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In re Novartis and Par Antitrust Litigation

United States District Court, E.D. Pennsylvania

November 5, 2019

IN RE NOVARTIS and PAR ANTITRUST LITIGATION

          OPINION

          JOSEPH F. LEESON, JR. UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION

         The Purchaser Plaintiffs, Retailer Plaintiffs, and End-Payor Plaintiffs (collectively, “Plaintiffs”) are part of an antitrust litigation originating in the Southern District of New York alleging Defendant Novartis conspired with fellow Defendant Par to ensure Par delayed the launch of a generic drug competing with Novartis. See In re Novartis & Par Anitrust Litig., No. 1:18-cv-04361-AKH (S.D.N.Y.). Currently, Plaintiffs are in the midst of a discovery dispute with non-party Alembic Pharmaceutical, Inc. over the production of subpoenaed documents. Alembic does not object to the entire subpoena, only Requests One, Two, Three, Four, Five, Seven, Twelve, and Thirteen. Presently pending before this Court is Plaintiffs' Federal Rule of Civil Procedure 45(f) motion to transfer this discovery dispute to the Southern District of New York, or, in the alternative, to compel Alembic to produce the documents subpoenaed. For the reasons set forth below, Plaintiffs' motion to transfer is denied and their motion to compel is granted in part and denied in part.

         II. BACKGROUND

         In the underlying case, Plaintiffs allege Novartis entered into an anticompetitive agreement with Par whereby Par agreed to delay the launch of its generic version of Exforge, a hypertension drug, until September 30, 2014, in exchange for Novartis' agreement not to launch its authorized generic version of Exforge until Par's generic had been on the market for six months. Plaintiffs further assert this agreement created a bottleneck that prevented other generic applicants, such as Alembic, from obtaining Federal Drug Administration approval to sell Exforge until the exclusivity's expiration as companies would need to wait to obtain approval to launch their version of generic Exforge. Plaintiffs allege this delay injured them because generic Exforge prices would have been lower if more generics were available for sale on the market.

         Plaintiffs served Alembic a subpoena to produce documents on November 21, 2018, including:

1. All Paragraph IV Certification Letters relating to any of the Patents.
2. All documents concerning the potential market entry of Authorized Generic Exforge or Authorized General Exforge HCT or lack thereof, including documents concerning the actual and/or forecasted sale of Authorized Generic Exforge, or Authorized Generic Exforge HCT, and including the impact of a potential market entry of Authorized Generic Exforge or Authorized Generic Exforge HCT or lack thereof on unit and/or dollar sales, gross and net revenues, profits, and/or unit process of Exforge, Generic Exforge, Generic Exforge HCT, Exforge HCT, Authorized Generic Exforge, or Authorized Generic Exforge HCT.
3. All documents concerning Your Generic Exforge or Generic Exforge HCT ANDA, and any other company's Generic Exforge or Generic Exforge HCT ANDA, including but not limited to the ANDAs themselves, the ANDA FDA correspondence logs, all supplements and amendments thereto, all communications to and from the FDA, Par, or Novartis (including memorializations of oral communications such as telephone contact reports) concerning such ANDAs, and all internal documents concerning any such Generic Exforge or Generic Exforge HCT ANDA(s).
4. All documents concerning Your, Par's, Novartis's or any other company's actual, proposed, or contemplated plans for launching Generic Exforge or Generic Exforge HCT, including the following: (i) launch timelines, new product launch meeting minutes, projections, and forecasts, including any assumptions used; (ii) schedules; (iii) launch updates, action items from new product launch meetings, and launch team meeting minutes; (iv) “at-risk” launch analysis and discussions; (v) manufacturing forecasts; (vi) sourcing of active and inactive ingredients (including communications with any suppliers); (vii) exhibit batches, scale up, validation, building and maintenance of commercial quantities, and/or manufacture, sale, transfer, or destruction of same; and (viii) public statements (including statements to investors or courts) and competitive intelligence.
5. All documents concerning any regulatory, legal, technical, manufacturing, or other issues other reasons why You or any other Generic Exforge ANDA filer could or could not or would or would not commercial launch a Generic version of Exforge version of Exforge prior to September 30, 2014, including but not limited to a. All documents concerning the manufacturing sites, facilities, equipment, and other resources proposed, contemplated, or actually used in the development, regulatory approval, scale-up, validation, commercial manufacturing, and launch of Generic Exforge.
b. All documents concerning CGMP, inspections, manufacturing, quality control, or quality assurance regarding any manufacturing sites, facilities, or equipment proposed, contemplated, or actually used in the development, regulatory approval, scale-up, validation, commercial manufacturing, and launch of Generic Exforge.
c. All documents relating to potential or actual suppliers of active or inactive ingredients, container/closure systems, labeling, tooling, or other vendors of products or services for Generic Exforge, including, but not limited, communications with any such company(ies); order and cancellation of orders; invoices and payments; contracts (including amendments and supplements thereto); drafts of contracts; compliance with contracts; disputes; settlements of disputes; forecasts; projection; manufacturing ability; supply requirements; production schedules; supply schedules, product marketing; product launch dates; internal memoranda; emails; meeting agendas and minutes; transcripts of conversations; and drug master files.
d. All documents relating to actual and theoretical manufacturing capacity and the rate limiters on that capacity, including any shortages in raw materials; manufacturing sites and/or equipment, or other rate limiters for Your Generic Exforge Product.
e. Documents sufficient to show the amount of inventory expressed in terms of weeks or months on hand of inventory that You had of Generic Exforge at the time of anticipated launch and/or at the time You actually launched Your Generic Exforge product.
f. Documents sufficient to show batch sizes, manufacturing process, throughput times per batch, and manufacturing rates for Your Generic Exforge product.
. . . .
7. ESI in a tab-, comma-, or semicolon-delimited ASCii flat text file or similar electronic format from September 1, 2014, to the present sufficient to identify sales of Generic Exforge and Exforge HCT in transaction-by-transaction format, as follows:
a. All direct sales/invoice transaction (as well as any discounts or any other price adjustments or offsets contained in the transaction data) including the following fields: (i) price or dollar amount, (ii) source of the transaction price, (iii) number of units sold; (iv) returned or otherwise affected by the transaction; (v) unit of measure; (vi) date of transaction; (vii) information sufficient to identify the type of transaction (e.g. a sale, a return, a discount, etc.); (viii) NDC; (ix) UPC; (x) SKI; (xi) product description; (xii) product form; (xiii) product strength; (xic) package size in extended units per package; (xv) bill-to and skip-to customer name; (xvi) customer number; (xvii) customer address; (xvii) customer class of trade code and the description of that code (all such customer information being provided for both the bill-to customer and the ship-to customer); and (xix) the customer's parent company (if the data identify a subsidiary, corporate affiliate, division, satellite office, distribution center, warehouse, or the like).
b. All data concerning chargeback, rebates, discounts, and other consideration given or accrued, including the following fields: (i) each transaction, including the date thereof; (ii) the name and address of, all unique codes or identifiers for, the Person, firm, corporation, or other business entity whom You paid, or on whose behalf you accrued, the chargeback, rebate, discount and/or other consideration; (iii) the name and address of, and all unique codes or identifiers for, the Persons firms, corporations, or other business entities that made the purchases in respect of which You paid or accrued the chargeback, rebate, discount or other consideration; (iv) the sales, or group of sales, upon which the rebate, discount or other consideration is based, including (aa) the number of units of the participate product sold, by package size, SKU, UPC, NDC, and any and all other unique codes or other identifiers for each sale or other transaction; (bb) the bill-to customer; (cc) the ship-to customer; (dd) the dates of the sales, or group of sales; (ee) the invoice amount in dollars for the sales or group of sales; (ff) the amount of the chargeback, rebate, discount or other consideration paid or accrued; and (gg) the contract, promise, agreement, or other basis upon which the chargeback, rebate, discount, or other consideration is calculated.
c. All administrative fee transactions, including: (i) fee amount paid, (ii) date of payment, (iii) date or date range of sales concerning the fee that was paid; (v) information sufficient to identify the type of administrative fee (if applicable); (vi)
customer number; (vii) customer address; and (viii) customer class of trade code and description of that code.
d. Any other paid or accrued discounts, rebates, chargebacks, billbacks, unit adjustments, price adjustments, shelf-stock price adjustments, returns, third-party returns, error corrections, free goods, nominally priced goods, and all other transaction types not reflected in the proceeding subsections (a. through c. above), whether created or maintained daily, monthly, quarterly, or at some other interval.
e. The complete documentation for all items a. through d. above including: (i) lookup tables, (ii) data dictionaries, (iii) list of fields; (iv) descriptions of information contained in those fields (e.g. field lengths, formats, etc.); (v) descriptions of any codes use in ay fields (such as class of trade designations, etc.); (vi) a separate product list, including NDC, SKU, UPC, product description, and package size; (vii) a separate table that lists, for each “bill-to customer” and “ship-to customer, ” the customer number, parent customer number, customer group number, customer identity, contact information, address, and class of trade (e.g. SIC code); (viii) a separate table listing and defining each transaction code, abbreviation, or other field or entry code, and indicating: (1) whether quantity values for each transaction type should be included in calculating net quantity sold, or should be ignored because they do not affect the net quantity sold; and (2) how negative unit and dollar values should be treated in calculating net quantities and dollar amounts; (ix) all datasets and calculations used: (1) to determine accrued rebates and/or chargebacks; and/or (2) to periodically reconcile accrued rebates and/or chargebacks with actual rebates and/or chargebacks, (x) return and/or exchange policies; and (xi) payment terms.
. . . .
12. All documents concerning the projected and actual gross and net revenues, returns, profits, margins, contribution, costs (including initial and ongoing research and development costs) and expenses from the sale of Exforge, Exforge HCT, Generic Exforge, or Generic Exforge HCT in the United States (including Puerto Rico and the territories of the United States) from January 1, 2009 to the present.
13. As pertaining to Generic Exforge and Generic Exforge HCT, each forecasted and/or actual financial statement, budget, profit, and loss statement, cost report, profitability report, balance sheet, account reconciliation, or other financial report regularly prepared by or for You on a periodic basis from the time of ...

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