Sandoz Inc. v. Amgen Inc.

Supreme Court Clarifies BPCIA Provisions

Life Sciences Vector
By: Stanley F. Chalvire
August 24, 2017

On June 12, 2017, the United States Supreme Court issued its first ruling on two key provisions of the Biologics Price Competition and Innovation Act (“BPCIA”) concerning the resolution of patent infringement suits in connection with the submission to the Food and Drug Administration (“FDA”) of applications to commercialize biosimilars in the United States.1

In contrast to traditional drugs, which are often chemically synthesized, biologics represent a growing class of therapeutics that are generally more complex and are biologically derived or prepared.  Somewhat analogous to their generic drug counterparts, a biosimilar is a biologic that FDA has determined is highly similar to an already FDA-approved “biological reference product” or “reference product,” notwithstanding minor differences in inactive components of the biosimilar for which there are no clinically meaningful differences in terms of the safety, purity, and potency. The BPCIA creates an abbreviated statutory pathway by which a biosimilar applicant can obtain FDA approval to commercialize its biosimilar version of a reference product by piggybacking onto FDA’s previous approval of such reference product.2

The BPCIA treats the submission of a biosimilar application to FDA as an “artificial” act of patent infringement, effectively enabling the commencement of patent infringement actions at certain points following FDA’s acceptance of the biosimilar application, despite the biosimilar applicant not having committed a traditional act of patent infringement, such as actually selling the allegedly infringing product.  The BPCIA also created a corresponding statutory scheme to facilitate the early resolution of patent disputes between the biosimilar applicant and the sponsor whose reference product is being referenced to support approval of the biosimilar.3  For example, the BPCIA provides that an applicant seeking FDA approval of a biosimilar must disclose its application and manufacturing information to the sponsor of the referenced product within twenty days of FDA’s acceptance of the biosimilar application, thereby initiating a choreographed exchange of information between the biosimilar applicant and the sponsor of the referenced product in preparation for a potential first phase of patent litigation.4  When the parties have identified any patents which may potentially be infringed by the manufacture, use or sale of the biosimilar applicant’s product, the sponsor of the referenced product is expected to bring a patent infringement suit.  The BPCIA also requires the biosimilar applicant to provide the sponsor of the reference product at least 180 days prior notice before commercially marketing the biosimilar product, thus triggering a potential second phase of patent litigation between the biosimilar applicant and such sponsor.5

In Sandoz Inc. v. Amgen Inc., the Court confronted two questions: (1) whether the statutory requirement that the biosimilar applicant provide its application and manufacturing information to the sponsor of the reference product is enforceable by injunction, and (2) whether the biosimilar applicant may provide the sponsor the 180 day notice of first commercial marketing before FDA’s approval of the biosimilar application.6

With respect to the first question, in a unanimous decision the Court ruled that Amgen, the sponsor of the reference product, was not entitled to an injunction under federal law to enforce the biosimilar applicant’s statutory requirement to provide its application and manufacturing information to Amgen prior to FDA approval.7  Instead, the Court held that Congress had intended to provide a sole remedy for the sponsor of the reference product in response to a biosimilar applicant’s refusal to provide its application to the sponsor of the reference product. This remedy is for the sponsor to bring a declaratory judgment action for patent infringement against the biosimilar applicant under § 262(l)(9)(C).8  The Court’s holding effectively provides that the BPCIA cannot compel a biosimilar applicant to engage in the information exchange provisions of the BPCIA, acknowledging the sponsor’s remedy for such a failure on the part of the biosimilar applicant to participate in the statutory exchange is for the sponsor, but not the biosimilar applicant, to immediately bring an action “for a declaration of infringement, validity, or enforceability of any patent that claims the [reference] biological product or a use of the [reference] biological product.”9

As to the second question of whether a biosimilar applicant may provide its 180 day notice to the sponsor of the reference product before actually securing FDA approval for its biosimilar, the Court held that the biosimilar applicant “may provide notice either before or after receiving FDA approval,” because the language of the statute imposes a “single timing requirement,” which is simply 180 days before commercial marketing of the biosimilar.10 The Court’s holding thus clarifies that § 262(l)(8)(A) does not require the biosimilar applicant to await FDA approval of its biosimilar application prior to giving the requisite 180 day notice to the sponsor of the reference product about its intention to market its biosimilar product.

The Court’s decision provides additional clarity regarding the provisions of the BPCIA and clarifies the mechanism by which biosimilar applicants can effectively bypass the information exchange provisions of the BPCIA that were intended to streamline or facilitate the resolution of patent disputes.  From the perspective of sponsors of reference products, the Court’s decision creates more uncertainty in the resolution of such patent disputes, potentially discouraging the earlier resolution of any potential infringement claims and delaying access of biosimilar products to patients.

For more information regarding the BPCIA or to discuss the Sandoz Inc. v. Amgen Inc. decision, please contact Stan Chalvire.

The author would like to acknowledge the contributions to this article by and give thanks to Bianca F.Sena, Northeastern University School of Law (NUSL) 2018.



Footnotes.

1. Sandoz Inc. v. Amgen Inc., 582 U.S. ____ (2017).

2. Id. at 2.

3. 42 U.S.C. 262(l).

4. 42 U.S.C. 262(l)(2)(A).

5. 42 U.S.C. 262(l)(8)(A).

6. Sandoz Inc., 582 U.S. at 1-4.

7. Id. at 10.

8. Id. at 12.

9. 42 U.S.C. §262(l)(9)(C)

10. Id. at 16.