Antitrust Law Daily Wrap Up, ANTITRUST—3d Cir.: Lawsuit by Sandoz on vasodilator drug Remodulin® generic remanded to district court, (Oct 8, 2026)

By Kenneth H. Ryesky, M.B.A., J.D.

Proprietary manufacturer had proffered a reasonable alternative to the district court's interpretation of a settlement agreement to patent litigation which contained ambiguous terms as to its coverage and exclusions.

A Third Circuit panel has mostly reversed and remanded a district court ruling in a lawsuit brought by generic drug manufacturer Sandoz against proprietary drug manufacturer United Therapeutics Corp (UTC). The litigation concerned vasodilator drug treprostinil, which in the form relevant to the litigation, is continuously injected by a pump. When Sandoz sought FDA approval of its generic alternative to UTC's proprietary Remodulin®, UTC initiated patent infringement litigation against Sandoz. The patent litigation was settled, and Sandoz began a marketing campaign for its generic version; the marketing campaign ultimately failed after the UTC and the manufacturer of the cartridges restricted the sale of the cartridges to specialty pharmacies, to the exclusion of Sandoz. The district court also ruled in favor of UTC on Sandoz's claims that the UTC breached the patent litigation settlement agreement. On appeal, the Sherman Act and state consumer law rulings of the district court, along with a damages ruling, were reversed and remanded. The appellate panel affirmed the admission of Sandoz's expert's testimony, however (Sandoz, Inc. v. United Therapeutics Corp., No. 24-3067 (3d Cir. Oct. 7, 2026)).

Background. Vasodilator drug treprostinil, used to treat pulmonary arterial hypertension (PAH), can be administered orally, inhaled, or injected. Remodulin®, an injectable form of treprostinil, was developed by United Therapeutics Corporation (UTC), approved by the FDA, and marketed as a proprietary drug. Remodulin® is administered by constant injection by an infusion pump from a cartridge containing the drug.

Sandoz Inc. (Sandoz) applied for FDA approval of a generic form of Remodulin® in 2011, and ultimately received approval. UTC sued Sandoz for patent infringement; the lawsuit was settled in 2015, such that UTC would not interfere with Sandoz's marketing efforts after Sandoz would begin its marketing of generic treprostinil in 2018.

Sandoz engaged RareGen, LLC, (RareGen) to drive its marketing of its generic treprostinil in 2019. Sandoz became unable to obtain the appropriate cartridges for the drug and compatible pumps for administering the drug because Smiths Medical ASD, Inc. (Smiths), the manufacturer of the pumps, had restricted its sales of pumps and cartridges to specialty pharmacies that fill the cartridges with the drug; the marketing campaign by RareGen and Sandoz thus failed.

Sandoz and RareGen sued UTC in 2019, alleging causes of action under (1) the Sherman Act; (2) unfair trade practices under New Jersey and North Carolina statutes; (3) tortious interference; and (4) breach of contract as between Sandoz and UTC. In March 2022, Sandoz was granted summary judgment on the Sherman Act, tortious interference, and state statute claims, while UTC was found liable to Sandoz for the contract breach claim relating to the 2015 patent settlement agreement, and was eventually awarded more than $61 million in damages on it. The court also denied UTC's motion to exclude Sandoz's expert on the damages, and dismissed RareGen from the case.

UTC, Sandoz, and RareGen all appealed the district court's rulings, as respectively applied against them, to the Third Circuit.

Contract breach. The appellate court reversed the district court's summary judgment in favor of Sandoz. On this claim, Sandoz and RareGen alleged that UTC's restrictions on the cartridges impeded Sandoz's efforts to launch generic treprostinil. The district court had found that UTC seized and restricted "title to all commercially available cartridges as Sandoz was preparing to launch its generic." The explicit terms of the 2015 settlement agreement exclude from its ambit "any technology associated with any UTC product(s)." In the context of the district court's finding, the settlement agreement was susceptible to more than one construction, and UTC had proffered a differing plausible alternative interpretation.

There accordingly could be no valid summary judgment grant on the breach-of-contract claim on the issue of liability, so the issue was remanded to the district court for further determination. This being done, neither could the UTC's summary judgment grant on the tortious interference claim stand; that, too, was reversed, as was the award of monetary damages to Sandoz.

Sherman Act claims. The appellate court panel affirmed the district court's dismissal of the Sherman Act claims. As an initial matter here, the court found that Sandoz's adoption of RareGen's argument was not improper and did not serve to inappropriately circumvent the word count limitations in the court's rules [Fed. R. App. P. 28(i)].

Here, there was no dispute that the Sherman Act claims were based upon an alleged exclusive dealing agreement by UTC with Smiths and the specialty pharmacies. Under a rule-of-reason analysis, the district court had found that UTC's concern over the supply of cartridges was justified, and its funding commitment to Smiths was a reasonable way to ensure the continued manufacture and availability of the cartridges. Sandoz and RareGen did not proffer any practical less restrictive alternative to the exclusive dealing arrangements, which actually sustained the relevant market for cartridges, even if it caused harm to a particular market participant.

For similar reasons, the court reversed the district court's summary judgment to UTC on the North Carolina statutory claims. The Sherman Act allegations were also predicates for the district court's summary judgment to UTC on the tortious interference claim; that claim was remanded for consideration as to "whether the Plaintiffs can sustain their tortious interference claim independently from the merits of their antitrust claims."

The Case is No. 24-3067.

Judge: Restrepo, L.

Attorneys: Karla M. Doe (Alston & Bird LLP) for Sandoz Inc. Edward J. Bennett (Williams & Connolly LLP) for United Therapeutics Corp.

Companies: Sandoz Inc.; United Therapeutics Corp.

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