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Sandoz Inc. v. Amgen Inc.

Federal Law Does Not Authorize Injunction to Force Biosimilar Manufacturers to Engage in BPCIA Sharing of Application Details

Sandoz Inc. v. Amgen Inc., (June 12, 2017) (THOMAS, J, for a unanimous Court; concurrence by Breyer, J.) (Fed Cir: LOURIE, Newman (CIP/DIP), Chen (DIP)) (N.D. Cal.: Seeborg) (5 of 5 stars)

Supreme Court vacates in part, reverses in part Fed Cir’s opinion (at 794 F.3d 1347 (Fed. Cir. 2015)) interpreting various aspects of the Biologics Price Competition and Innovation Act. The Supreme Court closely analyzes 35 U.S.C. § 262(l), which describes the “patent dance” that biosimilars must engage in before beginning marketing. The Fed Cir correctly held that federal law does not authorize an injunction to require a biosimilar applicant (here, Sandoz) to disclose its FDA application and manufacturing information to the manufacturer of the reference product (the “sponsor;” here, Amgen), as contemplated by § 262(l)(2)(A). The appropriate remedy for an applicant’s failure to disclose such material is the sponsor’s ability to file a declaratory judgment action for infringement, because the submission of the application to the FDA is itself an infringing act under § 271(e)(2)(C)(i) and (ii). Though reaching the same outcome, this is a change to the Fed Cir’s reasoning. The Supreme Court makes clear that the act of “artificial infringement” for biosimilars occurs with submission of the application.

The Fed Cir erred in rejecting Amgen’s request for an injunction under state law. Contrary to the Fed Cir’s reasoning, federal law does not provide any remedy for an applicant’s failure to disclose its application and manufacturing information, so the Fed Cir erred in concluding that federal law provided the “only remedies” for such failure. The Supreme Court vacates that determination, as well as vacating the Fed Cir’s analysis of California law as a potential basis for a state-law injunction. On remand, the Federal Circuit can revisit the California law issues.

The Fed Cir also erred in its analysis of when an applicant must notify a sponsor of its biosimilar application to the FDA. Interpreting § 262(l)(8)(A), “the applicant may provide notice either before or after receiving FDA approval.” Op. at 16. The Fed Cir’s reasoning that the notice must come after the FDA’s approval was inconsistent with the overall structure of the statute.

Concurrence: Justice Breyer notes that the FDA may, at some point, “determine that a different interpretation would better serve the statute’s objectives.” Concur. Op. at 1. Should it do so, then per Brand X, 545 U.S. 967 (2005), the FDA “may well have authority to depart from, or to modify, today’s interpretation.” Concur. Op. at 1.

KEYWORDS: BIOSIMILARS; PATENT DANCE; INJUNCTIVE RELIEF; SANDOZ INC.; AMGEN INC.