On June 3, 2015, the Federal Circuit heard oral argument on Amgen Inc.’s (“Amgen”) appeal of the Northern District of California’s decision holding that the Biologics Price Competition and Innovation Act’s (“BPCIA’s”) “patent dance” provisions are optional, and that the 180-day notice provision does not require licensure in Amgen, Inc., et al. v. Sandoz, Inc., et al., Case No. 14-cv-04741-RS (N.D. Cal. March 19, 2015). See Dancing Not Required: District Court Denies Amgen’s Bid for Preliminary Injunction, Finds BPCIA “Patent Dance” Optional.
The oral argument focused on the two main issues in the litigation: 1) whether the BPCIA’s patent dance provisions, 42 U.S.C. § 262(l)(2)-(6), are optional, as Sandoz Inc. (“Sandoz”) alleges and as the District Court held, or mandatory, as Amgen alleges, and 2) whether the 180-day notice provision, 42 U.S.C. § 262(l)(8), permits notice to be given immediately upon the FDA’s acceptance of a biosimilar application, as Sandoz alleges and as the District Court held, or only upon the FDA’s approval of the application, as argued by Amgen.
Amgen argued that the patent dance provisions and, in particular, § 262(l)(2), which states that “the subsection (k) applicant shall provide to the reference product sponsor a copy of the application submitted to the Secretary under subsection (k) and such other information that describes the process or processes used to manufacture the biological product” are mandatory. According to Amgen, a biosimilar applicant can choose to file its application under subsection (k) and follow the BPCIA provisions, or file its application under the “normal” subsection (a) pathway. Amgen further argued that the filing of a biosimilar application itself constitutes an artificial act of infringement under the BPCIA. However, the Court noted that if the filing of an application constitutes an act of infringement, neither party will know which patents should be asserted in an infringement action until the parties reach section (l)(3) of the patent dance, which provides for an exchange of a list of patents that could be infringed. The Court noted that it had never seen something intentionally drafted in this manner.
Sandoz argued that the BPCIA’s patent dance provisions are optional and that the BPCIA provides multiple ways to achieve the same end. According to Sandoz, if the biosimilar applicant chooses to use the patent dance provisions, then the biosimilar applicant “shall” provide certain information, such as its BLA and manufacturing information. Under section (l)(9)(c), if the biosimilar applicant chooses not to provide the information under sections (l)(2)-(6), then the reference product sponsor can bring suit against the biosimilar applicant. The Court observed that Sandoz was treating sections (l)(2)-(6) as optional and noted that it did not see any hint in the statute that section (l) is a “choose your own adventure” for the biosimilar applicant. According to the Court, the provision feels mandatory and, if a biosimilar applicant fails to meets its obligations, then it must face the consequences of section (l)(9)(c). This is the same remedy that would be available to a reference product sponsor if the patent dance provisions were found to be optional.
With respect to the 180-day notice of commercial marketing, Amgen argued that section (l)(8)(a) of the statute requires that a biosimilar applicant give notice of its intent of commercial marketing after the biosimilar product is licensed. (emphasis added.) Permitting a biosimilar applicant to provide notice when its application is accepted by the FDA would reduce a reference product sponsor’s time to contemplate filing a second phase of litigation to zero. The Court did note that Amgen has already enjoyed a substantial amount of time of exclusivity, and that most of the patents that could be called into question by Sandoz’s biosimilar have expired.
Sandoz argued that nothing in (l)(8) states that notice must be given “after” any particular act or occurrence. The Court, however, noted that providing notice at the time a biosimilar applicant’s application has been accepted by the FDA is speculative and aspirational at that point in time because there is no indication at that time whether or when the application will be approved.
When Amgen was questioned about the remedy it was seeking, Amgen emphasized that it was not seeking a windfall, but, instead, was requesting that the judgment against Amgen in the District Court be reversed, the BPCIA be clarified, and the case remanded to the District Court to fashion an appropriate remedy. Amgen was primarily concerned with ensuring that it be placed in the position it would have been in had Sandoz complied with BPCIA requirements.
Sandoz, on the other hand, argued that the preliminary injunction the Federal Circuit entered against it was moot because there cannot be any factual finding of irreparable harm. The District Court found there to be no irreparable harm and, according to Sandoz, the BPCIA only provides that a violation of section (l)(1)(h), a breach of confidentiality, constitutes irreparable harm.
The Federal Circuit has much to consider when deciding how to rule on these BPCIA interpretation issues. As the Court noted, the BPCIA could win a Pulitzer Prize for complexity. It will be interesting to learn whether the BPCIA will be interpreted as a “choose your own adventure” statute having several optional provisions.
K&L Gates will continue to follow any developments in this litigation.
