Covington & Burling lawyers yesterday scored a key win for Eli Lilly and Co. in a dispute over marketing a diabetes drug.
Washington-based partners Thomas Barnett and Michael Imbroscio persuaded a San Diego federal judge to vacate a temporary restraining order granted to Amylin Pharmaceuticals Inc. and deny Amylin's motion for a preliminary injunction.
Lilly and Amylin in 2002 struck an agreement to develop and launch Amylin’s drug, Byetta, which was approved by the Food and Drug Administration in 2005 and is used to treat type II diabetes. The drug has annual sales of about $700 million.
But Lilly recently struck a deal to promote a rival diabetes drug, Tradjenta, with Germany’s Boehringer Ingelheim using the same sales force.
“These are directly competing products. This sales force is charged to go out to the identical physicians and prescribers and target the identical patient population, and now it’s being charged to offer two directly competing drugs,” said Amylin lawyer Maura Grinalds, a partner at Skadden, Arps, Slate, Meagher & Flom at a June 2 hearing before Judge Janis Sammartino, according to the court reporter’s transcript.
Amylin wanted the court to force Lilly to stop selling Tradjenta and prevent the disclosure of confidential marketing information while the case is being litigated. The court obliged by granting a temporary restraining order on May 25, then scheduled the preliminary injunction hearing the following week.
Imbroscio stressed that “We’re not selling shoes here... diabetes is a public health crisis.” He said Amylin knew all along that Lilly had competing products, and that the contract between the companies allowed Lilly to sell them as well.
“There’s a notion that runs through [Amylin’s] papers, and, frankly, I think, through the court’s order, this notion that Lilly wants to kick Amylin to the curb. That’s just not the case,” he said, according to the transcript. “We’ve invested hundreds of millions of dollars. This product, Byetta, is as much Lilly’s product as it is Amylin’s.”
Sammartino in her June 8 ruling did not address the substance of the case, though her ruling hinted at an uphill battle for Amylin. Rather, she pulled the plug on the TRO because she found that Amylin failed to show it would suffer irreparable harm.
On Amylin’s fear that Lilly’s sales force would use confidential information to promote the rival drug, she wrote, “This assertion is entirely the product of speculation on Amylin’s part... And in any event, any losses attributable to Lilly’s misuse of Amylin’s confidential information—as distinguished from actual disclosure—are fully compensable in damages.”
Nor was she persuaded by Amlyin’s claim that it would suffer a loss of prospective customers and goodwill. “The Court cannot conclude that Amylin is likely to lose prospective customers and goodwill,” she wrote, “simply because Lilly’s sales representatives will sell Byetta and Tradjenta from the ‘same bag.’”