In September, the FDA began publishing the "Purple Book." The Purple Book is the biologic counterpart to the long running Orange Book for "small molecule" drugs. Like the Orange Book the Purple Book lists the biologic drug by both the product (proper) name of the biologic and the Proprietary name and the date it was licensed. Unlike the Orange Book, the Purple Book does not list any patents covering the drug, nor, with a few exceptions, any unexpired exclusivities. 

Significant strategic advantages may be gained by biosimilar applicants availing themselves of Patent Trial & Appeal Board (PTAB) patent challenge mechanisms. By way of background, the FDA apparently has decided that the 12 year biologic exclusivity first provided in the Affordable Care Act of 2010 applies to a Purple Book drug first approved before 2010— for example, Neupogen, licensed in 1991, is listed with an exclusivity expiring in 2003. The challenge for the biosimilar applicant and the advantage for the Originator lies in the failure of Congress to provide any guidance as to how the amended 42 U.S.C. §262 would be applied to biologic drugs licensed prior to its effective date. This failure has implications for biologic drugs whose 12 year exclusivity period has expired but which still has patent protection like Enbil® and Remicade® both now the subject of biosimilar applications.

The challenge lies in the patent provisions of §262(l) that provide for an extended exchange of information up to a 6½ month period before litigation can begin. The exchange of information cannot begin until the application is "filed." The FDA makes an initial review of the application for compliance with the rules, which takes approximately 2 months before an application filing date is accorded. While the biosimilar applicant can shorten the period for the exchange of patent information by not taking the full 60 days for each of its two responses, the process guarantees a minimum of at least 6 months from the date the application is lodged with the FDA until the commencement of litigation. Compounding matters is the 180 day notice the biosimilar applicant must give before commercial sales can begin, §262(l)(8)(A). The statute is silent on whether this notice can be given prior to approval of the biologic license. It seems reasonable to assume that the notice cannot be given until the FDA has accepted the BLA for filing. The District Court in Sandoz v Amgen, N.D. Ca., C-13-2904, document 101, determined that notice of commercial marketing could not be given until the product was approved. At least one biosimilar applicant, Celltrion, has estimated that the entire process will delay marketing by 10 to 12 months beyond the 10 month FDA review period and even then any product launch will most probably be at risk since it is unlikely a court decision will be received by the delayed launch date.

Currently two Biosimilar applications have been filed, entracept (Enbril®) by Sandoz, and infliximab (Remicade®) by Celltrion. Both Sandoz and Celltrion filed declaratory judgment actions against the Originator seeking declaration that their patents were invalid or not infringed prior to submitting their applications for a biologic license. The Sandoz complaint was dismissed because the district court considered the statutory patent scheme in §262 to oust the court of declaratory judgment jurisdiction. It did not help that Sandoz had not been directly accused of infringement. Janssen, the Remicade® innovator, has filed a motion to dismiss Celltrion's complaint also on the grounds that the statutory scheme controlled. This motion is still pending decision. The lack of a patent listings in the Purple Book make declaratory judgment filings questionable since one of the factors present in Teva v. Novartis, 482 F.3d 1330 (Fed. Cir. 2007), is missing.

A decision in the Sandoz appeal will decide whether or not a declaratory judgment action can be filed by a BLA applicant prior to filing the BLA and prior to the patent scheme in the statute. While Sandoz has attempted to create a fear of litigation based on comments by Amgen in general about defending Enbril® with its patents, its case is weakened by the fact that Amgen could not file suit until it learned that Sandoz had filed its BLA given the safe harbor provision of 35 U.S.C. 271(e)(1) and Amgen had not threatened Sandoz specifically with a patent infringement action.

Understanding both Sandoz's and Celltrion's desire to get market early requires an understanding of the economics of biosimilars as compared with generic drugs. The FTC has estimated that a typical generic takes from 3 to 5 years and $1 to $5 million to develop. In contrast biologics can take from 8 to 10 years and $100 to $200 million to develop. Sandoz has asserted that it began work on Entracept in 2004 while Celltrion asserted it began its development in 2008 and spent $112 million on its efforts.

Which, finally, brings us to the strategic use of the PTAB by biosimilar applicants.

IPRs offer a solution to the biosimilar applicant's dilemma and a challenge to the innovator. There is no waiting period to file an IPR and one could be filed well in advance of submitting the BLA (Biologic License Application) to obtain a decision on the validity of the relevant patents prior to the anticipated approval date. Strategically, an IPR could be filed based on the 12 year biologic exclusivity date challenging patents covering the biologic that are in force far beyond this exclusivity period. Given the complexity of biologic drugs, the likelihood of a favorable result would be greater than in district court due to the technically trained PTAB judges. Additionally, the biosimilar applicant would presumably be filing early enough to have an opportunity to file a second IPR to address any shortcomings the PTAB may find it its initial IPR filing. In addition, it could lead to the originator licensing the applicant. Celltrion in Europe was able to secure a license for most of the world excluding Canada and the U.S. as a result of European patent litigation. A similar result might occur in response to the grant of an IPR petition. Licensing may be a viable option given the economics of biologic drugs and biosimilars, especially if the biosimilar is not interchangeable with the innovator's product.

Biologic innovators whose 12 year exclusivity period has expired or will expire in the next few years would be well advised to review their patent position and determine if remedial action should be taken to correct any errors or deficiencies in the patent claims. With patent reissue applications now examined at the Central Reexamination Unit (CRU), reissue applications, or even supplemental examination, may be a worthwhile effort to strengthen (e.g., obtain narrower claims) any patents expiring after the regulatory exclusivity expires. IPR filings against pharmaceutical patents involved in ANDA litigations has been increasing and its only a question of when, not if, IPRs used against biologic patents.