The Third Circuit upheld a district court's refusal to enjoin Samsung Bioepis from supplying a Cigna subsidiary with a private-label ustekinumab biosimilar, ruling that Johnson & Johnson and Janssen Biotech failed to demonstrate irreparable harm from the alleged breach of their patent settlement agreement.

The underlying dispute centers on Stelara, Janssen's blockbuster biologic for plaque psoriasis, psoriatic arthritis, Crohn's disease, and ulcerative colitis, which generated over $70 billion in sales during its fifteen-year effective patent life. Following the expiration of Janssen's core ustekinumab patent in September 2023, Samsung obtained FDA approval for its biosimilar SB17, marketed as Pyzchiva, and the parties settled related patent litigation.

That settlement granted Samsung a limited patent license, permitting sublicenses only to "commercialization partners" selling SB17 "on behalf of" Samsung. The conflict arose when Samsung, alongside Sandoz, entered a Private Label Distributor Agreement with Quallent Pharmaceuticals Health LLC, a Cigna Group subsidiary. Under a companion sublicense, Samsung granted Quallent a non-exclusive right to sell SB17 under Quallent's own label.

Janssen argued this arrangement fell outside the settlement's commercialization-partner exception because Quallent would not be selling the product on Samsung's behalf. Janssen sought a preliminary injunction to halt Samsung's supply to Quallent during the pendency of the litigation.

The parties submitted competing expert declarations regarding irreparable harm. Janssen's expert, Dr. Robert Popovian, argued that because Cigna controls approximately 23% of the U.S. prescription market, its subsidiary's private-label biosimilar could commandeer nearly a quarter of potential consumers nationally. Dr. Popovian pointed to the Humira market, where private-label biosimilars caused Humira to lose 31% of its market share.

Samsung's expert, Dr. DeForest McDuff, assessed Humira's market share loss as relatively modest and measurable. He opined that any harm to Janssen would be quantifiable and might not even be imminent. U.S. District Judge Georgette Castner credited Dr. McDuff's opinion, concluding that Janssen had not shown its damages would be incapable of calculation.

Judge Castner denied the injunction despite finding Janssen likely to succeed on the merits of its breach-of-contract claims. Writing for a unanimous panel, Circuit Judge Krause affirmed the denial.

The court held that because damages are the default remedy for breach of contract, the availability of monetary damages typically precludes a finding of irreparable harm. The panel rejected Janssen's argument that loss of market share in a complex biopharmaceutical market is categorically sufficient to establish irreparable injury.

The court noted that its prior Novartis decision involved false advertising claims under the Lanham Act, where courts historically applied a presumption of irreparable harm that has been discredited by subsequent Supreme Court decisions in eBay and Winter. The correct standard requires showing that damage calculation is impracticable or practically impossible, not merely difficult.

The panel noted that Janssen's own Humira evidence cut against it: that market study showed the brand manufacturer was able to reach a co-branding agreement whereby its healthcare-conglomerate competitor could reap a percentage of its profits in exchange for returning Humira to its formulary. This suggested that negotiating disadvantages could be remedied through monetary arrangements.

On Janssen's claim that it would lose negotiating leverage against Cigna, the court held that the bald assertion of irreparable harm from a loss of negotiating leverage and the domino effect that loss allegedly would have on a movant's business does not clear the threshold. The ruling requires proof of actual and imminent rather than remote or speculative harm.

The panel affirmed the denial of the preliminary injunction on all four of Janssen's arguments.