Opposition Brief — Tri-Bio Laboratories, Inc. v. United States

ee

cae

TE eee er or % ee aa Rr ae wy Ae ———_____—.

ETE E Dp 2 q

A an

ile: ne JUL 8 ie

— ————————— Ho

In the Supreme Court of the Bite aot Sotates =

-” Ocroper TERM, a is

d ; rea:

Tri-Bio LABORATORIES, INC., PETITIONER . 3

Wi ‘4

UNITED STATES OF AMERICA AND +

FOOD AND DRUG ADMINISTRATION 2

ON PETITION FOR A WRIT OF CERTIORARI TO THE 4

UNITED STATES.COURT OF APPEALS

FOR THE THIRD CIRCUIT

BRIEF FOR THE RESPONDENTS IN OPPOSITION

CHARLES FRIED

Solicitor General

JOHN R. BOLTON

' Assistant Attorney General

GERALD C. KELL

_ Attorney

‘ Department of Justice

Washington, D.C. 20530

(202) 633-2217>

QUESTION PRESENTED

Whether the Federal Food, Drug, and Cosmetic Act, 21

U.S.C. (& Supp. IV) 301 et seg., which bars the marketing

of a new animal drug absent approval by the Food and

Drug Administration (FDA) of an application establishing

th. safety and effectiveness of the drug, permits a drug

manufacturer to rely on data submitted in an application

concerning another drug containing the same active and

inactive ingredients that was previously approved by the

FDA.

(I)

TABLE OF CONTENTS

Page

a oN a Li halen erin ws te kU. Wain Acar hse ao l

Ne See ge bai wh ee aa ele wink Grek Wale ¥ bes

ee. lb i cee 4 ep een eas kha aw oan eae l

rls) 5 os, 4 eked 4 SEE WARE Oe eke 68 kas 4

a ery hase ieee saaabled dvs ces a wess y

TABLE OF AUTHORITIES

Cases:

NLRB v. Bell Aerospace Co., 416 U.S. 267 (1974) ....... 8

Ruckelshaus v. Monsanto Co., 467 U.S. 986 (1984) ...... 3,6

Thomas v. Union Carbide Agricultural Products Co.,

en ia ber wee beak e 4ee 6

United States v. Generix Drug Corp., 460 U.S. 453

ees Rg PAR Ey CR SW OR See 2 eC pe ar 2

Upjohn Mfg. v. Schweiker, 681 F.2d 480 (6th Cir.

Me Siar c cls Walaa ha Cle SW OE ond cathe beds 0 6, 8

Weinberger v. Bentex Pharmaceuticals, 412 U.S. 645

os es ke an ae rks 6 aie 6 bean a ASD 9

Young v. Community Nutrition Inst., 476 U.S. 974

Ge od et a sag hen db 40M Ae ake a bie-a 5,8

Constitution, statutes and regulations:

U.S. Const. Amend. V (Takings Clause) ............... 6

Drug Price Competition and Patent Term Restoration

Act of 1984, Pub. L. No. 98-417, 98 Stat. 1585 (21

Wray Seas ba VU oe hadese cde eee’ 7

Federal Food, Drug, and Cosmetic Act, 29 U.S.C.

LS Neca ereé Cee ceeeeedesanen 1

I oe wht cddbes ive dbion fen

eG oy a conde be CEs we 8 es 2

ee ra a, ga Cake we aaesed sce 2

21 U.S.C. (Supp. IV) 355(j)(4)(D)(i)-(v) ... 2... 7,8

Be es EE yc ac ede sckavaads cuss xi t@s 2

IV

Statutes and regulations — Continued: Page

21 U.S.C. 36OO(D) 2.2.2... ccc cece cece cece ones pe

21 U.S.C. 360D(D)(1) 2... eee eee eee ee eens 2

21 U.S.C. 360D(dM1) ... 6... cece ee eee recess 5

21 U.S.C. 360bB(d)(3) ... 2... cece cere eee 9

i} Leek) err 2

21 C.F.R.:

OD cs i ancn es seb vetesrassunceucames

Section 514.1(a) ........ce eee c cece reece eee enees 4, 5,

NAN

Miscellaneous:

36 Fed. Reg. (1971):

i GE cache sends penne bsasesaaeesnaes soiree ie

ere terre rr

45 Fed. Reg. 82052-82063 (1980) ....-------e+ee reer

46 Fed. Reg. 27396 (1981) ....... 0. sere reer eres

H.R. 4714, 100th Cong., 2d Sess. (1988) .....---------:

H.R. Rep. 98-857, 98th Cong., 2d Sess. Pt. 1 (1984) .....

S. 255, 97th Cong., Ist Sess. (1981) ....----- +--+ e +e

ee ee

In the Supreme Court of the United States

OCTOBER TERM, 1988

No. 87-1804

TRI-BiO LABORATORIES, INC., PETITIONER

v.

UNITED STATES OF AMERICA AND

FOOD AND DRUG ADMINISTRATION

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

BRIEF FOR THE RESPONDENTS IN OPPOSITION

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. 5a-23a)

is reported at 836 F.2d 135. The opinion of the district

court (Pet. App. 26a-63a) is not yet reported.

JURISDICTION

The judgment of the court of appeals (Pet. App.

24a-25a) was entered on December 29, 1987. A petition for

rehearing was denied on February 1, 1988 (Pet. App.

la-2a). The petition for a writ of certiorari was filed on

May 2, 1988. The jurisdiction of this Court is invoked

under 28 U.S.C. 1254(1).

STATEMENT

1. Under the Federal Food, Drug, and Cosmetic Act,

29 U.S.C. (& Supp. IV) 301 et seg., any “new animal drug”

(1)

2

is deemed unsafe and adulterated and may not be in-

troduced or delivered for introduction into interstate com-

merce unless a new animal drug application (NADA) has

first been approved by the Food and Drug Administration

(FDA). See 21 U.S.C. 331(a), 351(a)(5), 360b(a)(1) and

(b).' The Act defines a “new animal drug” as a drug “the

composition of which is such that such drug is not general-

ly recognized, among experts qualified by scientific train-

ing and experience to evaluate the safety and effectiveness

of animal drugs, as safe and effective for use under the

conditions prescribed, recommended, or suggested in the

labeling thereof” (21 U.S.C. 321(w)). An NADA must

contain, inter alia, “full reports of investigations which

have been made to show whether or not such drug is safe

and effective for use” (21 U.S.C. 360b(b)(1)). A drug that

is not a duplicate for a previously approved drug is known

as a “pioneer” drug. See United States v. Generix Drug

Corp., 460 U.S. 453, 454-455 (1983).

2. In August 1981, petitioner, Tri-Bio Laboratories,

Inc., submitted an NADA for the marketing of a drug

manufactured under the trade name Gentaject. The

NADA referred to the FDA’s approval in 1978 of an

NADA for a pioneer drug manufactured by another com-

pany under the trade name Garasol, which contains the

same active and inactive ingredients as Gentaject, and

which, like Gentaject, is an injectable drug for use in one-

day old chicks to prevent early mortality from three

specific organisms. Garasol was patented in 1963, and its

patent expired in 1980. The FDA denied petitioner’s

NADA for Gentaject on the ground that it did not include

“full reports of investigations” establishing the safety and

efficacy of Gentaject, as required by 21 U.S.C. 360b(b)(1).

' The FDA enforces the Act as the designee of the Secretary of

Health and Human Services. See 21 U.S.C. 371(a); 21 C.F.R. 5.10.

3

The FDA refused to allow petitioner to rely on informa-

tion in the pioneer NADA for Garasol in support of Gen-

taject’s safety and efficacy. Pet. App. 38a-40a.

On September 13, 1984, petitioner filed a petition with

the FDA, seeking an administrative declaration that Gen-

taject is not a “new animal drug” because the FDA had

previously determined that Garasol is safe and effective.?

The FDA denied the petition. According to the FDA, peti-

tioner’s submission did not show that Gentaject is general-

ly recognized as safe and effective for its intended uses.

The FDA accordingly concluded that it was a new animal

drug that could not be marketed without prior FDA ap-

proval of an NADA. Pet. App. 40a-42a.

3. The district court upheld the FDA’s determination,

concluding that it was not arbitrary, capricious, an abuse

of discretion, or otherwise not in accordance with law

(Pet. App. 26a-29a). Adopting the magistrate’s report (see

id. at 30a-63a), the court rejected petitioner’s contention

that it was not required to include “full reports of in-

vestigations” in its NADA for Gentaject, and could in-

stead rely on FDA’s prior approval of the safety and ef-

ficacy of Garasol (see id. at 40a-48a). The court also re-

jected petitioner’s alternative claim that FDA approval is

not required because Gentaject is identical to Garasol and,

hence, is not a “new animal drug,” within the meaning of

the Federal Food, Drug, and Cosmetic Act, 21 U.S.C.

321(w) (Pet. App. 48a-60a).

4. The court of appeals affirmed (Pet. App. Sa-23a).

The court reasoned that this Court’s decision in

Ruckelshaus v. Monsanto Co., 467 U.S. 986 (1984), sup-

? The petition was submitted pursuant to a settlement agreement

between petitioner and the FDA, in which they agreed voluntarily to

dismiss two pending lawsuits each had brought against the other. See

Pet. App. 40a-4la.

4

ported the FDA’s refusal to allow petitioner to rely on the

data included in Garasol’s NADA because an FDA regula-

tion existing at the time of its submission provided the

manufacturer of Garasol “with a[] * * * reasonable

investment-backed expectation that the FDA would

refrain from nonconsensual use of research material” (Pet.

App. 17a).? The court also rejected petitioner’s alternative

contention “that because Gentaject is an exact duplicate of

a previously approved drug, Gentaject is not a ‘new drug’

necessitating the same exhaustive testing as its pioneer”

(id. at 18a). The court found that petitioner had failed to

establish that Gentaject fell within the “narrow” statutory

exception for drugs that are not considered “new,” because

they have “ ‘been used to a material extent or for a

material time’” and are “ ‘generally recognized’” by

qualified experts as safe and effective (id. at 19a, quoting

21 U.S.C. 321(w)). FDA’s prior approval of Garasol, the

court reasoned (Pet. App. 19a-20a), is not enough.

ARGUMENT

The decision of the court of appeals is correct, and it

does not conflict with any decision of this Court or of any

other court of appeals. Accordingly, further review is not

warranted.

1. The court of appeals correctly upheld the FDA’s

refusal to allow petitioner to establish that Gentaject is

safe and effective simply by incorporating into its own

NADA data contained in another applicant’s NADA

without that applicant’s consent. The relevant statutory

language, its legislative purpose, and subsequent congres-

sional action, all support the FDA’s view, which is

’ See 21 C.F.R. 514.1(a) (“Any reference to information furnished

by a person other than the applicant may not be considered unless its

use is authorized in a written statement signed by the person who sub-

mitted it.”).

5

longstanding (see 21 C.F.R. 514.1(a); 36 Fed. Reg. 18375,

18381 (1971); 40 Fed. Reg. 13802, 13825 (1975)), and

therefore, if “sufficiently rational,” must be upheld.

Young v. Community Nutrition Inst., 476 U.S. 974, 981

(1986).

a. First, the language of the Federal Food, Drug, and

Cosmetic Act does not support petitioner’s claim (Pet.

7-14; see id. at 4) that the FDA must allow petitioner to

appropriate data contained in another applicant’s NADA.

The Act provides that each NADA must include “full

reports of investigations which have been made to show

whether or not such drug is safe and effective for use” (21

U.S.C. 360b(b)). It nowhere suggests that an applicant

must be allowed to rely on, or otherwise incorporate full

reports contained in another NADA where, as in this case,

the prior applicant has not consented to appropriation of —

its work product.4

b. The reasonableness of the FDA’s interpretation is

also supported by policy concerns. “[A]ppropriation by

‘me-too’ drug manufacturers of data gathered by the

pioneer applicants at considerable expense would

discourage the development of new products and new uses

for existing ones” (Pet. App. 12a). Hence, as the court of

appeals explained (id. at 22a), “[t]he consumer may suffer

soimewhat higher generic drug prices, but, in the long run,

will avoid the risk of being denied the pioneer’s scientific

* Petitioner wrongly suggests (Pet. 10) that Section 360b(d)(1) of

the Act supports its contrary view. That subsection allows the FDA to

consider “information” “other” than that submitted as part of the

NADA, but only in support of a determination to “issue an order

refusing to approve the application” (21 U.S.C. 360b(d)(1) (emphasis

added)). As the district court explained (Pet. App. 45a), “{iJt is not up

to the FDA to make a case for the applicant, although it need not ig-

nore any information within its knowledge which may raise questions

as to the efficacy of the drug.”

6

advances deferred by the prospect of generic manufac-

turers taking advantage of the developer’s labor.”* As the

court of appeals further emphasized, petitioner’s view

would therefore also undermine any possible “reasonable

investment-backed expectation[s]” (id. at 14a-17a) that a

drug manufacturer, such as the manufacturer of Garasol,

might claim it has in the data contained in its NADA (see

id. at 17a-18a).°

’ Contrary to petitioner’s claim (Pet. 7-8), the FDA’s construction

of the Act does not necessarily require “drug manufacturers to

needlessly kill hundreds of thousands of animals at great expense.”

Although a manufacturer of a drug that is the duplicate of a

previously-approved drug may not appropriate information contained

in another’s NADA (absent consent), it may rely on published scien-

tific reports whenever available and, unlike the pioneer applicant,

need not also submit the raw data upon which those reports are based.

See 46 Fed. Reg. 27396 (1981); 45 Fed. Reg. 82052-82063 (1980); see

generally Upjohn Mfg. v. Schweiker, 681 F.2d 480, 482 (6th Cir.

1982). In any event, federal statutes necessarily reflect the legislators’

choice between competing objectives and, consequently, an agency’s

construction of a statute obviously does not fail merely because some

undesirable effects may possibly result.

° Petitioner mistakenly suggests (Pet. i) that this case ultimately

turns on the “reasonableness” of any investment-backed expectation

that the manufacturer of Garasol might have in information con-

tained in its NADA, based on an FDA regulation restricting the use by

any person of information contained in another’s NADA (see 21

C.F.R. 514.1(a); note 3, supra). FDA’s determination that petitioner

may not incorporate information contained in another’s NADA is a

reasonable construction of the Act’s statutory language, in light of the

policy and purposes of the Act. That construction need not be con-

stitutionally compelled by the Takings Clause: to be valid. For this

reason, petitioner’s discussion (Pet. 10-14) of Ruckelshaus v. Monsan-

to Co., supra, Thomas v. Union Carbide Agricultural Products Co.,

473 U.S. 568 (1985), and the Tucker Act, is generally misdirected.

7

c. More recent legislative developments confirm the—

correctness of the FDA’s construction of the Act. In 1984,

Congress enacted a law, the Drug Price Competition and

Patent Term Restoration Act of 1984, Pub. L. No. 98-417,

98 Stat. 1585 (amending 21 U.S.C. 355), that allows for

the very type of abbreviated application procedure that

petitioner seeks to utilize here—but only for generic

human drugs, not animal drugs. The 1984 law authorizes

an abbreviated application procedure for generic human

drugs that demonstrate bioequivalence with previously ap-

proved pioneer drugs, but also provides pioneer drug

manufacturers with a specified period, beyond the expira-

tion of the drug’s patent, within which no abbreviated ap-

plication may be approved (21 U.S.C. (Supp. IV)

355(j)(4)(D)(i)-(v)).

As this recent legislation demonstrates, Congress is

aware of the FDA’s construction of the Federal Food,

Drug, and Cosmetic Act (see, e.g., H.R. Rep. 98-857, 98th

Cong., 2d Sess. Pt. 1, at 14 (1984)). Indeed, as set out in

the court of appeals’ opinion (Pet. App. 13a-14a), Con-

gress has considered several proposals that would make

similar revisions to the application procedure for animal

drugs. For example, an early version of the legislation

ultimately enacted in 1984 (regarding only human drugs)

would have applied to both human and animal drugs. See

S. 255, 97th Cong., Ist Sess. § 155(c)(1)(A) and (c)(4)

(1981). Congress, however, has not yet adopted any of the

various proposals to amend the law regarding animal

drugs.’ Its “failure to change the scheme under which the

FDA operated is significant, for a ‘congressional failure to

revise or repeal the agency’s interpretation is persuasive

’ The House is currently considering a bill, which was introduced

on May 26, 1988, that would extend the abbreviated application pro-

cedures to animal drugs. See H.R. 4714, 100th Cong., 2d Sess. (1988).

8

evidence that the interpretation is the one intended by

Congress’ ” (Young v. Community Nutrition Inst., 476

U.S. at 983, quoting NLRB v. Bell Aerospace Co., 416

U.S. 267, 275 (1974)). The court of appeals correctly

refused to provide petitioner with the very legislative

amendment that Congress has declined to adopt.*®

2. Contrary to petitioner’s claim (Pet. 11), the court of

appeals’ decision in this case does not conflict with the

Sixth Circuit’s decision in Upjohn Mfg. v. Schweiker, 681

F.2d 480 (1982). Upjohn involved a drug manufacturer’s

claim that the FDA had improperly relied upon trade

secret data in its NADA in approving a competitor’s

NADA. The Sixth Circuit’s rejection of that claim, finding

“no evidence in the record” to support it (681 F.2d at 484),

is entirely consistent with the court’s ruling here that con-

sent is required. The Sixth Circuit’s decision in Upjohn

thus does not conflict with the court’s ruling here that one

applicant may not appropriate information contained in

another’s NADA without its consent.’

® Petitioner actually seeks more than that obtained in the 1984 Act

concerning human drugs. As described above, that Act, unlike peti-

tioner’s requested relief, provides pioneer drug manufacturers with a

period of time within which abbreviated application procedures may

not be utilized (see 21 U.S.C. (Supp. IV) 355(4j)(4)(D){i)-(v)). Hence,

Congress has expressly required the very duplicative application pro-

cedures for human drugs, albeit only for a limited time, that petitioner

contends Congress could not possibly have intended to require for

animal drugs.

¥ Petitioner does not appear to renew its claim, which was correctly

rejected by the court of appeals (Pet. App. 18a-20a), that Gentaject is

not a “new animal drug.” Gentaject would be something other than a

“new animal drug,” as defined by the Act, only if it had been “general-

ly recognized, among experts qualified by scientific training and ex-

perience to evaluate the safety and effectiveness of animal drugs, as

safe and effective” and had “been used to a material extent or for a

9

CONCLUSION

The petition for a writ of certiorari should be denied.

CHARLES FRIED

Solicitor General

JOHN R. BOLTON

Assistant Attorney General

GERALD C. KELL

Attorney

JULY 1988

material time” (21 U.S.C. 321(w)). As the court of appeals held (Pet.

App. 18a-19a), approval by the FDA of a drug containing the same

chemicals is not enough to trigger that narrow statutory exception.

FDA approval is not equivalent to “general recognition.” Nor does

FDA approval mean that a drug has necessarily “been used to a

material extent or for a material time.” To establish “general

recogni[tion],” an applicant must instead produce “evidence consisting

of adequate and well-controlled investigations, including field in-

vestigation, by experts qualified by scientific training and experience

to evaluate the effectiveness of the drug” (21 U.S.C. 360b(d)(3)). As

the court of appeals found (Pet. App. 19a, quoting Weinberger v.

Bentex Pharmaceuticals, 412 U.S. 645, 652 (1973)), “the investigation

should be ‘backed by substantial support in scientific literature.’ ” In

this case, petitioner failed to “refer to any established body of pub-

lished literature on Garasol” in its petition to the FDA (Pet. App.

19a). In addition, the FDA “found deficiencies in those materials sub-

mitted in support of Garasol’s general recognition status” (ibid.). The

court of appeals therefore correctly upheld “the FDA’s decision that

the [petitioner’s] petition did not present adequate scientific evidence

to sustain a finding of general recognition” (id. at 20a).

US. GOVERNMENT PRINTING OFFICE: 1988—202-037/60537