What You Need to Know About Biosimilars: Products, Recent Deals

What You Need to Know About
Biosimilars: Products, Recent Deals,
IP Issues and Licensing
August 2, 2012
Madison C. Jellins
Biologics Price Competition and
Innovation Act
• Biologics Price Competition and Innovation Act of 2009
(“BPCIA”) signed into law March 2010
• Statute requires third-party patents
– exclusively licensed by the Reference Product Sponsor
– and covering the reference biologic product, manufacture or
– be subjected to the patent dispute resolution procedure
– or the third party owner will risk forfeiture of its patent rights
• Both parties to an exclusive license agreement should
ensure that current and future license agreements address
possibility that licensed patents may be subject to a
biosimilar dispute
Patent Dispute Resolution Procedure
• BPCIA was modeled on Hatch-Waxman Act
• BPCIA establishes mechanism for resolving patent
– between sponsors of brand name biologics and
biosimilar applicants
– prior to commercial marketing of the biosimilar
• But unlike Hatch-Waxman, the Act does not
specify which patents will be subject of litigation
– No Orange Book with listing of patents covering drug
Patent Dispute Resolution Procedure
• The parties must negotiate in good faith to
reach agreement on the patents that will be
• The Biosimilar Applicant controls the number
of patents that will be litigated in the first
phase of litigation
Patent Dispute Resolution Procedure
• Triggered by FDA’s acceptance of biosimilar application
• 20 days later, Biosimilar Applicant must provide biosimilar
application and information on manufacturing to Reference
Product Sponsor
• Within 60 days, RPS must identify patents it “reasonably”
believes would be infringed and identify any patents it is
prepared to license
• Within 60 days of receiving initial list, Biosimilar Applicant
must identify patents it believes RPS reasonably could assert
and provide:
– Statement that it does not intend to commence marketing before expiration or
– Statement of non-infringement, invalidity or unenforceability contentions
• Within 60 days, RPS must state for each patent on either list
why the patent would be infringed and respond to invalidity
and unenforceability assertions
Patent Dispute Resolution Procedure
• After exchange of statements, parties must
negotiate number of patents to be litigated
• 15 days later, Biosimilar Applicant identifies
number of patents
• 15 days later, parties agree on number of
patents to be litigated
• 20 days later, RPS commences action on
specified patents
Negotiation of
Number of Patents in Suit
• The parties must negotiate in good faith to try
to reach agreement on the patents that will be
• If negotiation succeeds, the listed patents will
be litigated
• If negotiation fails, the Biosimilar Applicant
specifies the number of patents that will be
Second Phase of Litigation
• 180 days before launch (12 years after
approval), Biosimilar Applicant must provide
notice of intention to market
• 30 days later, reference product sponsor may
assert “deferred” patents and “late issued”
patents and seek preliminary injunction
• If patent owner wins on early asserted patent,
permanent injunction until patent expires
Exclusively Licensed Patents Included
• Unlike Hatch-Waxman, BPCIA includes process
– May be exclusively licensed by RPS
• BPCIA permits but does not require the RPS to
share the biosimilar application with third party
owners of patents exclusively licensed to the RPS
• BPCIA requires RPS to include relevant exclusively
licensed third-party patents in its patent list
• Exclusively licensed patents could be included in
patent dispute procedure without licensor being
aware of litigation or of biosimilar application
Penalties for Failure to
List Third Party Patents
• BPCIA includes several penalties for failure of
RPS to include exclusively licensed patents in
its list
• Can result in forfeiture of rights for the third
party patent owner/exclusive licensor
– regardless of whether third party owner/licensor
was involved in process or aware of possible
infringement of its patent
Penalties for Failure to List Third Party
Exclusively Licensed Patents
• RPS can seek a preliminary injunction prior to first
commercial marketing for any patent not in litigation
– if the patent was included on the RPS’s patent list or the
Biosimilar Applicant’s list
• The owner of a patent that should have been included
on the patent lists, but was not, may not bring an
action for infringement of the patent
• Where a patent was on the lists, but the RPS was not
timely in bringing suit, the suit was dismissed without
prejudice, or the suit was not prosecuted to judgment
in good faith, the sole remedy is a reasonable royalty
Existing and Future
Exclusive License Agreements
• Review existing exclusive license agreements
to determine whether licensed patent may be
subject to biosimilar patent dispute
• For prospective licenses, evaluate value of
granting an exclusive license against litigation
risks and potential forfeiture of patent rights
Exclusive License Provisions
• Licensor will want exclusive licenses to include:
– Prompt notice of any potential biosimilar application
– Right to review biosimilar application
– Right to participate in determination whether to include
licensed patent on RPS’ patent list
– Right to participate in litigation as to licensed patent
• Licensee/RPS will want exclusive license to include:
– Limited involvement of exclusive licensee in patent dispute
– Ability to assert licensed patent
– Control of course of litigation and settlement
Recent IP Developments
• Abbott petitioned FDA to prevent Humira
biosimilars on April 2, 2012
– FDA would have no choice but to use trade secrets in
Abbott’s BLA to support approval of competitor
– Taking under the Fifth Amendment
– FDA should not accept for filing, file, approve or
discuss with any company, or otherwise take any
action indicating that the agency will consider any
application for a biosimilar that cites the Humira BLA
Recent IP Developments
• Previous court rulings have found that data submitted to the FDA
constitutes trade secrets
• Argument extended to any drugmaker that submitted a BLA for product
approval prior to the enactment of the BPCIA
• The BPCIA introduced a statutory bargain under which FDA may approve
biosimilars that are highly similar to a reference product that has been
approved by FDA under a BLA
• In exchange for this partial taking of its trade secrets, the RPS receives a 12
year period of exclusivity and the opportunity for pre-market patent
• This bargain raises serious constitutional concerns if applied retroactively
• Note: BIO disagrees:
– “We continue to believe that the biosimilars law applies, and should apply, to
all biological products, whether the reference product was approved pre- or
post enactment of the law."
Recent IP Developments
• Humira was Abbott’s top-selling drug last year with about $3.4
billion in revenue
• Humira predicted to be the No. 1 selling drug this year with sales
reaching an $9.3 billion
• The patent on Humira expires in December 2016
• At least three companies have begun pre-clinical or clinical testing
of a Humira biosimilar
• Abbott plans to spinoff AbbVie later this year
– Humira will be 45% of the new company's sales and 85% of its profit
– Biosimilar competition would impact new company that draws most
of its profits from a single drug
Contact Information
Madison C. Jellins
HelixIP LLP, Silicon Valley
Direct: 650-241-0192
[email protected]

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