Antitrust Law Blog
Posted at 2:47 PM on February 18, 2011 by Sheppard Mullin
Indirect Purchaser Plavix Class Actions Tossed for Lack of Antitrust Standing
On January 31, 2011, the District Court for Southern District of Ohio granted defendants' Rule 12(b)(6) motion,
dismissing indirect purchaser class actions that challenged proposed reverse payment agreements as
anticompetitive under Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1-2. Plaintiffs alleged those
agreements prevented the defendants from entering into an alternative competitive agreement that would have
permitted the cheaper generic version of Plavix to enter the market sooner. In re Plavix Indirect Purchaser
Antitrust Litig. ("Plavix"), Slip Op., No. 1:06-cv-226, 2011 WL 335034 (S.D. Ohio Jan. 31, 2011).
Background – Kroger Co. v. Sanofi-Avantis, 701 F.Supp.2d 938 (S.D. Ohio 2010)
In an earlier opinion, which was incorporated by reference into the January 31 decision, the court dismissed the
direct purchaser actions based on the same allegations. Accordingly, a brief description of the background of the
case and the court's prior decision is helpful in understanding the context of the court's ruling dismissing the
indirect purchaser claims.
The defendants in both sets of actions were Sanofi Aventis and Sanofi-Synthelabo, Inc., Bristol-Myers Squibb
Company and Bristol-Myers Squibb Sanofi Pharmaceuticals Holding Partnership (collectively “Sanofi”) and
Apotex Corporation (“Apotex”). Sanofi manufactures a patented clopidogrel bisulfate drug, known as Plavix,
which is used to treat patients with a risk of heart attacks and strokes. Apotex was the first generic applicant to
seek FDA approval to market a generic version of Plavix in the United States, alleging that Sanofi's patent was
invalid (called a Paragraph IV certification). Sanofi then initiated a patent infringement suit against Apotex.
Kroger, 701 F.Supp.2d at 942.
The FDA grants the first generic applicant to file a Paragraph IV certification with a six-month exclusivity
period during which the generic drug manufacturer may sell the drug free of competition from any other generic
manufacturer. However, the filing of a patent infringement suit stays the FDA approval process for the generic
drug for up to 30 months. 21 U.S.C. § 355(j)(5)(B)(iii); Kroger, 701 F.Supp.2d at 942.
The automatic 30-month stay that was triggered by Sanofi's infringement suit pursuant to section
355(j)(5)(B)(iii) expired in May 2005, and the trial of the infringement action was scheduled for April 2006.
Apotex received FDA approval in January 2006, which started the 6-month exclusivity period running before
the patent issues were resolved. Apotex was, therefore, faced with either losing the lucrative 6-month
exclusivity rights or launching its generic drug "at risk," thus exposing itself to infringement damages if Sanofi's
patent was upheld. Apotex began preparing for an at risk launch based on a belief that it had a strong invalidity
case. Meanwhile, Aventis had obtained independent professional advice that called into question the validity of
the patent at issue. Kroger, 701 F.Supp.2d at 944.
Given the risks on both sides, negotiations ensued resulting in two sets of proposed settlement agreements, both
of which required government approval to take effect. The first called for a series of "reverse payments" by
Sanofi to Apotex, also guaranteeing that neither Apotex nor Sanofi would launch a generic during Apotex's
exclusivity period. When this agreement failed to gain government approval, the parties entered into a second
proposed agreement that capped Apotex's damages if the patent litigation was resolved in Sanofi's favor and
