A district court judge in New Jersey recently granted an API supplier’s motion to dismiss claims filed against the supplier in an ANDA suit, raising questions about whether an API supplier belongs as a defendant in these litigations. United Therapeutics Corp. v. Sandoz, Inc., No. 12-CV-1617 (March 10, 2014). The Court concluded that a declaratory judgment claim against the API supplier was too speculative where the FDA had not yet approved the ANDA product and where there was still a possibility that the Plaintiff could win the case against the ANDA-applicant. Because the New Jersey court rejected theories under direct infringement, indirect infringement, and declaratory judgment, it may be difficult for future patentees to sue API manufacturers in any capacity.
Plaintiff United Therapeutics Corp. (“UTC”) sued the API supplier (unnamed in the Order) for (1) direct infringement for its participation in the preparation of the ANDA; (2) indirect infringement for aiding and abetting the filing of the ANDA; and (3) for a declaratory judgment that the supplier would infringe UTC’S patent if Sandoz’s ANDA were approved. The district court rejected the direct infringement claim against the API supplier because the supplier did not “submit” the ANDA to the FDA, as is required for infringement under 271(e). Only the party who submits the ANDA can be liable for direct infringement under 271(e). The court also rejected UTC’s indirect infringement claim because the safe-harbor provision of the Hatch-Waxman Act protects activities undertaken solely for the development and submission of information to the FDA. The court concluded that the API supplier’s activity was reasonably related to the development and submission of the ANDA to the FDA and was thus protected by the safe-harbor.
The district court also dismissed UTC’s claim for a declaratory judgment that the API supplier would infringe UTC’s patent if Sandoz’s ANDA were approved. The court concluded that it did not have subject matter jurisdiction over the declaratory judgment claim because the claim did not have the requisite immediacy and reality to demonstrate an actual controversy. There was no immediacy because (1) the FDA had not yet approved the ANDA; and (2) there was still a possibility that UTC could win against Sandoz, thus precluding Sandoz from entering the market until expiration of the patent. In the face of these uncertainties, the court held that it was premature to speculate as to the API supplier’s future role.