District Judge Paul A. Crotty granted defendant Kennedy Trust for Rheumatology Research’s motion to dismiss plaintiff’s declaratory judgment action that three of Kennedy Trust’s patents, U.S. Patent No. 7,846,442, U.S. Patent No. 8,298,537, and U.S. Patent No. 8,383,120, that cover methods for treating rheumatoid arthritis by administering a combination of anti-TNFa antibody and methotrexate are invalid because of improper tactics used to acquire the patents. In 1998 Janssen Biotech, Inc. licensed these patents and received FDA approval to market its drug infliximab (anti-TNFa monoclonal antibody cA2) under the trademark Remicade. Now, Celltrion seeks to market its drug Remsima, a biosimilar of Remicade in the United States. The court held that Celltrion failed to establish an actual case or controversy because it had not engaged in potentially infringing activity. The court held that Celltron’s evidence of diligent pursuit of FDA approval and investment of substantial money into Remsinma was not enough to support a declaratory judgment action. Additionally the court was not convinced that Kennedy had expressed a clear intent to pursue infringement claims, stating prior litigious conduct was “only one circumstance to be considered.”

The court also held that even if Celltrion had “engaged in sufficient meaningful preparation to market Remsima and that threat of injury was sufficiently demonstrable” the court still had to decline to hear this case in light of the Biologics Price Competition and Innovation Act (“BPCIA”) statutory framework for resolving patent disputes. The court noted that the BPCIA ripens otherwise unripe patent disputes before the twelve year exclusivity of a reference biologic drug expires, allowing for biosimilar drugs to enter the marketplace promptly. Pursuant to the BPCIA, an applicant must provide a copy of its application for a biosimilar to the reference product sponsor within twenty days after the application is accepted for review by the FDA. Then the reference product sponsor must respond within sixty days, “identifying patents for which an infringement claim ‘could be reasonably be asserted.’” The parties then “negotiate these claims in good faith and if, after fifteen days of negotiations the parties have not reached an agreement, the reference product sponsor my then bring an action for patent infringement.”

Neither party may bring a declaratory judgment action while this process is under way. Here, the court found that Celltrion had not properly engaged in this dispute resolution process and found that Celltrion’s attempts to “skirt the BPCIA dispute resolution mechanism while reaping the benefits of its approval process is improper.” The court also dismissed Celltrion’s argument that the BPCIA applies only to the applicant and the reference drug sponsor, in this instance Janssen, and not to the patent holder, Kennedy. The court noted that this argument “demonstrates that [Celltrion’s] dispute against Kennedy is truly unripe: before Celltrion can market Remsima, it must resolve any dispute regarding its patents with Janssen.”

Case: Competition and Innovation Act Celltrion Heathcare Co. v. Kennedy Trust for Rheumatology Res., 14 Civ. 2256 (PAC), 2014 BL 336845, (S.D.N.Y. Dec. 1, 2014)