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March 14, 2016 Articles

Shall We Dance? FDA Biosimilar Approval Process Litigation Options

The litigation options available to biologic innovators and biosimilar applicants are in flux as district courts and the Federal Circuit interpret the BPCIA

By Henrik (Rik) D. Parker

In 2010, as part of the Affordable Care Act, Congress enacted the Biologics Price Competition and Innovation Act (BPCIA), which created, among other things, an abbreviated pathway for obtaining U.S. Food and Drug Administration (FDA) approval of biosimilars. While the BPCIA has similarities to the earlier Hatch-Waxman Act, which applies to small molecule drugs, there are significant differences. For example, there is neither an automatic 30-month stay of approval of the abbreviated biologics license application (aBLA) upon initiation of patent litigation under the BPCIA as there is with abbreviated new drug applications (ANDAs) under Hatch-Waxman, nor an Orange Book equivalent where the owner of the original biologic would need to list any patents covering its products, their manufacture, and their uses. Instead, the BPCIA contains a complicated set of litigation provisions centered around what has come to be called "the patent dance," as well as other provisions dealing with the giving of a 180-day notice of intended commercial marketing. These various provisions allow certain kinds of litigation while precluding others. (It should be noted that parsing the provisions of the BPCIA and of the complementary 35 U.S.C. section 271(e)(2)(C) and (e)(6) is difficult due to the extensive internal cross-referencing.)

As a new and quickly changing biosimilars landscape develops while both biologic innovators (referred to as "reference product sponsors" or "RPSs" in the BPCIA) and biosimilar applicants probe the complexities and scope of the BPCIA, the litigation options open to each remain in flux. Those varied options come with pluses and minuses that require a close examination before choosing a path. While an aBLA applicant does not have many options for bringing its own suit, it can largely direct the kind of suit that the RPS can bring. This article surveys those options and examines some of the decision points that might push biologic innovators or biosimilar applicants in particular directions.

The aBLA Applicant's First Fork in the Road: To Provide the aBLA or Not

The first decision point for an aBLA applicant is whether or not even to start down the road of engaging in the "patent dance" by providing its aBLA and related information to the RPS. As recently found by the Federal Circuit in Amgen Inc. v. Sandoz Inc., 794 F.3d 1347, reh'g denied, No. 2015-1499 (Fed. Cir. Oct. 16, 2015), petition for cert. filed (U.S. Feb. 16, 2016), an aBLA applicant is not required to dance or even provide its aBLA to the RPS, although—if it chooses not to do so—it is still required to provide the 180-day notice of commercial marketing, and to provide the notice only after the biosimilar has been licensed by the FDA. The Federal Circuit's decision that an aBLA applicant need not participate in the BPCIA's dispute resolution framework effectively opened up a distinct, parallel set of litigation possibilities that leaves the RPS with less knowledge about the biosimilar but potentially a quicker route to resolution.

If the aBLA applicant opts out of the dance by not providing the aBLA to the RPS within 20 days of the filing of the aBLA, the RPS may immediately bring a declaratory judgment action for infringement, validity, or enforceability of any patent the RPS has that it believes covers the BLA product or its use, while the aBLA applicant is explicitly precluded from bringing any action. 42 U.S.C. § 262(l)(9)(C). Although this section of the BPCIA seemingly omits process patents from the RPS's arsenal at this point, the Federal Circuit specifically pointed out that the RPS can also bring an infringement action based on 35 U.S.C. section 271(e)(2)(C)(ii), which makes the filing of an aBLA an act of infringement as to any patent that could have been identified during the BPCIA's patent dance—thus allowing for the assertion of process patents as well. Amgen, 794 F.3d at 1356 n.3.

It is worth noting that while these litigation options appear to give the RPS a lot of flexibility, the RPS still has the problem that it may have little knowledge of the structure of the biosimilar or how it is manufactured because it has not received the aBLA. Thus, the RPS may have difficulty in determining which of its patents apply. It would not be surprising that the RPS would be unable to assert its patent(s) before the actual launch of the biosimilar. Moreover, district courts may be reluctant to grant what would amount to a preliminary injunction in any prelaunch, non-BPCIA suit based solely on the statutory artificial act of infringement. On the other side, the aBLA applicant is precluded from seeking a declaratory judgment under the BPCIA provisions, although at least some argument can be made that an aBLA applicant can seek a "standard" declaratory judgment (i.e., without relying on the artificial act of infringement set out in the BPCIA and 35 U.S.C.) if it has been sufficiently threatened by the RPS and commercialization is sufficiently imminent.

The aBLA Applicant's Second Fork in the Road: To Finish the Dance or Not

If the aBLA applicant at least starts the patent dance by providing its aBLA and other required information to the RPS, the next step will be for the RPS to provide to the aBLA applicant an original list of patents that the RPS believes would be infringed by the commercialization of the proposed biosimilar. Thereafter, the aBLA applicant still has repeated opportunities to change its mind and to opt out and stop "dancing," e.g., by failing to provide various required information in the back-and-forth negotiations as to what patents should be litigated, or even by failing to provide the 180-day notice of commercial marketing. In the event that the aBLA applicant does subsequently opt out, or ultimately fails to provide the 180-day notice, the RPS may bring a declaratory judgment action for a declaration of infringement, validity, or enforceability of any patent that appeared on the RPS's original list, while the aBLA applicant—again—is specifically precluded from bringing such an action. 42 U.S.C. § 262(l)(9)(B).

Significantly, if a RPS fails to include a patent in its initial list that "should have been included"—i.e., the RPS decides to leave a patent out of the BPCIA patent dance—then it is precluded from bringing any patent infringement action asserting that patent as to the biosimilar that is the subject of the aBLA. 35 U.S.C. § 271(e)(6)(C). Thus, if the biosimilar entity chooses to initiate the patent dance, it is critical for the RPS to ensure that it properly analyzes the aBLA and related information provided to ensure that it includes all possibly relevant patents on its initial list.

At the same time, one of the goals of undertaking the patent dance is to end up with a focused list of patents for the two sides to litigate. To this end, the parties' original lists of potential patents may include several that do not appear on the ultimate smaller subset list on which suit will be commenced. In support of the overall process, the BPCIA specifically provides that neither side is allowed to bring an action for declaratory judgment as to any patent that was on the original lists but is not included on the final list (whether the list is an agreed list or one arrived at through the alternate "no agreement" procedure) unless and until the 180-day notice of commercial marketing of 42 U.S.C. section 262(l)(8)(A) is given. 42 U.S.C. § 262(l)(9)(A).

Dancing Leads to Action

When both sides decide to follow through with the full BPCIA patent dance, the ensuing litigation options are reasonably straightforward. Whether the parties end up with an agreed list of patents to litigate (42 U.S.C. § 262(l)(4)) or a list of patents to litigate resulting from the procedure to be used when no agreement is reached (42 U.S.C. § 262(l)(5)), the RPS is charged with bringing a patent infringement suit thereon within 30 days. 42 U.S.C. § 262(l)(6)(A)–(B). While the RPS can also seek damages or other monetary relief in such an action if launch has already commenced, perhaps the more significant ramification is that, if its BPCIA action is successful, the RPS is entitled to a mandatory injunction prohibiting infringement of the patents at issue by the biosimilar. 35 U.S.C. § 271(e)(4)(D) ("The court shall order a permanent injunction . . . .").

Should the RPS fail to bring an infringement suit within 30 days, or fail to properly prosecute such a suit once it has been filed, the RPS will be limited to seeking a reasonable royalty in any infringement action brought thereafter as to any of the patents on the agreed/disagreed list. 35 U.S.C. § 271(e)(6)(B). In other words, the RPS will not be able to stop commercialization of the biologic using any of those patents, but can only seek monetary compensation in the form of a reasonable royalty.

The aBLA Applicant's Third Fork in the Road: Notice or No Notice

Separate and, at least arguably, distinct from the patent dance and its subsequent BPCIA litigation are the BPCIA provisions stating that the aBLA applicant "shall provide notice to the [RPS] not later than 180 days before the date of the first commercial marketing of the biological product licensed." 42 U.S.C. § 262(l)(8)(A). The Federal Circuit has found that this notice: (1) is mandatory, at least in the situation where the aBLA applicant has chosen to totally opt out of the patent dance by failing to deliver its aBLA to the RPS; and (2) is not legally effective unless given after the FDA licenses the product. Amgen, 794 F.3d at 1358–60. Thus, the BPCIA, prevents a situation where the aBLA applicant does not disclose its aBLA and launches its biosimilar upon FDA approval without any prior notice to the RPS. See Amgen, 794 F.3d at 1359–60 (noting that "paragraph (l)(8)(A) . . . require[s] notice of commercial marketing be given to allow the RPS a period of time to assess and act upon its patent rights").

Notably, an open question remains as to whether or not an aBLA applicant who follows the patent dance is also still required to give the 180-notice, with the Federal Circuit implying that such notice would not be required. Amgen, 794 F.3d at 1359. Indeed, this issue is currently being litigated in Amgen Inc. v. Apotex Inc., No. 0:15-cv-61631 (S.D. Fla.), where, on December 9, 2015, the district court judge granted a preliminary injunction, determining that such notice was always mandatory, whether or not the patent dance had otherwise been followed. (Apotex has appealed this decision.)

With that background, let us examine the options with respect to giving, or not giving, the 180-day notice.

If the aBLA applicant chooses to give the proper 180-day notice, at least a couple of litigation options arise. First, as what would appear to be a direct converse of the situation discussed above where (per 42 U.S.C. section 262(l)(9)(A)) neither side is allowed to bring an action for declaratory judgment as to any patent that was on the original lists but is not included on the final list until the 180-day notice is given, presumably either party can bring a declaratory judgment action as to any such patent once proper notice is given.

Second, as another converse to what was discussed earlier, if the aBLA applicant participated fully in the patent dance and gave the proper 180-day notice, then as part of any authorized infringement action under the BPCIA, the RPS may seek a preliminary injunction prohibiting commercialization of the biologic until the issues of infringement, validity, and enforceability as to any patent that was on the first lists exchanged but was not included on the final list. 42 U.S.C. § 262(l)(8)(B). (Presumably, the RPS can also seek a preliminary injunction in the patent dance suit as to any patent that is included on the final patent list, should that suit not be completed before the time that the aBLA applicant intends to launch the new biologic.)

On the other hand, the aBLA applicant may choose not to give the 180-day notice in at least a couple of different situations, each giving rise to its own litigation options. First, as discussed above, it remains an open question as to whether or not the notice is required if the aBLA applicant has otherwise properly followed the patent dance procedure, because the BPCIA provides a specific remedy for a failure to provide notice in this situation: the RPS, but not the aBLA applicant, may bring an action for declaration of infringement, validity, or enforceability of any patent on the RPS's original list. 42 U.S.C. § 262(l)(9)(B). Even with this remedy, there is nothing to say at this point that the RPS could not also seek to enforce the 180-day notice provision. (As a side issue, it is not a certainty that the RPS would always know if the aBLA applicant has failed to give notice until the aBLA applicant actually launches the approved biologic. If not, any action would be an affirmative patent action rather than a declaratory judgment action.)

On the other hand, as illustrated in the Amgen v. Sandoz action, if the aBLA applicant opts out of patent dance initially and fails to give 180-day notice of commercial marketing, then the RPS can seek to compel compliance with the proper giving of the 180-day notice because notice in such a situation is mandatory. Indeed, with no patent dance and no notice, an RPS may not have sufficient information about the biosimilar until after it launches, at which point the RPS could seek, at a minimum, a 180-day temporary restraining order.


One other litigation option that may arise under the auspices of the BPCIA occurs when an RPS (or its agent), having received an aBLA applicant's confidential information relating to the applicant's biologic, improperly discloses that information. In that event, the aBLA applicant is deemed to have suffered "irreparable harm for which there is no adequate legal remedy and the court shall consider immediate injunctive relief to be an appropriate and necessary remedy." 42 U.S.C. § 262(l)(1)(H).

Ruminations and Conclusion

In most situations, engaging in the patent dance and the subsequent litigation under the BPCIA will provide benefits to both parties. In particular, both sides can figure out what patents are in dispute and can resolve those disputes prelaunch. With the parameters of the dispute more defined, potential license discussions can take place. From the RPS's viewpoint, there is the prospect of obtaining a mandatory injunction if it succeeds in the assertion of its patents. From the aBLA applicant's viewpoint, if it has recognized that the RPS has a robust, broad patent portfolio that may come into play, the applicant may prefer to participate in the patent dance to narrow the scope (and cost) of the dispute. (Of course, the opposite is also true: if the RPS has few applicable patents, the aBLA applicant may prefer to skip the patent dance and take its chances in a standard infringement action.)

Undoubtedly, the menu of biosimilar litigation options will continue to evolve and change over the coming months as courts and parties grapple further with fleshing out the details of the BPCIA. The bottom line for now is that the aBLA applicant will largely control the manner in which any dispute will play out by choosing whether or not to provide its aBLA, whether or not to dance, and whether or not to give the 180-day notice. Those aBLA-applicant-made choices will vary depending on the relative risks based on the specific facts of the situation. In all events, the savvy biologic manufacturer will fully consider all possible paths before making a decision as to where to take its chances and about which patents.

Keywords: litigation, intellectual property, BPCIA, biosimilars, biologics, aBLA

Copyright © 2016, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).