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The Dance Continues: Apotex Petitions the Supreme Court for Review

September 19, 2016

The Dance Continues: Apotex Petitions the Supreme Court for Review

September 19, 2016

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On September 9, 2016, Apotex Inc. petitioned the United States Supreme Court for a writ of certiorari seeking review of the Federal Circuit’s July 2016 ruling in Amgen v. Apotex (Apotex) holding that the 180-day commercial marketing notice provision is mandatory even when the parties did engage in the patent dance. Thus, in Apotex, the Federal Circuit reinforced its previous holding in Amgen v. Sandoz (Sandoz) and expanded its reach to parties who engaged in the patent dance. Though the Federal Circuit’s holding in Apotex is broad and clarifies one of the BPCIA’s enigmatic provisions, the decision deals a blow to biosimilar applicants. Specifically, biologic manufacturers who might otherwise market their biosimilar products immediately following FDA approval must now delay launch for 180 days.

Apotex’s petition for certiorari asks the Supreme Court to answer the following questions: (1) “Whether the Federal Circuit erred in holding that biosimilar applicants that make all disclosures necessary under the BPCIA for the resolution of patent disputes (viz. 42 U.S.C. § 262(l)(2)(A)) must also provide the reference product sponsor with a notice of commercial marketing under 42 U.S.C. § 262(l)(8)(A)” and (2) “Whether the Federal Circuit improperly extended the statutory 12-year exclusivity period to 12 ½ years by holding that a biosimilar applicant cannot give effective notice of commercial marketing under 42 U.S.C. § 262(l)(8)(A) for its biosimilar product until it receives an FDA license and therefore may not commercially market its biosimilar product for 180 days after receiving its license.” Apotex argues that parties engaged in the patent dance should be exempted from the 180-day delay. To hold otherwise, according to Apotex, would be to grant brand-name biologic makers a windfall without conveying a countervailing public benefit. In more detail, Apotex argues that the Federal Circuit’s combined holdings in Sandoz and Apotex confer upon brand-name biologic makers an extra 180 days of market exclusivity. “In so doing, the Federal Circuit has upset the careful balance between biologic price competition and innovation negotiated by Congress. . . . The Federal Circuit’s judicially-crafted alteration to the BPCIA, therefore, presents an issue of national importance.”

Notably, the Federal Circuit rejected these arguments when it considered Apotex, reasoning that the 180-day extension to the statutory exclusivity period created by its holding will occur less frequently as time goes on. In other words, the Federal Circuit predicted that as biosimilars reference newer products, they will start to seek approval “long before the 12-year exclusivity period is up.” According to the Federal Circuit, this allows FDA to issue licenses before the 11.5-year mark, preventing an extended market exclusivity period for the brand-name biologic makers. Unsurprisingly, Apotex’s petition argues that this prediction is factually baseless (i.e. FDA cannot now grant a biosimilar application until the 12-year exclusivity expires) and results in a clumsy solution that disrupts the balance between innovation and the cost of competition.

Apotex also argues that in situations like the one at bar—where the outstanding patent issues in the first wave of litigation have been resolved—waiting an additional 180 days “serves no logical purpose.”  But Apotex seems to discount the fact that the BPCIA contemplates a second wave of litigation on patents included in an initial l(3)(A) list that were not subject to the first round of litigation, as well as additional litigation on newly issued or licensed patents.  A reference product sponsor could, in theory, use the additional six-month window to initiate this subsequent litigation.

While accurately predicting the results of certiorari petitions is difficult, Apotex may be hopeful for at least three reasons. First, the BPCIA has sparked considerable litigation over its complex provisions. In Sandoz, the Federal Circuit described the BPCIA as a “riddle wrapped in a mystery inside an enigma.” This signals growing discomfort among lower courts concerning the BPCIA’s structure. Thus, the BPCIA’s complexity, combined with its growing societal importance, may spur the High Court to grant certiorari in this case.

Second, the Federal Circuit decided Sandoz in a divided panel, revealing a potential disagreement among the court’s judges. Though Apotex was unanimously decided, it substantially relied on the reasoning of Sandoz. Thus, the Supreme Court may take the developing schism below as an opportunity to resolve the fracture before its unpredictable impact creates further uncertainty in the nascent U.S. biosimilar market.

Third, and finally, in June of 2016, the Supreme Court sought advice from the U.S. Solicitor General concerning the certiorari petition filed in Sandoz. There, the issue also concerned the BPCIA’s notice of commercial marketing provision. Such a request hints that the Supreme Court is seriously considering the BPCIA questions pending before it. Also notable, Apotex encouraged the Supreme Court to consider the Sandoz and Apotex cases together on appeal because they present “distinctive and recurring fact patterns under the BPCIA.”

We will continue to monitor this litigation and provide updates.

Authors: Tasha M. Francis, Ph.D., Will Orlady, Jenny Shmuel, Ph.D.

The opinions expressed are those of the authors on the date noted above and do not necessarily reflect the views of Fish & Richardson P.C., any other of its lawyers, its clients, or any of its or their respective affiliates. This post is for general information purposes only and is not intended to be and should not be taken as legal advice. No attorney-client relationship is formed.

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Jenny Shmuel, Ph.D. | Principal

Jenny Shmuel, Ph.D., represents clients on a range of intellectual property matters, with an emphasis on medical device and pharmaceutical technologies. She has extensive experience in pre-suit diligence, case management, expert and fact discovery, and brief writing, and has examined and cross-examined witnesses at trial. Over the last several...