The generic industry has lined up against Novo Nordisk's maneuver to keep Caraco Pharmaceuticals from getting approval of a generic version of its diabetes drug Prandin .

Apotex, Impax, Mylan, Teva and the Generic Pharmaceutical Association have submitted amicus briefs in support of Caraco's petition to have the U.S. Court of Appeals for the Federal Circuit rehear its decision upholding Novo's actions.

In an apparently unprecedented move, Novo revised the patent use code for Prandin (repaglinide) in FDA's Orange Book so that Caraco could not obtain approval of the use of repaglindine as a monotherapy. The patent use code denotes the methods of using a drug. The code initially claimed "use of repaglindine in combination with metformin." In May 2009, the company changed the use code to claim "a method for improving glycemic control in adults with type 2 diabetes mellitus."

Caraco says the broader code implies the patent covers use of the drug as a monotherapy when the patent for that use expired in March 2009. As a result of the revision, Caraco was unable to get a labeling carve-out to market its generic version as a monotherapy.

Novo contends, however, that it is not blocking approval of Caraco's ANDA. Novo General Counsel Jim Shehan said there is nothing stopping Caraco from asking FDA to approve its generic with labeling identical to Novo's. While the labeling would infringe Novo's patent, that would not stop FDA from approving the ANDA, Shehan said. And once Caraco got approval, it would have the option of an at-risk launch.

"We aren't blocking them," Shehan said. "It's their choice."

Shehan said any ANDA approval may also be delayed by Caraco's good manufacturing process problems. Last year FDA had U.S. marshals seize Caraco's drug products after an inspection found GMP violations (¹ Also see "FDA Enforcement Stance Turned Aggressive Months Before Aug. 6 Initiatives" - Pink Sheet, 31 August, 2009.).

Meanwhile, Caraco is challenging the validity of Novo's patent. A trial is currently under way in Michigan.

Caraco initially was successful in opposing Novo's patent use code revision. Last year it won a district court injunction directing Novo to request FDA to reinstate the original code. But in April 2009, the U.S. Court of Appeals for the Federal Circuit ruled 2-1 that Caraco could not obtain an injunction (² Also see "New Tactic In ANDA Litigation: Novo Blocks Generic Prandin By Changing Its Patent Use Code" - Pink Sheet, 19 April, 2010.).

The panel held that under the Hatch-Waxman Act, a generic manufacturer can only assert a counterclaim to correct or delete information for improperly listed patents that do not claim either the drug for which the application was approved or an approved method of using the drug. Thus, it held that a manufacturer could not file a counterclaim to change the use code narrative.

The generic industry is concerned that the ruling will change the playing field in ANDA litigation.

"The Federal Circuit decision is endorsing what seems to be a blatant regulatory abuse," Caraco's attorney James Hurst, a partner at Winston & Strawn, stated. "If it stands, this tactic will become the next best way to block generics."

When a brand name product has a patent on only one or some of its approved uses, a generic company can file a "section viii statement" to carve out the patented indications from the label. The company would then be able to market its generic for unpatented uses.

Caraco filed a section viii statement and submitted a proposed label to carve out Novo's patented method of using the drug in combination with metformin. But when Novo changed the patent use code FDA disallowed the statement, concluding that the carve-out overlapped with the new use code. Thus, Caraco could not assert that its proposed label does not infringe Novo's patent.

FDA Is Not At Fault, Apotex and Impax Say

On May 14, Caraco filed a petition to the Federal Circuit for a panel rehearing and a rehearing by the full court. The majority panel's reading of the Hatch-Waxman Act "allows Novo to use its patents to block Caraco from marketing drugs that Novo concedes do not infringe," Caraco stated. "This extraordinary result compels review, particularly in the context of a law designed to expedite, not delay, generic competition."

Caraco said that under the panel's ruling, "brands are now free to submit use codes at the highest level of generality - e.g., 'a method for treating diabetes' - thus extending their patents to non-infringing uses."

Apotex, Impax, Mylan, Teva and GPhA also argued for a rehearing. In their joint brief, Apotex and Impax addressed Judge Raymond Clevenger III's concurring opinion, in which he said FDA had "gummed up the works" by requesting Novo to change its labeling to include a broad indication. FDA requested that the labeling for the class of oral diabetes drugs indicate the products could be used in combination with other oral diabetes drugs, not just metformin. Novo says it changed the use code to reflect the new labeling.

"Novo admitted at oral argument that the FDA did not require Novo to submit the patent description that enabled Novo to block generic approval," Apotex and Impax stated. They said Novo voluntarily changed its description immediately after FDA approved Caraco's request to carve out non-infringing uses of Novo's drugs.

"This manipulation - causing the FDA to reject approval of a drug that Novo concedes would have been marketed for only non-infringing uses - is unconscionable," they said.

In a June 1 response to Caraco's petition, Novo asserted that the majority panel was correct in its interpretation of the counterclaim provision in the Hatch-Waxman Act.

"The panel majority held that the Hatch-Waxman Act does not allow a generic competitor to force a pioneer drug company to change an accurate 'use code narrative' because the Act's narrow counterclaim is limited to correction or deletion of specified information for improperly listed patents that do not claim any approved methods of using a drug," the brief states.

Novo said Caraco's argument that the majority decision could tip the competitive balance in favor of branded manufacturers "is not a basis for rehearing and is appropriately addressed to Congress, not the federal courts."

Direct Purchaser Files Class Action Against Novo

The generic industry is not alone in opposing Novo's actions. American Sales Company, which purchased Prandin from wholesaler Cardinal Health, filed a class action against Novo on May 28 on behalf of direct purchasers of the drug.

"Novo Nordisk has maintained an unlawful monopoly in the market for repaglinide by blocking generic versions of Prandin from the market with sham Orange Book filings and sham litigation," the complaint says. The suit was filed in the U.S. District Court for the Eastern District of Michigan.

- Brenda Sandburg ( ³ b.sandburg@elsevier.com )

"The Next Best Way To Block Generics" May Be Novo's Patent Use Code Switch

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