Bausch Health Ireland Ltd. v. Mylan Labs. Ltd.

Case Name: Bausch Health Ireland Ltd. v. Mylan Labs. Ltd., No. 21-10403 (SRC) (JSA), 2022 WL 683084 (D.N.J. Mar. 8, 2022) (Chesler, J.)

Drug Product and Patent(s)-in-Suit: Trulance® (plecanatide); U.S. Patents Nos. 7,041,786 (“the ’786 patent”), 7,799,897 (“the ’897 patent”), 8,637,451 (“the ’451 patent”), 9,610,321 (“the ’321 patent”), 9,616,097 (“the ’097 patent”), 9,919,024 (“the ’024 patent”), 9,925,231 (“the ’231 patent”), and 10,011,637 (“the ’637 patent”)

Nature of the Case and Issue(s) Presented: Mylan filed an ANDA for its plecanatide oral tablets and, in response, Bausch filed suit in the District of New Jersey. Mylan moved to dismiss and Bausch opposed and cross moved for jurisdictional and venue discovery. The court granted Mylan’s motion in part, denied Bausch’s cross motion, and transferred the case to the Northern District of West Virginia.

Why Mylan Prevailed: Defendants argued that Mylan Pharmaceuticals Inc. (“MPI”) prepared and electronically submitted the ANDA from West Virginia. Defendants further contended that Mylan Inc., Agila Specialties Inc. (“Agila”), Mylan API, Mylan Laboratories Ltd. (“MLL”), and Viatris Inc. had no role in the development or preparation of the ANDA. For this reason, venue was proper only in West Virginia. In response, Plaintiffs argued that defendants were collectively involved in and would financially benefit from Mylan’s manufacture of API in New Jersey.

The court explained that corporate separateness was presumed and that Plaintiffs had not pled facts to support the conclusion that Defendants were a mere alter ego, and that there were no allegations of fraud or injustice that would permit Plaintiffs to pierce the corporate veil. Importantly, the court explained that it would not pierce the corporate veil even though the Viatris product catalogue did not differentiate among subsidiaries, Defendants shared numerous webpages/trademarks, and Defendants coordinated their regulatory communications with FDA.

Plaintiffs also argued that Mylan API was an ANDA submitter because it manufactured the API used to prepare the ANDA. The court rejected this argument, explaining that it was not sufficient that an entity intended to or would benefit from the approval of an ANDA product; instead, the entity must have participated in the preparation of the ANDA.

The court also found that Mylan Inc., MPI, and Viatris did not have a regular and established place of business in the District of New Jersey. Mylan Inc. executed a lease in the district, but had never actually operated out of that location, as it was a sublease for an independent, third-party organization. Further, although certain Mylan employees lived in the district, that residence could not be imputed to Defendants. Additionally, Defendants’ clinical trials in the district were not sufficient to establish a regular and established place of business. Finally, the court found that business registrations and payments within the district—i.e., being registered in the district or doing business in the district—were not sufficient to establish venue.    

Next, Plaintiffs argued that MLL and Agila should be considered a submitter of the ANDA because they: (i) appointed MPI as a U.S. agent for the Drug Master File; (ii) provided testing of the final drug substance; and (iii) communicated with the FDA’s New Jersey division regarding inspection of Mylan’s New Jersey-based facilities. But the court found that none of these activities turned a related entity into a “submitter” under the Hatch-Waxman provisions and dismissed these defendants.

Finally, the court dismissed Plaintiffs’ declaratory-judgment claim because any relief available to Plaintiffs resulting from their declaratory-judgment claims would have been duplicative of that available to them under Hatch-Waxman provisions.