In Re Lorazepam & Clorazepate Antitrust Litigation

467 F. Supp. 2d 74, 2006 U.S. Dist. LEXIS 91900
CourtDistrict Court, District of Columbia
DecidedDecember 20, 2006
DocketMDL 1290
StatusPublished
Cited by42 cases

This text of 467 F. Supp. 2d 74 (In Re Lorazepam & Clorazepate Antitrust Litigation) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Lorazepam & Clorazepate Antitrust Litigation, 467 F. Supp. 2d 74, 2006 U.S. Dist. LEXIS 91900 (D.D.C. 2006).

Opinion

*78 MEMORANDUM OPINION

THOMAS F. HOGAN, Chief Judge.

Pending before the Court are several post-trial motions. Defendant Mylan Laboratories, Inc., Defendant Mylan Pharmaceuticals, Inc. (together, “Mylan”), Defendant Cambrex Corpoi'ation (“Cambrex”), and Defendant Gyma Laboratories of America, Inc. (“Gyma”), collectively (“Defendants”), filed the following post-trial motions: Defendants’ Renewed Motion for Judgment as a Matter of Law Under Rule 50(b) [dkt. 883], Defendants’ Motion for New Trial Under Rule 59(a) [dkt. 888], and Defendants’ Motion for Remittur under Rule 59(e) [dkt. 890], among others. Upon careful review of the parties’ motions, oppositions, replies thereto, and the entire record herein, the Court will deny the Defendants’ Renewed Motion for Judgment as a Matter of Law and Defendants’ Motion for a New Trial. The Court will not rule on Defendants’ Motion for Remit-tur under Rule 59(e) at this time. 1

I. BACKGROUND 2

After a jury trial lasting over three weeks, on June 1, 2005, the jury found for the Plaintiffs and against all Defendants on the following state law claims: 3 agreement in unreasonable restraint of trade, conspiracy in unreasonable restraint of trade, monopolization, and attempted monopolization, all in the Lorazepam active pharmaceutical ingredient (“API”) market and the Lorazepam tablet market and in the Clorazepate API and tablet markets. 4 The jury awarded Plaintiff Blue Cross Blue Shield of Minnesota $1,756,096.00, Plaintiff Blue Cross Blue Shield of Massachusetts $8,430,887.00, Plaintiff Federated Mutual Insurance Company $410,878.00, and Plaintiff Health Care Services Corporation (“HCSC”) $1,448,437.00 in damages.

At the center of this litigation are exclusive licensing agreements between Defendants. In November 1997, Mylan and Profarmco entered two agreements, each entitled, “Exclusive Agreement,” in which Profarmco agreed to supply its Lorazepam and Clorazepate API to Mylan in exchange for an upfront payment and a share of Mylan’s profits from the sale of the two drugs in the form of royalty payments. The Exclusive Agreements had a term of ten years and provided that Pro-farmco would not supply Lorazepam and Clorazepate API to any other generic manufacturers in the United States, but did not prohibit such sale to the branded manufacturers or to any manufacturer *79 outside of the United States. The Exclusive Agreements did, however, provide that Profarmco should take all steps reasonably necessary to prevent its Lorazep-am and Clorazepate API that it sold outside of the United States to enter the United States. The Exclusive Agreements were terminated in December 1998 after the Federal Trade Commission (“FTC”) announced its investigation of Mylan’s actions.

A. The Parties

Plaintiffs Blue Cross Blue Shield (“BCBS”) of Minnesota, Federated Mutual Insurance Company (“Federated”), and BCBS of Massachusetts (collectively, “BCBS Plaintiffs”), and Plaintiff HCSC are health insurance companies that are third-party payors for prescription drugs, including Lorazepam and Clorazepate, on behalf of their insureds and self-funded customers, typically employer-sponsored health plans that contract with Plaintiffs to administer claims on their behalf and pursue plan-related costs.

Defendant Mylan is a large generic drug manufacturer and distributor that markets at least 91 generic drugs, including Lorazepam and Clorazepate. Defendant Cambrex sells chemicals through its subsidiaries for, among other things, drug manufacture. Defendant Profarmco is an Italian company that is a wholly-owned subsidiary of Cambrex that manufactures and sells various APIs. Defendant Gyma sells APIs and other chemicals to the pharmaceutical industry. Gyma acts as a U.S. agent for Profarmco, buying various APIs from Profarmco and selling them to generic manufacturers in the United States. Prior to the agreements at issue in this case, Profarmco and Gyma sold Lorazepam and Clorazepate API to Mylan and its generic competitors.

B. The Pharmaceutical Industry

1. The Supply Chain

Mylan, and other generic drug manufacturers, sell their products to wholesalers and retail pharmacies. The pharmacies sell the generic drugs to consumers, and then seek reimbursements for costs beyond the consumer’s co-payment or coinsurance payment from the consumer’s insurance company, such as Plaintiffs. BCBS Plaintiffs contract with what is known as a pharmacy benefit manager (“PBM”), who in turn contracts directly with the pharmacies. Plaintiff HCSC contracts directly with the pharmacies. Thus, the pharmacies generally bill the PBMs, who in turn bill the insurance companies. The amount Plaintiffs pay for a prescription reimbursement varies, and is set by formulas with many fluctuating variables in their contracts with the PBMs or directly with the pharmacies.

2. Regulatory Frameivork

Prior to selling prescription drugs in the United States, a manufacturer must obtain approval from the Food and Drug Administration (“FDA”). Manufacturers of generic drugs can expedite the approval process by filing an Abbreviated New Drug Application (“ANDA”), which relies on the data filed with the FDA concerning the bioequivalent pioneer drug. The ANDA process can take from several months to up to two years. All ANDA applications must reference the API provider that has already been approved by the FDA to supply API for the relevant drug. To obtain FDA approval to sell API, the API manufacturer must file a Drug Master File (“DMF”) with the FDA. Different drug manufacturers may reference the DMF of the same API producer in their ANDAs. Further, when a generic drug manufacturer wants to use a new API producer that it did not originally gain approval to use, it *80 must 'file a supplemental ANDA that references that API supplier’s DMF and test results using the new supplier’s API. This approval process can take up to one year.

II. DEFENDANTS’ RENEWED MOTION FOR JUDGMENT AS A MATTER OF LAW UNDER RULE 50(B)
A. Legal Standard

A Rule 50(b) motion “should not be granted unless the evidence, together with all inferences that can reasonably be drawn therefrom, is so one-sided that reasonable jurors could not disagree on the verdict.” Elam v. C & P Telephone Co., 609 F.Supp. 938, 940 (D.D.C.1984) (internal citations omitted).

The Court must grant a motion for judgment as a matter of law if “there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue.” Fed. R. Civ. Pro. 50(a); Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000). If reasonable minds could disagree about the import of the evidence, judgment as a matter of law is inappropriate. Anderson v.

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Bluebook (online)
467 F. Supp. 2d 74, 2006 U.S. Dist. LEXIS 91900, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-lorazepam-clorazepate-antitrust-litigation-dcd-2006.