Drug Purchasers Obtain Mixed Ruling in Dismissal Phase of Sensipar Reverse Payment Antitrust Class Action

According to an opinion issued by the District of Delaware last Friday, the case against drug makers Amgen and Teva will proceed on narrowed grounds. The class action brought by both direct purchaser plaintiffs (DPPs) and indirect purchaser plaintiffs (IPPs) alleges that Amgen gave Teva an unjustifiably large payment in exchange for the latter’s agreement to delay generic entry into the market for a drug that treats kidney disease.

The 50-page dismissal opinion written by Judge Leonard P. Stark explains that Amgen held the exclusive rights to develop and sell the drug cinacalcet, which it does under the brand name Sensipar. The court mentioned that since 2015, Sensipar has earned Amgen over $1 billion in sales.

Prior to the expiration of Amgen’s drug patent in 2018, Amgen obtained another patent for “formulations of cinacalcet” in 2016, due to expire ten years later. Almost immediately, the second patent was challenged by nearly two dozen prospective generic cinacalcet manufacturers.

Amgen began settling the suits in exchange for the rivals’ agreement to admit infringement, not to enter the market for generic cinacalcet before a certain date, and an acceleration clause. The provision said that though generics could enter the market if another “at-risk launcher” did so, Amgen could prevent generics from taking advantage of the clause by seeking a preliminary injunction against the at-risk launcher or settling with it.

Further, Teva and Amgen tussled for several years, the result of which was Teva bringing a generic to market and selling a one-off delivery of cinacalcet for $213 million. Amgen sought restitution and the two entered into an agreement whereby Teva got to keep its profits, agreed to pay Amgen $40 million, and agreed not to make or sell anymore generic cinacalcet for two-and-a-half years.

The plaintiffs challenged the Amgen-Teva agreement, arguing that it suppressed competition and drove up drug prices. They filed amended complaints in early 2021 after a dismissal opinion permitted some of the plaintiffs’ Sherman Act claims to proceed and directed the plaintiffs to file an amended complaint concerning only the claims remaining in the suit.

In last week’s opinion, Judge Stark once again upheld the plaintiffs’ Section 1 claim under the reverse payment theory. However, the court concluded that the plaintiffs’ claims based upon market allocation theory alleging that the Amgen-Teva agreement delayed the entry of generic cinacalcet manufacturers other than Teva was unviable. 

“In the amended complaints, Plaintiffs have still failed to plead these facts that might support a plausible theory of a conspiracy between Amgen and Teva to exclude other generic cinacalcet manufacturers from the market,” the opinion said.

In addition, Judge Sparks opined that because the plaintiffs had only been granted leave to amend claims left in the case, their monopolization causes of action had to be dismissed. The court referred to them as an “amalgamation of the ‘deterrence by acceleration clauses’ theory, which was pled in the original complaints and dismissed by the Court… and a repackaged market allocation theory based on the grace period, which was not pled as part of the Section 2 claims in the original complaints.” The court said that even on the merits, the plaintiffs’ claims fail for lack of plausibility and demonstration of anticompetitive effect.  

Finally, the court ruled on Teva’s motion to dismiss certain state law claims based on lack of constitutional standing on part of the IPPs, among other arguments. The court partly granted Teva’s request, limiting the IPPs’ claims to antitrust, consumer protection, and unfair trade claims brought under the laws of Arizona, California, Florida, Maryland, Missouri, New York, Oregon, Tennessee, and Utah, and their unjust enrichment claims to an even smaller subset.

The DPPs are represented by Chimicles Schwartz Kriner & Donaldson-Smith LLP, Hagens Berman Sobol Shapiro LLP, Nussbaum Law Group P.C., NastLaw LLC, and Roberts Law Firm P.A.

The IPPs are represented by The Bifferato Firm P.A., DiCello Levitt Gutzler LLC,  Glancy Prongay & Murray LLPBerman Tabacco, Hausfeld LLP, and Fine, Kaplan and Black R.P.C.

Amgen is represented by Morris, Nichols, Arsht & Tunnell LLP and Gibson Dunn & Crutcher LLP and Teva by Shaw Keller LLP and Mayer Brown LLP.