DC denial of Takeda’s permanent injunction affirmed based on License Agreement definitions

Takeda Pharm. U.S.A., Inc. v. Mylan Pharm. Inc.

Docket No. 2020-1407, -1417
July 31, 2020

Brief Summary: DC decisions denying Takeda a permanent injunction affirmed due to Final Court Decision regarding Licensed Patents as defined in License Agreement.

Summary: Takeda appealed DC denial of its request for a preliminary injunction (PI) in an ANDA suit regarding Takeda’s Colcrys® product (colchicine), an oral formulation used to treat gout. In the suit, Tekada alleged infringement of 17 Orange Book (OB) patents. Takeda and Mylan settled the litigation through a 2017 Settlement Agreement that allowed Mylan to sell generic colchicine on a date “after the date of a Final Court Decision (as defined in Exhibit A) holding that all unexpired claims of the Licensed Patents that were asserted and adjudicated against a Third Party are either (i) not infringed, or (ii) any combination of not infringed and invalid or unenforceable” (Section 1.2(d)). The “Licensed Patents” include the 17 OB patents, a “Final Court Decision” is a non-appealable (other than to the Supreme Court), federal court final judgment, and a “Third Party” is a person other than Takeda or Mylan. The License Agreement also included Section 1.10 stating that if Mylan breaches Section 1.2, it “would cause Takeda irreparable harm.” In a separate litigation against Hikma (the “West-Ward Litigation”) involving eight of the Licensed Patents, five were dismissed with prejudice and three were found by the Delaware DC in December 2018 not be infringed by Hikma’s § 505(b)(2) colchicine product Mitigare®, and Takeda did not appeal that decision. Based on that decision, Mylan notified Takeda it would “immediately start selling” its generic colchicine product and Takeda responded with a letter that “declined to indicate whether Takeda would pursue legal action against Mylan prior to breach of the License Agreement.” Mylan subsequently launched its product in November 2019 and Takeda then filed a complaint including a request for a PI leading to this appeal. The DC denied Takeda’s request for a PI after finding Takeda “failed to show it is likely to succeed on the merits or that it will suffer irreparable harm” (e.g., “[m]oney damages would remedy any harm”) and that “Section 1.2(d) was triggered by the West-Ward Litigation even though it did not relate to all of the Licensed Patents.” The DC also found that Section 1.2(d) was not “limited to generic equivalents of Colcrys® to the exclusion of 505(b)(2) products like Mitigare®” (e.g., “Section 1.2(d) makes no mention of generic Colcrys® products.” (Lorillard Tobacco, Del. 2006 (“the court is ‘constrained by…the parties’ words and the plain meaning of those words”); “We cannot rewrite the License Agreement because Takeda failed to communicate its intent.” (FN4)). The FC panel also agreed Takeda could not show irreparable harm (e.g., “unlikely Takeda can show that Mylan breached the License Agreement” and so “stipulation of irreparable harm according to Section 1.10 is not applicable”, “Takeda makes no credible assertion that it cannot be compensated by monetary damages” (Winter, US 2008)). The DC decision was therefore affirmed. Judge Newman’s dissent argued that “the accelerating event” had not occurred (e.g., “different FDA approval for different uses…not a generic counterpart of Colcrys®”).

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