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In re Suboxone (Buprenorphine Hydrochloride and Naloxone) Antitrust Litigation

United States District Court, E.D. Pennsylvania

September 8, 2017

IN RE SUBOXONE (BUPRENORPHINE HYDROCHLORIDE AND NALOXONE) ANTITRUST LITIGATION
v.
Indivior Inc. No. 16-cv-5073 THIS DOCUMENT RELATES TO Wisconsin, STATE OF WISCONSIN By Attorney General Brad D. Schimel, et al. Plaintiffs,
v.
INDIVIOR INC. f/k/a RECKITT BENCKISER PHARMACEUTICALS, INC., et al. Defendants. MDL No. 2445 No. 13-MD-2445

          MEMORANDUM OPINION

          GOLDBERG, J.

         In this next installment of the ongoing antitrust litigation regarding the prescription drug Suboxone, a collection of states[1] (collectively, “Plaintiffs” or the “States”), have brought suit against Defendants Indivior Inc., f/k/a Reckitt Benckiser Pharmaceuticals, Inc.; Reckitt Benckiser Healthcare (UK) Ltd.; and Indivior PLC, f/k/a/ Reckitt Benckiser Group, plc; and MonoSol Rx, LLC (collectively “Defendants”). The States' lawsuit follows previously-filed claims brought by several putative classes and a generic drug company. Similar to these prior claims, the States' Amended Complaint details antitrust allegations under §§ 1 and 2 of the Sherman Antitrust Act, allegations of an antitrust conspiracy between Indivior, Inc. (“Indivior”)[2]and MonoSol Rx, LLC, and multiple state law claims in connection with Defendants' alleged use of a multi-pronged anticompetitive scheme. According to the States, this scheme was designed to prevent or delay less expensive generic versions of the Suboxone tablet from entering the market in order to preserve their profits from the sale of Suboxone. Currently pending is Defendant Indivior's (“Moving Defendant”) Motion to Dismiss the Amended Complaint. For the following reasons, I will deny the motion in its entirety.

         I. FACTS ALLEGED IN THE AMENDED COMPLAINT[3]

         The following facts are set forth in the States Amended Complaint:

         A. Generic Drug Approval Process

         The federal Food and Drug Administration (“FDA”) regulates the manufacture and commercial sale of pharmaceutical drugs under the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. § 301, et seq. (Am. Compl. ¶ 26.) The manufacturer of a new drug must submit a new drug application (“NDA”) that demonstrates, among other things, a drug's safety, clinically proven effectiveness, composition, and patent coverage. (Id.)

         In an effort to speed the entry of generic drugs into the market, Congress passed the Drug Price Competition and Patent Term Restoration Act of 1984 (the “Hatch-Waxman Act”), under which generic drug manufacturers may receive FDA approval for generic drugs without replicating the clinical trials involved in an NDA. (Id. ¶ 27.) In lieu of an NDA, a generic drug manufacturer may submit an abbreviated new drug application (“ANDA”) and incorporate data, such as clinical studies, that the NDA filer submitted to the FDA. (Id. ¶ 28.) To be approved, an ANDA must demonstrate that the generic drug (a) has the same active ingredients as; (b) is pharmaceutically equivalent to (same dosage form and strength); and (c) is bioequivalent to (exhibiting the same drug absorption characteristics) the previously approved drug. (Id. ¶ 29.)

         Oral drugs proven to be both pharmaceutically equivalent and bioequivalent to a branded oral drug receive an “AB” rating from the FDA, indicating they are therapeutically equivalent to other drugs with the same rating in the same category. (Id. ¶ 30.) In most cases, only oral drugs with an AB rating may be substituted by pharmacists for a physician's prescription of a brand-name drug without the physician's approval. (Id.) The FDA publishes a list of all approved drugs and therapeutic equivalents in the Approved Drug Products with Therapeutic Equivalence Evaluations (the “Orange Book”). (Id. ¶ 31.)

         Once the FDA approves an ANDA and determines that the generic drug is AB-rated to the branded drug, state laws govern how the generic may be substituted for the brand name drug prescribed by physicians. (Id. ¶ 32.) In most states and under most health plans, a pharmacist may, and in many cases must, substitute an AB-rated generic drug for a prescribed brand-name drug. (Id. ¶ 32.)

         B. Suboxone Tablet's Orphan Drug Designation

         In 2002, Indivior introduced Suboxone, designed for the treatment of opioid addiction, as a sublingual tablet. (Id. ¶¶ 33, 37.) At that time, the two component ingredients of Suboxone- naloxone and buprenorphine-were not subject to any patent protection. (Id.) In 1994, and in lieu of exclusivity through patent protection, the FDA granted Indivior's Suboxone tablets a seven-year period of exclusivity as an “orphan drug”[4] based on Indivior's representation that it would be unlikely to recover the costs of developing and marketing the drug. (Id. ¶¶ 34, 36-37.) Nonetheless, Suboxone did not obtain actual marketing exclusivity until 2002, thus allowing Indivior to market the sublingual Suboxone tablet until October 8, 2009, without the threat of competition from any generic co-formulated buprenorphine/naloxone tablet. (Id. ¶ 37.) Indivior allegedly earned more than $2 billion on Suboxone tablets by 2010. (Id. ¶ 38.)

         C. Indivior's Alleged Product-Hopping Scheme

         1.Threat of Generic Entry in the Co-formulated Buprenorphine/ Naloxone Market

         As a general rule, when AB-rated generic drugs become available, lower-priced generic competitors may be rapidly substituted for their brand-name counterparts because the Hatch-Waxman Act and state drug product selection laws permit, and in many cases require, pharmacists to substitute an AB-rated generic drug for the branded version unless the prescription specifically states otherwise. (Id. ¶ 40.) Soon after a generic competitor enters the market, manufacturers of brand-name drugs typically lose eighty percent or more of their sales to lower-priced generics. (Id. ¶ 41.)

         As the orphan drug exclusivity period for Suboxone tablets neared expiration, Indivior became concerned that lower-priced generic versions of co-formulated buprenorphine/naloxone would enter the market and significantly reduce its sales and revenue of Suboxone tablets. (Id. ¶¶ 39, 42.) Faced with this impending loss of exclusivity, Indivior, in connection with a company named MonoSol Rx, LLC (“MonoSol”), began to formulate a “Buprenorphine Generic Offensive Strategy.” (Id. ¶¶ 44-45.) This strategy relied on FDA regulations that allow branded manufacturers to seek FDA approval to modify the dosage form and strength of an existing product, which would in turn change its pharmaceutical equivalence and alter the AB-rating of any proposed or available generic substitutes. (Id. ¶ 43.) The first step of the plan was to develop a new version of Suboxone which could be used to secure patent protection, while the second step was to convert the market for co-formulated buprenorphine/naloxone from Suboxone tablets to the newly-developed version of Suboxone. (Id. ¶ 45.)

         2. The Creation and Marketing of Suboxone Film

         In a December 2006 meeting, MonoSol and Reckitt Benckiser Healthcare UK Ltd. signed an agreement to develop and market a sublingual film form of Suboxone for the purpose of extending Indivior's exclusivity in the co-formulated buprenorphine/naloxone market. (Id. ¶ 46.) According to the Amended Complaint, MonoSol originally proposed this idea and convinced Indivior to develop the film product in partnership with MonoSol. (Id. ¶ 47.) MonoSol also negotiated with Indivior to receive royalty payments on the sales of Suboxone film. (Id. ¶ 49.)

         In April 2008, MonoSol applied for a patent, which was issued as patent number 8, 017, 150 entitled “Polyethylene Oxide-Based Films and Drug Delivery Systems Made Therefrom.” (Id. ¶ 51.) Indivior listed the ‘150 patent, as well as patent numbers 8, 475, 832[5] and 8, 603, 514 in the FDA Orange Book, and alleged that they covered Suboxone film. (Id. ¶ 52.) The earliest patent expires in 2023. (Id.)

         To speed up the approval process for the new film product, MonoSol suggested that Indivior have a pre-NDA filing guidance meeting with the FDA to request a priority review status. (Id. ¶ 53.) Both MonoSol and Indivior attended the FDA meeting. (Id.) On October 28, 2008, Reckitt submitted NDA 022410 to the FDA to market the sublingual film version of Suboxone. (Id. ¶ 55.) On August 21, 2009, the FDA rejected Indivior's application due to concerns that the film could be abused by patients and result in accidental exposure to children. (Id. ¶ 57.) In response, Indivior submitted a revised Risk Evaluation and Mitigation Strategy (“REMS”)[6] to address the safety concerns related to the film form. (Id. ¶ 59.) Based on the REMS, the FDA approved Indivior's NDA for Suboxone film on August 30, 2010. (Id. ¶ 60.)

         Because Suboxone film is in a different dosage form than Suboxone tablets, the two are not pharmaceutically equivalent. (Id. ¶ 56) Thus, any tablet form of generic co-formulated buprenorphine/naloxone would not be an AB-rated generic substitute for Suboxone film. (Id.) According to the Amended Complaint, however, the film offers no significant benefits for patients over the tablet and any differences between the two formulations are “clinically insignificant.” (Id. ¶ 62.) Moreover, the FDA found that the film has no demonstrable safety advantage over Suboxone tablets and, in fact, expressed concerns that the film actually presents increased safety issues and potential for abuse. (Id. ¶¶ 65-67.)

         According to Indivior's Suboxone Reformulation Development Plan, its “Priority I” goal was “to keep the target moving to reduce generic competition.” (Id. ¶ 69.) In a March 2007 email, Indivior explained that “the current plan calls for the introduction of the film in June 2009, transitioning [patients] from the [sublingual] tabs to the film, and then withdrawing the [sublingual] tabs altogether prior to October 2009.” (Id. ¶ 70.) MonoSol made the original suggestion that the withdrawal of Suboxone tablets could provide further protection from generic entry into the market, and this plan was discussed with employees of Reckitt Benckiser Healthcare, Ltd. (Id. ¶ 71.)

         Subsequently, Indivior engaged in a multi-faceted campaign to convert the co-formulated buprenorphine/naloxone market to Suboxone film. (Id. ¶ 72.) First, Indivior communicated to the public and the medical community that single-dose or unit-dose packaging was necessary to prevent potential exposure to multiple doses in the case of accidental pediatric exposure, and it began marketing Suboxone film in unit-dose packaging. (Id. ¶ 74.) In connection with this message, it partnered with consulting firm Venebio Group, LLC to develop its “Film is safer” platform, which it acknowledged was due solely to “packaging type.” (Id. ¶ 75.) Although Suboxone tablets had been sold in unit-dose packaging outside of the United States since 2005, Indivior did not make any attempt to convert its tablet packaging in the United States to unit-dose packaging, but rather continued to sell tablets in multi-unit bottles. (Id. ¶ 76.)

         Second, Indivior began a “multi-front offensive” to get film into the market before the generics could enter with their version of the tablet, including (1) aggressively promoting the alleged superiority of the film to doctors, payors and pharmacists; (2) encouraging use of the film through a targeted and sustainable payor strategy by creating a patient subsidy program available only for Suboxone film; (3) pricing film to be less expensive than tablets despite the more expensive production costs for film; (4) hiring and compensating its sales force so that it would earn bonuses for convincing health care providers to convert to film; and (5) coordinating efforts among field sales, marketing, and government to drive film's “stickiness” with targeted payors. (Id. ¶¶ 77-80, 83-86.)

         In September 2012, Indivior issued a press release advising the public and prescribing physicians that it intended to withdraw the tablets from the market within the next six months due to a “pediatric exposure safety issue.” (Id. ¶ 81.) Indivior also sought an FDA declaration that Suboxone tablets were being voluntarily pulled from the market for safety concerns. (Id. ¶ 82.) By mid-2012, the film accounted for over seventy percent of Suboxone prescriptions. (Id. ¶ 87.) By the time the generic tablets received FDA approval in February 2013, eighty-five percent of Suboxone prescriptions were written for the film. (Id.) Indivior withdrew Suboxone tablets from the market on March 18, 2013. (Id. ¶ 88.)

         D. Indivior's Role in Delaying Generic Entry

         The orphan drug exclusivity on branded Suboxone tablets expired on October 8, 2009, and ANDAs for approval to sell generic Suboxone tablets were filed in late 2009. (Id. ¶ 89.) Nevertheless, generic buprenorphine/naloxone tablets did not gain FDA approval until February 2013. (Id. ¶ 89.)

         In late 2011, while certain potential generic competitors were awaiting FDA approval of their ANDAs, Indivior submitted a REMS for Suboxone tablets, which was approved by the FDA in December 2011. (Id. ¶ 90.) On January 6, 2012, the FDA ordered Indivior to cooperate with its potential competitors-including Actavis, Inc., Amneal Pharmaceutical LLC, Ethypharm USA Corp., Mylan Inc., Roxane Laboratories Inc., Sandoz Inc., Sun Pharmaceuticals Industries, Ltd., and Teva Pharmaceuticals USA, Inc. (collectively, the “Buprenorphine Products Manufacturers Group”)-in a shared REMS. (Id. ¶ 91.) Shared REMS, like individual REMS, are used to address safety concerns of pharmaceutical products, but are designed to cover the situation where multiple manufacturers are marketing a generic product that is an AB-rated substitute product for a reference drug. (Id.)

         Despite the fact that Indivior's Suboxone tablet REMS had just been approved by the FDA in December 2011, Indivior allegedly did not cooperate with the generic manufacturers in the finalization and submission of a shared REMS. (Id. ¶ 93.) While not explicitly refusing to participate, it engaged in multiple delay tactics to prolong the approval of the ANDA for the generics. (Id.) After the Buprenorphine Products Manufacturers Group met with Indivior for several months to negotiate a shared REMS, the Group ultimately reported to the FDA that Indivior had no desire to enter into a shared REMS, feigned cooperation with the shared REMS development process, refused to participate in meetings with the generic ANDA filers, refused to discuss any issues pertaining to the shared REMS with the generic ANDA filers, placed conditions on its cooperation with the shared REMS development process that it knew the ANDA filers could not agree to, refused to share information with the generic ANDA filers regarding the existing REMS, raised last-minute issues to cause further delay once a shared REMS was ready to be submitted in August 2012, and stopped participating altogether in September 2012. (Id. ¶ 94.) Indivior's refusal to cooperate successfully delayed submission of the shared REMS until August of 2012, when the generic ANDA filers obtained a waiver allowing them to submit a shared REMS program of their own without Indivior's cooperation. (Id. ¶ 97.)

         In another purported delay tactic, Indivior filed a citizen petition[7] with the FDA on September 25, 2011. (Id. ¶ 98.) Indivior's citizen petition asked the FDA to withhold approval of the ANDAs for generic Suboxone tablets unless: (1) the ANDA contained a targeted pediatric exposure education program; (2) the ANDA product had child-resistant unit-dose packaging; and (3) the FDA had determined whether Indivior had discontinued Suboxone tablets for safety reasons. (Id. ¶ 102.)

         In the same week it filed the citizen petition, Indivior announced its intent to permanently withdraw Suboxone tablets from the market for safety reasons. (Id. ¶ 103.) Indivior never disclosed these alleged safety concerns about Suboxone tablets to the generic manufacturers during the shared REMS negotiation process. (Id. ¶ 104.) Moreover, one month prior, on August 30, 2012, Indivior specifically represented to the FDA, in a combined REMS assessment, that its tablet was successful, it needed no further changes, and Indivior had considered and rejected converting its Suboxone tablets to unit-dose packaging for pediatric safety reasons. (Id. ¶ 105.)

         The FDA denied Indivior's citizen petition on February 22, 2013, noting the petition was not supported by evidence and was inconsistent with Indivior's own behavior. (Id. ¶ 108.) The FDA further acknowledged that it had no authority to require Suboxone ANDAs to contain targeted pediatric exposure labeling because, pursuant to 21 U.S.C. § 355(j)(2)(A)(v) and 4(G), the labeling for an ANDA must be the same as the labeling for the approved listed drug. (Id. ¶ 108.) The FDA also stated that the close proximity of Indivior's withdrawal of Suboxone tablets to the “period in which generic competition for this product was expected to begin cannot be ignored.” (Id. ¶ 109.) In turn, the FDA referred Indivior's conduct to the Federal Trade Commission for antitrust investigation. (Id. ¶ 110.) Despite the denial, the citizen petition nonetheless had the effect of delaying FDA approval of the pending ANDAs. (Id. ¶¶ 111, 113.)

         On February 22, 2013, the FDA granted the generics-only, waiver-based REMS and approved Amneal and Actavis' ANDAs for tablet sales. (Id. ¶ 114.) On March 6, 2013, generic co-formulated buprenorphine/naloxone tablets entered the market. (Id. ¶ 115.)

         E. Procedural History

         In June 2013, several putative classes initiated litigation against Indivior alleging anticompetitive behavior with respect to its marketing and sale of Suboxone. These cases were consolidated into a multi-district litigation (“MDL”) in this Court. Among those cases were the class action complaint (“Class Action Complaint”) brought by Direct Purchaser Plaintiffs and End-Payor Plaintiffs (“Class Plaintiffs”) alleging that Defendants unlawfully delayed and impeded competition from generic versions of Suboxone tablets, resulting in ongoing overpayments by consumers. On December 3, 2014, I issued an opinion (the “Class Action Opinion”) dismissing one of Direct Purchaser Plaintiffs' stand-alone antitrust claims, a variety of state law claims by the End-Payor Plaintiffs, and claims against several of the other Defendant entities. In re Suboxone, 64 F.Supp.3d 665 (E.D. Pa. 2014). I left the remaining claims intact.

         On December 23, 2015, Amneal Pharmaceuticals LLC (“Amneal”), a generic manufacturer and competitor of Indivior, filed a complaint regarding Indivior's alleged anticompetitive conduct surrounding Suboxone. That case was consolidated with the MDL currently before me. On January 4, 2017, I issued a decision dismissing part of Amneal's claims that Indivior improperly delayed entry of generic tablets, all claims against Reckitt Benckiser Pharmaceuticals, Inc., and all claims against Indivior PLC. In re Suboxone, 13-MD-2445, 2017 WL 36371 (E.D. Pa. Jan. 4, 2017).

         On September 22, 2016, the Plaintiff States initiated the current litigation against all Defendants. The States then filed a First Amended Complaint on November 23, 2016, setting forth five causes of action as follows: (1) monopolization under the Sherman Act § 2 against Indivior, Reckitt Benckiser Healthcare (UK) Ltd., and Indivior PLC (the “Reckitt Defendants”); (2) attempted monopolization under the Sherman Act § 2 against the Reckitt Defendants; (3) conspiracy to monopolize under the Sherman Act § 2 against all Defendants; (4) illegal restraint of trade under the Sherman Act § 1 against all Defendants; and (5) individual state law claims against all Defendants.

         On December 12, 2016, Indivior filed a motion to dismiss the First Amended Complaint. The States responded on January 30, 2017, and Indivior filed a reply brief on February 21, 2017. Upon review, I find that the Amended Complaint properly pleads all alleged causes of action. As set forth in detail below, I will deny the motion to dismiss in its entirety.

         II. STANDARD OF REVIEW

         Under Federal Rule of Civil Procedure 12(b)(6), a defendant bears the burden of demonstrating that the plaintiff has not stated a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6); see also Hedges v. United States, 404 F.3d 744, 750 (3d Cir. 2005). The United States Supreme Court has recognized that “a plaintiff's obligation to provide the ‘grounds' of his ‘entitle[ment] to relief' requires more than labels and conclusions.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quotations omitted). “[T]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice” and “only a complaint that states a plausible claim for relief survives a motion to dismiss.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. A complaint does not show an entitlement to relief when the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct. Id.

         The Court of Appeals has detailed a three-step process to determine whether a complaint meets the pleadings standard. Bistrian v. Levi, 696 F.3d 352 (3d Cir. 2014). First, the court outlines the elements a plaintiff must plead to state a claim for relief. Id. at 365. Next, the court must “peel away those allegations that are no more than conclusions and thus not entitled to the assumption of truth.” Id. Finally, the court “look[s] for well-pled factual allegations, assume[s] their veracity, and then ‘determine[s] whether they plausibly give rise to an entitlement to relief.'” Id. (quoting Iqbal, 556 U.S. at 679). The last step is “ ‘a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.' ” Id. (quoting Iqbal, 556 U.S. at 679).

         III. DISCUSSION

         Moving Defendant's Motion to Dismiss posits two broad challenges to the Amended Complaint. First, Moving Defendant argues that Plaintiffs' Sherman Act § 2 claims of monopolization and attempted monopolization cannot survive because Plaintiffs have not pled sufficient facts to support a finding of anticompetitive behavior. Second, Moving Defendant contends that Plaintiffs' conspiracy claims under §§ 1 and 2 of the Sherman Act fail to allege concerted action taken in restraint of trade. I address each argument separately.

         A. Monopolization Under Section 2 of the Sherman Act

         Section 2 of the Sherman Act “makes it unlawful to monopolize attempt to monopolize, or conspire to monopolize, interstate or international commerce.” Broadcom Corp. v. Qualcomm Inc., 501 F.3d 297, 306 (3d Cir. 2007) (citing 15 U.S.C. § 2). A monopolization claim requires proof of “a general intent to do the act, for no monopolist monopolizes unconscious of what he is doing.” Times-Picayune Publ'g Co. v. United States, 345 U.S. 594, 626 (1953) (internal quotations and citations omitted). Nonetheless, “the possession of monopoly power will not be found unlawful unless it is accompanied by an element of anticompetitive conduct.” Verizon Commc'ns v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398, 407 (2004). This is so because the Sherman Act “directs itself not against conduct which is competitive, even severely so, but against conduct which unfairly tends to destroy competition itself.” McQuillan v. Spectrum Sports, 506 U.S. 447, 458 (1993). Therefore, to succeed on a claim for actual monopolization under § 2, a party must prove: “(1) the possession of monopoly power in the relevant market and (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historical accident.” Broadcom, 501 F.3d at 307 (quoting U.S. v. Grinnell Corp., 384 U.S. 563, 570-71 (1966)).[8]

         In the present case, Moving Defendant does not deny that it possessed monopoly power in satisfaction of the first element, [9] but instead focuses on the sufficiency of the allegations regarding anticompetitive conduct. Given that concession, I will discuss only the second element of anticompetitive conduct.

         Under the “rule of reason” burden-shifting framework set forth by the D.C. Circuit in United States v. Microsoft Corp., the party seeking to impose antitrust liability must initially provide evidence of the anticompetitive nature of a defendant's conduct. 253 F.3d 34, 58 (D.C. Cir. 2001). Once the plaintiff has met its burden of pleading or establishing the anticompetitive nature of a defendant's conduct, the burden shifts to the defendant to proffer a “nonpretextual claim that its conduct is indeed a form of competition on the merits because it involves, for example, greater efficiency or enhanced consumer appeal.” Id. at 59; see also Mylan Pharms. v. Warner Chilcott Pub. Ltd. Co., 838 F.3d 431, 438 (3d Cir. 2016). The plaintiff may then “ ‘either rebut those justifications or demonstrate that the anticompetitive harm outweighs the procompetitive benefit.' ” Id. (quoting Microsoft Corp., 253 F.3d at 58-59).

         In general terms, “a firm engages in anticompetitive conduct when it attempts ‘to exclude rivals on some basis other than efficiency' or when it competes ‘on some basis other than the merits.'” W. Penn Allegheny Health Sys., Inc. v. UPMC, 627 F.3d 85, 108 (3d Cir. 2010), (quoting Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585, 605 (1985) and LePage's, Inc. v. 3M, 324 F.3d 141, 147 (3d Cir. 2003)). “Conduct that impairs the opportunities of rivals and either does not further competition on the merits or does so in an unnecessarily restrictive way may be deemed anticompetitive.” Broadcom Corp., 501 F.3d at 308. Mere harm to competitors will not suffice; rather the alleged exclusionary acts must harm the competitive process and must actually have the requisite anticompetitive effect. Microsoft Corp., 253 F.3d at 58. Given the number of forms such conduct can take, a comprehensive enumeration of all the varieties of anti-competitive conduct is impossible. W. Penn Allegheny Health, 627 F.3d at 109. “The challenge for an antitrust court lies in stating a general rule for distinguishing between exclusionary acts, which reduce social welfare, and competitive acts, which increase it.” Microsoft Corp., 253 F.3d at 58.

         In the present matter, Plaintiffs' allegations of anti-competitive conduct fall into two broad categories: (1) product-hopping claims and (2) delay claims, each addressed separately below.[10]

         1. Product Hopping Claim

         Plaintiffs' first theory alleges that Moving Defendant has engaged in anticompetitive “product hopping.” Specifically, Plaintiffs claim that as the orphan drug exclusivity period for Suboxone tablets neared expiration, Moving Defendant sought to introduce Suboxone in a sublingual film form knowing that any generic tablets would not be AB-rated, i.e. not substitutable by a pharmacist, thereby converting the market to purely film. Plaintiffs contend that Moving Defendant did so solely to prolong its control over the buprenorphine/naloxone market without any concern for the fact that the film had substantial disadvantages in comparison to the tablet form. Moving Defendant now challenges the validity of this theory as a basis for a Sherman Act § 2 claim. I disagree with Moving Defendant and will allow this theory to proceed.

         When an alleged monopolist introduces a new product, the question is whether it is “engaging in exclusionary conduct ‘as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident.'” Microsoft, 253 F.3d at 58 (quoting Grinnell, 394 U.S. at 571). “As a general rule, ‘any firm, even a monopolist, may . . . bring its products to market whenever and however it chooses.'” Steamfitters Local Union No. 420 Welfare Fund v. Philip Morris, Inc., 171 F.3d 912, 925 n.7 (3d Cir. 1999) (quoting Berkey Photo, Inc. v. Eastman Kodak Co., 603 F.2d 263, 286 (2d Cir. 1979)). The practice of “product hopping, ” however, “under certain circumstances may be viewed as anticompetitive conduct.” Mylan Pharms. v. Warner Chilcott Public Ltd. Co., 838 F.3d 421, 438 (3d Cir. 2016). Product hopping occurs where “a pharmaceutical company makes modest reformulations to a brand name drug prior to the expiration of its market exclusivity for the purposes of stymieing generic competition and preserving monopoly profits.” In re Suboxone Antitrust Litigation, No 13-2445, __ F.R.D. __, 2016 WL 3519618, at *1 (E.D. Pa. June 28, ...


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