A Cure For Antitrust Standing?

Recently, the Third Circuit reexamined the test for antitrust standing in Ethypharm S. A. France v. Abbott Laboratories. The importance of the opinion, however, lies not just in the court's affirmation of the multifactor test typically used to analyze antitrust standing, but also in the court's analysis of how the regulatory framework of the pharmaceutical industry plays a role in analyzing the antitrust standing of participants in that industry.

Plaintiff (and appellant) Ethypharm is a French corporation that developed and manufactured the drug Antara. Recognizing the significant time and expense associated with marketing and selling a drug in the United States, Ethypharm granted Reliant Pharmaceuticals an exclusive license to develop, market, and sell Antara in the United States. Reliant also was responsible for obtaining U.S. Food and Drug Administration (FDA) approval for Antara. As permitted by the Food, Drug and Cosmetics Act (FDCA), Reliant relied upon the clinical studies and data for TriCor, a similar, already-approved drug, to obtain approval for Antara. Defendant (and appellee) Abbott Laboratories distributed TriCor in the United States.

Following Antara's FDA approval, Abbott sued Reliant for alleged patent infringement. Reliant and Abbott settled the patent litigation, and Abbott granted Reliant a non-exclusive license for the use of certain patents. The Abbott license, however, limited Reliant's ability to assign it. Several months after settlement, Reliant assigned the rights granted it by Ethypharm to Oscient, another pharmaceutical company. Abbott did not approve of the assignment, and Oscient's ability to sell Antara was limited. Despite Oscient's initial success, Antara's market share declined and it was unable to compete effectively against Abbott.

Ethypharm blamed Antara's failure on Abbott, the patent suit, and the restrictions and royalty payments resulting from the settlement. As a result, Ethypharm asserted claims against Abbott for violations of the Sherman Act and various state laws. The district court denied Abbott's motion to dismiss for lack of antitrust standing, but granted its summary judgment motion determining that Ethypharm did not present sufficient evidence of a causal connection between its alleged antitrust injury and the damage it experienced.

Ethypharm appealed. On appeal the Third Circuit considered the standing arguments first raised in Abbott's motion to dismiss and determined that Ethypharm...