In February, 2011, K-V Pharmaceuticals received FDA approval to market its branded pregnancy drug, Makena® as an orphan drug. Makena’s active ingredient, the hormone 17 HPC, aids at-risk expectant mothers in carrying their child to term.

As we previously reported, K-V sued the FDA demanding that it prevent compounding pharmacies from continuing to supply a compounded version of 17 HPC. The FDA successfully moved for dismissal on the grounds that courts must defer enforcement decisions to the agency charged with that enforcement. See Sep. 6, 2012 Opinion. On October 23, 2012 K-V filed a complaint with the International Trade Commission (ITC) seeking similar relief under the 1930 Tariff Act. See USITC Complaint.

K-V Seeks Relief Under The 1930 Tariff Act

The 1930 Tariff Act, as amended, empowers the ITC to grant relief if it finds, inter alia, “unfair methods of competition and unfair acts in the importation” of goods whose sales threaten “to destroy or substantially injure an industry in the United States.” See 1930 Tariff Act.

In its complaint, K-V alleges that its 7-year orphan drug exclusivity makes it the sole lawful, domestic purveyor of 17 HPC. According to K-V, compounders are acting illegally because they are behaving as drug manufacturers rather than fulfilling their lawful role of responding to a prescribing physician’s custom order for a unique therapy tailored to a specific patient. See USITC Complaint.

K-V named 7 Chinese manufacturers, 3 domestic distributors and 36 compounders, as Proposed Respondents but their request for relief applies much more broadly. Specifically K-V wants a ban on the importation of all 17 HPC “except as authorized by [K-V]” and to prevent the sale or solicitation of 17 HPC within the United States from any imported source unless authorized by K-V. See USITC Complaint at § X.(b)(i) and § X.(b)(ii)]

K-V Also Moves For Temporary Relief

In addition to permanent restraints, K-V has also requested a temporary general exclusion order and a temporary cease and desist order to halt immediately the damage they claim is being done to them by the importation and compounding of 17 HPC. K-V asserts that without relief, it may not be able to re-organize under Chapter 11 of the Bankruptcy Code and might cease as a going concern. K-V’s Oct. 23, 2012 Motion for Relief.

In order to be granted temporary relief, the Commission must conclude that (1) without it, K-V will suffer irreparable harm; (2) K-V is more likely than not to prevail upon the merits of its complaint; (3) the public interest will be served in granting the temporary relief; and (4) the hardship suffered by K-V without the relief outweighs the hardship suffered by the Respondents with the temporary relief. See K-V’s Oct. 23, 2012 Mem. in Support of Motion for Relief at ¶ 16.

The Commission Seeks Immediate Comment

The Commission invited the Proposed Respondents and the public at large to comment on K-V’s Complaint primarily as it pertains to the impact a ruling in K-V’s favor would have on the public’s health, safety and welfare as well as on the American competitive arena and domestic consumer interests. See Trade Commission Notice of Receipt and Fed. Reg. Notice.

Thus far, several interested parties have weighed in, many making the same arguments. A sampling:

  • The Alliance for Natural Health USA, points out that when Makena was approved, K-V set a per-dose list price of $1,500 compared to $10 and $20 per dose for compounded 17 HPC. The Alliance argues that if K-V is placed in a position to control the market, “it can be expected to resume such price gouging.” See Alliance Comments.
  • Alere, a provider of home healthcare services to pregnant women, suggests the Commission reject K-V’s requested relief because the K-V complaint is little more than an attempt “to evade the absence of a private right to enforce the FDCA.” Therefore, Alere “urges the Commission to defer to the FDA’s expert opinion” that it is important to preserve “the availability of compounded 17P to pregnant women.” See Alere Statement.
  • The March of Dimes, although offering no opinion “on the legal merits of the complaint,” urges the Commission to ensure that any action it takes makes provision for compounded 17HPC and avoids shortages by granting enough time for states and insurers to adjust their policies that currently give preference to compounded 17HPC. See March of Dimes Comments.
  •  A statement by 11 OB/GYN specialists and academicians on behalf of concerned physicians urges the Commission to “maintain the availability of compounded 17P.” They argue that Makena’s approval covers indications that apply to only 140,000 of the 500,000 at-risk patients. They also note that the presence of 2% benzyl alcohol in Makena makes it less safe than “a preservative-free formulation.” The physicians therefore conclude that a decision in K-V’s favor will impose upon doctors “a ‘Sophie’s Choice.’” See Statement of Concerned Physicians.
  • Twenty-one Proposed Respondents alert the Commission to the fact that even among the one-third of at-risk women covered by Makena’s approved labeling, doctors prescribe compounded 17HPC for dosing not offered by K-V, for women whose IM administration requires different oils, and most importantly for fear of the association between benzyl alcohol and “gasping syndrome” in infants. Describing K-V’s request as a “terrifying prospect,” the compounders suggest that a company teetering on bankruptcy, who sought “extortionist profits,” and who was “shut down in 2009 by FDA for substandard manufacturing practices,” cannot be entrusted with “the nation’s entire supply of 17P.” See Compounding Pharmacies Comments.

What Happens Next?

After the motion for temporary relief is decided, the ITC will announce a projected time frame to complete its investigation. The Commission may make a determination or issue a consent order without a determination. Once a determination is finalized any party adversely affected may appeal for review by the U.S. Court of Appeals, Federal Circuit. In addition, in certain instances, the President of the United States may render a determination inoperable for policy reasons. See 1930 Tariff Act at §1337(b – j).

Sources:

K-V Pharma. Co., et al. v. U.S. Food and Drug Admin., Case No. 1:12-cv-01105-ABJ (D. Columbia) (Sep. 6, 2012 Opinion); United States International Trade Commission Investigation No. 337-2919; Office of the Law Revision Counsel, U.S. House of Representatives 19 USC Sec. 1337, Jan. 3, 2012 (112-90); Federal Register.

This article was prepared by Bob Rouder (rrouder@fulbright.com / 512 536 2491) and Saul Perloff (sperloff@fulbright.com / 512 536 7166) of Fulbright’s False Advertising Practice.