United States Court of Appeals For the First Circuit

No. 20-1161

AKEBIA THERAPEUTICS, INC.,

Plaintiff, Appellant,

v.

ALEX MICHAEL AZAR, II, in his official capacity as Secretary of Health and Human Services, ET AL.,

Defendants, Appellees.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Allison D. Burroughs, U.S. District Judge]

Before

Howard, Chief Judge, Selya and Thompson, Circuit Judges.

Seth P. Waxman, with whom Bruce S. Manheim, Brian M. Boynton, Leon T. Kenworthy, Lindsey B. Silver, Wilmer Cutler Pickering Hale and Dorr LLP, and Nicole R. Hadas, were on brief, for appellant. Jennifer B. Dickey, Deputy Associate Attorney General, Civil Division, U.S. Department of Justice, with whom Joseph H. Hunt, Assistant Attorney General, Andrew E. Lelling, United States Attorney, Abby C. Wright and Sarah E. Weiner, Attorneys, Appellate Staff, Robert P. Charrow, General Counsel, U.S. Department of Health and Human Services, Brenna E. Jenny, Deputy General Counsel, Janice L. Hoffman, Associate General Counsel, and Susan Maxson Lyons, Deputy Associate General Counsel for Litigation, were on brief, for appellees. September 30, 2020 SELYA, Circuit Judge. In the modern world, the financial

fortunes of a new prescription drug are often determined by how

that drug is treated for reimbursement purposes by third parties.

This appeal illustrates the point: in the underlying case,

plaintiff-appellant Akebia Pharmaceuticals, Inc. (Akebia), sued a

quartet of related federal defendants — the Secretary of the

Department of Health and Human Services (HHS), the Administrator

of the Centers for Medicare & Medicaid Services, and the entities

that they lead1 — complaining that CMS acted arbitrarily,

capriciously, and contrary to law with respect to the reimbursement

protocol for Akebia's new drug, Auryxia, when prescribed for

treatment of iron deficiency anemia (IDA) in patients with chronic

kidney disease (CKD). Akebia moved for a preliminary injunction,

but the district court denied the motion. See Akebia Therapeutics,

Inc. v. Azar,

, 222 (D. Mass. 2020). After

careful consideration, we affirm.

I. BACKGROUND

The federal Medicare statute provides health-care

coverage for certain segments of the United States population,

particularly individuals sixty-five years of age or older and

1 We note two pertinent data points. First, both of the individual defendants are sued only in their official capacities. Second, the Centers for Medicare & Medicaid Services is the body within HHS responsible for generating the list of covered drugs that is at issue here. For ease in exposition, we refer to the defendants collectively as "CMS."

- 3 - individuals with certain disabilities (regardless of age). See 42

U.S.C. § 1395c. Medicare is divided into several parts, each

corresponding to a different dimension of the health-care

landscape. This case revolves around Medicare Part D, which

addresses prescription drug coverage for Medicare beneficiaries.

See id. §§ 1395w-101 to -104.

As opposed to other types of Medicare coverage, through

which the federal government pays health-care providers directly

in a typical fee-for-service arrangement, Medicare Part D involves

a contractual relationship with private insurance companies known

as "sponsors." See id. § 1395w-112. Medicare beneficiaries select

their preferred sponsor and benefits package and pay a monthly

premium to the chosen sponsor. In turn, the sponsor receives

reimbursement from the Medicare program for the cost of covered

drugs.

As a default, Part D requires sponsors to provide

Medicare beneficiaries access to all covered Part D drugs, subject

to various exclusions. See id. § 1395w-111(e)(2)(A); see also id.

§ 1395w-102(a)(1)(A); id. § 1395w-102(b). A covered Part D drug

is a drug dispensed by means of a prescription that the federal

Food and Drug Administration (FDA) has approved as safe and

effective. See id. § 1395w-102(e)(1)(A). In enacting Part D,

Congress specified several categories of drugs that CMS may exclude

- 4 - from coverage. See id. § 1395w-102(e)(2) (cross-referencing id.

§ 1396r-8(d)(2)).

The battleground in this case is a category of excluded

drugs encompassing "[p]rescription vitamins and mineral products,

except prenatal vitamins and fluoride preparations." Id. § 1396r-

8(d)(2)(E). At the center of the dispute is the scope of this

category, specifically, whether or not Auryxia, when prescribed

for treatment of IDA in patients with CKD, constitutes a "mineral

product" that CMS may properly exclude from coverage. Though this

dispute is essentially legal in nature, it lends perspective both

to sketch the factual underpinnings of Akebia's challenge and to

rehearse the travel of the case.

In September of 2014, the FDA approved Auryxia for the

treatment of hyperphosphatemia (elevated phosphate levels in the

blood), a condition commonly associated with CKD, for patients who

are receiving dialysis. Over three years later (in November of

2017), the FDA approved Auryxia for a second use: the treatment

of IDA in patients with CKD who are not on dialysis. Akebia, which

now owns Auryxia,2 describes the drug as a ferric citrate

coordination complex that differs from traditional iron

supplements in that it facilitates iron transport to the blood

rather than simply replacing missing iron. This distinction is

2 In December of 2018, Akebia purchased Keryx Biopharmaceuticals, which had developed Auryxia.

- 5 - salient, Akebia insists, because Auryxia can be used to treat

patients who have sufficient iron stores but have difficulty

transporting the iron to the blood in order to create red blood

cells. Seen in this light, Auryxia offers an alternative to

intravenous or oral iron supplements in situations in which such

traditional iron supplements are ineffective for patients who have

sufficient iron in their bodies but suffer from inadequate iron

transportation to the blood.

Although Auryxia initially was covered under Part D for

both of its permitted uses, CMS e-mailed sponsors in September of

2018, informing them that CMS had decided to exclude Auryxia from

coverage when used to treat IDA in patients with CKD who are not

on dialysis. CMS's e-mail stated that "[c]onsistent with other

iron products, ferric citrate was removed" from the list of drugs

covered under Part D. Following this guidance, Medicare sponsors

thereafter refused to cover Auryxia when prescribed to treat IDA.

Inheriting the existing state of Medicare coverage in

December of 2018, see supra note 2, Akebia made repeated efforts

to extract information from CMS about the coverage determination

and to persuade CMS to revisit it. These efforts included outreach

to CMS, in-person meetings with CMS officials, and a formal legal

memorandum submitted to both HHS's General Counsel and CMS's Chief

Legal Officer. Akebia's campaign proved unavailing: on October

- 6 - 4, 2019, CMS affirmed its coverage determination, making clear

that it would not revisit its position.

Within a matter of weeks, Akebia repaired to the federal

district court. Its complaint alleged that CMS, in denying full

Part D coverage of Auryxia, violated the relevant portions of the

Medicare statute by improperly classifying Auryxia as a mineral

product and excluding it from coverage. The complaint prayed that

the district court set aside CMS's coverage determination as

unlawful under the Administrative Procedure Act (APA), see

(2)(A), and restore full coverage for Auryxia. Shortly

thereafter, Akebia moved for a preliminary injunction, seeking to

press "pause" on the coverage determination until CMS's

interpretation could be fully litigated. Among other things,

Akebia claimed that it was likely to succeed on the merits of its

suit because CMS's interpretation of the Medicare statute was

antithetic to the statutory text; because CMS had acted arbitrarily

and capriciously by covering Auryxia for treatment of

hyperphosphatemia but excluding it for treatment of IDA; and

because CMS had compounded its arbitrary and capricious actions by

reaching a coverage determination at odds with past CMS decisions.

Following a hearing, the district court reserved decision and

subsequently issued a thoughtful rescript in which it concluded

that Akebia had failed to show a likelihood of success on the

merits of its claims. See Akebia, 443 F. Supp. 3d at 222. After

- 7 - making findings with respect to the other elements of the

preliminary injunction calculus, see id. at 230-231, it denied

Akebia's motion for preliminary injunctive relief, see id. at 231.

This interlocutory appeal ensued. See

(a).

II. ANALYSIS

Our analysis proceeds in three segments. As an hors

d'oeuvre, we start with CMS's contention that this matter is not

justiciable. Next, we proceed to the appetizer and limn the

standard of review associated with preliminary injunctions.

Finally, we turn to the main course: Akebia's asseveration that

the district court abused its discretion in refusing to grant a

preliminary injunction.

A. Justiciability.

In this venue, as in the court below, CMS argues that

the dispute between the parties is not fit for judicial review.

This argument rests on two pillars. First, CMS says that Akebia

did not properly channel its grievances through the agency's

internal appeals processes. See 42 U.S.C. § 1395ii (incorporating

id. § 405(h)). Second, CMS says that its coverage determination

e-mail does not constitute final agency action and, thus, is not

ripe for judicial review under the APA. See

.

With respect to the first of these claims, CMS posits

that Akebia has flouted the internal appeals process by attempting

an end run around the Medicare Appeals Council (through which all

- 8 - coverage disputes arising under the Medicare statute must be

channeled). See Shalala v. Illinois Council on Long Term Care,

Inc.,

(2000). In response, Akebia brands this

review process as inapposite, complaining that only Medicare

beneficiaries — not drug manufacturers — have standing to bring

administrative appeals to the Medicare Appeals Council. See 42

U.S.C. § 1395w-104(h)(1). So, Akebia's thesis runs, it should be

excused from compliance with the existing review structure because

that structure affords "no review at all" for its grievances.

Shalala,

.

Akebia's response strikes a nerve: CMS concedes that

there is no intra-agency mechanism through which drug

manufacturers may challenge coverage determinations for Medicare

Part D. But CMS suggests that this is Akebia's tough luck, and

CMS would leave Akebia high and dry, forcing Akebia to rely on

individual beneficiaries to challenge the contested coverage

determination to Akebia's behoof.

With respect to its second nonjusticiability claim, CMS

suggests that the September 2018 e-mail (which contained the

adverse coverage determination) was merely guidance to Medicare

sponsors and, thus, not final agency action. Since a "final agency

action" is a prerequisite to judicial review under the APA,

, CMS submits that a reviewable Part D coverage

determination may only be made by the Medicare Appeals Council.

- 9 - Akebia demurs. The September 2018 e-mail, it says,

satisfies the requirements for final agency action because it is

a decision that marks the consummation of CMS's decisionmaking

process (rather than a tentative decision) and is plainly a

decision from which legal consequences flow. See Bennett v. Spear,

(1997). In this regard, Akebia notes both

the apparent finality of CMS's coverage determination and the fact

(which CMS does not deny) that Medicare sponsors are now expected

to comply with this determination.

In appellate review, as in life, discretion is sometimes

the better part of valor. The parties' arguments weave a

jurisdictional riddle, which is both intricate and difficult to

resolve. We are, however, steadfast in our belief that "courts

should not rush to decide unsettled issues when the exigencies of

a particular case do not require such definitive measures."

Privitera v. Curran (In re Curran),

(1st Cir.

2017). So it is here.

To decide this appeal, it is not necessary for us to

determine either whether Akebia has exhausted its intra-agency

remedies or whether the CMS e-mail constituted final agency action.

Although hypothetical jurisdiction is generally disfavored, see

Steel Co. v. Citizens for a Better Env't,

(1998), such a barrier is insurmountable only when Article III

jurisdiction is in issue, see First State Ins. Co. v. Nat'l Cas.

- 10 - Co.,

, 10 n.2 (1st Cir. 2015). The justiciability

questions that CMS poses relate only to our statutory jurisdiction,

not our Article III jurisdiction (which is not in doubt).

Precedent teaches that where, as here, an appeal presents a

question of statutory jurisdiction, that question need not be

resolved if a decision on the merits will favor the party

challenging the court's jurisdiction. See Caribbean Mgmt. Grp. v.

Erikon LLC,

(1st Cir. 2020); First State,

. Because this is such a case, we (like the court below, see

Akebia, 443 F. Supp. 3d at 225), bypass the jurisdictional issue

and go directly to the parties' dueling over the denial of

preliminary injunctive relief.

B. Standard of Review.

When evaluating the denial of a preliminary injunction,

our review is for abuse of discretion. See Ross-Simons of Warwick,

Inc. v. Baccarat, Inc.,

(1st Cir. 1996). We

caution, though, that the abuse of discretion standard is not

monolithic: under this rubric, we review the district court's

answers to legal questions de novo, factual findings for clear

error, and judgment calls with some deference to the district

court's exercise of its discretion. See Corp. Techs., Inc. v.

Harnett,

(1st Cir. 2013).

The framework for considering whether to grant or deny

a preliminary injunction, properly enunciated by the court below,

- 11 - has four elements. An inquiring court must gauge the movant's

likelihood of success on the merits; must evaluate whether and to

what extent the movant will suffer irreparable harm if injunctive

relief is withheld; must calibrate the balance of hardships as

between the parties; and must consider the effect, if any, that

the issuance of an injunction (or the withholding of one) will

have on the public interest. See Corp. Techs.,

;

Ross-Simons,

. In the precincts patrolled by the

abuse of discretion standard, appellate review is respectful to

the district court's weighing of these elements but falls well

short of giving carte blanche to the district court's views. See

Corp. Techs.,

.

We hasten to add that these four elements are not of

equal prominence in the preliminary injunction calculus. The most

important is whether the movant has demonstrated a likelihood of

success on the merits — an element that we have described as the

"sine qua non" of the preliminary injunction inquiry. Ryan v.

ICE, __ F.3d __, __ (1st Cir. 2020) [No. 19-1838, slip op. at 11]

(quoting New Comm Wireless Servs., Inc. v. SprintCom, Inc.,

(1st Cir. 2002)). If the movant fails to demonstrate a

likelihood of success on the merits, the remaining elements are of

little consequence. See

Given the primacy of the likelihood-of-success element,

that element forms the logical starting point for our analysis.

- 12 - In this instance, the likelihood of Akebia's success depends

largely on the force of its legal challenge to CMS's interpretation

of the Medicare statute. Because we review the district court's

answers to legal questions de novo, see Corp. Techs.,

, we find ourselves in essentially the same position as the

district court with respect to this question. Thus, we effectively

review CMS's interpretation of the Medicare statute through the

lens of the standard articulated in the APA.3 See Mass. ex rel.

Div. of Marine Fisheries v. Daley,

(1st Cir. 1999).

Under that standard, we will depart from the agency's conclusion

only if its coverage determination proves to be "arbitrary,

capricious, an abuse of discretion, or otherwise not in accordance

with law."

(2)(A); see Doe v. Leavitt,

(1st Cir. 2009).

C. The Preliminary Injunction Inquiry.

Our construction of the preliminary injunction framework

(see supra Part (II)(B)) makes pellucid that the sine qua non of

a preliminary injunction is the movant's ability to show that it

is likely to succeed on the merits of its claims. In examining

3 Although review of administrative decisions under the APA often involves some degree of deference, see, e.g., Encino Motorcars, LLC v. Navarro,

(2016); Chevron U.S.A. Inc. v. NRDC,

(1984), this case falls outside the mine-run. Neither side has argued that CMS's September 2018 e-mail, which informed Medicare sponsors of its coverage determination regarding Auryxia, is entitled to any interpretive deference. We therefore afford it none.

- 13 - the district court's denial of Akebia's motion for a preliminary

injunction, we begin — and end — there.

As we already have indicated, Akebia's success or

failure in this case turns principally on the soundness of CMS's

interpretation of a statutory exclusion from Medicare Part D drug

coverage. Consequently, our inquiry into the district court's

holding that Akebia had failed to demonstrate a likelihood of

success must commence with the relevant portion of the statutory

text:

The following drugs or classes of drugs, or their medical uses, may be excluded from coverage or otherwise restricted . . . (E) Prescription vitamins and mineral products, except prenatal vitamins and fluoride preparations.

42 U.S.C. §§ 1396r-8(d)(2)–(d)(2)(E). The threshold question

involves whether Auryxia, when used to treat IDA in patients with

CKD, is a "mineral product" within the purview of the statute and,

thus, can be excluded from coverage under Part D.

In addressing this threshold question, we write on a

pristine page. For aught that appears, this question is a question

of first impression in the federal courts (except, of course, for

the district court's decision), and CMS concedes that it has not

formally promulgated a definition of "mineral products." Although

we tackle this issue of statutory interpretation head on, we

construe the statutory language only to determine Akebia's

- 14 - likelihood of success on the merits. We do not purpose to resolve

the issue definitively. See Ross-Simons,

(explaining that, at preliminary injunction stage, court of

appeals "need not conclusively determine the merits of the

underlying claims"); Narragansett Indian Tribe v. Guilbert,

(1st Cir. 1991) (cautioning that, at preliminary

injunction stage, decisions "are to be understood as statements of

probable outcomes" only).

Akebia chiefly contends that the word "mineral" must

denote a substance that is naturally occurring and inorganic

(devoid of carbon).4 Relying on various dictionary definitions to

this effect, Akebia insists that because Auryxia's active

ingredient (ferric citrate) is man-made and not inorganic, Auryxia

cannot come within the mineral products exclusion. CMS replies

that the touchstone of the analysis is the total phrase "mineral

products," which is necessarily inclusive of products that are

manufactured for sale or are otherwise anthropogenic.

4 For present purposes, we accept arguendo Akebia's proffered definition of the word "mineral," standing alone, as something "naturally occurring and inorganic." We note, though, that despite Akebia's litany of dictionary definitions, its proffered definition is not inevitable. The Supreme Court has warned that because the word "mineral" is used in many disparate contexts, dictionary definitions should generally be disfavored. See Watt v. W. Nuclear, Inc.,

(1983). Against this backdrop, we are not prepared to discount entirely CMS's argument that Congress probably did not intend that "mineral," as used in the Medicare statute, should encompass all dictionary-captured coal, stone, or other earthly materials.

- 15 - The court below found Akebia's definition of "mineral

products" too narrow, ruling instead that Congress intended for

"mineral products" to encapsulate man-made substances in addition

to those found in the natural world. See Akebia, 443 F. Supp. 3d

at 226. On this basis, the court concluded that CMS's decision to

exclude Auryxia from coverage when used to treat IDA was not

contrary to law. Id. We agree.

The text of the statute authorizes the exclusion of

"mineral products" not just "minerals." To accept Akebia's

isthmian definition, limited to just the word "mineral," would

require us to ignore a critical aspect of the exclusion category:

the word "products." Whenever feasible, courts ought to interpret

statutory language in ways that avoid rendering specific words or

phrases superfluous. See Gustafson v. Alloyd Co.,

(1995); United States v. Walker,

(1st Cir.

2011). This principle has obvious relevance here: Congress easily

could have used the word "mineral" alone, but instead chose to use

the broader term "mineral products." The addition of the word

"products" implies some kind of human modification to the mineral

itself. See, e.g., Webster's Third New International Dictionary

(1961) (defining "product" as "something produced by physical

labor or intellectual effort; the result of work or thought");

Black's Law Dictionary (9th ed. 2009) (defining "product" as

"[s]omething that is distributed commercially for use or

- 16 - consumption and that is usu[ally] (1) tangible personal property,

(2) the result of fabrication or processing, and (3) an item that

has passed through a chain of commercial distribution before

ultimate use or consumption."). If the statute only authorized

CMS to exclude naturally occurring, inorganic substances (as

Akebia suggests), the word "products" would serve no useful

purpose.

In addition, the text of the statute as a whole strongly

supports CMS's more expansive interpretation. The statute

authorizes the exclusion of "[p]rescription vitamins and mineral

products, except prenatal vitamins and fluoride preparations." 42

U.S.C. § 1396r-8(d)(2)(E). The fact that Congress explicitly

exempted "fluoride preparations" elucidates the breadth of the

mineral products exclusion. While fluoride itself is a naturally

occurring substance that fits Akebia's proposed definition of

"mineral," "fluoride preparation" necessarily denotes some kind of

man-made process altering fluoride, the raw material. It follows,

we think, that but for the explicit exemption, fluoride

preparations — which themselves are not naturally occurring — would

have been covered under the mineral products exclusion. And

although we need not speculate as to why Congress decided to save

fluoride preparations specifically from exclusion, that decision

makes manifest that the term "mineral products" encompasses

- 17 - manufactured products, like Auryxia, and not solely naturally

occurring substances.

Akebia struggles mightily to parry this thrust. It says

that the presence of "fluoride preparations" in the statute does

not undermine its interpretation of "mineral products" because

fluoride itself is a naturally occurring substance. In contrast,

the active ingredient in Auryxia is, in Akebia's parlance, a "novel

organic compound." The mere presence of a manufacturing process,

Akebia muses, does not itself make something a mineral product,

given that the active ingredient in Auryxia is not a mineral.

We are not moved by this proposed distinction. In our

view, Congress's inclusion of "fluoride preparations" in the

statute strikes at the heart of Akebia's contention that only

naturally occurring substances can be properly excluded under the

statute. Fluoride preparations are not naturally occurring

substances, and the fact that Congress saved them from exclusion

indicates to us that the mineral products exclusion necessarily

encompasses non-naturally occurring substances. Any other reading

elevates hope over reason.

Relatedly, Akebia argues that even if the mineral

products exclusion covers certain man-made substances, a drug can

be a mineral product and therefore eligible for exclusion only if

its active ingredient is naturally occurring and inorganic, that

is, a mineral. Because Auryxia's active ingredient is a "novel

- 18 - organic compound" that is "synthetically produced," Akebia

submits, it falls outside the compass of the exclusion. In

support, Akebia tries to use CMS's words against it, noting that

in its opposition to the preliminary injunction motion, CMS

represented that the term "mineral products" includes a

manufactured product that contains a mineral as an active

ingredient.5

To be sure, we agree with Akebia's premise: parties may

be bound by statements made in court filings. See, e.g.,

Harrington v. City of Nashua,

(1st Cir. 2010)

(noting that such admissions must be "clear" in order to be

binding); Schott Motorcycle Supply, Inc. v. Am. Honda Motor Co.,

(1st Cir. 1992) (holding party bound by "clear and

express statement" in its original and amended complaints). We

disagree, however, with the conclusion that Akebia would have us

draw in this case.

First and foremost, we do not read the statement as

undercutting the position that CMS has taken. And even assuming,

for argument's sake, that the active ingredient in Auryxia is a

synthetically produced, organic compound that is not a mineral,

5 CMS's actual language is more ambiguous than Akebia suggests. CMS's opposition stated that the mineral products exclusion "reasonably includes manufactured items containing a mineral as an active ingredient" even when the product is man- made.

- 19 - the presence of such an active ingredient would not negate the

fact that iron sits at the core of the drug's raison d'être. More

importantly, Akebia's insistence that the active ingredient itself

must be a mineral ignores the centrality of the word "products" in

both the statutory language and in the excerpt from CMS's

opposition to the preliminary injunction motion. As we already

have explained, Congress clearly intended the term "mineral

products" to encompass synthetic substances in addition to those

found in nature. In context, then, Akebia's insistence that

Auryxia cannot be a "mineral product" because its active ingredient

is not a mineral is nothing short of magical thinking. The statute

simply does not provide that the presence of a synthetic active

ingredient, in and of itself, renders something not a mineral

product and prohibits CMS from deploying the mineral products

exclusion.

Akebia resists this conclusion, suggesting that it would

result in an endless list of excluded drugs because any drug that

contained even a smidgen of mineral could be excluded. But Akebia

is whistling past the graveyard. CMS has not taken an interpretive

stance that even remotely threatens so extreme an outcome. Its

position is much more circumscribed: it will exclude such a drug

only if it is used to treat a mineral deficiency. Although we do

not purpose to resolve this interpretative question definitively

at the preliminary injunction stage, see Ross-Simons, 102 F.3d at

- 20 - 16, we find that Akebia has not demonstrated a likelihood of

success on its claim that CMS's interpretation of the mineral

products exclusion is arbitrary, capricious, or otherwise contrary

to law. See Leavitt,

.

Ably represented, Akebia looses a barrage of other

arguments. To begin, it observes that the FDA has approved Auryxia

to treat two conditions associated with CKD: hyperphosphatemia

and IDA. With respect to Part D coverage, though, CMS has excluded

Auryxia only when used to treat IDA. From this medley of facts,

Akebia argues that covering Auryxia for one use but excluding it

for the other is arbitrary and capricious. Embedded in this

argument are two distinct but imbricated propositions. First,

Akebia submits that the statutory language does not support any

use-based distinctions at all. Second, it submits that even if

some use-based distinctions are permissible, Auryxia does not

actually treat a "mineral deficiency" that would fit within the

Agency's use-based paradigm. We examine these propositions

separately.

Whether the Medicare statute authorizes CMS to exclude

from coverage certain uses of a drug but not others is a question

of law that we review de novo. See Corp. Techs.,

.

Here, the introductory language to the relevant statutory section

provides that "[t]he following drugs or classes of drugs, or their

medical uses, may be excluded from coverage or otherwise

- 21 - restricted." 42 U.S.C. § 1396r-8(d)(2). The exclusion categories

(including the mineral products exclusion) are then enumerated.

Some of the exclusion categories list broad classes of drugs, such

as "[p]rescription vitamins and mineral products." Id. § 1396r-

8(d)(2)(E). Other exclusion categories focus specifically on

particular uses that may be excluded, such as "[a]gents when used

for cosmetic purposes or hair growth." Id. § 1396r-8(d)(2)(C).

If a statute's plain meaning supplies a plausible

interpretation, then that interpretation ordinarily wins the day.

See United States v. Gordon,

(1st Cir. 2017). In

this instance, Congress spelled out the powers that it conferred

upon CMS quite clearly: CMS may exclude from coverage "[t]he

following drugs or classes of drugs, or their medical uses." 42

U.S.C. § 1396r-8(d)(2) (emphasis supplied). By excluding Auryxia

(a mineral product, see text supra) from coverage only for a

particular medical use, CMS took exactly the sort of action that

Congress authorized it to take. In other words, CMS acted well

within the encincture of the discretion afforded to it by the

statute.

Akebia's contrary argument, which posits that the

mineral products exclusion only authorizes the Agency to exclude

mineral products in their entirety, is unconvincing. This argument

suggests that because some exclusion categories begin with the

phrase "[a]gents when used for," drugs in all other exclusion

- 22 - categories may only be excluded based on their composition, not

their medical uses. Such a suggestion, though, is not only belied

by the plain language of the statute but also would render the

statutory phrase "or their medical uses" nugatory. That sort of

construction is to be avoided. See Gustafson,

;

see also Walker,

.

Here, moreover, if the entire universe of CMS's

exclusion options were listed alongside the exclusion categories

themselves, there would have been no earthly reason for Congress

to have included the phrase "or their medical uses" in the statute.

Put another way, if Akebia's interpretation prevailed, the words

"or their medical uses" could be deleted and the statute's meaning

would be unchanged. Like the district court, see Akebia, 443 F.

Supp. 3d at 230, we refuse to place our imprimatur on so fanciful

an exercise in statutory interpretation.

Nor does the fact that certain exclusion categories

begin with "[a]gents when used for" alter our conclusion. As

employed in the statute, nothing about that phrase implies that

other categories may only be excluded in an all-or-nothing manner,

premised on chemical composition. It is both plausible and

consistent with the statutory text to conclude — as we do — that

Congress wished to provide CMS with somewhat limited authority to

exclude drugs in certain categories while allowing CMS wider

latitude with respect to other categories.

- 23 - To say more about this line of argument would be to paint

the lily. We conclude, without serious question, that the plain

language of the statute authorizes use-based distinctions for Part

D coverage determinations. We also conclude that the use-based

distinction that CMS has made regarding Auryxia comes under the

umbrella of this authority. Akebia's contrary claims, therefore,

cannot undergird a showing of likelihood of success on the merits.

This brings us to Akebia's claim that even if use-based

distinctions are permissible under the statute, Auryxia does not

come within the contours of the excludable medical use that CMS

articulated before the district court. In its opposition to the

preliminary injunction motion, CMS asserted that the excludable

use for mineral products is for "manufactured products prescribed

for conditions arising from a mineral deficiency." It also

asserted that this interpretation was consistent with its

September 2018 e-mail to Medicare sponsors. Building on a

foundation constructed out of these assertions, Akebia notes that

Auryxia is often prescribed to patients that have functional iron

deficiency — a condition in which patients have sufficient iron

stores in their bodies but have difficulty using that iron to

create red blood cells.

As Akebia sees it, functional iron deficiency contrasts

with absolute iron deficiency (a condition in which the body simply

does not have enough iron). Auryxia effectively helps patients

- 24 - with functional iron deficiency transport the iron they already

have to the correct place (by making the iron more soluble) so

that the body can create red blood cells; it does not replace the

iron altogether. This unique feature of Auryxia, Akebia maintains,

means that Auryxia does not treat an iron deficiency but, rather,

treats an iron transport problem.

Akebia tells us that this distinction is of decretory

significance because Auryxia is often prescribed to patients with

functional iron deficiency — patients who do not respond well to

traditional iron supplements because they have all the iron they

need. Understood in this way, Auryxia does not treat an iron

deficiency but treats an iron transport problem and, thus, cannot

(Akebia says) be excluded under the statute. To support this

understanding, Akebia relies on statements from a variety of

medical and scientific professionals.

We do not gainsay that this technical distinction is

significant. For instance, it quite probably played a meaningful

role in Auryxia's patent applications. But it does not tell the

whole story: other factors swing the interpretive pendulum back

in CMS's favor. The most prominent of these factors is that

Auryxia is prescribed to treat IDA. IDA is a diagnosis indicating

that the body lacks the iron required for normal physiological

processes, even if the individual has adequate iron stores

elsewhere in the body.

- 25 - There is more. Notwithstanding Akebia's efforts to

differentiate Auryxia from traditional intravenous and oral iron

supplements by focusing on the part that Auryxia plays in iron

transport, the label required by the FDA describes Auryxia as an

"iron replacement product" — a term that clearly implies that

something is being replaced. This implication goes hand in hand

with the notion that — in contrast to treatment for

hyperphosphatemia, in which Auryxia is used like a paper towel to

soak up excess phosphates — the principal objective in IDA

treatment is to facilitate iron absorption, with an eye toward

ameliorating otherwise deficient iron levels in the blood.

Auryxia's underlying patent filings focus on the solubility of the

compound, buttressing the idea that the goal is to restore (or at

least improve) the patient's iron levels.

At bottom, the parties are arguing about whether

Auryxia, when prescribed for patients who have trouble using stored

iron to create red blood cells, should be regarded as treating a

mineral deficiency. This is a close question, but it is a question

of fact. The district court treated it as such and found that

Auryxia, when prescribed to patients with IDA, is a mineral product

- 26 - used to treat an iron deficiency.6 See Akebia, 443 F. Supp. 3d at

229.

Under the abuse of discretion standard, we review such

factual findings only for clear error. See Corp. Techs.,

. The particular factual finding under review results from

a plausible view of the evidence and is not clearly erroneous.

The FDA's characterization of Auryxia as an iron replacement

product and the fact that Auryxia is prescribed to treat IDA both

lend credence to the district court's conclusion. See Cumpiano v.

Banco Santander P.R.,

(1st Cir. 1990) (explaining

that, on clear error review, we "ought not to upset findings of

fact or conclusions drawn therefrom unless, on the whole of the

record, we form a strong, unyielding belief that a mistake has

been made.") (citing, inter alia, United States v. U.S. Gypsum

Co.,

(1948)); cf.

("Where there are two

permissible views of the evidence, the factfinder's choice between

them cannot be clearly erroneous.") (quoting Anderson v. City of

Bessemer City,

(1985)). It follows that, at

this stage of the litigation, Akebia's claim of error fails.

Akebia makes a last-ditch effort to bell the cat. It

contends that CMS's decision to exclude Auryxia from Part D

6 We recognize that, at the preliminary injunction stage, this finding is merely a predicted outcome, subject to reexamination at a trial on the merits. See Ross-Simons,

.

- 27 - coverage for some uses but not for others is arbitrary and

capricious because that decision is inconsistent with CMS's

treatment of analogous drugs. To support this contention, Akebia

points to CMS's prior decisions concerning several non-iron

products, including vitamin D products and electrolytes.

The fatal flaw in this contention is that it rests on a

claim that CMS cannot make coverage determinations based on use —

a claim that we already have rejected. See text supra. Given our

acknowledgment of CMS's authority to employ a use-based approach,

little more need be said. We add only that, in this context, the

usual reason for finding an agency's decision arbitrary and

capricious is the existence of "a deviation from its own prior

precedents without sufficient explanation or reasoning." Good

Samaritan Med. Ctr. v. NLRB,

(1st Cir. 2017).

To succeed on such a claim, Akebia would need to demonstrate that

CMS departed from either norms previously established or its

customary decisional rules when it decided to exclude Auryxia from

coverage. See Int'l Jr. Coll. of Bus. and Tech., Inc. v. Duncan,

(1st Cir. 2015); Shaw's Supermarkets, Inc. v.

NLRB,

(1st Cir. 1989). Here, however, CMS did

not deviate in any meaningful way from its own prior coverage

determinations: its use-based approach to Auryxia is consistent

not only with its treatment of other iron replacement products but

- 28 - also with its treatment of the other products that Akebia mentions.

We explain briefly.

To begin, Akebia's argumentation is under-inclusive. In

alleging that CMS acted inconsistently, Akebia's comparisons

conspicuously omit any serious discussion of CMS's classification

of other drugs used for the treatment of iron deficiency. Iron

supplements are Auryxia's closest analog, and CMS has regularly

excluded from coverage under Part D other iron products used to

treat IDA. See Akebia, 443 F. Supp. 3d at 227. Intravenous and

injectable iron drugs containing synthetic substances (such as

iron dextran, iron sucrose, and sodium ferric gluconate) are

uniformly excluded from Part D coverage when used to treat IDA.

So, too, polysaccharide iron complex, an orally-ingested iron

replacement product, is excluded from Part D coverage.

Apparently aware that it cannot win this battle, Akebia

seeks to make other (and less appropriate) comparisons. To this

end, it attempts to contrast CMS's decision regarding Auryxia with

CMS's coverage determinations for vitamin D products, synthetic

compounds combined with citric acid such as lithium salts, niacin-

based products, and electrolytes. These comparisons, though, are

flying under a false flag. The fundamental takeaway from CMS's

prior coverage decisions regarding the products singled out by

Akebia is that each decision was predicated on the use of the

particular product. Some examples suffice to make the point:

- 29 -  CMS decided to exclude certain vitamin D products,

known as "nutritional vitamin D," from Part D

coverage because such products directly treat a

vitamin D deficiency. On the contrary, CMS decided

to cover other vitamin D products, known

generically as "active vitamin D," under Part D

because they treat hyperparathyroidism by

inhibiting the parathyroid glands' secretion of

certain hormones. Nothing about these decisions is

inconsistent with CMS's treatment of Auryxia.

 CMS decided to cover niacin-based products, which

contain vitamin B3 for treatment of dyslipidemia

(abnormal lipid counts in the blood) rather than

for treatment of vitamin B3 deficiency. Nothing

about this decision is inconsistent with CMS's

treatment of Auryxia.

 CMS decided to cover products composed of synthetic

mineral compounds combined with citric acid,

including lithium salts, when used to treat

conditions other than mineral deficiencies (such as

psychiatric disorders). Nothing about this

decision is inconsistent with CMS's treatment of

Auryxia.

- 30 -  CMS decided to cover certain electrolytes under

Part D, even when used as replacement products (but

only when used to replace electrolytes, not non-

electrolyte minerals). To the extent that a

product has both electrolyte and non-electrolyte

mineral components, the product is not covered if

used to replace the non-electrolyte mineral.7

Nothing about this decision is inconsistent with

CMS's treatment of Auryxia.

Over and above these examples, we offer one last

observation. As a general matter, the vitamin and mineral products

category is broad enough that it would be odd to require CMS to

treat all products that potentially fall within it exactly the

same. The text of the statute gives us no reason to think that

Congress intended to impose so curious a regime. See, e.g., Shaw's

Supermarkets,

(holding that agencies need not

"microscopically examin[e] prior cases" and that prior cases are

not "straitjacket[s], inhibiting experimentation or change").

7 Akebia argues that because electrolytes are a subset of minerals, CMS cannot legitimately cover electrolyte but not mineral replacement products. At this moment, however, challenges to CMS's coverage decisions regarding electrolytes are not before us. The key query is whether CMS's decision regarding Auryxia was a significant departure from its prior coverage determinations, see Shaw's Supermarkets,

; and at this stage, we agree with the district court that it was not, see Akebia, 443 F. Supp. 3d at 229.

- 31 - That ends this aspect of the matter. Although an agency

must be sufficiently consistent in its decisionmaking to avoid

arbitrary and capricious outcomes, it need not always be precise

to the point of pedantry. See Davila-Bardales v. INS,

(1st Cir. 1994) (recognizing that "agencies retain a substantial

measure of freedom to refine, reformulate, and even reverse their

precedents in the light of new insights and changed

circumstances"). The basic rule is that an agency cannot

significantly depart from its own prior precedent without

adequately explaining its rationale. See Shaw's Supermarkets,

. There was no such departure here: the record reflects

that CMS acted in reasonable conformity with its past decisions

regarding analogous products. Because CMS treated its coverage of

Auryxia consistently with its past decisions concerning iron

products and other drugs falling under the vitamins and mineral

products exclusion, the district court did not abuse its discretion

in holding that CMS's treatment of Auryxia was neither arbitrary

nor capricious.

III. CONCLUSION

We need go no further. Inasmuch as we find neither

cognizable error nor abuse of discretion in the district court's

holding that Akebia failed to carry its burden of showing that it

is likely to succeed on the merits of its claims, we need not

address the other elements of the preliminary injunction

- 32 - framework. See Wine & Spirits Retailers, Inc. v. Rhode Island,

(1st Cir. 2005). After all, we have made it

luminously clear that likelihood of success is the "sine qua non"

of the preliminary injunction inquiry. Ryan, __ F.3d at __ [slip

op. at 11] (quoting New Comm Wireless Servs.,

).

Affirmed.

- 33 -