ANDA Automatic Stay Of FDA Approval Does Not Defeat Standing In Sham Litigation Antitrust Counterclaim

The District of Delaware recently denied a motion to dismiss an antitrust counterclaim in a patent infringement action in the wake of defendant Mylan, Inc. ("Mylan") having filed an Abbreviated New Drug Application ("ANDA") with the Federal Drug Administration ("FDA"). Shionogi Pharma, Inc. v. Mylan, Inc., United States District Court, District of Delaware, Civil Action No. 10-1077, August 31, 2011. The decision raises a host of interesting and provocative issues relating to the "sham" exception for petitioning activity immunity under the Noerr doctrine. See Eastern R.R. Presidents Conference v. Noerr Motor Freight, 365 U.S. 127 (1961) ("Noerr") and Professional Real Estate Investors v. Columbia Pictures Industries, 508 U.S. 49 (1993) ("PRE"). In essence, the court held that plaintiff and counter-defendant Shionogi Pharma, Inc. ("Shionogi") could not maintain that Mylan lacked standing to prosecute an antitrust counterclaim by virtue of Shionogi's filing of the underlying patent infringement action, which automatically triggered an ANDA automatic 30-month stay of FDA approval of Mylan's submission.

Shionogi is the owner and/or owner of exclusive licensing rights to U.S. Patent No. 6,740,341 BI. ("'341 patent"), entitled "Taste Masking Rapid Release Coating System." The '341 patent relates to the tablet design for masking a pharmaceutical's ill taste. Shionogi holds and is listed in the FDA "Orange Book" as the owner of a new drug application for Orapred ODT®, an orally disintegrating tablet. Mylan filed an ANDA with the FDA for a "prednisolone phosphate orally disintegrating tablet", which it intended to market as a therapeutic equivalent to, or generic formulation of, Shionogi's patented Orapred ODT® product. Upon receiving notice of Mylan's FDA filing for a non-infringing proposed product before the expiration of the '341 patent, Shionogi filed suit alleging '341 infringement. Mylan had attached to its certification that the proposed product has no "spacing layer", and would not infringe the '341 patent. This is because the '341 patent allegedly excludes tablets without a "spacing layer". Shionogi received samples from Mylan, which confirmed the absence of a spacing layer. In response to Shionogi's patent infringement action, Mylan filed an antitrust counterclaim alleging that the infringement action was a "sham" and constituted monopolization and attempted monopolization under Section 2 of the Sherman Act, and a combination and...