Supreme Court Grants Cert; Caraco Garners Support from Generic Pharma Industry

On June 27, 2011 the U.S. Supreme Court granted cert in Caraco Pharm. Labs., Ltd. v. Novo Nordisk A/S.

The article discusses the dispute between Caraco Pharmaceuticals and Novo Nordisk, in which the U.S. Supreme Court will address the Hatch-Waxman Act's provisions governing the marketing of generic drugs. Caraco has been working to introduce a generic version of the diabetes drug Prandin, but has been blocked by Novo's actions before the Food & Drug Administration (FDA). Novo owns a patent whose claims cover only one of three FDA-approved uses of Prandin, but has informed FDA that its patent in fact covers all three FDA-approved uses. Because FDA does not have substantive expertise in patents, it defers to the brand-name drug maker's description of the scope of its patent in deciding whether to permit generic marketing.

The Court will decide whether the Hatch-Waxman Act's counterclaim provision permits the courts to order Novo to correct the description of its patent provided to FDA. A brief submitted by Winston on behalf of Caraco set up the public policy argument by describing Novo's "gamesmanship" in its actions before FDA. "Using a patent to block the marketing of concededly unpatented uses would be extraordinary under any statute, but especially one designed to expedite generic competition." The brief provided a detailed review of the relevant provisions of the Hatch-Waxman Act and the FDA's regulations and procedures. Caraco further differentiated the pharmaceutical industry from other contexts, arguing that Hatch-Waxman eliminated the potential for effectively extending the scope of the patent to cover non-patented uses. "In other markets, competitors that wish to market allegedly infringing products can launch at risk and litigate later," Caraco explained. "But marketing drugs requires FDA approval. Thus, if brands can bottle up the approval process, generics are excluded from the market even where there is concededly no risk of infringement."

Caraco's position received support from several amici curiae, including Representative Waxman, AARP and U.S. PIRG, the Generic Pharmaceutical Association, Mylan Pharmaceuticals, and the United States. According to amicus Representative Waxman, the challenged Federal Circuit opinion "eviscerates" key aspects of the Hatch-Waxman system and "would enable brand companies to improperly delay generic competition for years, costing consumers and the health care industry dearly." And as the United States pointed out in a brief filed by Solicitor General Donald Verrilli, the counterclaim prevents brand-name drug makers from "upset[ting] the Hatch-Waxman balance by submitting a host of inappropriate patent information to FDA that prevented or delayed FDA's approval of [generic marketing]."

Novo's brief was filed October 17, 2011. Oral arguments in the case will be held December 5, 2011.