The Federal Circuit handed down a decision interpreting the Biologics Price Competition and Innovation Act (BPCIA) in a way that effectively grants branded biologics an additional six months of exclusivity.  However, in a win for biosimilar applicants, the Federal Circuit also held that the statutory directive to disclose abbreviated application and manufacturing information to the branded company, and engage in the BPCIA’s complicated patent dispute resolution scheme, is optional.  Amgen, Inc. v. Sandoz, Inc., No. 2014-1499, 2015 U.S. App. LEXIS 12523 (Fed. Cir. 2015).

This case involved the biological product Neupogen (filgrastim), which Amgen has marketed since 1991.  In May 2014, Sandoz filed an abbreviated biologics license application (“aBLA”) seeking approval of a biosimilar filgrastim product.  One day after receiving notification that the FDA had accepted Sandoz’s aBLA for review, Sandoz notified Amgen that: (1) it had filed an aBLA for Neupogen, (2) it believed the application would be approved in the first or second quarter of 2015, and (3) it intended to launch its product immediately upon FDA approval.  Sandoz also informed Amgen that it did not intend to provide Amgen with a copy of its aBLA or its manufacturing information as contemplated by § 262(l)(2)(A) of the  BPCIA.

Federal Circuit Effectively Extends Exclusivity for Biologics.  Section 262(l)(8)(A) of the BPCIA requires that a biosimilar applicant “shall provide notice to the reference product sponsor not later than 180 days before the date of the first commercial marketing of the biological product licensed under subsection (k).”  Interpreting this provision, the Federal Circuit held that the notice provided by Sandoz that it intended to launch its product as soon as it received FDA approval was not effective.  Instead, focusing on the statutory use of the term “licensed,” the Federal Circuit held that a biosimilar applicant cannot provide the notice under § 262(l)(8)(A) until 180 days after its license has been approved by the FDA.  The effect of this ruling is that a biosimilar applicant cannot begin marketing its product until at least 180 days after it has been approved by the FDA.

Federal Circuit Lets Biosimilar Applicant Decide Whether to Dance or Face DJ Action.  The Federal Circuit also considered whether the statutory directive for a biosimilar applicant to disclose its aBLA and manufacturing information to the branded company is mandatory.   Section  262(l)(2)(A) states that, not later than 20 days after receiving notice that the FDA has accepted its application for review, a biosimilar applicant “shall provide” to the reference product sponsor a copy of the aBLA as well as the manufacturing process.  Section § 262(l)(9)(C) then provides that, if an application fails to share its aBLA and manufacturing information with the branded company under § 262(l)(2)(A), the branded company may bring a declaratory judgment action for a declaration of infringement, validity, or enforceability of any patent the claims the biological product or its use.

At the district court, Amgen asserted state law claims for unfair competition and conversion, claiming that Sandoz had violated the BPCIA when it failed to provide a copy of the aBLA and its manufacturing information to Amgen.  The district court concluded that Sandoz had not violated the BPCIA and dismissed Amgen’s claims for unfair competition and conversion.  On appeal, the Federal Circuit affirmed, holding that the disclosure provision was optional, not mandatory, and the only consequence for choosing not to disclose is that the branded company can file a patent infringement suit as outlined in the BPCIA.  Since the BPCIA provides a consequence for failure to provide the aBLA and manufacturing information under § 262(l)(2)(A), the Federal Circuit reasoned that failing to do so did not violate the BPCIA and, thus, there were no additional remedies for Amgen beyond what is provided in the BPCIA.

Although the Federal Circuit’s ruling does effectively add an additional 180 days to the exclusivity period for branded biologics products, biosimilar applicants also come away knowing that the statutory directive to share aBLA’s and manufacturing information immediately upon filing for approval is optional.  This holding allows biosimilar applicants the possibility of avoiding resolution of biosimilar patent disputes under the BPCIA’s patent dispute scheme in favor of a DJ action based on its refusal to disclose its aBLA and manufacturing information.