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FEDERAL JUDGE BLASTS FDA OVER PRAVACHOL EXCLUSIVITY RULING

October 26, 2005

An FDA decision that wiped out Teva Pharmaceutical's market exclusivity for a generic version of Bristol-Myers Squibb's (BMS) lucrative cholesterol-lowering drug Pravachol (pravastatin sodium) was arbitrary and in violation of federal law, according to a district court judge, who recently granted injunctive relief to Teva.

Teva sued the FDA in July following the agency's determination that an earlier patent dispute between BMS and another generic firm, Apotex, triggered Teva's 180-day exclusivity period, which it was awarded for being the first generic company to file an abbreviated new drug application (ANDA) with a Paragraph IV certification for pravastatin. The suit, filed in the U.S. District Court for the District of Columbia, sought to reverse the FDA's decision and enjoin the agency from approving ANDAs filed by competing generic firms.

Judge John Bates ruled in favor of Teva, declaring that the FDA used flawed logic in determining the trigger date for Teva's exclusivity period. "Teva's 180-day exclusivity clock was never triggered, and the court concludes that FDA's determination to the contrary was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law," Bates writes in his Oct. 21 decision.

Under the 1984 Hatch-Waxman Act, the 180-day clock can begin in one of two ways. The first, which Teva was banking on, occurs when the generic drug in question is first marketed commercially. Teva plans to begin marketing its Pravachol generic when BMS' patent on the drug expires in April 2006.

The second method of triggering the exclusivity clock, which the FDA elected to use, occurs when a court declares the drug's patent to be invalid or not infringed when challenged by an ANDA Paragraph IV certification. According to the FDA, this trigger occurred when Apotex sought declaratory judgment against BMS in April 2004 for the patent covering Pravachol. That lawsuit was dismissed in August 2004 when both companies agreed there was no actual controversy.

Based on the outcome of the BMS-Apotex case, the FDA informed Teva in June that its 180-day exclusivity period for pravastatin expired in February — 14 months before Teva planned to launch its generic. At the time of the FDA's determination, financial analysts estimated that Teva stood to lose roughly $300 million if it lost its exclusivity period.

Bates ruled, however, that because the BMS-Apotex case was dismissed, there was no court decision capable of triggering Teva's exclusivity period.

"The BMS-Apotex dismissal at issue here is not a court decision ... [T]hat dismissal lacks sufficient judicial imprimatur to transform it from a private agreement between the parties into a finding of fact made by the district court," the judge writes. "The dismissal was wholly voluntary and entirely uncontested."

Teva's President and CEO Israel Makov praised the court's decision, saying it "properly clarifies key exclusivity provisions of the Hatch-Waxman Act, in a manner which maintains the incentives to bring generic products to market."

Teva confirmed that it is still eyeing an April 2006 launch for its pravastatin product, which will be marketed in 10-, 20- and 40-mg dosage strengths. The three strengths have combined annual U.S. branded sales of approximately $1.6 billion.

An FDA official declined to comment on whether the agency intends to appeal the ruling.