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May 29, 2015
Brattle Client Warner Chilcott Granted Summary Judgment in Pharmaceutical Antitrust Case

In a closely-watched pharmaceutical antitrust case, Brattle client Warner Chilcott prevailed in a motion for summary judgment against Mylan Pharmaceuticals. Mylan, which produced a generic version of Warner Chilcott’s branded acne medication Doryx, alleged that Warner Chilcott had acted anticompetitively by product hopping. In particular, Mylan claimed that Warner Chilcott had prevented it from competing through “automatic substitution” in pharmacies by making minor innovations in Doryx and subsequently discontinuing older versions of the drug.

A Brattle team led by principals Steve Herscovici and Lisa Cameron worked closely with attorneys from White & Case in providing analytical support for four different experts. Our reports and analyses showed that:

  1. generic manufacturers compete with branded drugs using a variety of mechanisms rather than merely relying on “automatic substitution” of branded drugs with their generic equivalents;
  2. third party payors can and do drive utilization from a given branded drug towards a wide array of cheaper therapeutic substitutes;
  3. third party payors had driven utilization from Doryx to a number of therapeutic substitutes even when no generic equivalent for Doryx was available on the market;
  4. there were numerous pro-competitive business considerations motivating Warner Chilcott’s innovations in Doryx, including the need to reduce risks to patients taking the drug; and
  5. changing the formulation of Doryx led to a significant reduction in reported adverse events.

In ruling on summary judgment, Judge Paul Diamond of the Eastern District of Pennsylvania found that Warner Chilcott had not acted anticompetitively because Doryx faced competition and that third party payors’ treatment of Doryx reflected this. He also found that Mylan had numerous ways to reach patients— even if it could not take advantage of automatic substitution laws— and that Mylan had failed to demonstrate that changes in Doryx’s formulation were predatory in nature. Judge Diamond’s ruling is the first decision in a product hopping case based on a full discovery record, and comes as a number of similar cases are being litigated.

The case is Mylan Pharmaceuticals Inc. v. Warner Chilcott PLC et al.