Shall we dance? Regulatory approval, trade secrets and the transatlantic biosimilars patent wars

The AmeriKat's chooses a modern,
interpretive form of dance to express
her emotions...

Dancing is the movement of form to express emotion and symbolize intent.  We dance to tell a story.  At a wedding we dance to celebrate.  And some of the more obnoxious amongst us dance purely to attract attention.  But in all instances, information can be gleaned from the movements. In patent litigation, the dancing starts early, but often alone and in the dark as a party deliberates if, when and how to step into the spotlight.  Once they do, their dancing partner is dragged towards the center stage to start the real show.  In the context of biosimilars, the patent dance has been heating up on both sides of the Atlantic.

Like any good dance, the stage first must be set and in this context it is set by the regulatory framework and commercial implications.  In the US, the Biologics Price Competition and Innovation Act (BPCIA) provides for a shorter approval pathway for biological products that are demonstrated to be biosimilar to or interchangeable with an already FDA-approved biological product (i.e. the reference product).  The biosimilar must be shown to be highly similar to the reference product, with no meaningful differences to safety and efficacy.  An interchangeable biological product is a biosimilar that also meets interchangeability standards.  Interchangeability allows pharmacists, without the approval of the prescribing doctor, to substitute a reference product with an interchangeable biological product.  Physicians are often encouraged to switch from a reference product to a biosimilar to reduce costs (with some reports estimating costs savings of upwards of $250 billion over the next ten years).

In Europe, a similar regime is created by Directive 2001/83/EC, where applicants need to provide data from studies that show that their product is similar to the reference product without any meaningful differences in terms of quality, safety or efficacy.  Currently, the European Medicines Association (EMA) has approved over 20 biosimilar products (see here, compared with the four approved by the FDA).  Last month, to facilitate the introduction of new biologics, the EMA, launched a pilot support program where developers of biosimilars may seek scientific advice from the EMA to assist in identifying the studies that they should conduct on the basis of those already conducted.  In Europe, interchangeability and/or substitution is a matter for national authorities in each member State.

Ready to dive into the lucrative biologics market

From a commercial perspective, switching is the inflection point.  Once a reference product is switched to a biosimilar the revenue stream for the reference product is diverted to the biosimilar company.  With global yearly sales in 2014 for the top biologics ranging between $3-18 billion and IMS's estimation that by 2020 this figure will increase to $390 billion,  it is a no brainer that biosimilar companies are chomping at the bit to secure some of this market share.  Indeed, according to some resources, there are apparently 700 biosimilars in various stages of development.  No surprise therefore that the topic of interchangeability generates active discussion both in the regulatory context.

Last week, interchangeability was subject to a joint position paper from the European Federation of Pharmaceutical Industries and Associations (EFPI), the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA) and European Biopharmaceutical Enterprises.  The paper proposed key factors that physicians should take into account when switching from a reference product to a biosimilar or between biosimilars.  The latter represents a regulatory loophole.  Presently, although a biosimilar will be compared to its reference product, there is no similar regulatory requirement when substituting between two biosimilars that are approved to the same reference product.  In these circumstances, the position paper states that:

"There are unlikely to be any clinical data directly comparing different biosimilars to the same reference biologic in the similar group of related products. This is not required in regulatory filings. Switching between biosimilars represents an unknown, and one that harbours considerable uncertainty."

While emphasizing that the physician is center stage in deciding whether to switch on a case-by-case basis, the paper continues cautioning that switching is not recommended where:

1.  The reference product or biosimilar loses efficacy or there are patient tolerance issues.  This, the paper explains, is because all of these related products are expected to have similar clinical efficacy and safety to the patient such that there is no incremental clinical benefit to the patient.   

2.  The physician feels that a switch may compromise future treatment options for the patient.  However, it is noted that "little is known about the consequences of multiple exposures to the same group of related products and the consequences on immunogenicity of future treatments with biologics."

The press release concludes:

"Biosimilars have an important role to play in promoting the sustainability of healthcare systems. Used appropriately, biosimilars will provide health systems with the financial headroom to maintain investment in new technologies and therapies. Our industry recognises its responsibility to support efforts that instill confidence in physicians and patients in the use of biosimilars, including through the promotion of appropriate clinical use and contributing to informed decision-­making."  

The BCIPAKat - a mystery to everyone,
including those who brought about it's
existence

This regulatory and commercial background informs the increasing level of patent litigation activity experienced by courts on both sides of the Atlantic.  Unlike in Europe, the BPCIA also provides for a mechanism for a reference product company to assert its patents prior to the launch of the biosimilar.  The provisions are so notoriously complex that the procedure is often referred to as a "patent dance", but one in which some biosimilar applicants would rather sit out.  The provisions are so complex that the Court of Appeals for the Federal Circuit had this to say about the BPCIA:

"Winston Churchill once described Russia as “a riddle wrapped in a mystery inside an enigma.”  That is this statute. In these opinions, we do our best to unravel the riddle, solve the mystery, and comprehend the enigma."

The first step of the patent dance is taken by the biosimilar applicant who "shall provide" to the reference product company (in confidence to external and in-house counsel) a copy of their application and other information that describes the process used to manufacture the biological product.  To the AmeriKat, these manufacturing disclosure requirements sound highly unappealing, especially if there is some wonderful new high-yield or continuous process utilized by the applicant that is arguably protected as a trade secret.  Thereafter, the parties exchange patent information including arguments why the biosimilar infringes or does not infringe the relevant patents (together with the validity of those patents), culminating in litigation of a narrowed pool of patents prior to the launch of the biosimilar.  However, no later than 180 days before the launch of the biosimilar, the applicant must again notify the reference product company.  The reference product company can then launch another wave of patent litigation, including applying for a preliminary injunction, on the basis of additional patents.

Despite the use of a lot of "shalls" in the section, biosimilar companies have interpreted
paragraph (l)(9)(C) of BPCIA as indicating that they do not have to be a willing dance partner.  This provision provides:

"If a subsection (k) applicant [the biosimilar applicant] fails to provide the application and information required under paragraph (2)(A), the reference product sponsor, but not the subsection (k) applicant, may bring an action under section 2201 of Title 28, for a declaration of infringement, validity, or enforceability of any patent that claims the biological product or a use of the biological product." 

Amgen - comfortable leading or being lead
in the patent dance

The argument goes that if the whole procedure was compulsory, there would not be a provision which provided for what happens if an applicant does not follow it.  On the 26 April 2017, the US Supreme Court will hear arguments on this issue in Sandoz v Amgen.  The case concerns Sandoz's application for a biosimilar to Amgen's filgrastim product (sold under the name Neupogen) to decrease the risk of infection in cancer patients.  The Supreme Court will also be deciding an issue on the 180-notification.  Amgen argues that a biosimilar applicant can only provide this notice after approval (which can only be 12 years after approval), thus effectively extending market exclusivity by another 6 months.  In July 2015, the Federal Circuit held that the patent dance was indeed optional, but that the 180-day notice could only be given after the 12 year exclusivity period ended (a bit of a draw).  Amici briefs have been filed by Apotex, Coherus (see recent Kat post), Biosimilars Council and Mylan, all supporting Sandoz.  The Supreme Court's decision is expected this Summer.

Amgen itself is on the other side of one of these dances with respect to Genentech's bevacizumab product (sold as Avastin).  Although Amgen provided a copy of their application to Genentech, it did not provide information about its manufacturing process and withheld consent to provide a copy to its third party expert, all of which Genentech argued was necessary to determine whether and which of its patents would be infringed by Amgen's biosimilar product.  In early February, Genentech launched an action seeking an order that Amgen comply with the disclosure requirements and an injunction to stop Amgen selling its product or seeking approval of its product until Genentech was restored to the position it would have been had Amgen complied with the BPCIA.  However, after Amgen moved to dismiss the complaint in light of the Federal Circuit's decision in Sandoz v Amgen (despite the pending review by the Supreme Court), two weeks ago the Court dismissed Genentech's complaint with leave to amend within 45 days.

Meanwhile, other fora are being explored in the biosimilar patent wars.  The PTAB is hearing a variety of inter partes reviews (IPRs) (for example, in January Coherus issued four petitions for IPRs against AbbVie's Humira patents).  The potential of section 337 investigations in the US International Trade Commission to ward off biosimilars is being entertained (even for those biosimilars pending approval and despite only three cases concerning biologics to have ever been investigated), as well as possible competition actions.  "Foreign" court venues may also hold value.  For example, litigants in the English Patents Court may wish to leverage the value of an Arrow, excuse me, Fujifilm declaration before other courts (see IPKat posts here).

A fragmented legal landscape contributes
to patent uncertainty in Europe

In Europe, although EFPIA have proposed an early resolution mechanism, none exist (for any type of molecule).  In the current national landscape of patent litigation, this means that the point at which a patentee may seek a preliminary injunction is country-specific and, indeed, the point at which they may even have notice that a generic or biosimilar is about to launch varies.  On the other side of the fence, biosimilar companies also have to figure out what dance they want to preform and when - an aggressive face-to-face tango dragging their opponent into a pre-launch declaratory or revocation action or a soft pique turn waiting for the legal and commercial landscape to appear.  Irrespective of their move and in which court, both parties are faced with overall pan-European uncertainty (which may well suit either party in any given scenario).  This may well change with the Unified Patent Court (a UPC-style Fujifilm declaration, anyone?).

Uncertainty is rampant on both sides of the Atlantic (at least for now).  In the US, uncertainty arises because the governing federal statute is an enigma, while in Europe it is the lack of pan-European mechanism or unified approach (so far) that can cause chaos.

But one thing is certain if you are entering the biosimilar space - you better get your dancing shoes on.