Appeals Court Backs Apotex Suit Dismissal
The 2nd Circuit Court of Appeals has affirmed a lower federal court’s dismissal of antitrust and false advertising claims arising out of Apotex’ ANDA for a generic form of Acorda Therapeutics’ Zanaflex (tizanidine) capsules. Apotex had alleged that Acorda filed a sham petition with FDA to slow Apotex’ generic launch and also claimed that Acorda made false advertisements for its Zanaflex product.
Attorney James Buchanan (McDermott Will & Emery) writes in an online post that the federal district court ruled that the simultaneous approval by FDA of Apotex’ ANDA and its denial of Acorda’s petition that raised concerns about the ANDA “was by itself insufficient to support a Sherman Act claim.” The court later granted summary judgment to Acorda and dismissed all of Apotex’ Lanham Act false advertising claims on the grounds that none of Acorda’s representations (with one exception) were literally false or likely to mislead consumers, and that Apotex failed to show that the false depiction in one graph would meaningfully affect consumers’ purchasing decisions.
In dismissing the appeal, the 2nd Circuit said Apotex failed to show that the Acorda petition was objectively baseless. Although earlier case law established an inference that a citizen petition is a sham when it is denied simultaneously with grant of an ANDA petition, the appeals court cited recent FDA guidance undermining that inference, Buchanan writes. Specifically, he says, the guidance favors contemporaneous adjudications of ANDA applications and citizen petitions so as to safeguard the procedural rights of ANDA applicants such as Apotex.
The appeals court also upheld the grant of summary judgment on the Lanham Act claims. It held that Acorda advertisements could not be the basis for Lanham Act claims to the extent that they were consistent with the FDA-approved labeling. And for claims alleged to be outside the labeling boundaries, the court said that Apotex failed to show that the representations were inconsistent with the labeling in a manner sufficient to support a false advertising claim. Although the 2nd Circuit agreed with the district court conclusion that a reasonable juror could determine that one Acorda graph communicated a literally false message, it held that Apotex failed to show that the misrepresentation was material to the extent that it was likely to influence consumers’ purchasing decisions.