Let’s Get Ready to Rumble:
What Can We Learn from Early Patent Litigation Over Biosimilar Drugs
By Kevin M. Nelson and Patrick C. Gallagher, Ph.D.
Biosimilar applicants have come out of their corner swinging, in a couple of cases
throwing punches before the bell rang. The Enbrel® and Remicade® cases gave the industry
some clarity on when an applicant should not file a declaratory judgment action and who should
be the party filing the suit. The Neupogen® suit appears to hinge on a question of statutory
interpretation that could define how the process for adjudicating biosimilar patent disputes plays
out in the future.
Fighting The Good Fight
The bell rang at the end of 2014 to start the biosimilars fight in the U.S., with several
contenders filing applications with FDA. In the first week of 2015, FDA’s Oncologic Drugs
Advisory Committee (ODAC) voted unanimously in favor of recommending Sandoz’s biosimilar
filgrastim for approval in the US. Sandoz is also continuing its pursuit of approval for a
biosimilar version of Enbrel® (enteracept). Celltrion has partnered with Hospira on an
application for a biosimilar version of Remicade® (infliximab) marketed as Remsima, which
FDA’s Arthritis Advisory Committee is preparing to consider March 17, 2015. In midDecember 2014, Apotex announced that FDA had accepted for filing Apotex’s application
seeking permission to market a biosimilar version of Neulasta® (pegfilgrastim). There has not
yet been any litigation or patent office proceedings relating to Apotex’s application, but we have
seen some early bouts regarding Sandoz’s applications and Celltrion/Hospira’s efforts to get to
market.
This article will focus on the lawsuit relating to Enbrel®, the two lawsuits relating to
Remicade®, and the currently pending matter relating to a biosimilar version of Neupogen®.
First Round TKOs: Declaratory Judgment Actions by Sandoz and Celltrion/Hospira
The cases involving biosimilar versions of Enbrel® and Remicade® provide examples of
biosimilar applicants taking the offensive in an attempt to resolve any patent disputes associated
with the referenced biological products in an expedited fashion. The cases all involved filing a
declaratory judgment action by the biosimilar applicant (or in Hospira’s case, the company that
will be co-marketing the biosimilar product) before the biosimilar application was produced and
before the parties had exchanged any patent information. And the take-home lesson from these
cases is that courts are extremely reluctant to find declaratory judgment jurisdiction if the
biosimilar applicant has not yet received acceptance for filing its application from FDA.
Sandoz’s biosimilar Enbrel® litigation
In June 2013, Sandoz filed suit seeking a declaratory judgment of noninfringement and
invalidity of two Amgen patents related to Enbrel®. Sandoz’s basic argument was that it had
expended millions of dollars in developing its biosimilar product and wanted to obtain patent
certainty before embarking on commercialization. In fact, Sandoz even provided a notice of
commercialization to Amgen to show it was truly serious about its intent to resolve any issues
before its product went to market. The only problem was that Sandoz had not yet filed its
biosimilars application when it filed its declaratory judgment suit. The district court dismissed
Sandoz’s complaint, holding that Sandoz’s future intent to file an application with FDA is
insufficient to create a case or controversy, and that there was no immediate threat of injury to
Sandoz. Sandoz Inc. v. Amgen Inc., Case No. 13-2904, Dkt. No. 101 at 3-4 (N.D. Cal. Nov. 12,
2013). The district court also held that Sandoz was required to participate in the statutorily
mandated exchange of patent information and that its notice of commercialization was
ineffective because its enteracept product was not a “licensed” biosimilar since it did not have
approval. Id.
The Federal Circuit affirmed the district court’s dismissal of the complaint, agreeing with
the district court that Sandoz had no imminent injury since it hadn’t yet filed an application with
FDA. Sandoz Inc. v. Amgen Inc., 2014-1693, Slip. Op. at 9-12 (Fed. Cir. 2014). The court
found that there were too many contingencies with respect to Sandoz’s product—for example,
Phase III clinical study completion was years away which may lead to changes in Sandoz’s
product—for there to be a ripe patent dispute. Id. Because the Federal Circuit affirmed the
holding that there was no subject matter jurisdiction, it did not reach the issues of whether an
applicant needed to engage in the patent exchange procedure before filing a suit or whether an
applicant could provide notice of commercialization before the biosimilar product is approved by
FDA.
Celltrion and Hospira file suits on Remicade® patents
The declaratory judgment suits filed by Celltrion and its marketing partner Hospira
relating to infliximab suffered similar defeats. Celltrion filed a patent declaratory judgment
action against Kennedy, the owner of several patents relating to Remicade®, after its efforts to
obtain licenses of the patents failed. In its complaint, Celltrion related a similar story of millions
that had been invested in the development of its product, but also asserted that there has been
foreign patent litigation between the two companies over Celltrion’s biosimilar product in those
countries. Celltrion also argued that Remicade®’s exclusivity has already expired, and that
Kennedy and Janssen, who is a licensee of the patents, is improperly extending the exclusivity of
the product. But Celltrion also jumped the gun in much the same way that Sandoz did—it filed
its complaint before it filed its biosimilar application, and its complaint was dismissed. The
district court again found that approval was too far away for there to be an imminent
controversy. Celltrion Healthcare Co., Ltd. v. Kennedy Trust for Rheumatology Research, No.
14-cv-2256 (PAC), Slip. Op. at 6-8 (S.D.N.Y. Dec. 1, 2014).
Hospira filed its declaratory judgment action against Janssen, but waited until after
Celltrion filed its infliximab biosimilar application. The timing proved no better here though.
Hospira’s downfall was not so much the timing as its failure to follow the statutory provisions
for the patent information exchange. The court was concerned about companies using partnering
arrangements to avoid complying with the statute. Hospira, Inc. v. Janssen Biotech, Inc., No.
14-cv-7049 (PAC), Slip. Op. at 3 (S.D.N.Y. Dec. 1, 2014). Both Celltrion and Hospira decided
not to pursue appeals of their matters.
A Puncher’s Chance: Sandoz’s Defense in Neupogen®
Sandoz has used the old rope-a-dope for its application for a biosimilar version of
Neupogen® to try and accelerate the process of getting its product to market. In this instance,
Sandoz actually filed its filgrastim application and its application was accepted for filing by
FDA. The BPCIA states that when an applicant receives its acceptance for filing, the applicant
“shall provide to the reference sponsor” the biosimilar application and its manufacturing details.
42 U.S.C. § 262(l)(2). But Sandoz was concerned about the confidentiality of its manufacturing
details, so it wrote to Amgen (the reference product sponsor) to inform Amgen that Sandoz’s
application was accepted for filing but that Sandoz was not going to provide all the details of its
application and manufacturing process, and that Sandoz was not going to participate in the patent
exchange procedure. Sandoz further stated it was willing to provide some details under an
extensive confidentiality provision. Sandoz also gave Amgen a notice of commercial marketing
of its filgrastim product. Amgen refused Sandoz’s offer and instead filed a lawsuit. The dispute
centers on what does shall mean in section 262.
Amgen claimed in its suit that Sandoz was trying to have its cake and eat it too—that
Sandoz wanted to follow the statute when it was advantageous but ignore the provisions of the
statute that it didn’t want to follow. Amgen contended that Sandoz was required to provide its
application and manufacturing details, that Sandoz improperly took information about Amgen’s
product to file its biosimilar application without following the other provisions of the statute, and
that Sandoz’s offer of commercial marketing was ineffective. In short, Amgen argued that shall
means must.
Sandoz responded that it was not required to provide its application and manufacturing
details despite the wording of the statute. Instead, according to Sandoz, the statute gives both
Sandoz and Amgen options: section 262(l)(9)(C) states that if the biosimilar applicant fails to
provide its application and manufacturing details, the reference sponsor, and only the reference
sponsor, may file a declaratory judgment action. In short, Sandoz argued that shall means may..
Both parties have filed motions for judgment on the pleadings, which are due to be heard
in mid-March 2015. The dispute is a classic battle of statutory interpretation heavyweights. In
one corner, two statutory sections that state that the applicant shall provide its application and
manufacturing details once it receives its acceptance for filing. 42 U.S.C. §262(l)(2)(A); see also
§262(l)(1)(A). In the other corner, a separate statutory section that states that the sponsor may
file a declaratory judgment section if the applicant does not provide the required application and
manufacturing details. Id. at §262(l)(9)(C). So the question is whether shall is a term of
requirement (must) or is it simply permissive (may) where there is another statutory section that
apparently allows that applicant to disregard the shall provision.
While Sandoz and Amgen were duking out the statutory interpretation of the BPCIA, the
FDA raised the stakes. In January, FDA’s Oncology Drugs Advisory Committee recommended
14-0 that FDA approve Sandoz’s filgrastim biosimilar application. The FDA committee
commended Sandoz for its robust analytical and clinical showing, which included testing of
about 19 quality attributes and extensive clinical study data, and post-marketing
pharmacovigilance data for foreign-approved versions of Sandoz’s filgrastim product. Sandoz’s
seemingly impending approval caused Amgen to file a motion for preliminary injunction on
February 5 asking the court to enjoin any approval of Sandoz’s product until the court has
decided the parties’ cross motions for judgment on the pleadings. Amgen cited to Sandoz’s
statement in the parties joint scheduling submission to the court that Sandoz expects to receive
approval for its product on or around March 8, 2015 and that Sandoz intends to launch its
product at that time. The preliminary injunction hearing will take place in early March.
Fighting Harder/Smarter
So what can a biosimilar applicant do to get its product to market in the most efficient
manner? One approach is to simply follow the statute—get the acceptance for filing, push the
patent exchange process as much as possible, and only bring suit if the reference sponsor tries to
slow the process down to a crawl. In choosing this process, however, the biosimilar applicant
must be thoroughly prepared for patent litigation before its biosimilar application is filed. It is
necessary to know the patent landscape well in advance of having a completed application that is
ready to be filed, and to marshal all available defenses early in the game.
A biosimilar applicant could also take advantage of post-grant review procedures such as
inter partes review (IPR) or reexamination. IPRs allow for litigation-like procedures in the
Patent Office for adjudicating the validity of patents, and offer a compressed time frame for
resolution of the dispute. Significantly, IPRs, reexaminations, and other post-grant review
procedures are outside of the scope of the biosimilar patent exchange prescribed in the statute for
biosimilar applications. Thus, a biosimilar applicant doesn’t have to wait on the patent exchange
to challenge the validity of an issued patent in the Patent Office.
One example of taking the fight to the reference sponsor is seen in the recent final
rejection issued by the Patent Office in an inter parties reexamination of one of the Remicade®
patents licensed to the reference sponsor Janssen, a Johnson & Johnson company. Instead of
waiting for the BPCIA patent exchange to play out, Janssen has been forced to fight for its patent
life back in the Patent Office. Choosing the right turf can be crucial to the outcome of battles
like these, and in the right situation, battling in the Patent Office can be extremely effective to
weaken the reference sponsor’s patent arsenal before the BPCIA patent procedures ever come
into play.
While IPRs provide a lower invalidity burden of proof and no presumption of patent
validity, the only available challenge in an IPR is invalidity based on 102 (anticipation) and 103
(obviousness). In addition, the patent challenger in an IPR is estopped from raising any
invalidity defenses in district court litigation that were or could have been raised in the IPR.
IPRs have become an effective tool for both invalidating challenged claims and for facilitating
settlement between petitioners and patent holders both before and during litigation, making IPRs
an attractive option for a biosimilar applicant in the right situations.
Kevin Nelson is a partner in Duane Morris’s Intellectual Property practice group. Kevin
has represented generic drug companies in large-scale patent infringement actions brought under
the Hatch-Waxman Act in both the district court and the Federal Circuit. He has assisted
companies in developing noninfringement and invalidity positions for their paragraph IV notice
letters, as well as assisting clients in preparing their Abbreviated New Drug Applications
(ANDA) for submission to FDA, and has represented those companies before FDA in getting
their products to market. Finally, Kevin has advised companies on how to navigate the legal and
regulatory waters of the United States biosimilars process.
Dr. Patrick Gallagher is an associate in Duane Morris’s Intellectual Property practice
group. He has assisted generic pharmaceutical companies, compounding pharmacies, and others
in the agricultural, chemical, and biotechnology industries with intellectual property and
regulatory matters. Dr. Gallagher has been involved in all aspects Hatch-Waxman practice,
including advising on ANDA filings, development of noninfringement and invalidity arguments
for FDA-required notice letters, and in every phase of litigation through trial and appeal to the
Federal Circuit Court of Appeals. He also provides guidance with respect to development of the
regulatory pathway for approval of biosimilars.