Introduction
The In re: Sensipar (Cinacalcet Hydrochloride Tablets) Antitrust Litigation is a complex and multifaceted legal case that involves allegations of anticompetitive conduct in the pharmaceutical industry. This litigation centers around the drug Sensipar, which is used to treat secondary hyperparathyroidism and hypercalcemia, and is marketed by Amgen Inc.
Background of Sensipar and Cinacalcet Hydrochloride
Sensipar, with the active ingredient cinacalcet hydrochloride, has been a highly profitable drug for Amgen since its introduction in 2004. It has generated over $1 billion in annual sales since 2015[1][2][4].
Patent Litigation and Settlements
The litigation involves multiple generic manufacturers who sought to enter the market with their versions of cinacalcet hydrochloride. These generic manufacturers filed Abbreviated New Drug Applications (ANDAs) and were subsequently involved in patent infringement litigation with Amgen. Amgen settled many of these suits, requiring the generic manufacturers to admit to patent infringement and agree not to launch their generic products before specified dates, which were prior to the expiration of the relevant patent ('405 patent)[1][2][4].
Settlement Agreements and Acceleration Clauses
These settlement agreements included acceleration clauses that allowed the generic manufacturers to enter the market earlier if another generic manufacturer launched its product "at risk" of patent infringement. The agreements also included a 10-day grace period during which Amgen could prevent the acceleration of the agreed entry dates by seeking a preliminary injunction or reaching an agreement with the at-risk launcher[1][2].
Cipla's Role and Litigation
Cipla Ltd. and Cipla USA, Inc. played a significant role in the litigation. Cipla launched its generic cinacalcet product in March 2019, which led Amgen to file a motion for a preliminary injunction. However, the court denied this motion, ruling that Amgen could not seek relief against Cipla for its at-risk launch[2][4].
Teva's Involvement and Settlement with Amgen
Teva Pharmaceuticals USA Inc. also entered into a settlement with Amgen. This settlement involved Teva acknowledging the validity and enforceability of the '405 patent and agreeing to pay Amgen up to $40 million, contingent on the duration the cinacalcet market remained free of generic products. Teva also agreed to cease selling its generic product, but this did not prevent other generic manufacturers from launching their products[2][4].
Antitrust Allegations
The core of the litigation involves allegations of anticompetitive conduct. Plaintiffs, including direct purchasers, end payors, and Cipla, alleged that the settlements between Amgen and the generic manufacturers constituted reverse payment agreements or market allocation agreements, which are per se unlawful under antitrust laws. They argued that these agreements delayed the entry of generic products into the market, thereby maintaining Amgen's monopoly and increasing prices for consumers[2][4][5].
Application of FTC v. Actavis
The case hinges on the interpretation of the Supreme Court's decision in Federal Trade Commission v. Actavis Inc. (2013), which held that reverse payments in patent settlements could be subject to antitrust scrutiny. However, the Supreme Court also indicated that not all settlements involving payments should be treated as suspect reverse payments. In the Sensipar case, the district court's decision deviated from this guidance by treating the compromise of damages as a plausible reverse payment, despite the fact that it aligned with the Supreme Court's example of a non-suspect payment[5].
District Court's Decision and Criticism
The U.S. District Court for the District of Delaware's decision in Sensipar has been criticized for contradicting the Supreme Court's precedent in Actavis. The court's ruling that any transfer of value could be considered a reverse payment, without considering the specific circumstances, has been seen as potentially dangerous and misleading for future patent settlements across various industries[5].
Implications and Future Outlook
The Sensipar litigation has significant implications for patent settlements in the pharmaceutical industry and beyond. If the district court's decision stands, it could lead to increased antitrust scrutiny of patent settlements, potentially discouraging legitimate settlements and complicating the resolution of patent disputes. The case highlights the need for clarity and consistency in applying antitrust laws to patent settlements[5].
Key Players and Their Roles
- Amgen Inc.: The brand manufacturer of Sensipar, involved in patent litigation and settlements with generic manufacturers.
- Teva Pharmaceuticals USA Inc.: A generic manufacturer that settled with Amgen and agreed to pay up to $40 million.
- Cipla Ltd. and Cipla USA, Inc.: Generic manufacturers that launched their products at risk and were involved in litigation against Amgen and Teva.
- Direct Purchaser Plaintiffs and End Payor Plaintiffs: Groups of plaintiffs who purchased or reimbursed for the purchase of Sensipar, alleging anticompetitive conduct.
Statistical Impact
The financial stakes are high, with Sensipar generating over $1 billion in annual sales. The settlements and litigation have significant economic implications, affecting both the pharmaceutical companies involved and the consumers who rely on these medications.
Expert Insights
Industry experts argue that the district court's decision in Sensipar could have far-reaching consequences, making it more difficult for companies to settle patent disputes without fear of antitrust litigation. This could lead to more protracted and costly litigation, ultimately affecting the availability and pricing of generic drugs.
"The district court's decision is wrong, potentially dangerous and should be reversed. It contradicts controlling U.S. Supreme Court precedent and could have significant implications for patent settlements well outside the pharmaceutical context in which it arises."[5]
Key Takeaways
- The Sensipar litigation involves complex antitrust allegations related to patent settlements in the pharmaceutical industry.
- The case centers on the interpretation of FTC v. Actavis Inc. and its application to reverse payment agreements.
- The district court's decision has been criticized for deviating from Supreme Court precedent.
- The implications of this case could affect patent settlements across various industries.
- The financial and market impact of the litigation is significant, with high stakes for both pharmaceutical companies and consumers.
Frequently Asked Questions (FAQs)
What is the main issue in the In re: Sensipar Antitrust Litigation?
The main issue is whether the patent settlements between Amgen and generic manufacturers constitute anticompetitive conduct, specifically reverse payment agreements or market allocation agreements.
What is the significance of the FTC v. Actavis decision in this case?
The FTC v. Actavis decision is crucial as it sets the precedent for when reverse payments in patent settlements can be subject to antitrust scrutiny. The Sensipar case hinges on the interpretation and application of this decision.
Who are the key players in the litigation?
The key players include Amgen Inc., Teva Pharmaceuticals USA Inc., Cipla Ltd. and Cipla USA, Inc., as well as the direct purchaser plaintiffs and end payor plaintiffs.
What are the potential implications of the district court's decision?
The decision could lead to increased antitrust scrutiny of patent settlements, potentially complicating the resolution of patent disputes and affecting the availability and pricing of generic drugs.
How does this case impact consumers?
The case could impact consumers by delaying the entry of generic drugs into the market, thereby maintaining higher prices for medications like Sensipar.
Cited Sources:
- In re Sensipar (Cinacalcet Hydrochloride Tablets) Antitrust Litig., United States District Court, D. Delaware, Mar 11, 2022.
- In re Sensipar (Cinacalcet Hydrochloride Tablets) Antitrust Litigation, 412 F. Supp. 3d 1344 (U.S. Jud. Pan. Mult. Lit. 2019).
- 1:19-F-02895 - IN RE: Sensipar (Cinacalcet Hydrochloride Tablets) Antitrust Litigation, US District Court.
- 19-2895.pdf - District of Delaware, IN RE: SENSIPAR (CINACALCET HYDROCHLORIDE TABLETS) ANTITRUST LITIGATION.
- Misguided Sensipar Ruling Threatens Patent Settlements, White & Case, December 16, 2020.
