Generic firms seek big bond if kept off market
on Apr 14, 2014 at 6:51 pm
Generic makers of a lower-priced version of a highly popular drug for treating multiple sclerosis asked the Supreme Court on Monday to allow them to start selling their product next month. However, if they are kept off of the market by court order and not allowed to compete for more than a year, they asked that the brand-name company, Teva Pharmaceuticals, USA, be required to post a bond that apparently could run into the hundreds of millions of dollars.
The generic firms — Sandoz Inc., Momenta Pharmaceuticals, Inc., Mylan Pharmaceuticals, Inc., and Natco Pharma Ltd. — filed their opposition to a plea by Teva that seeks to block the generic alternatives of its drug Copaxone, at least while the Supreme Court moves ahead with review of a pending appeal by Teva seeking to revive its key patent on that drug (Teva Pharmaceuticals USA v. Sandoz).
Some of Teva’s patents on Copaxone are due to expire on May 24, and that is when the generic competitors want to launch their products. At the core of the legal dispute, though, is a patent that is not due to expire until September of next year. Teva wants protection from generic alternatives now, on the premise that marketing of those versions will so undercut its market that it will have no way to recover if its key patent is ultimately revived.
But, in their response, the generic companies argued that Teva has not asked for the only kind of legal relief that would protect it in the meantime and, in any event, it has not made a case for any form of relief from the effect of a federal appeals court ruling that Teva lost.
Chief Justice John G. Roberts, Jr., has the Teva application for a postponement of the appeals court ruling so that the generics could not begin competing. He has the authority to act on his own, or share the issue with his colleagues. He had ordered the generics to file a response by Monday afternoon to the Teva application (13A1003). The Court is not scheduled to review Teva’s petition until next Term, starting in October.
If the Supreme Court, or the Chief Justice, do grant Teva relief now, the generic companies contended, that should only be done on condition that Teva post “substantial bonds — one for Sandoz and one for Mylan — to ensure that Sandoz and Mylan can be fully compensated in the event it is determined” that temporary relief for Teva was granted incorrectly.
While the filing did not specify how high the bonds should be, the companies argued that the losses they would suffer from not being able to launch their competing products “would be hundreds of millions of dollars.”
That statement in the document apparently was based upon separate sworn statements by executives of the generic companies — statements that were not made public with their response. “The information that justifies those amounts is highly sensitive,” the filing said. They asked permission to file those declarations “under seal,” to be seen only by the Court and by lawyers for the two sides in the dispute.
Among other arguments that the generic firms made in arguing against any protection for Teva is that the company is moving quickly to switch patients who have been taking a 20-milligram dose of Copaxone to a 40-milligram dose that is protected by a patent that will be in force until 2030. The shift is part of Teva’s strategy, the generic companies argued, to maintain monopoly control even though its main patent claim has been ruled invalid.
There is no timetable for the Chief Justice or the full Court to act on Teva’s application, but an order could come at any time now that the competing papers have been filed.
