AbbVie recently settled its dispute with Amgen, whose Amjevita biosimilar it accused of infringing its patents for Humira, the world’s best-selling drug. Though clearing an eventual path to market for Amgen’s drug, the deal constitutes a major victory for AbbVie, keeping a major competitor off the US market until 2023, despite the 2016 expiration of Humira’s core patent. While AbbVie remains embroiled in a related lawsuit with Boehringer Ingelheim, its settlement with Amgen is a clear vindication of its strategy to avoid a steep ‘patent cliff’ by building and asserting a major portfolio of secondary patents.
The settlement ended a lawsuit in which AbbVie alleged that Amgen’s planned launch of Amjevita would infringe its patent rights to Humira, a treatment for rheumatoid arthritis. Humira (whose scientific name is adalimumab) is the world’s best-selling medicine, bringing in $16 billion of sales annually – 63% of AbbVie’s overall revenue. It is also a biologic – a complex type of drug produced from living cells and expected to constitute 52% of the top 100 product sales by 2022. Amjevita is a biosimilar (an imitation, though not an exact replica, of a pre-existing biologic) which has recently received regulatory approval from the US Food and Drug Administration for use as an alternative to AbbVie’s drug.
Although its patent for Humira’s main ingredient expired in 2016, AbbVie has acquired more than 100 additional rights relating to the medicine, at least one of which is not due to expire until 2034. It claimed that Amgen’s copycat version infringed 61 of these patents, 10 of which AbbVie asserted in litigation initiated in August 2016. The two parties struck a deal at the end of last month, allowing Amjevita to be launched on the US market in January 2023, and in the European Union market in October 2018 under the name Amgevita. As part of this, Amgen has agreed to pay royalties on sales of its biosimilar to AbbVie.
The settlement is not only significant because Humira’s revenues are so large and so crucial for AbbVie’s bottom line. The litigation between AbbVie and Amgen was also much discussed as an interesting test case for biologics disputes, especially because it was among the first suits in which a large number of secondary patents was asserted against a biosimilar competitor.
In its complaint, AbbVie argued that its many patent rights reflected the “two decades of research, investment, and innovation” it has undertaken since it invented the Humira antibody in 1996. Yet, 53 of its Humira-related rights were filed in 2015-2016, just before the expiration of the core patent. Many interpreted this flurry of patent filing activity as an ‘evergreening’ exercise, employed to extend the drug’s market exclusivity. A Bloomberg article in September opined that “the legal strategy (behind the lawsuit) is easy to grasp”, quoting Goodwin Proctor partner Robert Cerwinski as saying that the case was “the first time the patent thicket strategy has been tried in biologics litigation”.
This article was pessimistic about Amgen’s chances of penetrating AbbVie’s “seemingly impregnable fortress of patents”, while another Bloomberg blog suggested that AbbVie’s patent strategy was indicative of why only two biosimilars had made it onto the US market by 2016, despite the regulatory route to market being opened in 2010.
Against this background, the settlement does not seem entirely unfavourable to Amgen, which has in a sense broken through the AbbVie’s wall of rights. It will not have to endure a long trial, originally scheduled to start in late 2019, and risk a negative verdict. And despite a substantial delay to its US launch, Amgen’s biosimilar will be brought to market in the EU within a year. “This agreement will allow us to secure a strong foothold in the $4 billion European Adalimumab market,” said Amgen’s biosimilars chief Scott Foraker, when the deal was announced.
However, there is little doubt who the real winner is from this settlement. By upholding Humira’s monopoly in the crucial US market until 2023, AbbVie may have avoided – or least delayed – a steep ‘patent cliff’. The period of exclusivity agreed to in the deal is longer than some analysts had anticipated, and extends far beyond the expiry of Humira’s core patent, giving AbbVie valuable breathing room to introduce new products and diversify its revenue streams. Bringing greater certainty about AbbVie’s commercial prospects, the settlement also triggered a 5.7% rise in the company’s share price on the day it was sealed. What’s more, the company gets a share of whatever revenue the Amgen drug generates.
The takeaway, then, is that developing a dense portfolio of secondary patents can be an extremely effective means of maintaining market exclusivity for a biologic medicine. AbbVie is not entirely out of danger: it is still locked in litigation with Boehringer Ingelheim, which has produced the second FDA-approved biosimilar version of Humira. Perhaps AbbVie will not be able to clinch such a positive outcome, but its deal with Amgen suggests that Humira’s owner is in a strong position. Indeed, the settlement – and AbbVie’s broader patent strategy – will provide food for thought for the many biologics innovators whose products face patent cliffs in coming years.