By John A. Hamilton 
On October 17, 2018, generic drug producer Teva Pharmaceuticals (“Teva”) filed a Complaint and Motion for Preliminary Injunction (“PI Motion”) in the US District Court for the District of Columbia. Teva alleges that the US Food and Drug Administration (“FDA”) unlawfully changed its policy regarding eligibility for 180-day marketing exclusivity for generic drugs, potentially irreparably harming Teva’s right to such exclusivity for its generic version of Allergan’s Restasis® (cyclosporine ophthalmic emulsion.)  Teva further asserts that it was the first applicant that complied with the Hatch-Waxman Act  (“the HWA”) requirements  for challenging at least one of the Restasis® patents.  FDA responded on November 2, 2018, with a Motion to Dismiss and supporting Memo also opposing Teva’s PI Motion.
Under the HWA, an abbreviated new drug application (“ANDA”) that “contains a [Paragraph IV] certification and is for a drug for which a first applicant has submitted an application containing such a certification,…shall be made effective on the date that is 180 days after the date of the first commercial marketing of the drug (including the commercial marketing of the listed drug) by any first applicant.”  A Paragraph IV filing comprises a certification that any patents listed in the FDA “Orange Book” covering the relevant brand-name drug is invalid, unenforceable, or will not be infringed by the generic drug product. The HWA defines the term “first applicant” to mean an applicant that, [i] on the first day on which a substantially complete application containing a [Paragraph IV certification] is submitted for approval of a drug, [ii] submits a substantially complete application that contains and [iii] lawfully maintains’ the certification for the drug.  A “first applicant”, however, can forfeit eligibility for exclusivity if “[a]ll of the patents as to which the applicant submitted a certification qualifying it for the 180-day exclusivity period have expired.” 
FDA sought comments on HWA 180-day exclusivity issues relating to Restasis® through a July 2015 “Dear Applicant Letter”.  With respect to Restasis®, two patents originally listed in the Orange Book expired in 2009 (U.S. Pat. No. 4,839,342, “the ‘342 patent”) and mid-2014 (U.S. Pat. No. 5,474,979, “the ‘979 patent”), respectively. A third patent (U.S. Pat. No. 8,629,111, “the ‘111 patent”), was listed in January 2014. One or more ANDAs or patent amendments containing Paragraph IV certifications to the ‘979 patent were filed after expiration of the ‘342 patent and before listing of the ‘111 patent, potentially qualifying the sponsor(s) as a “first applicant”. However, the ‘979 patent expired before FDA issued an Acknowledgement Letter to any of such applicants, and before any sponsor had the opportunity to provide notice of the Paragraph IV certification. In light of this fact pattern, FDA sought comment on two issues: (1) was each sponsor of a substantially complete ANDA containing a Paragraph IV certification to the not-yet expired second patent eligible “first applicants”, and (2) whether 180-day exclusivity for Restasis® generics forfeited in May 2014 upon expiration of the ‘979 patent, such that no ANDA applicant is eligible.
In a July 13, 2018, letter decision regarding Suboxone® (buprenorphine and naloxone) sublingual film generics (“the Suboxone Letter”), FDA adopted a 180-day exclusivity eligibility determination approach distinct from the previously applied approach. Under the new rationale, exclusivity for certain strengths of generic Suboxone® was forfeited for all applicants. FDA asserted in the Suboxone Letter that its “First Effective” approach to determining 180-day exclusivity prior to enactment of the 2003 Medicare Modernization Act (“the MMA”) that added the “first applicant” definition to the HWA, under which eligibility is found for the first applicant that submits a substantially complete ANDA (amendment or supplement) and makes it “effective” by providing patent notice in a timely manner, is problematic in that a more senior applicant who fails to provide timely notice could lose eligibility if a junior applicant gives notice first. FDA concluded that the “First Effective” approach was inconsistent with the definition of “first applicant” added by the MMA and adopted a new “First Submitted Interpretation” approach. Under the “First Submitted” interpretation, the definition of “first applicant” is read such that element [i] above (the “when” prong) refers to a single specific date on which an application was submitted to qualify its sponsor as a “First Applicant”; whereas the [ii] “submit” and [iii] “lawfully maintain” elements “describe requirements for specific applications submitted on this single fixed date to maintain eligibility for exclusivity. Under this reading of the statute, there can only ever be one “first day on which a substantially complete application containing a paragraph IV certification [or an amendment to a substantially complete application with a paragraph IV certification] is submitted,” regardless of whether the applicant that submits its application (or an amendment or supplement to its application) on that “first day” gives or fails to give timely notice of and/or otherwise lawfully maintains its paragraph IV certification.” 
Teva’s Complaint challenges, as the asserted first generic applicant that complied with the HWA’s requirements for challenging at least one of the patents (the ‘111 patent) covering Restasis®, FDA’s revised definition of “first applicant” and ruling depriving Teva of its right to 180-day marketing exclusivity.  Teva argues that FDA has violated procedural rules of the Administrative Procedures Act (“the APA”) in two ways. First, it ignores applicants’ “reliance interests” upended by reversing nearly two decades of taking precisely the opposite interpretation to the one announced in the Suboxone Letter. Secondly, it overturned “legislative rules promulgated through the notice-and-comment process without undertaking a new round of notice-and-comment rulemaking.”  Teva also argues that FDA’s decision conflicts with the substance of MMA’s text and structure, in that the FDA’s new interpretation writes the requirement to [iii] “lawfully maintain” the Paragraph IV certification out of the HWA. Teva is seeking a declaration that FDA’s Suboxone Letter is “arbitrary, capricious, an abuse of discretion and not in accordance with law,” that Teva’s ANDA is entitled to exclusivity, and to bar the FDA from approving any other ANDAs for Restasis® generics. 
On November 2, 2018, FDA responded with a Motion to Dismiss and Memo in support thereof and in opposition to Teva’s PI Motion. FDA argues dismissal under Rue 12(b)(1) is proper because Teva has not pleaded facts that would establish standing or ripeness, nor shown a substantial likelihood of success on the merits.  FDA asserts that “Teva has yet to obtain FDA’s approval of its application – or even a “tentative approval” – which is a necessary predicate for Teva’s proposed product to meet the statutory criteria to be eligible for a 180-day exclusivity period” and is, thus “baseless and premature”.  FDA suggests that Teva could forfeit eligibility for exclusivity if any of multiple events outlined in the HWA occur, citing failure to obtain tentative ANDA approval within 3o months of filing, and uncertainty that Teva’s successful district court invalidation of the Restasis® patents will survive appeal or that marketing will begin by 75 days after an final invalidity decision.  FDA further asserts that the Suboxone Letter interpretation passes muster under the two-step framework established in Chevron U.S.A. v. Natural Resources Defense Council, 467 US 837 (1984) (“Chevron”) and the APA standard of review. FDA argues that the definition of “first applicant”, as amended by the MMA, does not provide for the circumstance in which a Paragraph IV certification is made but notice is not perfected, and thus FDA’s “First Submitted” policy interpretation is not unambiguously foreclosed upon under Chevron step one.  With regard to the second step of the Chevron analysis, FDA states that the Suboxone Letter sets forth extensive reasoning and explanation behind FDA’s interpretation that easily passes muster to be granted agency deference. 
 John Hamilton is a 12-year veteran of the FDA, registered patent attorney and sole proprietor of the Law Office of John A. Hamilton LLC located west of Boston. He concentrates his practice in patent prosecution, IP transactions, and FDA counseling.
 Teva Pharmaceuticals USA, Inc.’s Memorandum of Points and Authorities in Support of its Motion for a Preliminary Injunction, October 17, 2018, U.S. District Court for the District of Columbia, 1:18-cv-02394, at p. 1.
 Public Law 98-417.
 FDC Act § 505(j)(5)(B)(iv).
 Teva Memo, at p. 1.
 FDC Act § 505(j)(5)(B)(iv)(I).
 FDC Act § 505(j)(5)(B)(iv)(II)(bb).
 FDC Act § 505(j)(5)(D)(vi), as amended by the 2003 Medicare Modernization Act, which also sets forth events under which a “first applicant” would forfeit its eligibility for 180-day exclusivity, the events including (I) Failure to Market, (II) Withdrawal of Application, (III) Amendment of Certification, (IV) Failure to Obtain Tentative Approval, (V) Agreement with Another Applicant, the Listed Drug Holder, or a Patent Owner, and (VI) Expiration of All Patents.
 Docket No. FDA-2015-N-2713.
 Suboxone Letter, at pp. 9-10.
 Teva Memo, at p. 10.
 Id., at p. 25.
 Id., at p. 31.
 Teva Pharmaceuticals USA, Inc.’s Complaint for Declaratory and Injunctive Relief, October 17, 2018, U.S. District Court for the District of Columbia, 1:18-cv-02394, at p. 4.
 FDA Memo, at p. ii.
 Id., at pp. 1-2.
 Id., at pp. 14-15.
 Id., at p. 25.
 Id., at p. 26.