Drugmaker Abbvie’s use of hundreds of patents to protect its chance to profit off the sale of its drug, Humira, and then to settle legal challenges brought by would-be competitors, does not mean the company violated antitrust laws, a federal judge has ruled.
On June 8, U.S. District Judge Manish S. Shah sided with the North Chicago-based Abbvie in the nationwide slew of lawsuits accusing the pharmaceutical company of illegally profiting more than it should have from the sale of its medication.
“Plaintiffs say that AbbVie’s plan to extend its power over Humira amounts to a scheme to violate federal and state antitrust laws,” Judge Shah wrote in his opinion. “But what plaintiffs describe is not an antitrust violation.
“AbbVie has exploited advantages conferred on it through lawful practices and to the extent this has kept prices high for Humira, existing antitrust doctrine does not prohibit it.”
AbbVie was targeted by a host of class action lawsuits, led by labor union benefit plans, the city of Baltimore, and others, last year. In Chicago federal court, they were sued by both the United Food and Commercial Workers International Union Local 1500 Welfare Fund and the Fraternal Order of Police, Miami Lodge 20, Insurance Trust Fund.
The lawsuits contained similar claims, and were consolidated into one action, before Judge Shah in Chicago.
The class actions took aim at AbbVie’s attempts to maintain control over the sale of Humira for as long as it could. According to court documents, AbbVie obtained hundreds of patents related to the drug.
Humira, an anti-inflammatory, is used to treat a range of conditions, including rheumatoid arthritis, plaque psoriasis, ulcerative colitis and Crohn’s disease, among others.
AbbVie’s patent for the drug’s active ingredient, an antibody known as adalimumab, expired in 2016.
Nonetheless, the complaint asserts AbbVie used its “patent thicket” to prevent competitors from producing “biosimilar” drugs to compete with Humira. The lawsuits also specifically accused AbbVie of using those intellectual property holdings to leverage concessions from would-be competitors.
The reason, plaintiffs said, is simple: AbbVie reaps big profits from the sale of Humira.
In his decision, Judge Shah noted Humira “generated almost $20 billion in worldwide sales in 2018 alone and more than $56 billion in the United States between 2012 and 2018, making it the best-selling drug in the country.”
According to Shah’s decision, a month’s worth of Humira injections can cost about $4,500.
The plaintiffs asserted AbbVie’s use of its patent holdings related to Humira amounted to creative violations of federal and state antitrust laws, and caused buyers, like insurers and others purchasing the drug, to spend far more than they should have, if other drugmakers could have sold competing versions of Humira.
Judge Shah noted the lawsuits present a new kind of antitrust accusation.
But the judge said the claims were too “speculative.”
In his 73-page decision, Shah said the plaintiffs have fallen short of demonstrating how AbbVie’s accumulation of those patents were anticompetitive or the result of “sham petitioning” before the U.S. Patent and Trademark Office.
The judge noted AbbVie succeeded in obtaining permits for Humira ingredients in more than 53% of the applications it submitted. Shah said this should mean AbbVie’s conduct is protected by the so-called Noerr-Pennington doctrine, which can shield companies from liability under antitrust laws for attempting to secure laws or other enforceable government protections, like patents.
“Here, the vast majority of the alleged scheme is immunized from antitrust scrutiny, and what’s left are a few sharp elbows thrown at sophisticated competitors participating in regulated patent and biologic-drug regimes,” Shah wrote.
Further, the judge noted AbbVie’s settlements with several of those “sophisticated competitors,” including Amgen, Samsung Bioepis, Sandoz, and others, did not necessarily cause the plaintiffs to spend more for Humira than they otherwise would have needed to.
The plaintiffs noted AbbVie reached settlements with some of those competitors, granting them the rights to begin selling biosimilar versions of Humira years before AbbVie’s patents would have otherwise expired.
The plaintiffs further asserted the competitors would have prevailed in court challenges to those patents, but instead settled, allowing AbbVie to maintain its control over Humira, and its price, for a few more years.
But the judge said he did not share the plaintiffs’ certainty concerning the competitors’ chances for success in court.
Rather, he said, AbbVie’s position of strength came from its patents, not necessarily anticompetitive behavior and dealmaking.
“If the reason the biosimilar manufacturers could not make it to market was that AbbVie had a patent that prevented them from doing so, it was the patent - and not AbbVie’s other conduct - that was the but-for cause of the monopoly prices,” the judge wrote.
Therefore, he said, the plaintiffs’ claim of injury from the higher prices under antitrust law
“is not plausible.”
Shah dismissed the legal action against AbbVie and the other defendant companies. But he did so with prejudice, meaning the plaintiffs are able to attempt to file a new complaint that attempts to remedy the problems with their case identified by the judge in his ruling.
Plaintiffs are represented by attorneys from several firms, including: Labaton Sucharow; Hagens Berman Sobol Shapiro; Girard Sharp; the Dugan Law Firm; Robbins Geller Rudman & Dowd; Seeger Weiss; Freed Kanner London & Millen LLC; Fine, Kaplan and Black RPC; Myers & Flowers; Wexler Wallace; Lite Depalma and Greenberg; Shepherd, Finkelman, Miller & Shah; Scharf Banks Marmor; Freedman Boyd Hollander Goldberg Urias & Ward; Kessler Topaz Meltzer & Check; Cohen Milstein Sellers & Toll; Lockridge Grindal Nauen; Bransetter Stranch & Jennings; Heins Mills & Olson; and Grant & Eisenhoffer.
AbbVie is represented by the firm of Kirkland & Ellis.
Amgen is represented by Sidley Austin LLP.
Samsung Bioepis is defended by the firms of Riley Safer Holmes & Cancila and O’Melveny & Myers.
Sandoz is represented by Baker Botts LLP.