On June 12, 2017, the Supreme Court held that a biosimilar applicant cannot be enjoined under federal law to provide its application and manufacturing information to the reference product sponsor (“RPS”) under the Biologics Price Competition and Innovation Act (“BPCIA”). The Court also held that a biosimilar applicant need not wait until receipt of FDA approval to provide the required 180-days’ prior notice of its intent to commercially market the biosimilar product.
The BPCIA and the “Patent Dance”
The BPCIA, passed as part of the Affordable Care Act in 2010, permits a biosimilar applicant to apply for an abbreviated license four years after the reference product was first licensed. Under § 262(l)(2) of the BPCIA, the biosimilar applicant shall provide to the RPS a copy of the application and manufacturing information no later than 20 days after the FDA accepts the biosimilar application. Thereafter, the statute provides for alternating information disclosures by the biosimilar applicant and the RPS which is intended to identify patents to be litigated in two waves of litigation. This is known as the “patent dance.” The first wave of litigation is initiated following the parties’ exchange of patent lists and other information.
The BPCIA also requires the biosimilar applicant to provide notice to the RPS no later than 180 days before the date of the first commercial marketing of the biosimilar product. During that 180-day period, the RPS may seek a preliminary injunction in a second wave of litigation that allows the RPS to assert patents not previously asserted in the first wave of litigation.
What If the Biosimilar Applicant Declines to Dance?
Amgen has marketed filgrastim under the brand name Neupogen since 1991. In May 2014, Sandoz filed an application seeking FDA approval of a biosimilar version of filgrastim, which Sandoz planned to market under the name Zarxio. On July 8, 2014, before FDA approval, Sandoz notified Amgen that it intended to begin commercial marketing of Zarxio immediately after FDA’s receipt of approval. Later in July 2014, Sandoz informed Amgen that it had opted not to provide Amgen with Sandoz’s biosimilar application and that Amgen was entitled to sue Sandoz under § 262(l)(9)(C).
The Federal Circuit, in a 2-1 opinion with two partial dissents, held that (1) disclosure of a biosimilar application and the subsequent patent dance process are voluntary processes that Sandoz may choose not to participate in; and (2) Sandoz’s notice of intent to begin commercial marketing was defective because Sandoz provided it before it received FDA approval. The Supreme Court granted Sandoz’s petition for certiorari, and Amgen’s conditional cross-petition for certiorari, and consolidated the cases.
The Supreme Court’s Decision
The questions presented to the Supreme Court were (1) whether Sandoz’s disclosure of its biosimilar application to Amgen, along with the subsequent patent dance process, was mandatory; and (2) whether Sandoz’s July 2014 notice given before FDA approval was effective notice under § 262(l)(8)(A). On the first issue, the Supreme Court held that although the Federal Circuit reached the correct outcome, its reasoning was flawed. According to the Supreme Court, Section 262(l)(2)(A)’s requirement that an applicant provide the RPS with its application and manufacturing information was not enforceable by an injunction under federal law. The Court explained that § 262(l)(9)(C) permitted RPS to bring an immediate declaratory-judgment action of patent infringement for an applicant’s failure to turn over its application and manufacturing information. The provision is silent, however, on the right of the RPS in forcing the applicant to turn over the application and manufacturing information. The Supreme Court interpreted the lack of this explicit remedy as Congressional intent to not give the RPS the right to enforce the disclosure requirement under federal law. Importantly, the Supreme Court held that the RPS does not have a federal injunction remedy to compel disclosure of the biosimilar application, but it did not state that the disclosure requirement is optional.
Notably, the Supreme Court left the state law remedy open on remand, and directed the Federal Circuit to determine whether an injunction was available under state law to enforce the disclosure requirement, and whether the BPCIA pre-empted state-law remedies for failure to comply with the disclosure requirement.
Second, the Supreme Court held that an applicant “may provide notice of commercial marketing before obtaining a license.” Section 262(l)(8)(A) states that the applicant “shall provide notice to the reference product sponsor not later than 180 days before the date of the first commercial marketing of the biological product licensed under subsection (k).” The Court interpreted the phrase “of the biological product licensed under subsection (k)” as modifying “commercial marketing” rather than “notice,” so under this interpretation, the applicant may provide notice either before or after receiving final FDA approval.
What This Means for You
The petitioners in this case asked the Supreme Court to resolve to statutory interpretation issues related to the BPCIA. As to one issue, regarding timing of the notice of commercial marketing, the Court provided clear guidance and held that a biosimilar applicant need not wait until licensure to provide notice to the RPS. On the other issue, whether a biosimilar must provide its application to the RPS, the Court’s opinion did not directly answer the question. Instead, the Court considered what remedy is available to the RPS when the biosimilar applicant does not provide its application, and held that no federal injunction is available to force compliance with the statutory requirement. Rather, the Supreme Court remanded to the Federal Circuit to decide whether an injunction was available under state law and whether the BPCIA pre-empted state law remedies.