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Biosimilars at the Federal Circuit – Can the Parties Be Compelled to Dance?

June 10, 2015
In 2009, Congress passed the Biologics Price Competition and Innovation Act (“BPCIA”), which for the first time provided for biosimilar or interchangeable biological drug products.  But it was not until March 6, 2015, that the FDA approved the first biosimilar application – an application by Sandoz to market a version of Amgen’s NEUPOGEN® (filgrastrim) biologic drug product.  Nevertheless, there is still a question as to when Sandoz will be able to begin selling its drug product, because the parties are still resolving the patent issues.  On June 3, 2015, the Federal Circuit heard oral arguments in the Amgen v. Sandoz case, to resolve some basic questions about the requirements of the BPCIA.  It will not be surprising if this case is a topic of conversation at the BIO International Convention beginning next week in Philadelphia.

As with Hatch-Waxman statute for small-molecule pharmaceuticals, the BPCIA includes both an abbreviated drug approval process and a mechanism by which the parties can address any patent claims while the drug is being approved.  The language of the statute, however, has given rise to some confusion, or as Judge Lourie of the Federal Circuit more colorfully put it, the BPCIA could win a “Pulitzer prize for complexity or uncertainty.”  Last March, Judge Seeborg of the Northern District of California sided with Sandoz on its interpretation of the BPCIA which if upheld, could be a blow to biologic drug sponsors with regard to the enforcement of their intellectual property rights.

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One of the disputes involves the disclosure and patent exchange provisions of the BPCIA, known affectionately as the “patent dance.”  This process is supposed to begin with the disclosure of relevant information by the biosimilar applicant.  Specifically, 42 U.S.C. § 262(l)(2) says that the biosimilar applicant “shall provide to the reference product sponsor a copy of the application submitted to the Secretary under subsection (k), and such other information that describes the process or processes used to manufacture the biological product that is the subject of such application . . . .”  (emphasis added).  The statute also includes a potential consequence for non-disclosure by the applicant.  42 U.S.C. § 262(l)(2) provides that the reference product sponsor may bring an immediate action “for a declaration of infringement, validity, or enforceability of any patent that claims the biological product or a use of the biological product.”

Sandoz took the position that the disclosure requirement was not mandatory, because a biosimilar applicant could opt to withhold its information and be subject to a declaratory judgement action.  Sandoz asserted that the disclosure provision was only mandatory if a biosimilar applicant wishes to partake in the benefits of the patent dance.  Judge Newman had a different take on that question – for her it was not whether to partake in this particular subpart of the BPCIA, but rather whether to partake in the entirety of the BPCIA process – including the abbreviated approval process:

“If you want my data – if you want to be a (k) applicant, which I gather Sandoz has done, right – has used the data, hasn’t gone through their own clinical trials or all the rest of it – then this is what you ‘shall’ do.  You don’t have to use the Amgen data, you can create your own, then you are home free.”


While counsel for Sandoz disagreed, Judge Newman continued:

“But why isn’t it the question -  if you have a statute, this integrated statute, there were - from the record it looks as if there were extensive hearings, tradeoffs, debates, connections with the pros and cons of Hatch Waxman for biosimilars –and here we have a complicated statute and you say only some of it counts.”


Judge Chen also tried to reconcile the statute as a whole.  On the one hand, he observed: “I don’t see through the language or the structure of (l) where there’s a hint that it’s a ‘choose-your-own-adventure’ situation for the (k) applicant.”  On the other hand, Judge Chen noted that if even if the provision was mandatory, the result might be the same –the declaratory judgment “remedy” outlined by the statute.
The problem is that this statutory “remedy” would not put the reference product sponsor in the same position that it otherwise would have been.  The BPCIA envisions patent litigation with regard to methods of manufacturing.  Indeed, this is one type of information specified in the statute.  If the biosimilar applicant refuses to “dance,” however, the declaratory judgment “remedy” is limited to patents covering the biological product or the uses thereof.

Moreover, if the biosimilar applicant withholds its application and information, the reference product sponsor will have difficulty knowing which patents are being infringed.  With such overwhelming incentives, it is not surprising that a biosimilar applicant would choose to withhold its information.

 

 

Andrew W. Williams is a partner with McDonnell Boehnen Hulbert & Berghoff LLP. With over a decade of experience in all areas of intellectual property law, Andrew’s practice primarily consists of patent litigation, prosecution and opinion work in the biotechnology, pharmaceuticals and chemistry sectors. He is also a regular contributor on patent related issues to the Patent Docs blog.