UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION
- Robert Pitofsky, Chairman
- Sheila F. Anthony
- Mozelle W. Thompson
- Orson Swindle
- Thomas B. Leary
|In the Matter of
HOECHST MARION ROUSSEL, INC.,
CARDERM CAPITAL L.P.,
a limited partnership,
|Docket No. 9293
DECISION AND ORDER
The Federal Trade Commission ("Commission") having heretofore issued its
complaint charging that it had reason to believe that certain acts and practices of
Hoechst Marion Roussel, Inc. ("Respondent Hoechst"), Carderm Capital L.P.,
("Respondent Carderm"), and Andrx Corporation ("Respondent Andrx") may
have violated Section 5 of the Federal Trade Commission Act, and Respondents having been
served with a copy of that complaint, together with a notice of contemplated relief, and
Respondents having filed answers denying said charges;
Respondents and counsel for the Commission having thereafter executed an Agreement
Containing Consent Order, on the basis of which the matter is being settled; an admission
by each Respondent only of the jurisdictional facts set forth in the complaint relating to
it (except as modified in the Agreement Containing Consent Order), denying all other
allegations; a statement that the signing of said agreement is for settlement purposes
only and does not constitute an admission by Respondents that the law has been violated as
alleged in such complaint or that any allegation of the complaint is true, other than the
jurisdictional facts relating to it set forth in paragraphs 1-4 immediately below (as more
fully stated in the Agreement Containing Consent Order); and waivers and other provisions
as required by the Commission's Rules; and
The Secretary of the Commission having thereafter withdrawn this matter from
adjudication in accordance with § 3.25(c) of its Rules; and
The Commission having thereafter considered the matter and having thereupon accepted
the executed consent agreement and placed such agreement on the public record for a period
of thirty (30) days, now in further conformity with the procedure prescribed in
§ 3.25(f) of its Rules, the Commission hereby makes the following jurisdictional
findings and enters the following order:
- 1. Andrx is a corporation organized, existing, and doing business under and by virtue of
the laws of the State of Delaware, with its office and principal place of business located
at 4001 S.W. 47th Avenue, Fort Lauderdale, Florida, 33314.
- 2. Hoechst is a corporation organized, existing, and doing business under and by virtue
of the laws of the State of Delaware, with its office and principal place of business
located at 339 Interpace Parkway, P.O. Box 663, Parsippany,
New Jersey 07054. Hoechst is, directly or indirectly, a wholly-owned subsidiary of
its parent Aventis, S.A., which is incorporated under the laws of the Republic of France
with its office and principal place of business at 25 Quai Paul Doumier, 92408 Courbevoie
- 3. Carderm is a Delaware limited partnership having its office and principal place of
business at Richmond House, 12 Par-la-Ville Road, Hamilton, Bermuda. Carderm is directly
or indirectly owned or controlled by Hoechst.
- 4. The Federal Trade Commission has jurisdiction of the subject matter of this
proceeding and of Respondents, and the Commission has determined that this proceeding is
in the public interest.
IT IS ORDERED that for the purposes of this order, the following definitions shall
- A. "Respondent Andrx" means Andrx Corporation, its directors, officers,
employees, agents and representatives, predecessors, successors, and assigns; its
subsidiaries, divisions, groups, and affiliates controlled by Andrx, and the respective
directors, officers, employees, agents and representatives, successors, and assigns of
- B. "Respondent Hoechst" means Hoechst Marion Roussel, Inc., its directors,
officers, employees, agents and representatives, predecessors, successors, and assigns;
its parent subsidiaries, divisions, groups, and affiliates controlled by Hoechst or its
parent, and the respective directors, officers, employees, agents and representatives,
successors, and assigns of each.
- C. "Respondent Carderm" means Carderm Capital, L.P., its directors, officers,
employees, agents and representatives, predecessors, successors, and assigns; its
subsidiaries, divisions, groups, and affiliates controlled by Carderm, and the respective
directors, officers, employees, agents and representatives, successors, and assigns of
- D. "Commission" means the Federal Trade Commission.
- E. "180-day Exclusivity Period" means the period of time established by
section 505(j)(5)(B)(iv) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
§ 355(j) et seq.), as interpreted by the appellate courts at the time of
- F. "Agreement" means anything that would constitute an agreement under Section
1 of the Sherman Act or Section 5 of the Federal Trade Commission Act.
G. "ANDA" means an Abbreviated New Drug Application, as defined under 21 U.S.C.
§ 355(j) et seq. as to which the applicant is the ANDA First Filer.
- H. "ANDA First Filer" means the party whom the FDA determines is and remains
entitled to, or eligible for, a 180-day Exclusivity Period which has not yet commenced
running or expired, so long as that status, in the exercise of reasonable diligence at the
time of the Agreement, is or would be known to or is believed by the Respondent entering
into such Agreement.
- I. "Drug Product" means a finished dosage form (e.g., tablet,
capsule, or solution) that contains a drug substance, generally, but not necessarily, in
association with one or more other ingredients, as defined in 21 C.F.R. § 314.3(b).
- J. "Effective Date" means the later of (1) the date of entering into the
Agreement; or (2) the last date of receipt of each judicial or regulatory approval of the
Agreement in the event that such approval is a pre-condition to the Agreement taking
- K. "Expiration Date" means the date 180 days (or such other period as is
embraced by the definition of 180-day Exclusivity Period) after the date that the ANDA
First Filer commences commercial marketing of the Drug Product pursuant to the ANDA, the
Reference Drug Product, a Follow-on Drug Product, or any other generic version of the
Reference Drug Product or Follow-on Drug Product.
- L. "FDA" means the United States Food and Drug Administration.
- M. "Follow-on Drug Product" means any Drug Product that (1) is manufactured or
licensed by, or for, the same NDA Holder as the Reference Drug Product; (2) involves the
same active chemical ingredient or is prescribed for one or more of the same indications
as the Reference Drug Product (disregarding for these purposes any new indications of the
Follow-on Drug Product); and (3) after the ANDA First Filer has submitted to the FDA its
original or initial ANDA (a) receives final FDA approval, (b) is first commercially
marketed in the United States, or (c) involves the NDA Holder withdrawing substantial or
equivalent marketing or sales efforts from the Reference Drug Product or devoting substantial or additional marketing or sales efforts to
the other Drug Product.
- N. "NDA" means a New Drug Application, as defined under 21 U.S.C. § 355(b) et
- O. "NDA Holder" means: (1) the party that received FDA approval to market a
Drug Product pursuant to an NDA, (2) a party owning or controlling enforcement of the
patent(s) listed in the Approved Drug Products With Therapeutic Equivalence Evaluations
(commonly known as the "FDA Orange Book") in connection with the NDA, or (3) the
predecessors, subsidiaries, divisions, groups and affiliates controlled by, controlling,
or under common control with any of the entities described in subparagraphs (1) and (2)
above (such control to be presumed by direct or indirect share ownership of 5% or
greater), as well as the licensees, licensors, successors and assigns of each of the
P. "Patent Infringement" means infringement of any patent or of any filed patent
application, extension, reissue, renewal, division, continuation, continuation in part,
reexamination, patent term restoration, patents of addition and extensions thereof.
- Q. "Person" means both natural persons and artificial persons, including, but
not limited to, corporations, unincorporated entities, and governments.
- R. "Reference Drug Product" means the Drug Product identified by the ANDA
applicant as the Drug Product upon which the ANDA First Filer bases its ANDA.
S. "Relinquishing" means abandoning, waiving, or relinquishing.
IT IS FURTHER ORDERED that Respondents cease and desist, either directly or indirectly,
in connection with the sale of Drug Products in or affecting commerce, as
"commerce" is defined in Section 4 of the Federal Trade Commission Act, 15
U.S.C. § 44, with respect to which Respondent is either an NDA Holder or the ANDA First
Filer for such Drug Product(s) from being a party to any Agreement in which one party is
an NDA holder, and the other party is the ANDA First Filer, and in which:
- A. the ANDA First Filer is prohibited by such Agreement from relinquishing, or is
subject to a penalty, forfeiture, or loss of benefit if it relinquishes, its right to the
180-Day Exclusivity Period; or
- B. the ANDA First Filer agrees to refrain from researching, developing, manufacturing,
marketing, or selling any Drug Product that could be approved for sale by the FDA pursuant
to the ANDA as to which it is the ANDA First Filer and that is neither the subject of any
written claim of Patent Infringement nor supported by a good faith opinion of counsel (the
privileged nature of which shall be respected and remain protected), that the Drug Product
would be the subject of such a claim if disclosed to the NDA Holder.
- Provided, however, that nothing in Paragraph II shall prohibit Agreements
- (1) within 20 days of the Effective Date of the Agreement, the ANDA First Filer offers
for sale, and as promptly as practicable thereafter, commences commercial marketing of the
Drug Product subject to the ANDA, the Reference Drug Product, a Follow-on Drug Product, or
any other generic version of the Reference Drug Product or Follow-on Drug Product;
(2) one of the following two conditions has been satisfied: (a) the 180-day Exclusivity
Period, if any, has been triggered and begun to run with respect to the Drug Product
subject to the ANDA; or (b) within 10 days of the commercial marketing of a Drug Product
other than the one subject to the ANDA, the ANDA First Filer has notified the FDA, in
writing, that it will relinquish any and all eligibility for, and entitlement to, a
180-day Exclusivity Period, if any, for the Drug Product subject to the ANDA beyond the
Expiration Date. However, subparagraphs (1) and (2) shall not apply (or shall be
deemed satisfied) if Respondent is a party to an Agreement pursuant to which it engages in
conduct described by Paragraphs II.A and/or II.B, but such conduct is pursuant to, or in
accordance with, a federal statute, federal appellate court decision, FDA rule, FDA
regulation or authoritative pronouncement or interpretation of the FDA made or promulgated
after the date of this Order; and
(3) Respondent has provided Notification, as described in Paragraph V below, to the
Commission at least thirty (30) days prior to the Effective Date of the Agreement (except
that a fewer number of days' notice, but in no event fewer than ten (10), may be given if
the ANDA First Filer reasonably believes that such reduced notice will permit it to
commence marketing more quickly).
- Provided further that nothing anywhere in Paragraph II shall prohibit
Agreements involving the complete transfer of rights in a Drug Product or the withdrawal
of an ANDA.
IT IS FURTHER ORDERED that, in any instance where a Respondent is a party to a Patent
Infringement action in which it is either the NDA Holder or the alleged infringer, it
shall cease and desist, either directly or indirectly, in connection with the sale of Drug
Products in or affecting commerce, as "commerce" is defined in Section 4 of the
Federal Trade Commission Act, 15 U.S.C. § 44, from being a party to any Agreement in
which (a) the parties do not agree to dismiss the litigation, (b) the NDA Holder provides
anything of value to the alleged infringer, and (c) the alleged infringer agrees to
refrain during part or all of the course of the litigation from selling the Drug Product
at issue, or any Drug Product containing the same active chemical ingredient as the Drug
Product. Notwithstanding the above, however, such an Agreement is permissible
when entered into in conjunction with a joint stipulation between the parties that the
court may enter a preliminary injunction pursuant to Rule 65 of the
Federal Rules of Civil Procedure, if: (1) together with the stipulation for a preliminary
injunction that Respondent provides the court with the proposed Agreement, as well as a
copy of the Commission's complaint, order, and Analysis to Aid Public Comment in this
matter (which provision may be made to the court in camera or pursuant to any
confidentiality order in place in the case); (2) such Respondent has provided
Notification, as described in Paragraph V below, to the Commission at least thirty (30)
days prior to submitting the stipulation for a preliminary injunction; (3) such Respondent
does not oppose any effort by the Commission to participate, in any capacity permitted by
the court, in the court's consideration of any such action for preliminary relief (with
the Commission giving consideration to participating in such proceeding in the event the
Commission determines that such participation will expedite the court's consideration of
said preliminary injunction motion); and (4) the court issues an order and the parties'
agreement conforms to said order or the Commission determines, at the request of such
Respondent, that entering into the stipulation during the pendency of the Patent
Infringement action would not raise issues under Section 5 of the Federal Trade Commission
Act. Nothing in this paragraph shall be interpreted to prohibit or restrict the right of
any Respondent from seeking relief from the court, without notice to the Commission,
including, but not limited to, applying for preliminary injunctive relief or seeking to
extend, or reduce, the 30-month stay pursuant to 21 U.S.C. § 355(j)(5)(B)(iii).
IT IS FURTHER ORDERED that a Respondent shall provide Notification as described in
Paragraph V below to the Commission at least thirty (30) days before the Effective Date of
any Agreement made after the date the Agreement Containing Consent Order is signed and
effective whereby such Respondent is a party and is either an ANDA First Filer or an NDA
Holder, and an ANDA First Filer agrees with an NDA Holder to refrain from selling any Drug
Product under its ANDA for any period of time, provided that, in the event of litigation
between the NDA Holder and the ANDA First Filer, such Respondent is not required to
provide Notification for any such Agreement filed with or by the court unless the
Agreement results in the dismissal of all or part of said litigation. Such Respondent
shall use its best efforts to provide the required Notification in conformity with the
30-day period set forth above.
The Prior Notification required by Paragraphs III and IV shall be filed with the
Secretary of the Commission and shall include the following information, to the extent
known and not subject to any legally recognized privilege or immunity: (1) identification
of the parties involved in the Agreement; (2) identification of all Drug Products involved
in the Agreement; (3) identification of all persons who have filed an ANDA with the FDA
(including the status of such application) for any Drug Product containing the same
chemical entity(ies) as the Drug Product(s) involved in the Agreement; (4) a copy of the
proposed Agreement; (5) identification of the court, and copy of the docket sheet, for any
legal action which involves either party to the Agreement and relates to any Drug
Product(s) containing the same chemical entity(ies) involved in the Agreement; and (6) all
documents which were prepared by or for any officer(s) or director(s) of a Respondent for
the purpose of evaluating or analyzing the Agreement.
IT IS FURTHER ORDERED that each Respondent shall file a verified written report within
sixty (60) days after the date this order is issued, annually thereafter for five (5)
years on the anniversary of the date this order is issued, and at such other times as the
Commission may by written notice require, setting forth in detail the manner and form in
which each Respondent intends to comply, is complying, and has complied with this order.
Each Respondent shall include in its compliance reports, among other things that are
required from time to time, a full description of the efforts being made to comply with
IT IS FURTHER ORDERED that each Respondent shall notify the Commission at least thirty
(30) days prior to any proposed change in Respondent such as dissolution, assignment, sale
resulting in the emergence of a successor corporation, the creation or dissolution of
subsidiaries or any other change in Respondent that may affect compliance obligations
arising out of this order.
IT IS FURTHER ORDERED that, for the purpose of determining or securing compliance with
this order and subject to any legally recognized privilege or immunity, and upon written
request with reasonable notice to each Respondent, each Respondent shall permit any duly
authorized representative of the Commission:
- A. Access, during office hours and in the presence of counsel, to all facilities, and to
inspect and copy all books, ledgers, accounts, correspondence, memoranda, calendars, and
other records and documents in its possession or under its control relating to compliance
with this order; and
- B. To interview officers, directors, employees, agents, and other representatives of
each Respondent, who may have counsel present, regarding such compliance issues.
IT IS FURTHER ORDERED that this order shall terminate on May 8, 2011.
By the Commission.
Donald S. Clark
ISSUED: May 8, 2001