United States: Riddle Me This: The Federal Circuit Provides A Measure Of Clarity To The Enigmatic Biosimilar Approval Pathway

In Amgen Inc. v. Sandoz Inc. (No. 2015-1499), a fractured panel of the Federal Circuit Court of Appeals recently decided two issues of first impression relating to the Biologics Price Competition and Innovation Act of 2009 ("BPCIA"), the statutory scheme establishing an abbreviated pathway for regulatory approval of follow-on biological products.  Both the biosimilar applicant (Sandoz) and the reference product sponsor (Amgen) emerged partly victorious, with one two-judge majority agreeing with Sandoz that a biosimilar applicant is not required to disclose its application and manufacturing process to the reference product sponsor, and a different two-judge majority agreeing with Amgen that a biosimilar applicant cannot provide the required 180-day notice of commercial marketing prior to FDA approval, or "licensing," of the biosimilar product.  All three members of the panel joined together, however, in calling out the complexity of the BPCIA, likening it—as Winston Churchill once said of Russia—to "a riddle wrapped in a mystery inside an enigma."

The BPCIA establishes an abbreviated pathway, analogous to that created by the Hatch-Waxman Act for generic pharmaceutical drugs, that allows a company to seek regulatory approval for a follow-on biological product without the rigor required of the original biologics license.  Whereas a biologics license application ("BLA") requires extensive clinical data establishing the safety and efficacy of the original product, an abbreviated biologics license application ("aBLA") requires only that the follow-on applicant (also known as a "subsection (k) applicant") establish that its product is either "biosimilar" to or "interchangeable" with the previously licensed biologic (known as the "reference product").  Compare 42 U.S.C. § 262(a) with id. § 262(k).  However, Congress also provided a twelve-year period of exclusivity for the reference product from the date of its first licensure, such that no follow-on product may be sold during that interval, regardless of patent protection.  Id. § 262(k)(7)(A).  In fact, an application for a biosimilar cannot even be submitted until four years after first licensure of the reference product.  Id. § 262(k)(7)(B).  In this way, the BPCIA seeks to balance the interests of those engaging in original biologics discovery with the public's desire for lower cost medical treatment.

The BPCIA also establishes a regime for the reference product sponsor and subsection (k) applicant to narrow and resolve patent infringement disputes.  In addition to creating an artificial act of infringement, again not unlike that created by the Hatch-Waxman Act for generic pharmaceutical drugs, the BPCIA also establishes a complex process, often referred to as the "patent dance," for the exchange of information between the subsection (k) applicant and reference product sponsor.  See generally 42 U.S.C. § 262(l).  First, within 20 days after an aBLA is accepted by the FDA for review, the BPCIA specifies that a subsection (k) applicant "shall provide to the reference product sponsor a copy of the application submitted . . . 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."  Id. § 262(l)(2)(A).  Subsequent to that exchange, the BPCIA also establishes a schedule for the parties to provide each other with lists of patents they believe applicable, along with their respective positions on infringement and validity.  Id. § 262(l)(3).  The BPCIA then allows the reference product sponsor to bring an action for patent infringement.  Id. § 262(l)(6).  Finally, a subsection (k) applicant "shall provide notice to the reference product sponsor not later than 180 days before the date of first commercial marketing of the biological product licensed under subsection (k)," thus allowing the reference product sponsor to seek a preliminary injunction prohibiting such activity pursuant to any patent listed by either party as part of the patent dance but excluded from the § 262(l)(6) infringement action.  Id. § 262(l)(8)(A)–(B).

Amgen began marketing the biological product filgrastim, branded Neupogen®, in 1991.  Sandoz filed an aBLA in May 2014 seeking approval for a biosimilar version of filgrastim and, upon receiving notification from the FDA that its aBLA had been accepted for review, notified Amgen on July 8, 2014 that it intended to launch its biosimilar immediately upon FDA approval of the follow-on product.  When Sandoz shortly thereafter elected not to engage in the patent dance, Amgen brought suit in the Northern District of California asserting claims of unfair competition and conversion under California state law, premised on Amgen's allegation that Sandoz violated the BPCIA by failing to disclose its aBLA and manufacturing information and by prematurely providing notice of commercial marketing prior to licensure by the FDA.  Amgen also claimed infringement of its U.S. Patent No. 6,162,427, which claims a method of using filgrastim, under federal law.  The FDA approved the aBLA filed by Sandoz on March 6, 2015, on which day Sandoz (again) provided notice of commercial marketing to Amgen.

The district court agreed with Sandoz's interpretation of the BPCIA, holding that the subsection (k) provision regarding the exchange of information was permissive and not mandatory and further that Sandoz's notice of its intent to commercially market a filgrastim follow-on product was effective despite being given prior to the FDA's approval.  After the district court dismissed Amgen's unfair competition and conversion claims and entered final judgment as to that portion of the case, Amgen appealed.

On the first issue, the first panel majority, consisting of Judges Lourie and Chen, agreed with the district court that a follow-on applicant is not required to engage in the patent dance.  That majority found that when read in context, the word "shall" in paragraph (l)(2)(A) cannot mean "must" because the BPCIA elsewhere contemplates that a subsection (k) applicant may fail to disclose the information detailed in paragraph (l)(2)(A).  Specifically, paragraph (l)(9)(C) provides a remedy for a subsection (k) applicant's failure to comply with paragraph (l)(2)(A), pursuant to which the reference product sponsor may bring an action for declaratory judgment on any patent.  The first majority noted that this would allow the reference product sponsor to obtain the same information specified in paragraph (l)(2)(A) through discovery, which in point of fact Amgen had already done.  The majority thus concluded that because Sandoz had taken "a path expressly contemplated by the BPCIA, it did not violate the BPCIA by not disclosing its aBLA and the manufacturing information by the statutory deadline."

With respect to the timing of a subsection (k) applicant's notice of commercial marketing, the second panel majority, consisting of Judges Lourie and Newman, concluded that the district court had erred in holding that such notice may be given prior to FDA approval of a biosimilar product.  Instead, the panel majority found that the statutory language compelled an interpretation pursuant to which effective notice can be given only after a biosimilar product has been licensed by the FDA.  In particular, the majority relied on Congress's use of the term "biological product licensed under subsection (k)" in paragraph (l)(8)(A), in contrast to other BPCIA provisions that instead use the term "the biological product that is the subject of" the application, reasoning that Congress used "licensed" instead of "subject of" because it intended a different meaning.  By requiring that final FDA approval be granted prior to any notice of commercial marketing, Congress sought to ensure that any controversy between the subsection (k) applicant and reference product sponsor would be "fully crystallized," and thus that the reference product sponsor would not be "left to guess the scope of the approved license and when commercial marketing would actually begin."  The second majority therefore concluded that "under paragraph (l)(8)(A), a subsection (k) applicant may only give effective notice of commercial marketing after the FDA has licensed its product."

It remains to be seen how long the panel's guidance on these two issues of first impression remains dispositive, as the fractured decision reveals conflicting judicial opinions that may convince the Federal Circuit to engage in en banc review if requested by either party.  In the meantime, neither brand-name biologic companies nor biosimilar companies are left entirely happy.  Should other biosimilar companies follow in Sandoz's footsteps and refuse to share manufacturing information, brand-name biologic companies will be forced to rely on expensive litigation discovery procedures to fully understand which of their patent rights may even be applicable.  On the other hand, brand-name biologic companies may now gain an extra six months of exclusivity where FDA licensure of a biosimilar occurs towards the end of the statutory twelve-year term. Only time will tell whether the panel decision in Amgen v. Sandoz identified an effective solution to two of the many riddles posed by the BPCIA.​​​​​​​

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Events from this Firm
30 Nov 2017, Conference, San Francisco, United States

The 2017 agenda addresses significant pending legislative and regulatory changes along with our annual substantive updates.

5 Dec 2017, Webinar, California, United States

This highly interactive colloquium will provide a deep understanding and practical advice regarding major e-discovery challenges facing organizations today.

6 Dec 2017, Seminar, California, United States

Network and be seen as an information security thought leader. “The Exchange” colloquium is designed for senior business executives and security practitioners from both the public and private sector.

 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Emails

From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.