (i.e., maintaining prices above the level that would have occurred absent Medicis and Impax's allegedly unlawful conduct), ” and that “absent that conduct and unimpaired generic competition beginning in 2009, all or nearly all Class members would have paid less for their purchases of minocycline hydrochloride extended release tablets.” D. 575 at 27. Dr. Leitzinger bases his conclusions upon: (1) “extensive empirical economic research demonstrating that generics are substantially cheaper than and rapidly substituted for their brand counterparts, ” D. 575 at 27, including a 2010 FTC study stating that generics account for ninety percent of the prescription base one year after entry onto the market; (2) “contemporaneous forecasting documents, prepared for business purposes by Medicis, Impax, Teva, Sandoz, Mylan and Lupin, which conclude that, with unimpaired generic competition, generic Solodyn would be priced lower than brand Solodyn, and would quickly capture most Solodyn sales”; and (3) “what happened during the abbreviated 2009 and 2010 launches of generic Solodyn, and after generic entry allowed under the challenged agreements, starting November 26, 2011, ” during which times the “[c]lass paid less for generic Solodyn than for brand Solodyn.” D. 575 at 27-29; D. 576-1 ¶¶ 22-34. Dr. Leitzinger concludes that given that the putative class members are “nearly all wholesalers or retailers supplying product to broad cross-sections of the patient community, ” and that approximately ninety percent of Solodyn prescriptions would have converted to generics under competitive conditions at a fraction of the branded price, “if the jury concludes there was meaningful impairment of generic competition” here, “the only plausible inference is that all (or nearly all) Class members paid inflated prices for (at least some of) their minocycline hydrochloride extended release tablets as compared to what they would have paid” otherwise. D. 576-1 ¶¶ 35-38.

         Defendants argue that DPPs' evidence is insufficient to establish predominance because it is “generalized” and does not show actual injury of any members of the class. D. 598 at 12-14; D. 611 at 12-14. Defendants distinguish this case from other reverse payment cases where academic literature and forecasts provided the appropriate evidence because here, unusually, there was at least some time during the class period during which generics were on the market. D. 598 at 12-14. They argue that actual data showing prices and sales of those generics and brand Solodyn during that time is thus the better measure of whether the class members suffered any antitrust injury. Id. To support their arguments, Defendants submit the opinion of John H. Johnson, IV, the President and CEO of Edgeworth Economics LLC, a consulting firm that provides “economic and financial analysis for complex litigation and public policy debates.” Dr. Johnson Report ¶ 5. Dr. Johnson argues “there was no actual delay in generic entry” in this case because generic Legacy Strength Solodyn was introduced through three at-risk entries and, “as a result, was continuously available to consumers throughout the class period.” Dr. Johnson Report ¶ 1 (emphasis in original).

         This argument serves as the basis for several attacks on Dr. Leitzinger's-and DPPs'- contentions. First, Defendants argue that Dr. Leitzinger's methodology is flawed because it ignores actual data about purchasers' rate of conversion to generic Solodyn during this period in favor of inaccurate forecasts and generalized economic literature. D. 598 at 13; D. 611 at 13. Second, Defendants argue that Dr. Leitzinger's conclusions depend upon a hypothetical world in which putative class members purchased more generic Solodyn than they actually did without providing a methodology showing that to be true. D. 598 at 16-17; D. 611 at 16-17. Third, Defendants argue that Dr. Leitzinger's report fails to account for “case-specific supply and demand factors” such as Medicis marketing and promotion programs (e.g., coupon programs) that made the brand less expensive than the generic for many patients and Medicis's launch of the Solodyn Add-On Strengths. D. 598 at 17-18; D. 611 at 17-18. Defendants argue that these factors, and not restricted competition resulting from the Medicis-Impax agreement, explain the low demand of generic Solodyn during that time. D. 598 at 17-18.

         Dr. Leitzinger responds by explaining that the “actual data” here is not “representative of what would have occurred in the but-for world” of unrestrained competition. D. 576-1 ¶ 44. He explains that he was “not able to make use of the actual generic experience for purposes of estimating generic penetration in the but-for world” because the “initial abbreviated Legacy Strength generic launches were limited to just a few days and therefore do not provide a meaningful window as to the likely generic penetration from a sustained generic presence in the market, ” and the “post-November 2011 launches occurred at a time when Medicis was no longer selling Solodyn in Legacy Strengths.” Id. DPPs argue that the relevant comparison is not what happened in the actual world with brief generic launches, but rather the conversion rate and price assuming “sustained, full-fledged generic competition.” See D. 631 at 11. With that understanding in mind, DPPs argue that all or nearly all class members paid overcharges on their purchases and thus experienced antitrust impact. D. 631 at 21.

         Moreover, predictive evidence and methodologies often serve as the basis for a showing of predominance in antitrust cases. See, e.g., Lidoderm, 2017 U.S. Dist. LEXIS 24097, at *61 (accepting DPPs' arguments for classwide proof of injury “[g]iven the well-researched market at issue and the well-recognized type of antitrust injury alleged”); Relafen, 218 F.R.D. at 343-45. The Court declines to reject DPPs' reliance, at least in part, upon forecasts or predictions, even here, where there was some data regarding the impact of generics on the market, because the limits of the latter data do not serve as an appropriate proxy for the but-for market.

         Furthermore, the Court is persuaded that these forecasts serve as a better proxy for unconstrained competition than the “actual” data of generic and brand Solodyn sales. First, DPPs argue that the brief generic entry during 2009 and 2010 did not establish unfettered competition between generics and brand Solodyn. D. 631 at 14-15. Dr. Leitzinger points out that each generic seller separately entered the market for only a few days in each case before entering into agreements with Medicis, at which point they each announced that they were leaving the market. D. 632 ¶ 10. At the start of each brief launch there was “rapid growth in retail prescriptions filled by generics, ” but after each generic seller announced it would be ending sales, “the growth in generic prescription levels halted, turning sharply downward.” D. 632 ¶¶ 11-12. Dr. Leitzinger also presents evidence that generic Solodyn was not accessible by many direct purchasers or registered on large health insurers' formularies until after the generics' sustained launch in 2011. D. 632 ¶¶ 15-17. Second, Dr. Leitzinger explains that Medicis's couponing during this period does not account for differences between actual sales and forecasted sales of generics during this time because, among other things, “the primary process which drives generic penetration is automatic substitution at the pharmacy level, ” which is not impacted by any coupon or copay programs for consumers.[9] D. 632 ¶ 24. Third, DPPs argue that post-2011 generic sales are not a valid proxy because by November 2011, Medicis had taken “advantage of the generic delay it had purchased to shift the majority of Solodyn prescriptions from the Legacy to the Add-On Strengths.” D. 631 at 15-16. Additionally, Dr. Leitzinger did take the actual data into account in forming his conclusions, noting that even during the points of limited entry, the generic was priced at approximately fifty ...

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