Last week, Sandoz filed its opening Supreme Court brief, asking the Court to determine (1) whether notice of commercial marketing under Subsection (l)(8)(A) of the Biologics Price Competition and Innovation Act (“BPCIA”) is legally effective if given prior to FDA approval, and whether, in any event, (2) the notice provision can be enforced by an injunction that delays market entry of a biosimilar by 180 days.
This case centers around Sandoz’s FDA-approved biosimilar ZARXIO®, which is intended to compete at a lower price-point with Amgen’s brand-name NEUPOGEN® (filgrastim). Sandoz’s product entered the commercial market in September 2015, but only after a 180-day waiting period that the Federal Circuit effected through its holding in Amgen v. Sandoz, 794 F.3d 1357 (Fed. Cir. 2015). Although Sandoz’s product is already on the market, the dispute between the parties remained live because it was capable of repetition, yet evading review. The issues are likely to arise again because both Amgen and Sandoz have other biosimilar and biologic products in development, explaining why the parties have invested in bringing litigation this far.
Sandoz urged the Court to reconsider the Federal Circuit’s ruling in Amgen, which held that notice must be given post-licensure, enforceable by a court-ordered injunction deferring biosimilar commercialization by six months. According to Sandoz, the Federal Circuit improperly created an additional extra-statutory six months of exclusivity for reference product sponsors—beyond 12 years ensured by 42 U.S.C. § 262(k)(7)(A)—constituting a windfall for the sponsors and delaying patient access to cheaper biosimilars. Sandoz disagreed with the Federal Circuit on three primary issues, arguing (A) the correct contextual interpretation of the notice provision at 42 U.S.C. § 262(l)(8)(A) allows notice before FDA licensure, (B) the notice provision does not create a separate right, and (C) the statute does not authorize injunctive relief to enforce notice.
1. The BPCIA Permits Notice Before FDA Licensure
Subsection (l)(8)(A) provides that a biosimilar applicant shall give the reference product sponsor notice “not later than 180 days before the date of the first commercial marketing of the biological product licensed under” the abbreviated pathway. In its brief, Sandoz parsed the statutory text, walking through Congress’ precise wording to support its interpretation of the notice provision and refute the Federal Circuit’s. Sandoz also pointed out that there is no need to “notice” a sponsor after FDA licensure, as FDA licensure of a biosimilar is a public act, itself making the public (and sponsor) aware that a biosimilar is soon to be commercially marketed. Finally, Sandoz bolstered its position by discussing its view of the BPCIA as contemplating patent litigation many years before FDA approval to give a biosimilar manufacturer the option of firmly resolving any patent disputes well in advance of the commercial launch of its biosimilar. Br. 41
2. There is No Stand-Alone Right to Notice
Sandoz argued that the Federal Circuit ignored the “procedural role” that notice plays in the patent dance and instead fabricated a private right of action nowhere mentioned in the statute. According to Sandoz, the notice provision must be read in context—that is, the notice provision is part and parcel of the other “patent dance” provisions where, at each step, compliance with the statute opens and closes certain avenues of relief. In the case of the notice provision, providing notice accelerates patent resolution by allowing the sponsor to seek declaratory judgment of infringement and a permanent injunction on any patents not yet litigated. If the biosimilar manufacturer fails to give notice, then the sponsor (but not the applicant) may bring a declaratory judgment action for any patents on the sponsor’s original patent list (as well as any patents newly issued or licensed following the sponsor’s original patent list). Thus, according to Sandoz, the purpose of the notice provision is inapplicable if the biosimilar manufacturer declines to engage in the “patent dance” steps (since declaratory judgment on all patents is already available to the sponsor in that case) or if the reference product sponsor has no relevant enforceable patents. Indeed, Sandoz argues if the Federal Circuit’s holding—that notice is an independent right—is left in place, a “perverse” outgrowth would be an automatic six-month stay of commercial launch even when there are no patents left to litigate. Br. 40.
3. The Federal Circuit Cannot Fashion its Own Remedies Outside of those Prescribed by the BPCIA
Sandoz also addressed its third main argument: that the Federal Circuit was wrong in inventing an extra-statutory right of action to “enforce” the notice of commercial marketing provision. Sandoz first noted that Supreme Court precedent forecloses adding judicially-created remedies to those already within the BPCIA. Br. 43. Sandoz also noted that Congress knew how to grant injunctive relief, but only did so within the context of the confidentiality requirements of the BPCIA (provision 262(l)(1)(H)), providing firm evidence that Congress did not intend for injunctive relief to be available for violation of the notice provision.
Sandoz then countered Amgen’s theory that, without separate injunctive relief, an applicant could potentially keep its aBLA secret and “surprise” the sponsor by launching into commercial marketing unannounced. Sandoz noted that developing a biosimilar requires eight to ten years and “between $100 million and $200 million,” a difficult undertaking to keep secret. Br. 49 citing FTC Report at 14. Indeed, even Amgen, which has its own biosimilars, issued a press release upon filing its aBLA because this is considered a significant financial event that companies typically disclose in their security filings. Public advisory committee meetings and clinical trials related to biosimilars are listed at “clinicaltrials.gov,” a publically available website. In addition, Sandoz argued no rational applicant would try to “surprise” a sponsor by commercially marketing without notice due to the significant potential for financial harm after being removed from the market by a patent injunction. Br. 51.
In sum, Sandoz’s arguments have set the stage for a fight that will have serious implications for the emerging biosimilar industry. Additional arguments may soon be forthcoming, as amicus briefs are due Friday, February 17, 2017. We will continue to monitor this case and report on developments.
Tasha M. Francis, Ph.D. | Associate
Tasha Francis, Ph.D. is an associate in Fish & Richardson’s Twin Cities office, practices intellectual property litigation with an emphasis on patent litigation. Dr. Francis has represented plaintiffs and defendants in cases involving medical devices, biotechnology and pharmaceuticals.
Jenny Shmuel, Ph.D. | Associate
Jenny Shmuel is an Associate in the Boston office of Fish & Richardson. Ms. Shmuel has worked on a range of intellectual property matters, including patent litigation in the software and medical device fields, copyright litigation, trade secret litigation in state court, and various patent and trademark prosecution projects.
Gina Nellesen | Former Fellowship Attorney
Gina Nellesen was a Patent Fellowship Attorney in Fish’s Silicon Valley office. Ms. Nellesen drafts and prosecutes patents for academic institutions, corporations, and emerging life sciences companies. She collaborates with scientists to capture new IP and builds patent landscapes to help clients understand the patentable space and areas with freedom-to-operate.
Jenny Shmuel is an Associate in the Boston office of Fish & Richardson. Dr. Shmuel has represented clients on a range of intellectual property matters, with an emphasis on medical device and pharmaceutical technologies. Since joining the firm, Dr. Shmuel has worked to build...
Tasha Francis, Ph.D. is an associate in Fish & Richardson’s Twin Cities office, practices intellectual property litigation with an emphasis on patent litigation. Dr. Francis has represented plaintiffs and defendants in cases involving medical devices, biotechnology...