AstraZeneca Pharmaceuticals LP v. Food & Drug Administration ( 2013 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued March 21, 2013 Decided April 26, 2013
No. 12-5227
ASTRAZENECA PHARMACEUTICALS LP,
APPELLANT
v.
FOOD & DRUG ADMINISTRATION, ET AL.,
APPELLEES
Appeal from the United States District Court
for the District of Columbia
(No. 1:12-cv-00472)
Robert A. Long Jr. argued the cause for appellant. With
him on the briefs were Timothy C. Hester, Benjamin C. Block,
and Matthew J. Berns.
Gerald C. Kell, Senior Trial Counsel, U.S. Department of
Justice, argued the cause for appellees. With him on the brief
were Stuart F. Delery, Principal Deputy Assistant Attorney
General, Maame Ewusi-Mensah Frimpong, Deputy Assistant
Attorney General, William B. Schultz, Acting General
Counsel, U.S. Department of Health and Human Services, and
Eric M. Blumberg, Deputy Chief Counsel, Litigation.
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Before: ROGERS and TATEL, Circuit Judges, and
SENTELLE, Senior Circuit Judge.
Opinion for the Court filed by Senior Circuit Judge
SENTELLE.
SENTELLE, Senior Circuit Judge: AstraZeneca
Pharmaceuticals LP, a manufacturer of pharmaceutical
products, appeals from the district court’s grant of summary
judgment in an action praying a declaratory judgment that the
Food and Drug Administration (“FDA”) could not approve
generic versions of its Seroquel product and seeking to
restrain the FDA from approving abbreviated new drug
applications (“ANDAs”) for such competing products until
the expiration of a period of exclusivity. The district court
granted summary judgment in favor of the FDA, and
AstraZeneca appealed. For the reasons set forth below, we
agree with the district court that the FDA reasonably
determined that AstraZeneca was not entitled to such period
of exclusivity. We therefore affirm the grant of summary
judgment.
I. BACKGROUND
A. Statutory Framework
The Federal Food, Drug, and Cosmetic Act (“FDCA”)
governs the drug approval process for new and generic drugs.
See 21 U.S.C. §§ 301–99. A drug manufacturer, such as
AstraZeneca, seeking to introduce a new, or pioneer, drug
must file a new drug application (“NDA”) with the FDA. Id.§ 355(b)(1). If the FDA approves the application, the statute
entitles the manufacturer to a period of marketing exclusivity
during which the FDA cannot approve bioequivalent generic
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drugs. See id. § 355(j)(5)(F). Once the exclusivity period has
expired, the FDA can approve generic drugs bioequivalent to
the pioneer drug through an abbreviated new drug application.
See id. § 355(j). ANDAs need not include new clinical
studies demonstrating the generic drug’s safety or efficacy,
but must propose the same basic labeling as approved for the
pioneer drug. See id. § 355(j)(2)(A)(v); see also 21 C.F.R.
§ 314.94(a)(8)(iv).
The FDCA provides for additional periods of exclusivity
for pioneer drugs based on medical studies completed after
the initial approval process if such studies support new
indications of the drugs, which typically means that the drugs
can be used in new patient populations or to treat different
conditions. 21 U.S.C. § 355(j)(5)(F); see AstraZeneca
Pharm. LP v. FDA, 872 F. Supp. 2d 60, 64 (D.D.C. 2012).
Drug manufacturers can apply for this additional exclusivity
through a supplemental new drug application (“sNDA”). The
statutory provision governing such sNDAs provides:
If a supplement to an application . . . contains reports
of new clinical investigations (other than
bioavailability studies) essential to the approval of the
supplement and conducted or sponsored by the person
submitting the supplement, the Secretary may not
make the approval of an application submitted under
this subsection for a change approved in the
supplement effective before the expiration of three
years from the date of the approval of the supplement
....
21 U.S.C. § 355(j)(5)(F)(iv). Therefore, as provided in FDA
regulations, the FDA cannot approve an ANDA for three
years following the approval of an sNDA if the ANDA “relies
on . . . information supporting a change approved in the
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supplemental new drug application.” 21 C.F.R.
§ 314.108(b)(5)(ii). An amendment makes this exclusivity
period “three years and six months rather than three years” in
some circumstances where the manufacturer provides
pediatric studies that the FDA requests. 21 U.S.C.
§ 355a(c)(1)(A)(i)(II). The statute leaves the word
“supplement,” along with many of its other terms, undefined.
The FDA has promulgated extensive regulations setting forth
the application process and defining the statutory terms. See
21 C.F.R. §§ 314.3, 314.50, 314.60, 314.70.
B. Factual and Procedural Background
AstraZeneca has marketed Seroquel, an atypical
antipsychotic medication used to treat disorders such as
schizophrenia, since 1997, largely without generic
competition. Based on various sNDAs, the FDA has given
supplemental exclusivity to AstraZeneca when it added
indications to Seroquel. AstraZeneca has made other label
changes which did not add indications to Seroquel, but only
added safety information. With respect to these safety-related
label changes, the FDA has not granted any additional period
of exclusivity. AstraZeneca, 872 F. Supp. 2d at 67.
One side effect of drugs like Seroquel is hyperglycemia,
or high blood sugar. The FDA has added information about
observed changes in blood sugar levels to labeling on all
antipsychotic drugs. On June 26, 2008, in response to a
request from the FDA, AstraZeneca submitted metabolic data
regarding observed changes in blood sugar levels among
patients taking Seroquel or Seroquel XR, an extended release
version of Seroquel. The data came from fifteen clinical
trials, all conducted for reasons other than generating this
particular data and none conducted on pediatric patients.
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Separately, AstraZeneca submitted two sNDAs in support
of new pediatric indications of Seroquel on October 28, 2008,
requesting three years of exclusivity for the new indications.
The FDA considered those sNDAs while it was continuing
review of the blood sugar labeling question. Correspondence
between AstraZeneca and the FDA establishes that they
discussed those two subjects and others in the same letters.
On October 16, 2009, the FDA asked for a table summarizing
the previously submitted glucose data, which AstraZeneca
supplied, along with other labeling changes. This table,
referred to as Table 2, is the basis of the current litigation.
On December 2, 2009, the FDA approved the pediatric
sNDAs as well as the proposed labeling changes, including
Table 2. The FDA sent AstraZeneca a single letter reflecting
these approvals.
On September 2, 2011, AstraZeneca filed two citizen
petitions with the FDA requesting exclusivity for Table 2
based on the clinical trials that provided the relevant data.
The FDA denied the petitions without responding to
AstraZeneca’s request by, as the district court put it,
“conveniently” ignoring the legal question regarding Table
2’s eligibility for exclusivity. AstraZeneca, 872 F. Supp. 2d
at 74. AstraZeneca filed suit and moved for a preliminary
injunction. The district court dismissed that action as unripe
and denied the motion for a preliminary injunction because
the FDA had not yet decided whether to grant ANDAs that
included Table 2 in the labeling for generic versions of
Seroquel and Seroquel XR. See AstraZeneca Pharm. LP v.
FDA, 850 F. Supp. 2d 230, 249–51 (D.D.C. 2012). Four days
after the district court’s decision, on March 27, 2012, the
FDA approved ANDAs for generic versions of Seroquel with
Table 2 included as part of the labeling.
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The FDA issued a letter to AstraZeneca on the same day
explaining its decision that Table 2 was not entitled to a
period of exclusivity. The letter points out that “changes in
labeling that involve the addition of warnings or other similar
risk information are generally not entitled to 3-year
exclusivity.” Public Joint Appendix 304. It goes on to
explain that Table 2 contains only “generally applicable safety
information” and thus is not protected by any exclusivity. Id.In addition, the letter states that Table 2 does not include data
from any indications for which Seroquel still had exclusivity,
including the pediatric indications. Id. at 306. Finally,
according to the letter, it was purely “coincidental” that the
FDA approved Table 2 “in the course of approving” the
pediatric sNDAs. The FDA’s letter explicitly stated that
“there is no relationship between the exclusivity for pediatric
indications . . . and the data in Table 2.” Id.AstraZeneca again filed suit, seeking a temporary
restraining order and further relief. The district court denied
the motion for a temporary restraining order and later granted
summary judgment in favor of the FDA, holding that the
statute is ambiguous and the FDA’s interpretation is
reasonable. AstraZeneca filed this appeal.
II. DISCUSSION
A. Mootness
The FDA first argues that we should dismiss this case as
moot. Article III of the Constitution gives federal courts
jurisdiction to decide cases and controversies. This provides
federal courts jurisdiction to decide only “actual, ongoing
controversies.” See, e.g., Honig v. Doe, 484 U.S. 305, 317
(1988). “Even where litigation poses a live controversy when
filed, the mootness doctrine requires a federal court to refrain
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from deciding it if events have so transpired that the decision
will neither presently affect the parties’ rights nor have a
more-than-speculative chance of affecting them in the future.”
LaRoque v. Holder, 679 F.3d 905, 907 (D.C. Cir. 2012)
(quoting Clarke v. United States, 915 F.2d 699, 701 (D.C. Cir.
1990) (en banc)). According to the FDA, this case is now
moot because any period of exclusivity attached to Table 2
would have expired by December 2, 2012, three years after
the FDA approved the addition of Table 2 to Seroquel’s
labeling. See 21 U.S.C. § 355(j)(5)(F)(iv).
However, the FDA is not correct that the possibility of
relief has been extinguished. As we noted above, the period
of exclusivity can be extended beyond three years for an
additional six months if the FDA requests and receives
pediatric studies from the manufacturer. See id.§ 355a(c)(1)(A)(i)(II). If applicable in this case, the longer
period of exclusivity would not expire until June 2, 2013.
The FDA argues that AstraZeneca waived this claim of longer
exclusivity by failing to specifically argue it below. This is
not, however, dispositive on the particular facts of this case.
As the FDA concedes, it would have to consider the pediatric
exclusivity period “if AstraZeneca prevails in its request for
three-year exclusivity for Table 2.” Appellees’ Br. at 48.
Because AstraZeneca has submitted some pediatric studies
regarding Seroquel, if AstraZeneca were to prevail on the
merits of its claim, exclusivity through June 2, 2013, might be
available. See AstraZeneca, 872 F. Supp. 2d at 65 n.4.
Therefore, our decision will affect AstraZeneca’s actual
rights, and the case is not moot. Thus, we must determine the
merits of the summary judgment.
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B. Summary Judgment
Under the Federal Rules of Civil Procedure, grant of
summary judgment is appropriate where “there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed. R. Civ. P. 56(a). Our
review of the district court’s grant of summary judgment is de
novo. See, e.g., Calhoun v. Johnson, 632 F.3d 1259, 1261
(D.C. Cir. 2011). We therefore undertake the same
examination as the district court to determine the presence or
absence of genuine disputes of material fact and legal
entitlement to judgment of the movant, in this case the FDA.
Sherley v. Sebelius, 689 F.3d 776, 780 (D.C. Cir. 2012).
When summary judgment is at issue in a case of
administrative review under the APA, we, like the district
court, are required to “hold unlawful and set aside agency
action, findings, and conclusions found to be . . . arbitrary,
capricious, an abuse of discretion, or otherwise not in
accordance with law.” 5 U.S.C. § 706(2)(A). Under the
applicable standard the district court, and now this court, must
allow summary judgment for the agency (in this case, the
FDA), unless the appellants can demonstrate by record
evidence that “a genuine dispute” exists as to some material
fact supporting the proposition that the FDA’s actions under
review were “arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with law.” See Sherley, 689 F.3d
at 780.
There being no genuine dispute as to the facts of record,
see id., our analysis is limited to the validity of the FDA’s
interpretation and application of the statute. Since the
determinative issue is one of an agency’s interpretation of a
statute, we apply the familiar test of Chevron U.S.A. Inc. v.
Natural Resources Defense Council, Inc., 467 U.S. 837(1984). See Mylan Labs., Inc. v. Thompson, 389 F.3d 1272,
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1279–80 (D.C. Cir. 2004) (applying Chevron to FDA decision
letters). “If the intent of Congress is clear, that is the end of
the matter; for the court, as well as the agency, must give
effect to the unambiguously expressed intent of Congress.”
Chevron, 467 U.S. at 842–43. If the statute is ambiguous,
“the question for the court is whether the agency’s answer is
based on a permissible construction of the statute.” Id. at 843.
AstraZeneca contends that it should prevail at the first
step of the Chevron test. That is, it contends that the statute
clearly provides the exclusivity it seeks based on Table 2.
AstraZeneca relies on the statutory language that provides for
exclusivity where a supplement “contains reports of new
clinical investigations . . . essential to the approval of the
supplement.” 21 U.S.C. § 355(j)(5)(F)(iv).
AstraZeneca argues that the statute clearly entitles Table
2 to exclusivity on two grounds. First, Table 2 was “a change
approved in” the pediatric supplements, and the supplements
included “reports of new clinical investigations . . . essential
to the approval of the supplement[s].” Id. Second, some of
the clinical studies that provided the data for Table 2 were
“new clinical investigations” “essential to the approval” of the
labeling changes so as to independently warrant exclusivity.
Either way, AstraZeneca claims, Table 2 is entitled to
exclusivity, so the FDA’s approval of ANDAs incorporating
Table 2 prior to June 2, 2013, was contrary to the statute.
Because we disagree that the statute mandates exclusivity in
these circumstances, and because we consider the FDA’s
interpretation reasonable, we affirm the district court’s grant
of summary judgment.
At the core of this dispute is the statutory language that
limits exclusivity to “a change approved in the supplement”
and requires that “the supplement contain[] reports of new
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clinical investigations . . . essential to the approval of the
supplement.” 21 U.S.C. § 355(j)(5)(F)(iv). This language is
permeated by ambiguities that, under Chevron, leave
discretion in the FDA to adopt reasonable interpretations of
the application process outlined by the statute.
The statute leaves to the FDA the interpretation of a
“supplement” to a drug application. Under the statute, the
FDA has power to implement the entire application and
approval process, which necessarily gives the FDA discretion
to determine the requirements of “applications” and
“supplements” and how to handle changes that are not
contained in such applications or supplements. Because the
statute includes these ambiguities, the language “constitutes
an implicit delegation from Congress to the agency to fill in
the statutory gaps.” FDA v. Brown & Williamson Tobacco
Corp., 529 U.S. 120, 159 (2000).
The fundamental problem with both of AstraZeneca’s
arguments is that the FDA has maintained that Table 2 was
not “a change approved” in any supplement, and only changes
approved in a supplement are entitled to a statutory period of
exclusivity. See Public Joint Appendix 306; 21 U.S.C.
§ 355(j)(5)(F)(iv). The FDA has exhaustive regulations
detailing the parameters of the application process, including
how to amend pending supplements and applications. See 21
C.F.R. §§ 314.50, 314.60, 314.70. AstraZeneca makes no
attempt to show that these procedures are contrary to the
statute. Nor has AstraZeneca shown that the FDA’s
application of the law to the relevant facts was arbitrary or
capricious.
The supplements here dealt with new pediatric
indications of Seroquel. AstraZeneca submitted the data for
Table 2 in letters coded as general correspondence (not
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supplements) prior to even filing those supplemental
applications. See Public Joint Appendix 298. Further, no
data for Table 2 was derived from the pediatric studies at
issue in the supplements, and AstraZeneca cited only the
pediatric studies in support of its request for exclusivity.
Table 2 is only contained in the “Adult” section of Seroquel’s
labeling. Finally, though AstraZeneca makes much of the fact
that the FDA approved the pediatric supplements and Table 2
at the same time, the FDA explained that the “this timing was
only coincidental, and there is no relationship between the
exclusivity for the pediatric indications earned on December
2, 2009, and the data in Table 2.” Id. at 306. We see nothing
arbitrary or capricious about the FDA’s reasoned explanation
for its actions.
We have examined the remainder of the administrative
record and find nothing that contradicts the FDA’s position
that it considered Table 2 as separate from the pediatric
supplements. As the district court explained, “the
administrative record shows that the pediatric supplements
were approved on their own merits based upon clinical
investigations unrelated to the Table 2 labeling change, which
standing alone does not entitle AstraZeneca to exclusivity.”
AstraZeneca, 872 F. Supp. 2d at 83. The fact that
AstraZeneca titled its eventual submission of Table 2 an
“Amendment to a Pending Application” does not require the
FDA to consider that submission an actual amendment to a
completely unrelated supplemental application.
Therefore, the labeling changes in Table 2 were neither
“a change approved” in the pediatric supplements nor
submitted as a separate supplement. AstraZeneca states that
Table 2 could have been submitted as a separate efficacy
supplement, but AstraZeneca does not claim it ever was.
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Because the statute only provides exclusivity for changes
approved as part of a supplement, AstraZeneca’s claims fail.
AstraZeneca attempts to establish that the FDA was
arbitrary or capricious by directing us to prior grants of
exclusivity to label changes approved in supplements. See
Public Joint Appendix 119–22. However, the FDA’s
explanation that it considered Table 2 independently of a
supplemental application sufficiently distinguishes this case to
defeat that claim. The consistency of the FDA’s denial of
exclusivity in this case with prior FDA actions is strikingly
underscored by the fact that the agency did not extend
exclusivity in seven other recent labeling changes for drugs in
Seroquel’s class. See AstraZeneca, 872 F. Supp. 2d at 86.
Because the FDA reasonably considered Table 2 as
separate from the pediatric supplements, Table 2 was not “a
change approved in the supplement,” and therefore the statute
does not entitle AstraZeneca to exclusivity for Table 2.
III. CONCLUSION
For the foregoing reasons, the decision of the district
court is
Affirmed.