Johnson and Johnson 2009 Annual Report Download - page 62

60 J O H N S O N & J O H N S O N 2 0 0 9 A N N U A L R E P O R T
In the action against Barr Pharmaceuticals, Inc. (Barr) (now a
wholly-owned subsidiary of Teva Pharmaceutical Industries LTD.)
regarding ORTHO TRI-CYCLEN® LO, in January 2008, the Com-
pany’s subsidiary Ortho Women’s Health & Urology, a Division of
Ortho-McNeil-Janssen Pharmaceuticals, Inc. (OMJPI), and Barr
agreed to a non-binding term sheet to settle the litigation, which
settlement discussions are still underway. The trial court postponed
the January 2008 trial without setting a new trial date. In June
2009, Barr launched its generic product “at risk” before trial. OMJPI
sought a preliminary injunction and recall of Barr product which the
Court granted in July 2009. In July 2009, the parties entered into a
definitive agreement to settle the lawsuit. Under the terms of the
settlement, Barr obtained a release for its sales of its generic product
in exchange for an undisclosed royalty payment. Barr also obtained a
non-exclusive, royalty-bearing license to re-enter the market on
December 31, 2015, or earlier in certain limited circumstances.
In October 2008, the Company’s subsidiary OMJPI filed suit in
Federal District Court in New Jersey against Watson Laboratories,
Inc. (Watson) in response to Watson’s ANDA regarding ORTHO
TRI-CYCLEN® LO. In June 2009, the Company’s subsidiary OMJPI
filed suit in Federal District Court in New Jersey against Sandoz
Laboratories, Inc. (Sandoz) in response to Sandoz’s ANDA regarding
ORTHO TRI-CYCLEN® LO. The Sandoz and Watson cases have
been consolidated.
In January 2010, the Company’s subsidiary OMJPI filed suit in
Federal District Court in New Jersey against Lupin Ltd. and Lupin
Pharmaceuticals, Inc. (collectively “Lupin”) in response to Lupin’s
ANDA regarding ORTHO TRI-CYCLEN® LO.
In the action against Barr and AlphaPharm with respect to their
ANDA challenges to the RAZADYNE® patent that Janssen (now
OMJPI) licenses from Synaptech, Inc. (Synaptech), a four-day non-
jury trial was held in the Federal District Court in Delaware in May
2007. In August 2008, the court held that the patent was invalid
because it was not enabled. Janssen (OMJPI) and Synaptech have
appealed the decision. Since the court’s decision, multiple generic
companies have received final approvals for their products and have
launched “at risk” pending appeal. Additional generic approvals and
launches could occur at any time. In September 2009, the Court of
Appeals affirmed the judgment that the patent is invalid.
In the action by McNEIL-PPC, Inc. (McNeil-PPC) and ALZA
Corporation (ALZA) against Andrx Corporation (Andrx) with
respect to its ANDA challenge to the CONCERTA® patents, a five-
day non-jury trial was held in the Federal District Court in Delaware
in December 2007. In March 2009, the court ruled that one
CONCERTA® patent would not be infringed by Andrx’s proposed
generic product and that the patent was invalid because it was not
enabled. The court dismissed without prejudice Andrx’s declaratory
judgment suit on a second patent for lack of jurisdiction. McNeil-
PPC and ALZA filed an appeal in May 2009. The appeals court
heard argument on February 3, 2010. A decision is pending.
ALZA and OMJPI filed a second suit in Federal District Court in
Delaware against Kremers-Urban, LLC and KUDCO Ireland, Ltd.
(KUDCO) in January 2010 in response to KUDCO’s ANDA chal-
lenge regarding CONCERTA® tablets. In its notice letter, KUDCO
contends that two ALZA patents for CONCERTA® are invalid and
not infringed by a KUDCO generic.
In the RAZADYNE® ER cases, a lawsuit was filed against Barr
on the RAZADYNE® use patent that Janssen (now OMJPI) licenses
from Synaptech in June 2006. In September 2008, the above-
discussed Delaware decision invalidating the RAZADYNE® use
patent resulted in entry of judgment for Barr on that patent, but the
case will be reopened if Janssen (now OMJPI) and Synaptech win
on appeal. Barr has received FDA approval of its product and has
launched “at risk.” In September 2009, the Federal Circuit affirmed
the Delaware decision invalidating the RAZADYNE® use patent.
As a result, this case will not be reopened.
In the action against Lupin Pharmaceuticals, Inc. (Lupin)
regarding its ANDA concerning LEVAQUIN®, Lupin contends that
the U.S. Patent and Trademark Office improperly granted a patent
term extension to the patent that Ortho-McNeil (now Ortho-
McNeil-Janssen Pharmaceuticals, Inc. (OMJPI)) licenses from
Daiichi Pharmaceuticals, Inc. (Daiichi). Lupin alleges that the active
ingredient in LEVAQUIN® was the subject of prior marketing, and
therefore was not eligible for the patent term extension. Lupin con-
cedes validity and that its product would violate the patent if mar-
keted prior to the expiration of the original patent term. Summary
judgment against Lupin was granted in May 2009 and Lupin
appealed. Oral argument was held in September 2009. A decision
is pending.
In the ULTRAM® ER actions, Ortho-McNeil Pharmaceutical,
Inc. (Ortho-McNeil) (now OMJPI), filed lawsuits (each for different
dosages) against Par Pharmaceuticals, Inc. and Par Pharmaceuticals
Companies, Inc. (Par) in May, June and October 2007 on two
Tramadol ER formulation patents owned by Purdue Pharma
Products L.P. (Purdue) and Napp Pharmaceutical Group Ltd. (Napp).
OMJPI also filed lawsuits (each for different dosages) against Impax
Laboratories, Inc. (Impax) on a Tramadol ER formulation patent
owned by Purdue and Napp in August and November 2008. Purdue,
Napp and Biovail Laboratories International SRL (Biovail) (the NDA
holder) joined as co-plaintiffs in the lawsuits against Par and Impax,
but Biovail and OMJPI were subsequently dismissed for lack of
standing. The trial against Par took place in April 2009. In August
2009, the Court issued a decision finding the patents-in-suit invalid.
Purdue has appealed that decision. The trial against Impax is sched-
uled for June 2010. In November 2009, the case against Impax was
stayed with the consent of all parties. In September and October
2009, respectively, Purdue filed suits against Paddock Laboratories,
Inc. (Paddock) and Cipher Pharmaceuticals Inc. (Cipher) on its
Tramadol ER formulation patents.
In January 2010, Purdue filed a suit against Lupin Ltd. (Lupin)
on its Tramadol ER formulation patents.
In September 2009, Centocor Ortho Biotech Products, L.P.
(COBI, LP) intervened in an inventorship dispute between Kansas
University Center for Research (KUCR) involving certain U.S.
government-owned VELCADE® formulation patents. KUCR brought
this action against the U.S. government in the District of Kansas
seeking to add two Kansas University scientists to the patents.
The U.S. government licensed the patents (and their foreign coun-
terparts) to Millennium Pharmaceuticals, Inc., who in turn subli-
censed the patents (and their foreign counterparts) to COBI,LP
for commercial marketing outside the U.S. If KUCR succeeds in its
co-inventorship claim and establishes co-ownership in the U.S.
VELCADE® formulation patents, we anticipate that KUCR will initi-
ate actions to establish co-inventorship and co-ownership with
respect to the foreign counterpart patents in the countries where
COBI, LP has commercial marketing rights. If KUCR in Kansas is
successful, this may adversely affect COBI, LP’s license rights in
those countries.
AVERAGE WHOLESALE PRICE (AWP) LITIGATION
Johnson & Johnson and several of its pharmaceutical subsidiaries,
along with numerous other pharmaceutical companies, are defen-
dants in a series of lawsuits in state and federal courts involving alle-
gations that the pricing and marketing of certain pharmaceutical
products amounted to fraudulent and otherwise actionable conduct
because, among other things, the companies allegedly reported an
inflated Average Wholesale Price (AWP) for the drugs at issue.
Many of these cases, both federal actions and state actions