Antitrust Law Daily Wrap Up, ANTITRUST—N.D. Ga.: Pharma companies cannot discover information underlying FTC patent lawsuit studies, (May 12, 2015)

By Greg Hammond, J.D.

In an FTC antitrust action against Solvay Pharmaceuticals, Inc., Watson Pharmaceuticals, Inc., Paddock Laboratories, Inc., and Par Pharmaceutical Companies, Inc., the defendant pharmaceutical companies were denied their motion to obtain underlying information concerning certain FTC patent lawsuit studies. In denying the motion to compel, the federal district court in Atlanta determined that the defendant pharmaceutical companies failed to demonstrate that the underlying information was relevant, or that the benefits of production would outweigh the burden of complying with the production request (In re AndroGel Antitrust Litigation (No. II), May 11, 2015, Thrash, T.).

Background. The FTC filed suit against the pharmaceutical company defendants, alleging that they engaged in a “reverse payment” settlement to resolve patent infringement litigation between Solvay—the marketer of brand-name testosterone replacement drug AndroGel—and would-be generic competitors. The defendants seek to compel the FTC to produce certain information underlying a number of general studies concerning patent lawsuits and settlement agreements between brand-name and generic drug manufacturers.

The court determined that it was required to resolve two questions: (1) is the non-public information underlying the FTC studies at issue “relevant” to any claim or defense; and (2) if so, do the burdens of producing the requested information outweigh any benefit the information may provide?

Relevance. The court first concluded that the pharmaceutical company defendants failed to demonstrate that the information underlying the FTC studies at issue is relevant to the specific claims in this case. “This information concerns other lawsuits and other settlement agreements between other parties,” the court noted. Although the Commission cited two of the studies in its second amended complaint, that information alone did not demonstrate that the underlying information was relevant to the specific claims at issue. Further, it remained unclear whether the FTC’s experts would utilize the studies in forming their opinions or how reliance on the general studies would render them relevant to the specific claims in this case.

Burden of production. Even if the underlying information was deemed relevant, the significant burden of complying with the defendants’ discovery requests would outweigh any minimal benefit to be gained from the disclosure, the court concluded. Specifically, the court noted that the studies deal with nearly 800 brand-generic settlement agreements containing confidential and protected information. In order to comply with the defendants’ request, according to the court, the Commission would have to redact an “extraordinary number of documents” and would have to justify each redaction with a written statement. The motion to compel was consequently denied.

The case number is 1:09-MD-2084-TWT.

Attorneys: Randall W. Weinsten for Federal Trade Commission. Julia K. York (Skadden Arps Slate Meagher & Flom LLP) for Actavis, Inc. Adam M. Acosta (White & Case, LLP) for Par Pharmaceutical Companies, Inc. and Paddock Laboratories, Inc. Joshua S. Meltzer (Munger, Tolles & Olson, LLP) for Solvay Pharmaceuticals, Inc. and AbbVie Products LLC.

Companies: Actavis, Inc.; Par Pharmaceutical Companies, Inc.; Paddock Laboratories, Inc.; Solvay Pharmaceuticals, Inc.; AbbVie Products LLC

Cases: Antitrust GeorgiaNews