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Northern District of California Judge Seeborg Opens the Door to Alternative Route to Challenge Patents on Biologics

Introduction

On March 19, 2015, Northern District of California Judge Richard Seeborg denied Amgen's request for a preliminary injunction on a generic version of Neupogen, which had been approved by the FDA in early March and found the mandatory 180-day stay had already run. This clears the way for Sandoz to launch the first biosimilar of a biologic sold in the United States.

Background

The Biologics Price Competition and Innovation Act (BPCIA), the Act establishes an abbreviated pathway to achieve FDA approval for biosimilars. 42 U.S.C. § 262:(1) paragraphs (l)(2)-(l)(6) and (l)(8) require providing notice to the owner of the reference listed drug of the FDA approval within 20 days and require 180-days notice before the first commercial marketing of a biosimilar. Amgen brought patent and unfair competition claims against Sandoz, and argued that Sandoz failed to comply with the disclosures and negotiation procedures required by the BPCIA and that it had failed to give proper notice. As to the BPCIA special procedures, Sandoz countered that the BPCIA did not require an applicant follow the disclosures and negotiation procedures. As to advanced notice, Sandoz argued that it had given notice in 2014 and that the statute did not require that Sandoz wait for approval to provide the notice. Sandoz filed counterclaim challenging the infringement and validity of the asserted patent.

Amgen filed a preliminary injunction, focusing on the BPCIA requirements and unfair competition. Both parties filed motions for judgment on the pleadings.

The Decision

While there was no question that Sandoz failed to engage in the disclosure and dispute resolution of the BPCIA, Judge Seeborg agreed with Sandoz that there was no requirement to do so. Judge Seeborg rejected Amgen's interpretation of the statute, which would make these disclosures and negotiations mandatory. Notwithstanding the use of "shall" in the subsection, several other sections provide for immediate litigation in the event that the disclosures are not made, thus supporting Sandoz's interpretation that the statute does not require the disclosures and negotiations but merely provides those procedures as one possible avenue for an applicant. Accordingly, an applicant may ignore the disclosures and negotiation process if it wishes.

With respect to the required 180-days notice before the first commercial marketing of a biosimilar, Judge Seeborg rejected Amgen’s argument that the notice must be given after FDA approval of the biosimilar. Amgen's reading could result in an extension of the 12 year exclusivity period for a biologic. Instead, the notice may be given at any time and thus Sandoz's notice in July 2014 began the clock on the 180 days. Because Amgen's unfair competition claim was based on Amgen's interpretation of the statute as to these two issues, Judge Seeborg dismissed Amgen's claims of unfair competition. And because Amgen's preliminary injunction claim was based on its unfair competition claim and failure to comply with the BPCIA, the Court denied Amgen's request for preliminary injunction.

Implications

The Court's decision may open the way for speedier resolution of cases, including those where the biosimilar applicant believes there are few or weak patents covering a biologic. For cases where a large number of patents potentially cover the proposed biosimilar, applicants may prefer to proceed under the disclosure and negotiation procedures of BPCIA, which provides a relatively efficient and orderly process in those instances. In addition, because the 180-day notice requirement may be provided before approval, litigation involving biosimilars is likely to start early and may possibly involve products that are ultimately not approved.

The parties previously agreed to seek expedited review of any appeal and Amgen has indicated that it will seek relief from the Court's ruling. Thus the Federal Circuit may have the opportunity in the near future to provide its interpretation of BPCIA. Meanwhile, Amgen is not barred from seeking a preliminary injunction based on its patent claims.

© 2022 ArentFox Schiff LLPNational Law Review, Volume V, Number 84
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About this Author

Schiff Hardin offers substantial experience and strength in handling intellectual property litigation, among other major areas of the law. More than 50 Schiff Hardin attorneys practice in the field of intellectual property law, in offices across the country. We provide a broad range of litigation, counseling, and transactional services involving patents, trademarks, trade dress, trade secrets, copyrights, franchising, licensing and electronic commerce of all types.

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