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Perrigo’s Claims of Sham Litigation to Delay Generic Rejected by Third Circuit

pharmacy medicine capsule pill in production line at medical factory

An opinion was issued on Thursday by the Third Circuit regarding an antitrust suit filed by plaintiffs Perrigo Co., and related entities against Abbvie Inc., Abbott Laboratories, Unimed Pharmaceuticals LLC, and Besins Healthcare Inc. The opinion affirmed the dismissal of the alleged violations of the Sherman Act.

The District of New Jersey originally held that a 2012 settlement between the parties released the plaintiffs’ current claim and dismissed the complaint. The Third Circuit opinion affirms this decision.

Defendants Unimed and Besins hold a patent that claims a pharmaceutical composition intended to treat hypogonadism. The defendants produce and market two brand-name topical gels known as AndroGel and AndroGel 1%, which are both covered under the aforementioned patent.

The plaintiffs produce a generic version of the AndroGel 1%, seeking approval to do so from the Food and Drug Administration (FDA) in 2011. The plaintiff also sent the defendants a notification letter of their intent to market the 1% generic in which they stated that the product would not infringe on the patent-in-suit.

The defendants then sued the plaintiffs for patent infringement, but before the plaintiffs responded to the suit, the parties reached a settlement agreeing to a mutual release. Following the settlement, the FDA approved the 1% generic and it hit markets in late 2014.

In 2020, the plaintiffs sued the defendants for alleged violations of the Sherman Act, claiming that the previous litigation was a sham intended to delay the plaintiffs’ launch of the 1% generic. The plaintiffs added that the lawsuit enabled the defendants to “maintain monopoly power,” and delay “the entry of much less expensive competitive generic products.” 

The defendants countered the suit by asserting that the plaintiffs’ claims were barred by a 2012 settlement agreement and moved for judgment, which the Court granted with prejudice. The Court explained that the claim accrued before the effective date of the settlement agreement, that the absence of of FDA approval on the 1% generic did not preclude the plaintiffs from establishing an injury when the litigation was filed, and that the asserted speculative damages exception to the general accrual rule did not apply.

The plaintiffs then appealed this decision, alleging antitrust activity against the defendants since their “sham” lawsuit delayed the release of the 1% generic and reduced AndroGel’s competition.

The court held that the defendant’s patent infringement suit was not a sham and was brought within the proper timeline, thus delaying FDA approval. The court ruled that the plaintiff’s speculative damages exception does not apply since the plaintiffs did not demonstrate whether or not they would suffer damages adequately, simply the amount of damages they would suffer. The court also ruled that the plaintiffs’ claim accrued when the defendants filed the litigation.

The plaintiffs were represented by Conrad O’Brien and the defendants were represented by Kirkland & Ellis, Clement & Murphy, Foley & Lardner, and Faegre Drinker Biddle & Reath.

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