A key provision of the Medicare Modernization Act's forfeiture provision for ANDA filers' 180-day exclusivity could be moot if courts continue to refuse to hear petitions by generic companies for declaratory judgments.

The forfeiture provision of the 2003 MMA provided that first-filing generic companies would have to "forfeit" their 180-day exclusivity if they do not launch within 75 days of an ANDA approval or an appeals court decision, whichever is later.

However, in situations where there is no underlying patent litigation and thus no court decision, generic firms are able to seek a declaratory judgment to trigger a first-filer's 180-day exclusivity or to attain patent certainty before launch.

Congress "inserted the DJ provision just in case...the brand company doesn't want to sue you for whatever reason," attorney William Rakoczy (Rakoczy Molino Mazzochi Siwik LLP) said at the Generic Pharmaceutical Association's Annual Policy Conference in Washington, D.C. Sept. 19.

"Congress also directed the courts to hear these cases, to the maximum extent allowable by the Constitution," Rakoczy noted.

However, "the wheels have completely fallen off. Since MMA has passed, I don't believe that there has been a situation in this context where a generic company has been able to file a DJ and secured jurisdiction," Rakoczy said.

"The DJ provision itself is inextricably linked with this forfeiture provision and without the ability to get a DJ, I'm afraid that we're in for just way more uncertainty and likely litigation over this in the future until the courts can sort it out."

Teva sought a declaratory judgment on a Pfizer patent for Zoloft (sertraline) in order to trigger Ivax' 180-day exclusivity, but the Federal Circuit Court of Appeals found that MMA did not relax the requirement that ANDA filers establish a "reasonable apprehension" of suit to bring a declaratory judgment action. (¹ Also see "Declaratory Judgment Ruling Will Add Uncertainty To Generic Launches" - Pink Sheet, 31 January, 2005., p. 33).

Since passage of the MMA, no company has yet forfeited exclusivity, Rakoczy and FDA Associate Chief Counsel Elizabeth Dickinson noted.

"We are in...the calm before the storm with these forfeiture provisions....There will be a storm," Rakoczy said.

"I can't imagine any self-respecting company going down easy when they are the first one to get whacked with one of these forfeitures, and I think we're likely to see a lot of creative interpretation when that comes up."

Dickinson said although FDA is working on regulations to implement MMA's provisions, it is likely that many of the details will be worked out in court (² Also see "Generic Exclusivity Forfeiture Provisions Put FDA In “Hot Seat”" - Pink Sheet, 10 October, 2005., p. 16).

Federal Trade Commissioner Jon Leibowitz told the conference that there is a "need to fix the declaratory judgment law." The commission also hopes to crack down on settlements involving reverse payments as well as citizen petition abuse (see ³ Also see "FTC Commissioner Urges Generic Firms To Shun Reverse Payment Deals" - Pink Sheet, 25 September, 2006. ).

"Recent court cases have created a certain catch-22 for some generics. Once the first-filer has settled, the courts won't let subsequent generics bring a patent challenge and FDA won't let them go to market without first winning one," he said. "Simply put, that makes no sense. A 180-day exclusivity period should be rewarding generics for bringing competition to market," he said.

One upcoming case that may provide clarity on the declaratory judgment issue is an Apotex case with Pfizer over Zoloft. Apotex has filed for certiorari with the Supreme Court.

The case "tees up directly all of these issues, in one big bundle: the MMA, the DJ provision itself, whether its reasonable apprehension test should apply at all," Rakoczy said.

Rakoczy, a lawyer representing Apotex in the case, said the Supreme Court has asked the Office of the Solicitor General to weigh in and the response is expected by the year-end.

Another case that may provide clarity on the reasonable apprehension test is MedImmune v. Genentech, which is pending at the Supreme Court with oral argument scheduled for Oct. 4, Rakoczy said.

- Kathryn Phelps

Generic Exclusivity Forfeiture Provision Hits Snag In Courts; FTC Wants Fix

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