Ferring Pharmaceuticals Inc. et al v. Serenity Pharmaceuticals, LLC et al
Filing
300
OPINION AND ORDER re: 117 MOTION for Preliminary Injunction filed by Reprise Biopharmaceutics, LLC, Serenity Pharmaceuticals, LLC, Avadel Specialy Pharmaceuticals, LLC: For the reasons set forth above, Defendants' motion for a preliminary injunction is denied with leave to renew. (Signed by Judge Robert W. Sweet on 11/8/2018) (jwh)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
----------------------------------------x
FERRING B.V., FERRING
INTERNATIONAL CENTERS .A., and
FERRING PHARMACEUTICALS INC.,
17 Civ. 9922
OPINION and ORDER
Plaintiffs and Counter Defendants,
-agai nst -
SERENITY PHARMACEUTICALS, LLC,
REPRISE BIOPHARMACEUTICS, LLC ,
AVADEL SPECIALTY PHARMACEUTICALS, LLC
Defendants and
Counterclaimants.
-----------------------------------------x
APPEARANCES:
Attorneys for Plaintiffs
GIBBONS P.C.
One Gateway Center
Newark, NJ 07102
By: William P. Deni, Jr., Esq.
Jeffrey A. Palumbo , Esq.
WOMBLE CARLYLE SANDRIDGE & RICE , LLP
Atlantic Station
27 1 17th St., NW, Suite 2400
Atlanta, GA 30363
By:
John W. Cox, Ph.D.
WOMBLE CARLYLE SANDRIDGE & RICE, LLP
222 Delaware Avenue, Suite 1501
Wilmington, DE 19801
By: Mary Bourke, Esq.
Kristen Healey Cramer, Esq.
Dana K. Severance, Esq.
Daniel M. Attaway, Esq.
FROSS ZELNICK LEHRMAN & ZISSU, P.C.
4 Times Square, 17 t h Floor
New York, New York 10036
By:
James D. Weinberger, Esq.
Jessica Vosgerchian, Esq.
Attorneys for Defendants
JONES DAY
250 Vesey Street
New York, NY 10281-1047
By: Christopher J. Harnett, Esq.
Pablo D. Hendler, Esq.
Shehla Wynne, Esq.
Kevin V. McCarthy, Esq.
John G. Froemming (pro hac vice)
1
Sweet, D.J.
Following the Federal Drug Administration's ("FDA's")
approval of Plaintiffs Ferring B.V., Ferring International
Center S.A., and Ferring Pharmaceuticals Inc.'s ("Ferring" or
"Plaintiffs") NOCDURNA product, Defendants Serenity
Pharmaceuticals, LLC ("Serenity"), Reprise Biopharmaceutics LLC
("Reprise"), Avadel Specialty Pharmaceuticals LLC ("Avadel")
(together, "Defendants,") have moved for a preliminary
injunction to block the commercial release and administration of
the drug.
Before this Court is a significant skirmish in the 16year-old battle between the parties over development of
therapies to treat nocturia due to nocturnal polyuria, a disease
of the kidneys which causes excessive nighttime urination. The
contours of this conflict can found in this Court's past
opinions. 1
1
See e.g., Ferring v. Allergan, 253 F.Supp.3d 708 (S.D.N.Y.
2015) ("Equitable Estoppel Opinion") and Ferring v. Allergan,
316 F.Supp.3d 623 (S.D.N.Y. 2018) ("Standing Opinion").
2
Based on the conclusions set forth below, the motion
for preliminary injunction is denied.
I.
Prior Proceedings
Familiarity with the facts of this case and the
related 2012 case, Ferring B.V. v. Allergan, Inc., No. 12 Civ.
2650 (RWS)
(the "2012 Action"), is assumed. The following
summary is provided only as necessary to resolve the pending
motion.
On April 28, 2017, Ferring commenced this action in
the District of Delaware against Allergan,
Inc.
("Allergan"),
Serenity, and Reprise, seeking a declaratory judgment of patent
invalidity , unenforceability, and non-infringement with respect
to Defendants' United States Patent No. 7,405,203 (the "203
Patent"), United States Patent No. 7,579,321 (the "321 Patent"),
and United States Patent No. 7,799,761 ("the 761 Patent")
(together, the "Patents in Suit"). See generally Pl. Compl., ECF
No. 1.
Ferring amended its Complaint on June 30, 2017. ECF
No. 18.
3
After briefing from parties on the issue of
jurisdiction in Delaware and transferability, the case was
transferred to this District , where it was designated related to
the 2012 Action. See ECF Nos. 25 - 27 , 58. Around the same time,
Allergan was voluntarily dismissed from the case. See ECF No.
35.
Following contention over whether Ferring's NOCDURNA
drug would be approved, and with Serenity's motion to dismiss
for lack of jurisdiction pending, Ferring received FDA approval
of its New Drug Application ("NOA") on June 21, 2018. SeeECF No.
99.
On June 28 , 2018 Serenity and Reprise, together with
newly-joined patent licensee Avadel, answered Ferring's Amended
Complaint and asserted various counterclaims, including patent
infringement and willful patent infringement by NOCDURNA of the
203 Patent and the 321 Patent. ECF No. 101.
On July 19, 2018, Ferring moved to strike certain of
Serenity's defenses and to dismiss certain of its counterclaims,
4
including those alleging patent infringement under 35 U.S.C. §
271(a) . ECF No. 114 at 13-14.
On July 23, 2018, Serenity moved for a preliminary
injunction to block the commercial release of NOCDURNA. ECF No.
117.
On July 27 , 2018, parties entered into a stipulated
Case Management Plan, scheduling the Markman claim construction
hearing for October 15, 2018, 2 and an accelerated trial on the
merits for January 14, 2019. ECF No. 131.
On August 2, 2018, Serenity filed a cross-motion to
strike certain of Ferring's affirmative defenses asserted in its
July 19 motion to strike and dismiss. ECF No. 136.
On August 14, 2018, Serenity filed a motion for
judgment on the pleadings. ECF No. 148.
2
The Markman has since been adjourned to November 13, 2018
at 10:00AM.
5
On August 20, 2018, Ferring withdrew its July 19, 20 18
motion to strike and dismiss certain of Serenity's affirmative
defenses. ECF No. 160.
On September 1 0 , 2018, Ferring moved for summary
judgment on the issue of invalidity under 35 U.S.C. § 112 for
la ck o f enablement, ECF No. 178, and for non-infringement or,
alternatively, invalidity due to lack of written description ,
ECF No. 1 82.
On September 21, 2018 , Serenity moved for judgment on
the pleadings on the issue of collateral estoppel. ECF No. 206.
On October 16, 2018, a six-day hearing commenced on
Serenity's motion for a preliminary injunction to block the
commercial release and administration of NOCDURNA. ECF No. 117.
Seven witnesses were called and examined, including economic and
pharmacological experts. Dozens of exhibits and demonstrat ives
were introduced by each side. On October 26, 2018 , the hearing
concluded, at which point the motion for preliminary injunction
was marked fully submitted.
6
II.
The Facts
At the preliminary injunction hearing, factual issues
were raised involving patent infringement, invalidity,
unenforceability, and damages, among others going to the merits
of this dispute. Final determinations on these iss.ues and others
will be made in due course: claim construction will be conducted
after the scheduled Markman hearing and issues of infringement
will be determined after trial. It is for that reason, and the
reasons that follow, that Serenity's preliminary injunction
motion is denied.
Because of the interrelatedness of these factual
issues, detailed findings of fact will be deferred and made
following the scheduled Markman hearing and trial.
The Defendants' NOCTIVA has been on the market since
May 1, 2018. Ferring unless enjoined will launch NOCDURNA on
November 8, 2018. The Defendants have presented evidence as to
its "first mover advantage" and the damages resulting from
Ferring's anticipated contracts with Pharmacy Benefit Managers.
7
III. The Patents in Suit
On May 7, 2002, Ferring filed a Great Britain Patent
Application No. GB0210397.6 (the "GB Application"), for a
"pharmaceutical dosage f orm of desmopressin adapted for
sublingual absorption," with no inventor named. In the following
months and years, Dr. Fein and Ferring filed several patents
involving this subject matter. See Ferring B.V. v. Allergan,
Inc., No. 12 Civ. 2650 (RWS) , 2015 WL 5671799, at *2-*3
(S.D.N.Y. Sept. 22, 2015)
(detailing the many Fein and Ferring
patents).
On September 20, 2002 , Ferring filed Patent
Cooperation Treaty ("PCT") Application IB02/04036, claiming the
same subject matter as the GB Application and naming Dr. Fein as
one of its inventors . Ferring v. Allergan, 253 F. Supp. 3d 708,
711 (S.D.N.Y. 2015) .
On May 7, 2003, Ferring filed a modified PCT
Application IB0 3/02368 (the "PCT Application") that claimed
priority to the GB Application, but did not include low dose and
sublingual claims. Ferring, 1 66 F. Supp. 3d at 418. Nor did it
name Dr. Fein as an inventor. Id.
8
On November 12, 2003, Dr. Fein, through counsel, filed
co ntinuation-in-part United States patent application
10/706,100 based off his PCT application US2003/014463. Ferring
v. Allergan, 253 F.Supp. 3d 708, 713 (S.D.N.Y. 2015). U.S. patent
application 10/706,100 issued as U.S. Patent Application
2004/0 13 8098 Al on July 15, 2004. Id.
On May 4, 2007 , Dr. Fein, through counsel , filed U.S.
patent application 11/744,615 as a division of his previously
filed U.S. patent application 10/706,100. Id.
On July 15, 2008, Dr. Fein, through counsel ,
filed U.S. patent application 12/173,074 as a continuation of
his previously filed U.S. patent application 11/744,615. Id.
On July 29 , 2008 , Dr. Fein's U.S. patent application
11/744,615 issued as the 203 Patent. Id. The 203 Patent is
"dire cted to a pharmaceutical composition" of desmopressin
"effective to establish a steady plamsa/serum desmopressin
concentration in the range of from about .1 pg/mL plasma/ serum
to about 10.0 pg/mL plasma/serum." ECF No. 185-3. The 203 Patent
includes the following claims:
9
(1)
A method of treating nocturia, primary nocturnal
enuresis, or incontinence, or for inducing
voiding postponement, said method comprising
administering to a patient in need thereof a
pharmaceutical composition comprising a dose of
desmopressin sufficient to achieve a maximum
desmopressin plasma/ serum concentration of no
greater than 10 pg/ml, which is to be maintained
for about four to six hours.
(6)
A method of claim 1, comprising administering
said composition by transmucosal delivery.
(10) A method of inducing an antidiuretic effect in a
patient comprising the step of administering to a
patient a pharmaceutical composition comprising
desmopressin by transmucosal, transdermal, or
intradermal delivery in an amount and for a time
sufficient to establish a maximum serum/ plasma
desmopressin concentration no greater than 10
pg/ml.
Id. at 27 .
On June 1 8 , 2009, Ferring filed U.S. patent
application 12/487,116 as a continuation of its previously
filed U.S. patent application 10/513,437. Id. at 712.
On August 25 , 2009, Dr. Fein 's patent application
12/173,074 iss ued as U.S. Patent No. 7,579, 32 1 ("321 patent")
Id. The 321 patent is "directed to a pharmaceutical composition
comprising . 5 ng to 20 µg desmopressin and a pharmaceutically
acceptable carrier." ECF No. 185-8 at 3. Its common
10
specification is identical to the 203 Patent's. Id. The 321
Patent includes the following claims, as relevant:
(1)
A method for inducing voiding postponement in a
patient while reducing the risk that the patient
develops hyponatremia comprising delivering to the
bloodstream of the patient an amount of desmopressin
no more than about 2 ng/kg by intranasal, transdermal,
intradermal, transmucosal, or conjunctival
administration, said amount being therapeutically
effective to produce an antidiuretic effect lasting
for no more than between about 4 and hours.
(12) The method of claim 1 or 8 comprising administering
the desmopressin by transmucosal administration.
Id. at 29.
On October 12, 2010, Adriana Burgy of Finnegan,
Henderson, Farabow, Garrett & Dunner, L.L.P., counsel of record
for Ferring, filed a request for reexamination of Dr. Fein's 203
Patent before the United States Patent and Trademark Office
("PTO"). Id.
On January 19, 2011, the PTO denied Ferring's request
for reexamination. Id.
On May 24, 2011, Ferring's U.S. patent application
12/487,116 issued as U.S. Patent No. 7,947,654
Patent"). Lloyd Deel. Ex. 10 at 2. Id.
11
("the 654
Among the issues presented with regard to patent
infringement are: whether NOCDURNA as administered will embody
either or both the "maximum desmopressin plasma/ serum
concentration of no greater than 10 pg/ml" limitation from Claim
1 of the 203 Patent and the "transmucosal delivery" limitations
from Claim 6 of the 203 Patent and Claim 12 of the 321 Patent.
Central to these issues is the threshold construction question
of whether Dr. Fein's patent are constrained to a calculable
upper dose limit corresponding to a maximum plasma
concentration.
IV.
The Applicable Standard
Preliminary injunctions are "drastic remed[ies] that
should not be granted unless the movant, by a clear showing,
carries the burden of persuasion." Mazurek v . Armstrong, 520
U.S. 968, 972
(1997). A party seeking a preliminary injunction
must establish:
[1] that [it] is likely to succeed on the merits, [2]
that [it] is likely to suffer irreparable harm in the
absence of preliminary relief, [ 3] that the balance
of equities tips in [its] favor, and [ 4] that an
injunction is in the public interest.
12
Winter v. Natural Res. Def. Council , Inc., 555 U.S. 7, 20
(2008) .
The general purpose of a preliminary injunction is to
avoid irreparable injury to the movant and to preserve the
court's power to render a meaningful decision after a trial on
the merits. See WarnerVision Entm't Inc. v. Empire of Carolina,
Inc., 101 F.3d 259, 261 (2d Cir . 1996). A preliminary injunction
is an "extraordinary remedy" that is never awarded "as of
right." Winter, 555 U. S. at 24 ; see also Grand River Enter. Six
Nations, Ltd. v . Pryor, 481 F.3d 60, 65 (2d Cir. 2007). Whether
injunctive relief should issue or not "rests in the sound
discretion of the district court which, absent abuse of
discretion, will not be disturbed on appeal." Reuters Ltd. v.
United Press Int'l, Inc., 903 F.2d 904, 907
(2d Cir. 1990)
(citation omitted).
A party seeking a preliminary injunction must
establish:
(1) either (a) a likelihood of success on the merits,
or (b) sufficiently serious questions going to the merits of its
claims to make them fair ground for litigation, plus a balance
of the hardships tipping decidedly in favor of the moving party;
(2) irreparable harm; and (3) that issuance of the injunction
13
would be in the public interest. See Oneida Nation of N.Y. v.
Cuomo, 645 F.3d 154, 164 (2d Cir. 2 011 )
(internal quotations and
citations omitted); Red Earth LLC v. United States, 657 F.3d
138, 143 (2d Cir. 2011). Where, as here, "the relevant facts
either are not in dispute .
or when the disputed facts are
amenable to complete resolution on a paper record," a hearing is
not required to resolve a motion for preliminary injunction.
Charette v. Town of Oyster Bay, 159 F.3d 749, 755 (2d Cir. 1998)
(citations omitted).
Pursuant to Federal Rule of Civil Procedure 52(a), in
granting or refusing a preliminary injunction, the court shall
set forth "the findings of fact and conclusions of law" which
constitute the grounds of its action. The Second Circuit has
stated that "[t]hese findings are not conclusive, and may be
altered after a trial on the merits." Visual Scis., Inc. v.
Integrated Cornrnc'ns Inc., 660 F.2d 56, 58
(2d Cir. 1981)
(citing
Hamilton Watch Co. v. Benrus Watch Co., 206 F.2d 738, 740 (2 d
Cir. 1953)).
14
V.
Defendants' Motion for a Preliminary Injunction is Denied
Movants submit that a preliminary injunction is
necessary to avoid the "severe and irreparable harm" that would
result if NOCDURNA is administered before the conclusion of a
trial on the merits. Defs.' Memo. at 7, ECF No. 118. Their
position is that NOCDURNA infringes several claims of Dr. Fein's
203 and 321 Patents. Id. at 7-8.
Ferring contends that Movants have not established
irreparable harm and, in any event, NOCDURNA does not infringe
the asserted claims of the 203 and 321 Patents because its
"doses are greater than the doses required by the claims as
properly construed" and because Movants "have failed to prove
that NOCDURNA is absorbed 'transmucosa lly.'" Pl. Brief in Opp.
("Pl. Opp.") at 9, ECF No. 193.
i. Likelihood of Success on the Merits
To establish a likelihood of success on the merits
Serenity must demonstrate both that administration of NOCDURNA
likely infringes at least one of the claims in Dr. Fein's 203 or
321 Patents and that the Patents are likely to withstand
15
Ferring's invalidity challenge. See Vehicular Techs. Corp. v.
Titan Wheel Int'l, Inc., 141 F.3d 1084, 1088 (Fed. Cir. 1998)
If a "substantial question concerning either infringement or
validity" exists then a preliminary injunction will not issue.
Amazon.com, Inc. v. Barnesandnoble.com, Inc., 239 F.3d 1343,
1350-51 (Fed. Cir. 2001); see also AstraZeneca LP v. Apotex,
Inc., 633 F. 3d 1042, 1050 (Fed. Cir. 2010).
a. Infringement of the Dose Limitation, If Any
A central question that remains unanswered is whether,
and to what degree, the 203 and 321 Patents are confined to a
calculable dose range corresponding to the plasma concentration
listed in Claim 1 of the 203 Patent. Claim 1 is directed to:
"A method of treating nocturia, primary nocturnal
enuresis, or incontinence, or for inducing voiding
postponement, said method comprising administering to
a patient in need thereof a pharmaceutical composition
comprising a dose of desmopressin sufficient to
achieve a maximum desmopressin plasma/ serum
concentration of no greater than 10 pg/ml," which is
to be maintained for "about four to six hours."
ECF No. 185-3 at 27.
Movants contend that NOCDURNA, which is administered
in doses of "27.7 mcg once daily" for women and "55.3 mcg once
16
daily" for men for the treatment of nocturia due to nocturnal
polyuria, satisfies the "dose of desmopressin sufficient to
achieve a maximum desmopressin plasma/serum concentration no
greater than 10 pg/ml" from Claim 1. Defs.' Ex. A at 2. Movants
rely on the linear relationship between doses of desmopressin
and plasma/serum concentrations to support an inference of
infringement. Id. at 3-4. Infringement of Claim 1 is
established, they claim, by the mathematical relationship
between doses of NOCDURNA and the resulting physiological
response
(plasma concentration expressed as Area Under the Curve
("AUC") or Maximum Serum Concentration ("Cmax")). Id. at 7
("Ferring's NOA Products contain a dose of desmopressin
sufficient to maintain a maximum concentration of about .5-10
pg/ml for about four to six hours.").
Ferring counters by reference to intrinsic evidence
supporting a "dose limitation" based on Dr. Fein's inclusion in
the Patents' shared common specification of the dose range ".5ng
to 20 µg desmopressin." ECF No. 185-3 at 3; 321 Patent, ECF No.
185-8 at 2. Ferring avers that, "under a proper claim
construction," this dose range limitation constrains the Patents
to doses between .5 ng to 20 µg.
Pl. Opp. at 13. Were the Court
to adopt Ferring's construction based on the language of the
17
common specification, NOCDURNA's dose range would not infringe
the asserted claims' dose ranges. Id. at 13.
("The two approved
formulations for NOCDURNA contain either 25 µg or 50 µg of
desmopressin. These doses are greater than the 20 µg upper dose
limit of the asserted claims, and thus Ferring cannot
infringe[.]").
But the common specification of the Patents in Suit is
not the only place a specific low dose range of desmopressin is
contemplated. Dr. Fein's edits to the GB priority application
also suggest an intent to limit the dosage of his inventions to
a particular range. Pl. Opp. at 7. After Dr. Fein's edits, the
GB application read, "comparatively lower doses are specifically
contemplated, for example from .5ng to 20,000ng (20 µg) [.]" Id.
(internal parentheses omitted). Dr. Fein's reference to the
specific .5 ng to 20 µgrange presents a "substantial question"
with respect to whether NOCDURNA, as administered in doses of 27
and 55 µg,
infringes on the Patents in Suit and the plasma
concentrations therein. See Amazon, 239 F.3d at 1350-51.
At the same time, Movants have presented plausible
evidence suggesting doses of NOCDURNA as administered infringe
upon the 203 Patent's claimed plasma concentrations even i f the
18
Patents in Suit are limited to a particular dose range.
Mayersohn Deel. ~ 78, ECF No. 233 (noting both that a POSITA
"can calculate the oral dosage of desmopressin needed to achieve
the plasma/ serum concentration within the claimed range" and
that "use of Ferring's NOCDURNA product will infringe the
asserted claims containing these limitations under either
[party's] construction.")
(emphasis added); Id.
~
89 (The Patent
Examiner recognized the pharmacokinetic linearity at play and
the ease with which a POSITA could practice the invention:
"[a]chieving the [plasma concentration] would amount to nothing
more than routine optimization.")
The linear relationship between plasma concentration
and dosage plausibly suggests infringement by NOCDURNA of the
Patents in Suit. But the burden on a preliminary injunction is
higher than that. See Benitez v. King, 298 F.Supp.3d 530, 536
(W.D.N.Y. 2018)
("The standard for demonstrating a likelihood of
success on the merits
is far more demanding than the
plausibility standard[.]"). Ferring's contention that the 203
Patent is-because it has to be-limited to the .5 ng to 20 µg
range from the common specification is likewise plausible.
19
The parties dispute plausibly and in good faith the
meaning of asserted claims which are the subject of an imminent
Markman claim construction hearing. Parties' have repurposed
claim construction arguments at the preliminary injunction
hearing and in their briefs. See Defs.' Memo. at 3-4
("[A]s
Movants previously detailed in their claim construction briefs,
Ferring's efforts to rewrite the actual language of the asserted
patents do violence to the central tenets of claim
construction"); Pl. Opp. at 7-8
("[T]he asserted claims should
be construed as limited to 'low doses' of desmopressin"). The
significance of the upcoming claim construction is demonstrated
by Serenity's submission of its 106-page claim chart.
A full patent infringement analysis will be conducted
following the hearing and trial. See Catorek v. Kobayashi
Ventures, LLC, No. 08-cv-5706 (NRB), 2009 WL 2850760, at *7
(S.D.N.Y. Aug. 31, 2 009)
(Dismissing two "substantive patent
motions [which] require the Court to construe the claims in the
various patents at issue" because "claim construction is
premature" before a Markman hearing.).
20
b. Infringement of the Transmucosal Limitation
Several claims in both the 203 and 321 Patents require
desmopressin be delivered to the bloodstream by "transmucosal
delivery." 3 Claim 6 of the 203 Patent, for example, is a "method
of Claim 1, comprising administering said composition by
transmucosal delivery." Id. Parties agree that "transmucosal
delivery" involves absorption of a drug across a mucosal
membrane, such as the oral mucosa under the tongue. Pl. Opp. at
17; see also 321 Patent, ECF No. 185-8 (describing
desmopressin's "absor[ption] across the sublingual mucosa for
systemic distribution"). The disagreement, then, is about
whether NOCDURNA as administered is necessarily absorbed in the
oral mucosa and therefore infringes upon the "transmucosal
delivery" limitation. Pl. Opp. at 17
("[T]he documents cited by
Movants failed to show that the desmopressin in Ferring's
NOCDURNA drug product will enter the bloodstream via
transmucosal absorption")
(cleaned up); Defs.' Claim Chart at 19
3
ECF No. 185-5, ECF No. 185-8; see also Pl. Opp. at 8-9
(noting that "[c]laims 2, 6, 10, 11, 12, 13, 14, and 15 of the
203 Patent each have a requirement that desmopressin be
delivered by 'transmucosal delivery'" and that "[c]laims 1, 2,
3, 5, 6, 7, 12, and 19 of the 321 Patent each have a requirement
that desmopressin be delivered by 'transmucosal
administration.'").
21
(Arguing that, because "at least a portion of the desmopressin
in [NOCDURNA] is administered by transmucosal delivery," there
must be literal infringement of Claims 6 and 10 of the 203
Patent, among others).
Ferring's formulation expert, Dr. Jennifer Dressman,
submits that Movants have "failed to show that the desmopressin
in Ferring's NOCDURNA drug will enter the bloodstream v ia
transmucosal absorption," and thus have failed to establish
infringement on the transmucosal route of administration.
Dressman Deel.
~~
65, 76 - 77
("[SJ imply because NOCDURNA is an
orodispersible tablet does not mean that the desmopressin the
formulation is absorbed through the ora l mucosa."). Dressman
"disagrees comp letel y" with Movants' attempt to link the site of
administration (where the pill is placed) with its site of
absorption (where the desmopressin is absorbed into the blood)
Id.
~
72. According to Dr. Dressman, "rapid disintegration of
NOCDURNA in the oral cavity does not mean that desmopressin is
absorbed in the oral cavity." Id.
~
67 . In addition, Dr.
Dressman points out the "unsuitab[ility]" of desmopressin for
absorption in the ora l cavity and the possibility that the
"site(s) of absorption can be quite different to the site where
the drug is administered."
Id.
~
22
50.
Movants characterize Ferring's position that the
transmucosal route of administration is not infringed by
NOCDURNA as "preposterous." Defs.' Reply Br. at 4. In response,
Movants point to representations that Ferring made to the FDA
and papers it published on the administration and absorption of
desmopressin. Id.
(noting, among other things, Ferring's
statement that "desmopressin is immediately available for
absorption via the membranes of the mouth").
Still, Ferring has presented a "substantial question"
as to whether NOCDURNA is necessarily absorbed at its site of
administration. See Amazon, 239 F.3d at 1350-51. Without the
benefit of a Markman hearing and a trial to determine on its own
whether NOCDURNA, in its current recommended administration,
likely infringes the "transmucosal absorption" limitation, a
likelihood of infringement has not been shown.
Accordingly, Ferring's contention that the claims of
the 203 and 321 Patents are limited to a particular dose range
presents, at a minimum, a "substantial question" with respect to
the claims at issue. Amazon, 239 F.3d at 1350-51. Movants have
not adequately addressed this suggested "dose limitation," nor
23
have they presented a clear dose limitation of their own. Pl.
Opp. at 13. Ferring has likewise raised a substantial question
regarding Movants' claim that NOCDURNA is necessarily absorbed
transmucosally. Id.
("If [non-movant] raises a substantial
question concerning [infringement]
. that [movant] cannot
prove lacks substantial merit, the preliminary injunction should
not issue.")
(cleaned up). Because likelihood of success is a
necessary prerequisite to the issuance of a preliminary
injunction, without it the motion must be denied.
Inc. v. Abbott Laboratories, 849 F.2d 1446, 1457
4
See Hybritech
(Fed. Cir.
1988), see also United States v. Weikert, 504 F.3d 1, 5 (1st
Cir. 2007)
(~[I]f the moving party cannot demonstrate that he is
likely to succeed in his quest, the remaining factors become
matters of idle curiosity.")
4
Because determining patent infringement is a two-step
process-"[1] interpret the claims to determine their scope and
meaning; [2] compare the properly construed claims to the
allegedly infringing device"-a likelihood of infringement
analysis is ill-suited for a pre-Markman procedural posture. See
generally Parker-Hannifan Corp. v. Wix Filtration Corp., No. 06cv-98, 2006 WL 3028706, at *3 (N.D. Cal. Oct. 24, 2006) (denying
preliminary injunction motion because "without the benefit of a
Markman hearing, the court is not in a position to interpret
definitively the patent claims and their terms[.]")
24
ii.
Irreparable Harm in the Absence of an Injunction
Defendants' burden to establish irreparable harm is
high. See PHG Technologies, LLC v. St. John Companies, Inc., 469
F.3d 1361, 1364; see also Amazon, 239 F.3d at 1350.
Movants have contended that, as the first product
approved by the FDA for its indication, NOCTIVA has achieved an
exclusive market position that would be irreparably harmed were
NOCDURNA to come to market. Pl. Memo. at 10. In support of this
position, Movants submit an expert declaration from economist
Dr. Christopher Vellturo. See generally Vellturo Deel. Vellturo
concludes that NOCTIVA's "significant and long-lasting" firstmover advantage in the market would suffer correspondingly
significant and long-lasting harm without an injunction. Id. at
~~
11-12. This harm, according to Vellturo, would last "well
beyond the completion of trial," even if NOCDURNA is eventually
taken off the market. Id. Vellturo notes that among the benefits
of being a first-mover in a "nascent marketplace" is the benefit
of "capturing an initial base of loyal patients and prescribing
physicians." Id.
~
14.
25
Vellturo also opines that, if NOCDURNA were launched,
it would "forever alter the market" and "irreparably affect the
[Court's] ability to calculate damages." Id.
~
15. According to
Vellturo, Movants would suffer loss of revenue in the form of
lost market share, profitability reduction, permanent price
erosion, and more. Id.
~~
18-20.
However, while NOCTIVA is a first mover as the
earliest drug approved for its indication, without establishing
patent infringement, Movants have no legal right to market
exclusivity. Second, while Vellturo characterizes Movants as
"poised" to "captur[e] an initial base of loyal patients and
prescribing physicians," NOCTIVA's performance in the market
tells a different story. Id.
~
14. Prescriptions for NOCTIVA
have been filled just 2,452 times at retail outlets during its
first 24 weeks on the market. See Pl. Opp. at 20 ; Carter Deel.
~~
1, 21 . Avadel's net sales during this period, estimated to be
$289,000, represents less than one percent of Avadel's total net
sales-and even less when considering royalties Avadel pays
Serenity and Reprise. Id.
While it is certainly possible Movants will suffer
lost sales as NOCDURNA enters the market, lost sales alone do
26
not establish irreparable harm. Automated Merch. Sys., Inc. v.
Crane Co., 357 Fed. App'x 297, 300 (Fed. Cir. 2009); see also
Nutrition 21 v. United States, 930 F.2d 867 , 871 (Fed. Cir.
1991)
("[N]either the difficulty of calculating losses in market
share, nor speculation that such losses might occur, amount to
proof of special circumstances justifying the extraordinary
relief of an injunction prior to trial.").
Movants' claim that "there may be permanent price
erosion" even if NOCDURNA is withdrawn from the market after
trial is speculative. Defs.' Memo at 18 ("[I]t may not be
possible for Avadel to restore NOCTIVA to the price levels in
place prior to Ferring's at-risk launch"). Movants themselves
admit that this possibility "depend[s] on the existence of
intervening events." Id.
Movants further speculate that Avadel and Serenity's
research and development programs will be irreparably harmed if
NOCDURNA comes to market. Id. at 18. As Ferring notes, however,
Serenity has already been paid $135 million in up-front fees for
NOCTIVA and is unlikely to be materially affected by whatever
lost sales are realized in this interim period. Pls. Opp. at 22.
And for Avadel, of whose total revenue NOCTIVA comprises less
27
than one percent, it is not plausible that research and
development will be harmed, let alone irreparably. Id. at 20.
Finally, Movants claim that Ferring's "NOCDURNA label
and product approval history is likely to taint the safety
reputation of NOCTIVA" based on NOCDURNA's warning label, which
instructs patients to limit fluid intake, and could be confused
with its own. Defs.' Memo. at 19 ("[T]he restrictive labeling on
the NOCDURNA product presents a substantial risk that physicians
will be reluctant to prescribe any desmopressin product[.]").
This contention is speculative and unsupported. See Lowe Deel.
~
6; Pl. Opp. at 28.
Movants have not established that NOCDURNA's entrance
into the market would cause irreparable harm which cannot be
compensated for by money damages. PHG Technologies, LLC v. St.
John Companies, Inc., 469 F.3d 1361, 1364 (Fed. Cir.
2006) ("[M]ovant cannot be granted a preliminary injunction
unless it establishes both of the first two factors.").
For this
reason, and the reasons above, the motion for preliminary
injunction is denied. In the event that Defendants establish
patent infringement, appropriate relief can be fashioned in due
course.
28
VI. Conclusion
For the reasons set forth above, Defendants' motion
for a preliminary injunction is denied with leave to renew.
It is so ordered.
New York, ijY
November
fj--,
2018
U.S.D.J.
29
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