Sciele Pharma, Inc. v. Lupin Ltd.

Case Name: Sciele Pharma, Inc. v. Lupin Ltd., Civ. No. 09-0037 (RBK/JS), 2011 U.S. Dist. LEXIS 139892 (D. Del. Dec. 6, 2011) (Kugler, J.)

Drug Product and Patent(s)-in-Suit: Fortamet^® (metformin hydrochloride); U.S. Patent Nos. 6,099,859 and 6,866,866

Nature of the Case and Issue(s) Presented: Whether the Court should enter a preliminary injunction against defendants.  In 2009, plaintiffs sued defendants for alleged infringement of the ‘859 and ‘866 patents.  Between 2009 and 2011, the parties entered into an agreement where defendants would promote Fortamet.  On September 7, 2011, the Court held a Markman hearing and issued a Markman order the next week.  On September 20, 2011, defendants informed plaintiffs that they were terminating the agreement and launched their generic product shortly thereafter.  In response, plaintiffs moved for a preliminary injunction.  The Court held a hearing to determine whether to grant the injunction.

The Court applied the general preliminary injunction standard, which required a showing of the following: (i) a substantial likelihood of success on the merits; (ii) a significant risk of irreparable harm if the injunction is withheld; (iii) a favorable balance of hardships; and (iv) a fit (or lack of friction) between the injunction and the public interest.  After finding that plaintiffs were likely to succeed on the merits and made a showing of irreparable harm, the Court entered a preliminary injunction.

Why Sciele Prevailed:  (Court enters preliminary injunction after finding plaintiffs were likely to succeed on the merits and suffer irreparable harm).  Defendants argued that their products did not embody one element of the alleged claim-the mean time to maximum plasma concentration ("Tmax") within a range of 5.5 to 7.5 hours.  Tmax is the time when the level of drug in the person is highest.  Defendants presented an expert study to show a Tmax of 12.8 hours.  Plaintiffs' expert argued that this study was flawed because it lacked certain information that "a well-documented study" would have contained.  Plaintiffs' expert further argued that the study was flawed for lack of a control group.  The Court disregarded both experts' testimony.  Instead, it turned to defendants' FDA-approved label which stated that the product has a Tmax of 6 hours.   Because this Tmax was within the disputed element range, the Court found a high likelihood of success that defendants infringed the ‘866 patent. 

The Court also rejected the defendants' invalidity argument.  Defendants' sole argument was that the ‘866 patent was erroneously granted because the allowed claimed Tmax range fell into a range that the Examiner rejected as obvious earlier in the prosecution.  This, argued defendants, was therefore a mistake that undercut the rationale underlying the presumption of validity and that the USPTO did its job properly.  But the Court rejected defendants argument, noting that "it cannot be overlooked that claim 1, as it appears in the ‘866 patent, was indeed approved by the PTO...."  Applying the presumption of validity, the Court found that the patent was granted properly with the 7.5 hour Tmax ceiling.  Because the defendants failed to raise any other invalidity issue, the Court found that the patent was likely valid. 

Next, the Court found that the plaintiffs would be irreparably harmed if Lupin were not enjoined.  Plaintiffs submitted sufficient evidence to demonstrate that they would lose good will as well as significant sales and market share.  Those latter losses would require plaintiffs to cut their work force.  Based on those facts, the Court found that plaintiffs would suffer irreparable harm without the preliminary injunction.

In analyzing the balance of hardships, the Court found for the plaintiffs because of their risk of unforeseeable harm.  It observed that the defendants would suffer foreseeable losses, but noted that plaintiffs' unforeseeable harm was greater.  The Court also noted that defendants would not be required to callback their products that they had already put into the market, which alleviated some of defendants' hardship.  Additionally, the Court required plaintiffs to post a $54 million bond, also alleviating defendants' hardship.  In sum, the plaintiffs' unknown harm in light of defendants' quantifiable harm (mitigated in light of the bond) led the Court to find the plaintiffs' hardships to be greater if the injunction were not granted. 

Finally, the Court found that the public interest would not be harmed if the preliminary injunction were granted.  It found that the public's interest in lower drug costs did not outweigh plaintiffs' interest in protecting its patent rights.  Thus, since all four factors weighed for the plaintiffs, the Court issued the requested preliminary injunction.