FTC Complaint Against Shire Dismissed

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Delaware federal court judge Richard Andrews has granted a Shire motion to dismiss a 2/7/17 Federal Trade Commission (FTC) complaint alleging that the company abused the FDA citizen petition process to prevent generic competition to its Vancocin. FTC said Shire “inundated” FDA with 46 regulatory and court filings that “harmed competition and consumer welfare by obstructing and delaying the FDA approval process for a generic version of Vancocin.”

Andrews says Shire made two main arguments in calling for dismissal. First, Shire said that FTC failed to plead the facts necessary to invoke its authority under the FTC Act to bring suit. And second, it said its actions are immune from challenge under the Noerr-Pennington doctrine, which says that entities have a right to petition the government for redress of grievances.

The ruling says Shire raised what appear to be novel questions about the interpretation of Section 13 of the FTC Act. The judge held that FTC’s ability to seek an injunction in the case rested on the agency’s ability to demonstrate that the company had violated or was about to violate a law that FDA enforces. He further held there was no dispute that FTC had not alleged that Shire was violating a law.

“Having accepted the complaint’s factual allegations as true and having viewed those allegations in the light most favorable to the FTC,” Andrews wrote, “I find the complaint fails to adequately plead facts allowing for the reasonable inference that [Shire] ViroPharma is ‘about to violate’ a law enforced by the FTC pursuant to Section 13(b).”

Andrews further determined that the question of whether the company’s petitions and other filings were a sham could not be determined at the motion-to-dismiss stage, and instead requires fact-finding. He gave FTC 20 days to revise its complaint in accordance with the dismissal order.

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