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Federal Circuit Hears Oral Arguments in Litigation involving the First U.S. Biosimilar Product

On June 3, 2015, a three-judge Federal Circuit panel comprising Judges Alan D. Lourie, Raymond T. Chen and Pauline Newman, struggled to understand the patent dispute resolution provisions of the Biologics Price Competition and Innovation Act (BPCIA) during oral arguments in Amgen, Inc. v. Sandoz, Inc., Fed. Cir. No. 15-01499.


On July 24, 2014, Sandoz became the first company to announce acceptance by the U.S. Food and Drug Administration (FDA) of a biologics license application under the abbreviated pathway of the BPCIA at 42 U.S.C. §262(k).   The application was for approval to market Zarxio™, a biosimilar of Amgen’s Neupogen® (filigrastim) product.

According to the patent dispute resolution provisions of the BPCIA (also known affectionately as the “patent dance”), once notified by FDA of acceptance of its application for review, Sandoz had 20 days to provide Amgen with a copy of its application and other manufacturing information.  After this initial disclosure, certain other exchanges and disclosures of information were to occur between the parties based on a tight time schedule.  However, Sandoz refused to provide this initial or other information alleging that participation in the patent dance was not mandatory.  As a result, because Sandoz failed to:  (1) provide Amgen with a copy of its application and manufacturing information within the 20 day period, (2) follow any of the other patent dispute resolution procedures of the statute (such as develop a list of patents to enable Amgen to know which, if any, of its patents Zarxio™ might infringe) and (3) provide Amgen with notice 180 days before the first commercial marketing of Zarxio™, Amgen sued Sandoz in the U.S. District Court in the Northern District of California on October 24, 2014.  In its complaint, Amgen alleged various state law claims (unfair competition (under Cal. Bus. & Prof. Code Section 17200 et seq.) and conversion) and infringement of U.S. Patent No. 6,162,427.  Amgen also requested a preliminary injunction to prevent Sandoz from marketing Zarxio™.

On March 6, 2015, the FDA approved Zarxio™ for the same five indications approved for Neupogen®.

On March 19, 2015, the District Court denied Amgen’s request for a preliminary injunction agreeing with Sandoz’s interpretation that the BPCIA’s patent dance provisions were optional. Final judgement was entered by the District Court on March 25, 2015 and Amgen appealed to the Federal Circuit on the same day.  On March 27, 2015, Amgen sought another preliminary injunction from the District Court pending appeal, or alternatively, an injunction lasting until the Federal Circuit could rule on the appeal.  On April 15, 2015, the District Court denied the motion on both grounds.

On April 17, 2015, Amgen filed an emergency motion for an injunction pending appeal with the Federal Circuit pursuant to Fed. R. App. P. 8(a).  In its motion, Amgen argued that it would likely succeed on the merits because the District Court erred in its interpretation of the BPCIA.  According to Amgen, the District Court, by converting the provisions of the BPCIA from mandatory to optional, “toppled the statutory balance in favour of the Applicant and allowed Applicants to game the system”.  Sandoz filed its opposition to the motion on April 24, 2015.  On May 5, 2015, the Federal Circuit granted Amgen’s emergency motion, stalling at least temporarily, Sandoz’s commercial launch of Zarxio™.  The Federal Circuit expedited Amgen’s appeal and docketed June 3, 2015 for the oral hearing.

The Oral Arguments

Nick Groombridge of Paul Weiss, representing Amgen, began by addressing whether the disclosure of a biologics license application and certain manufacturing information by a Section 351(k) applicant (K applicant) to the reference product sponsor was mandatory or optional. In response, Judge Lourie quickly commented:

What you are going to tell us Mr. Groombridge is that ‘shall’ means ‘shall’ and in fact, it means ‘must’ and usually that is true, and, this is a statute that is a multifaceted statute and I’m thinking that perhaps it is entitled to a Pulitzer Price for complexity or unclarity or something.”

Mr. Groombridge noted that the BPCIA was “not the most plainly worded statute” and argued that the filing of a §351(k) application was an act of infringement and that such infringement occurs before the reference product sponsor knows which patents are going to be infringed. Judge Chen noted that he had never seen a statute written in such a way to which Mr. Groombridge stated that in his opinion, the BPCIA was “purposefully” written to “deal with the complexities of the patenting around biologics”.

Deanne Maynard of Morrison & Foerster, representing Sandoz, began her argument stating that the “BPCIA procedures on which Sandoz relies creates multiple ways to the same substantive end”. Judge Lourie quickly interjected stating, “It’s awfully detailed concerning the exchange of information – why would that have been for not if you could just skip it?”  As Ms. Maynard continued, the Justices appeared sceptical of Sandoz’s interpretations of the patent dance provisions.  For example, at one point, Judge Newman stated:

How is the sponsor supposed to know if anything is going on without notice? How can you file suit if no one tells you ‘I’m getting ready to infringe your patent?’  …Its hard to make sense of the extensive legislative debate about those provisions based on the way you are interpreting it – so help us.

Judge Chen added:

…[Y]ou seem to be reading (l)(2)-(l)(6) as an option and then if the Applicant doesn’t choose that option than there is the (l)(9) option. I just don’t see either through the language or structure of (l) where there is a hint that it is a ‘choose your own adventure’ situation for the K applicant.  It seems much more like that (l)(2)-(l)(6) keeps saying over and over and over again ‘shall’ do this ‘shall’ do that and (l)(9) finally gets to well, if the K applicant fails to provide the application in a timely way then the patent owner can bring a DJ action at that point.  So, in that sense, it does feel like it’s mandatory and if you fail to meet you requirements, your obligations under the statute, you deal with the consequences in (l)(9)(c).

Judge Chen asked the question of what would happen if (l)(9) did not exist. Ms. Maynard responded that it would be a “harder issue for us” but acknowledged that “(l)(9) does exist”.

Near the end of the Mr. Groombridge’s rebuttal, Judge Lourie brought the court to laughter when he said, “If the purpose of the statute is to avoid litigation, it’s already failed. It doesn’t show promise of success”.

Please continue to watch the BRIC Wall Blog for updates on Amgen v. Sandoz.



About this Author

Lisa Mueller, Michael Best, Patent application Attorney, intellectual property lawyer,
Partner, Industry Group Chair, Life Sciences

Lisa provides strategic counsel on complex patent issues to clients in the pharmaceutical, biopharmaceutical, biotechnology and chemistry sectors. She brings an in-depth knowledge and extensive experience to her work advising clients on patent protection, freedom to operate and invalidity of blockbuster drugs they aim to produce and distribute.

Lisa’s advice on the full spectrum of global intellectual property portfolio management includes patent prosecution, opposition and other post-grant proceedings