August 1, 2020

Lack of Likelihood of Success and Irreparable Harm Doomed Preliminary Injunction

In Takeda Pharmaceuticals USA, Inc. v. Mylan Pharmaceuticals Inc., [  2020-1407, 2020-1417] (July 31, 2020), the Federal Circuit affirmed the denial of a preliminary injunction on the grounds that Takeda failed to show that it was likely to succeed on the merits or that it would be irreparably harmed absent a preliminary injunction.

A plaintiff seeking a preliminary injunction must establish the following:

  1. That s/he is likely to succeed on the merits
  2. That s/he is likely to suffer irreparable harm in the absence of preliminary relief
  3. That the balance of equities tips in her/his favor
  4. That an injunction is in the public interest

On the likelihood of success, the Federal Circuit agreed that the final judgment in the prior litigation likely triggered Section 1.2(d) of a License Agreement, permitting Mylan to market its generic colchicine product, and therefore Takeda was unlikely to succeed on the merits.

The Federal Circuit then considered the issue of irreparable harm. Takeda primarily relied on Section 1.10 of the License Agreement, which created a presumption of harm if the license agreement were breached, to prove irreparable harm. The Federal Circuit by its terms, Section 1.10 only offers Takeda a basis for establishing irreparable harm in the event Mylan breached Section 1.2. However, because it concluded that it is unlikely Takeda can show that Mylan breached the License Agreement, the Federal Circuit further concluded that Section 1.10 is not useful for establishing irreparable harm.

In dissent, Judge Newman argued that there was no accelerating event and thus Mylan breached the Agreement, entitling Takeda to a preliminary injunction.