With the intended goal of bringing biosimilar drug products to market, Congress passed the Biologics Price Competition and Innovation Act (“BPCIA”) in 2009. This statute tried to mirror the Hatch-Waxman statute for small molecules, including both an abbreviated drug approval process and a mechanism to address any patent claims during drug approval. However, because of the differences between these two types of drugs, stemming from the increased complexity in manufacturing and patent protection, unique provisions were included in the BPCIA. Unfortunately, as Judge Lourie of the Federal Circuit put it, the BPCIA could win a “Pulitzer prize for complexity or uncertainty.” And, it is these new provisions that could prove the downfall of the BPCIA, at least as it currently exists.
One of the differences that is threatening to eviscerate the BPCIA is the information disclosure and patent exchange provisions, known affectionately as the “patent dance.” Instead of providing for an equivalent Orange Book, the BPCIA includes the patent dance to allow the parties to determine which patents are considered relevant. This begins with the disclosure of relevant information by the biosimilar applicant. Specifically, 42 U.S.C. § 262(l)(2) says that the biosimilar applicant “shall provide to the reference product sponsor a copy of the application submitted to the Secretary under subsection (k), and such other information that describes the process or processes used to manufacture the biological product that is the subject of such application . . . .” (emphasis added). The statute also includes a potential consequence for non-disclosure by the applicant. 42 U.S.C. § 262(l)(2) provides that the reference product sponsor may bring an immediate action “for a declaration of infringement, validity, or enforceability of any patent that claims the biological product or a use of the biological product.”
The problem is that the BPCIA can be read to not require the disclosure of information by the biosimilar applicant. Instead, the biosimilar applicant would choose to withhold its information and be subject to a declaratory judgement action. Indeed, this is the position taken by Sandoz in its attempt to market a version of Amgen’s NEUPOGEN® (filgrastrim) –the first case of FDA approval of a biosimilar application. Judge Seeborg of the Northern District of California agreed with Sandoz, which was a blow to biologic drug sponsors.
On appeal, the Federal Circuit heard oral arguments on June 3, 2015, in part to resolve this basic question. Sandoz asserted that the disclosure provision was not mandatory, but instead a mechanism to allow the biosimilar applicant the certainty of the patent dance if they choose. Judge Newman had a different take on that question – for her it was not whether to partake in this particular subpart of the BPCIA, but rather whether to partake in the entirety of the BPCIA process – including the abbreviated approval process:
If you want my data – if you want to be a (k) applicant, which I gather Sandoz has done right – has used the data, hasn’t gone through their own clinical trials or all the rest of it – then this is what you ‘shall’ do. You don’t have to use the Amgen data, you can create your own, then you are home free.
While counsel for Sandoz disagreed, Judge Newman continued:
But why isn’t it the question – if you have a statute, this integrated statute, there were – from the record it looks as if there were extensive hearings, tradeoffs, debates, connections with the pros and cons of Hatch Waxman for biosimilars –and here we have a complicated statute and you say only some of it counts.
For his part, Judge Chen tried to reconcile the statute as a whole. On the one hand, he observed: “I don’t see through the language or the structure of (l) where there’s a hint that it’s a ‘choose-your-own-adventure’ situation for the (k) applicant.” On the other hand, Judge Chen acknowledged that if even if the provision was mandatory, the result might be the same – the statutory declaratory judgment “remedy.”
The problem is that this “remedy” would not put the reference product sponsor in the same position that it otherwise would have been. The BPCIA envisions patent litigation with regard to methods of manufacturing. Indeed, this information is specified in the statute. If the biosimilar applicant refuses to “dance,” however, the declaratory judgment “remedy” is limited to patents covering the biological product or the uses thereof. Moreover, if the biosimilar applicant withholds its information, the reference product sponsor will not know which patents are being infringed. With such incentives, it is not surprising that a biosimilar applicant would choose to withhold. If the Federal Circuit agrees, Congress will need to reevaluate the BPCIA to return the benefits to the reference product sponsors that they thought they already enjoyed.