Bayer Healthcare LLC v. Norbrook Laboratories Ltd et al

Filing 200

ORDER signed by Judge Rudolph T Randa on 06/07/2011 granting 179 Motion to extend the stay of FDA approval of Norbrook's ANADA No. 200-495 through the trial is GRANTED; the stay is EXTENDED through the 02/06/2012 trial. (cc: all counsel) (Koll, J)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN

BAYER HEALTHCARE LLC,
PlaintiffCounterclaim Defendant,
Case No. 08-C-0953
(Consolidated With
Case No. 09-C-0108)
-vsNORBROOK LABORATORIES, LTD.,
and NORBROOK, INC. USA,
DefendantsCounterclaimants.

DECISION AND ORDER

This matter comes before the Court upon the motion of the Plaintiff, Bayer
Healthcare LLC (“Bayer”), for an extension through the February 6, 2012, trial date of the
30-month stay of the Food and Drug Administration’s (“FDA”) approval of the Abbreviated
New Animal Drug Application (“ANADA”) No. 200-4951 filed by the Defendants, Norbrook
Laboratories, Ltd., and Norbrook, Inc. USA (collectively “Norbrook”).
In seeking the extension, Bayer argues that, because Norbrook has failed to
reasonably cooperate in expediting this action, the Court should extend the stay. Norbrook,
contests Bayer’s assertion, contending that it has reasonably cooperated in expediting this

1
The Court notes that Bayer and Norbrook have cited two different ANADA numbers – 011-557 and 200-495
respectively.

litigation and that the motion should be denied. For the reasons stated herein, Bayer’s
motion to extend the stay through the trial is granted.
Factual Background
The Generic Animal Drug and Patent Term Restoration Act (“GADAPTRA”),
codified in 21 U.S.C. § 360b, provides generic manufacturers with a method to facilitate
early entry of generic drugs into the market while protecting the patent rights of pioneering
drug companies. Under GADAPTRA, pioneering drug companies with animal drug patents
may file a New Animal Drug Application (“NADA”) with the FDA and upon approval, their
patent will be listed in the Green Book, see 21 U.S.C. §§ 360b(c)(3). Once the patent is
listed in the Green Book, a generic manufacturer seeking to market a generic version of a
pioneering drug may file an ANADA with the FDA. The ANADA may rely upon tests and
studies done by the original pioneering drug company and its NADA.
However, a generic drug manufacturer must include in its ANADA a
“certification” that addresses the relationship of the generic drug to the pioneering drug
patent. See 21 U.S.C. § 360b(n)(1)(H). The generic manufacturer must assert that either (i)
the patent holder has not filed any information with the FDA; (ii) the patent has expired; (iii)
the patent will expire on a certain date; or, (iv) the patent is invalid or will not be infringed
by the manufacture, use, or sale of the new animal drug for which the application is filed.
Id.
If the generic drug manufacturer makes a Paragraph IV certification, a
notification must be sent to each owner of the patent which is the subject of the certification.

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21 U.S.C. § 360b(n)(2)(A)(i).2 Upon receiving notice, the pioneering drug company, who
owns the patent in question, has 45 days to file suit under 35 U.S.C. § 271(e)(2) in order to
trigger an automatic 30-month stay on FDA approval of the generic drug manufacturer’s
ANADA. 21 U.S.C. § 360b(c)(2)(D)(iii). A district court may shorten or extend the stay
depending upon whether either party has failed to reasonably cooperate in expediting the
action. Id.
Bayer alleges that it owns United States Patent No. 5,756,506 (“the ‘506
patent), entitled”Single High Dose Fluoroquinolone.” (Compl. ¶¶ 17, 19.) The ‘506 patent
covers the use of antibiotic enrofloxacin in a single, high dose to treat sick cattle. (Compl.,
Ex. A.) Bayer alleges that Norbrook has infringed the ‘506 patent. (Compl. ¶¶ 24, 25.)
On September 29, 2008, Bayer received notice that Norbrook filed an
ANADA, No. 011-557, seeking approval for a generic animal drug product which contains
enrofloxacin to treat cattle with bovine respiratory disease. (Compl. ¶ 21.) The notice also
stated that Norbrook had submitted to the FDA a “Paragraph IV certification” with respect
to the ‘506 patent. (Id.)
On November 7, 2008, Bayer commenced this lawsuit by filing a one-count
Complaint alleging that Norbrook’s filing of its ANADA prior to expiration of the ‘506
patent is an act of infringement in violation of 35 U.S.C. § 271(e)(2). (Compl. ¶ 24.) Since
Norbrook’s ANADA asserted a Paragraph IV certification and Bayer filed suit within the

2

Although the subsection is not specifically addressed in this decision, the Court notes that 21 U.S.C.
§ 360b(n)(2)(A) should cite 21 U.S.C. § 360b(n)(1)(H)(iv), not 21 U.S.C. § 360b(n)(1)(G)(iv). Notably, 21 U.S.C. § 360b
(n)(1)(G) does not contain any subsections.

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statutorily prescribed time, an automatic 30-month stay on approval of Norbrook’s ANADA
was triggered. See 21 U.S.C. §§ 360b(n)(2)(A)-(B); 21 U.S.C. § 360b(c)(2)(D)(iii).
On December 1, 2008, Norbrook submitted an amendment to the FDA
withdrawing its Paragraph IV certification and substituting a Section I patent certification.3
(Third Am. Answer & Countercl. ¶ 21.)
Fact discovery opened on May 1, 2009. (Scheduling Order, Feb. 24, 2009.)
The deadline, as amended, for fact discovery was August 13, 2010. (Third Am. Scheduling
Order, Jul. 20, 2010.) The trial was initially set for March 21, 2011, within the 30-month
stay period that would expire on March 29, 2011. (Scheduling Order, Feb. 24, 2009.)
Norbrook filed an unopposed motion to amend the scheduling order,
requesting a May 2011 trial date. (Norbrook’s May 21, 2010, Mot. Am.) The Court granted
Norbrook’s motion to amend and rescheduled the trial for May 2, 2011. (Am. Scheduling
Order, May 22, 2010.) Expert discovery was set to close on January 28, 2011. (Fourth Am.
Scheduling Order, Nov. 17, 2010.)
On December 6, 2010, five months before the scheduled trial date, Norbrook
informed Bayer that it was making changes to its ANADA. (Fisher Decl. ¶ 16, Ex. N.) On
December 23, 2010, Norbrook produced a number of documents relating to the ANADA,
including an amended label for its ANADA. (Fisher Decl. ¶¶ 17-19, Exs. O-Q.)

3

Previously, this Court held that Norbrook failed to show that the FDA will approve the amendment. Bayer
Healthcare, LLC. v. Norbrook Labs., Ltd., No. 08-C-0953, 2009 W L 6337911, at *7 (E.D. W is. Sept. 24, 2009). Based
on that determination, the Court declines to accept Norbrook’s contention that that the Paragraph IV certification and
30-month stay are invalid.

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On January 6, 2011, Bayer served Norbrook with a second set of
interrogatories, a Rule 30(b)(6) deposition notice for a January 24, 2010, deposition, and a
request that Norbrook supplement its earlier responses to interrogatories and production of
documents with information regarding Norbrook’s December 2010 amendments to its
ANADA. (Fisher Decl. ¶¶ 20-22, Exs. R-T.) Norbrook responded to Bayer’s second set
of interrogatories on April 5, 2011. (Fisher Decl. ¶ 32, Ex. FF.)
On March 29, 2011, the Court issued a fifth amended scheduling order that
reopened fact discovery on issues relating to the changes in Norbrook’s ANADA until
August 26, 2011, and rescheduled the trial to February 6, 2012. The stay continues through
June 30, 2011, to afford this Court the opportunity to resolve the instant motion. (Court’s
Mar. 24, 2011, Decision and Order, 7.)
Motion to Extend Stay
As the basis for requesting an extension of the stay on the FDA approval of
Norbrook’s ANADA through the February 6, 2012, trial, Bayer asserts that Norbrook has
failed to reasonably cooperate in expediting this action. More specifically, Bayer asserts that
“Norbrook changed its [ANADA] application after the close of fact discovery and after the
submission of expert reports, just months before trial.” (Bayer’s Mem. Supp. Mot. Extend
Stay, 12.) Bayer argues that these changes were made deliberately – as a part of Norbrook’s
strategy – to delay the litigation and that this warrants an extension under Eli Lilly and Co.
v. Teva Pharms. USA, Inc., 557 F.3d 1346 (Fed. Cir. 2009). (Bayer’s Reply Supp. Mot.
Extend Stay, 5.)

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In addition, Bayer asserts that Norbrook failed to serve “discovery responses
for more than three months, not withstanding that the Federal Rules [of Civil Procedure]
mandate a response within 30 days.” (Id. at 6.) Furthermore, Bayer asserts that Norbrook
has advanced a 35 U.S.C. § 112 defense in violation of an agreement to forego that defense,
and used its late amendment to its ANADA to insert the § 112 defense after the Court had
stricken it. (Id.) Bayer argues that Norbrook’s actions, when taken collectively, “[were]
unreasonable and delayed [the] trial in this case beyond the date of stay expiry.” (Id.) Thus,
Bayer asks this Court to extend the stay of FDA approval of Norbrook’s ANADA through
the February 6, 2012, trial.
Norbrook, however, asserts that it has reasonably cooperated in expediting this
litigation and even hints that no stay exists. (Norbrook’s Mem. Opp’n Mot. Extend Stay, 810.) Norbrook contends that the 30-month stay is not intended to enable the parties to fully
resolve their patent disputes before its expiration and that Bayer should file for preliminary
injunctive relief if it wants to prevent the FDA from approving Norbrook’s ANADA. (Id.
at 6, 11.) Further, Norbrook argues that it was trying to expedite this litigation when it
decided to forego asserting inequitable conduct and obviousness claims against Bayer. (Id.
at 8.) Norbrook also disputes Bayer’s characterization of the agreement to forego § 112
defenses and counterclaims as applying to all possible § 112 enablement defenses and asserts
that this Court found Norbrook was not dilatory or playing games in later asserting its § 112
enablement defense. (Id. at 8-9.)

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Additionally, Norbrook argues that Eli Lilly does not apply because Norbrook’s
ANADA amendment does not change the method for which it seeks FDA approval, whereas
in Eli Lilly, the ANADA amendment materially changed the product in question. (Id. at 9.)
Norbrook states that its ANADA amendment is not comparable to those addressed in Eli
Lilly. (Id.) Norbrook also argues that Bayer’s arguments to extend the stay are irrelevant
because Bayer’s patent is invalid and Norbrook is not infringing on that patent.4 (Id. at 17.)
Norbrook asks this Court to deny Bayer’s motion to extend the 30-month stay.
Analysis
In considering Bayer’s request to extend the stay, the questions before the
Court are (1) whether Norbrook has failed to reasonably cooperate in expediting this action;
and, (2) if so, whether the stay should be extended through the February 6, 2012, trial date
pursuant to 21 U.S.C. § 360b(c)(2)(D)(iii).
Section 360b(c)(2)(D)(iii) of Title 21 of the United States Code states:
If . . . an action is brought before the expiration of [45 days from
the date the notice provided under subsection (n)(2)(B)(i) 5 ], the
approval shall be made effective upon the expiration of the 30
month period. . . or such shorter or longer period as the court
may order because either party to the action [has] failed to
reasonably cooperate in expediting the action . . . .

4

This Court will not address Norbrook’s patent invalidity argument because it pertains to issues for trial. In this
Decision and Order, the Court will only address the issue of whether to extend the statutorily prescribed 30-month stay.
5

Although the subsections are not addressed in this decision, the Court notes that 21 U.S.C.
§ 360b(c)(2)(D)(iii) should cite subsection (n)(2)(A)(i) not (n)(2)(B)(i) because (n)(2)(B) does not contain any
subsections.

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Bayer filed this action within 45 days after receiving notice of Norbrook’s ANADA and
Paragraph IV certification, thus, triggering the automatic 30-month stay and giving subject
matter jurisdiction to this Court to determine the period of the stay.
A district court has the discretion to adjust the 30-month stay if it finds either
party has failed to reasonably cooperate in expediting this action. Eli Lilly, 557 F.3d at 1350.
In Eli Lilly, Teva Pharmaceuticals (“Teva”) changed a manufacturing specification eight
months before the trial date. Id. The district court reasoned that “because Teva provided
Lilly with its altered [product] just eight months before trial, [the stay would be extended]
to provide Lilly with a reasonable amount of time to allow its expert to test and report [on
the altered product] . . . and for Lilly to assess and utilize that information and analysis in
preparation for trial.” Id. The federal circuit court of appeals upheld the extension finding
that the record contained sufficient evidence upon which the district court rationally based
its decision. Id.
In this case, Norbrook changed its ANADA in December 2010 – leaving Bayer
with only five months to reassess and prepare its infringement case before the May 2, 2011,
trial date. No doubt, Norbrook’s actions – in waiting four months after the close of discovery
and only five months before trial to change its ANADA – provide a strong basis for this
Court to extend the stay, compared to those of Eli Lilly.
Additionally, Bayer asserts that the stay should be extended because Norbrook
failed to comply with Bayer’s discovery requests. The assertion is somewhat misleading.
Bayer served its second set of interrogatories on January 6, 2011. Pursuant to Rule 33(b)(2)

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of the Federal Rules of Civil Procedure, Norbrook had 30 days, or until February 10, 2011,6
to respond to them. However, the Fourth Amended Scheduling Order, provided “[a]ll
requests for expert discovery must be served by a date sufficiently early so that all expert
discovery in this case can be completed no later than January 28, 2011.” (Fourth Am.
Scheduling Order ¶ 1, Nov. 17, 2010.)
Bayer served its second set of interrogatories too late. Under the time allowed
by Rule 33, the date Bayer served its interrogatories did not allow for the completion of
expert discovery on January 28, 2011. Norbrook’s delay in responding was not proper –
Norbrook should have objected to the interrogatories as too late. Since the timing of Bayer’s
January 2011 interrogatories violated the Court’s scheduling order, Norbrook’s untimely
responses to them does not provide a reasonable basis for finding that Norbrook failed to
reasonably cooperate in expediting this action.
Norbrook cites Bayer Schera Pharma AG v. Sandoz, Inc., No. 08 Civ. 03710,
2010 WL 3447906 (S.D.N.Y. Sept. 2, 2010), in contending that the stay should not be
extended. However, the situation in that case is not analogous. In Bayer Schera, 2010 WL
3447906, at *6, Bayer contended that a motion to dismiss for lack of personal jurisdiction,
which had been pending three months until it was withdrawn, established that the movant
had failed to reasonably cooperate in expediting the action. However, the district court held

6

Rule 6 of the Federal Rules of Civil Procedure was used to calculate the February 10, 2011, date. Pursuant to
Rule 6(a)(1), January 6, 2011, the day on which the requests were served was excluded and every intermediate day was
included, bringing the date to February 6, 2011. Since February 6, 2011, fell on a Sunday, the period continued to run
until Monday, February 7, 2011. See Fed. R. Civ. P. 6(a)(1)(C). Then, pursuant to Rule 6(d), three days were added
resulting in a February 10, 2011, date for Norbrook to respond to Bayer’s discovery requests.

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that Bayer had “offered no evidence that the mere submission of this motion – or the limited
jurisdictional discovery that the parties conducted – caused any significant delay in [the]
proceedings.” Id. at * 7. Instead, the court held that Bayer – the plaintiff – had not sought
to expedite the litigation Id. In this case, however, Norbrook’s December 2010 ANADA
amendment has resulted in a delay of the litigation.
In sum, because Norbrook changed its ANADA application so late in litigation
– much later than in Eli Lilly – this Court finds that Norbrook failed to reasonably cooperate
in expediting this action. Therefore, Bayer’s motion to extend the stay through the February
6, 2012, trial date is granted. Based on the foregoing, the Court need not address Norbrook’s
contention that Bayer should be required to seek a preliminary injunction to prevent the FDA
from approving Norbrook’s ANADA.
NOW, THEREFORE, BASED ON THE FOREGOING, IT IS HEREBY
ORDERED THAT:
1.

Bayer’s motion (Docket No. 179) to extend the stay of FDA approval

of Norbrook’s ANADA No. 200-495 through the trial is GRANTED;and,
2.

The stay is EXTENDED through the February 6, 2012, trial.

Dated at Milwaukee, Wisconsin, this 7th day of June, 2011.
BY THE COURT
s/ Rudolph T. Randa
HON. RUDOLPH T. RANDA
U.S. District Judge

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