Generic Drug Manufacturer's ANDA Filing Allows Delaware Court to Exercise Personal Jurisdiction: Federal Circuit | Practical Law

Generic Drug Manufacturer's ANDA Filing Allows Delaware Court to Exercise Personal Jurisdiction: Federal Circuit | Practical Law

In Acorda Therapeutics Inc. v. Mylan Pharmaceuticals Inc. and Astrazeneca AB v. Mylan Pharmaceuticals Inc., the US Court of Appeals for the Federal Circuit held that the filing of an Abbreviated New Drug Application (ANDA) for approval to market and sell generic drugs nationwide satisfied the constitutional requirements for the federal district court in Delaware to exercise personal jurisdiction over the generic drug manufacturer.

Generic Drug Manufacturer's ANDA Filing Allows Delaware Court to Exercise Personal Jurisdiction: Federal Circuit

by Practical Law Intellectual Property & Technology
Published on 21 Mar 2016 • USA (National/Federal)
In Acorda Therapeutics Inc. v. Mylan Pharmaceuticals Inc. and Astrazeneca AB v. Mylan Pharmaceuticals Inc., the US Court of Appeals for the Federal Circuit held that the filing of an Abbreviated New Drug Application (ANDA) for approval to market and sell generic drugs nationwide satisfied the constitutional requirements for the federal district court in Delaware to exercise personal jurisdiction over the generic drug manufacturer.
On March 18, 2016, in Acorda Therapeutics Inc. v. Mylan Pharmaceuticals Inc. and Astrazeneca AB v. Mylan Pharmaceuticals Inc., the US Court of Appeals for the Federal Circuit affirmed two lower-court decisions concluding that those courts could exercise specific personal jurisdiction over a generic drug manufacturer based on its Abbreviated New Drug Application (ANDA) filing ( (Fed. Cir. Mar. 18, 2016)).
Mylan Pharmaceuticals Inc. filed two ANDAs with the Food and Drug Administration (FDA) seeking approval to manufacture and market generic versions of drugs covered by patents owned or licensed by Acorda Therapeutics Inc. and AstraZeneca AB. As part of its ANDA filings, Mylan certified that Acorda and AstraZeneca's patents are invalid or would not be infringed by Mylan's marketing of its proposed drugs. Acorda and AstraZeneca both filed suit against Mylan in the US District Court for the District of Delaware under 35 U.S.C. § 271(e)(2)(A).
Mylan moved to dismiss both cases, arguing that neither Delaware nor the federal district court in Delaware could exercise personal jurisdiction over Mylan in these cases. Both district court judges:
  • Concluded that Delaware had sufficient contacts related to the subject of the cases to allow Delaware to exercise specific personal jurisdiction over Mylan.
  • Certified their decisions for interlocutory review.
The Federal Circuit affirmed both decisions in a single opinion.
Reviewing the decisions de novo, and applying Federal Circuit law, the Federal Circuit explained that the jurisdictional dispute depended only on the constitutional question of whether Delaware's exercise of personal jurisdiction would be consistent with the Due Process Clause of the Fourteenth Amendment, which requires the defendant to have certain minimum contacts with the forum to establish personal jurisdiction. The minimum contacts requirement focuses on whether the defendant's suit-related actions create a substantial connection with the forum.
The Federal Circuit noted that:
  • Mylan took the costly and significant step of applying to the FDA for approval to engage in future activities, including the marketing of its generic drugs.
  • It was undisputed that Mylan intended to direct sales of its drugs into Delaware, among other places, once it received the requested FDA approval to market them.
As a result, the Federal Circuit concluded that the minimum-contacts standard was satisfied by Mylan's ANDA filings. It explained that Mylan's ANDA conduct was suit-related and has a substantial connection with Delaware, because:
  • The ANDA filings are tightly tied, in purpose and planned effect, to the deliberate act of making sales in Delaware, among other places.
  • The suit is about whether that in-state activity will infringe valid patents.
  • Mylan's ANDA filings constitute formal acts that reliably indicate plans to engage in marketing the proposed generic drugs.
The Federal Circuit explained that its jurisdictional analysis was informed by the nature of the Hatch-Waxman Act, which authorizes ANDAs. The court focused on the fact that the Hatch-Waxman Act:
  • Contemplates a close connection between an ANDA filing and the real-world acts that approval of the ANDA will allow and that will harm patent-owning brand-name manufacturers.
  • Treats the ANDA filer as distinctive because its filing has reliably confirmed a plan to engage in real-world marketing.
Therefore, Mylan's activities meet the minimum contacts requirement even where the sales and marketing have not yet occurred. The Federal Circuit did note however that Mylan:
  • Has registered to do business in Delaware.
  • Appointed an agent to accept service of process there.
  • Indicated in its certificate of registration that it intends to engage in pharmaceutical manufacturing, distribution, and sales in Delaware.
  • Has a network of independent wholesalers and distributors with which it contracts to market drugs in Delaware.
Finally, the Federal Circuit considered that:
  • Mylan is a large generic manufacturer that has litigated many ANDA lawsuits in Delaware.
  • Delaware has an interest in providing a forum to resolve disputes involving products distributed in Delaware.
  • Upholding jurisdiction in Delaware serves plaintiffs' interests and the judicial system to efficiently resolve the litigation.