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Biologics Price Competition and Innovation Act of 2009
“The Biosimilars Act”
• Passed as Title VII, Subtitle A of the Patient Protection and Affordable Care Act, Pub. L. No. 111-148, 124 Stat. 119, §§ 7001-03.
• Signed into law on March 23, 2010.
The Biosimilars Act
Amends the Public Health Service Act (“PHSA”) (42 U.S.C. § 262) by adding:
• § 351(k) – licensure requirements for follow-on biologics (“FOB”) as either:
Biosimilar Interchangeable
• § 351(l) – patent infringement disputes
Data Exclusivity forReference Product
No § 351(k) application can be filed until four years after the date the reference product was first licensed.
No § 351(k) application can be approved until 12 years after the date the reference product was first licensed.
Pediatric Exclusivity - Four and 12 year periods can be extended for six months each.
Regulatory Exclusivity for First Interchangeable Product
First § 351(k) applicant to obtain FDA approval as interchangeable is eligible for marketing exclusivity.
• Subsequent applications for interchangeable product cannot be approved for one year.
• Does not prevent approval of biosimilar products based on the same reference product.
• Interchangeable exclusivity can be shortened or forfeited.
Patent Infringement Actions Hatch-Waxman: Automatic 30-month stay if
Reference Product Sponsor (“RPS”) files suit within 45 days of receiving notice of Paragraph IV certification against patent previously listed in the Orange Book.
Biosimilars Act: No Orange Book listing.
• RPS identifies Orange Book-type patents after reviewing copy of § 351(k) application.
• Step-wise procedure for determining patents-in-suit.
Biosimilars Pre-suit Procedures
351(k) applicant provides copy of application to RPS
RPS providesParagraph 3(A) List
351(k) applicant provides Paragraph 3(B) List
Negotiations regarding patents to be in suit
60 days 5 days
60 days
RPS replies to Paragraph 3(B) List
Either party begins, any time
351(k) applicant discloses number of patents it will place on Paragraph 5 List
Simultaneous exchange of Paragraph 5 Lists
Infringement suit filed.
If no agreement,any time
30 days
60 days
FDA accepts 351(k) application for review
20 days
Mandatory Disclosure by 351(k) Applicant
Within 20 days of FDA notice that § 351(k) application has been accepted for review, 351(k) applicant must provide RPS with:
• Complete copy of § 351(k) application.
• Information regarding the process used to manufacture the follow-on product.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Confidentiality
Mandatory disclosure provided to:
• outside counsel designated by RPS.
• one in-house attorney for RPS.
Eligible recipients cannot participate in patent prosecution relating to the reference product.
Access may also be given to representative of patentee/licensor of RPS.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
ConfidentialityNo automatic disclosure to:
• outside scientific experts
• RPS employees
• non-recipient outside counsel
Information may be used only to determine whether an infringement action could be brought.
Confidentiality provisions apply until a protective order is entered in the ensuing infringement action.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
RPS’s Paragraph 3 List
Within 60 days of receiving mandatory disclosure, RPS provides to 351(k) applicant:
• Paragraph 3(A) List - identifies all patents on which RPS believes a patent infringement claim could reasonably be brought.
• Identification of the listed patents that the RPS would be prepared to license.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
351(k) Applicant’s ResponseWithin 60 days of receiving Paragraph 3(A)
List, 351(k) applicant provides to RPS:
• Paragraph 3(B) List - identifies all patents on which the applicant believes a patent infringement claim could be brought.
• A response for each patent identified for possible licensing.
• A patent challenge or statement of intent for each patent on either list.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
351(k) Applicant’s ResponsePatent challenges must include a detailed
statement of its opinion why each claim is:Invalid,Unenforceable, orWould not be infringed by the commercial
marketing of the FOB.
Statement of intent must indicate that the applicant does not intend to begin commercial marketing until patent expiry.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
RPS’s Reply
Within 60 days of receiving Paragraph 3(B) List, RPS provides to 351(k) applicant:
• Detailed statement of its opinion why each claim would be infringed by the commercial marketing of the FOB, and
• Response to any unenforceability/ invalidity contentions.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Mandatory Negotiations
Following RPS’s Reply:
• Parties must negotiate regarding patents to be included in infringement action.
• Maximum 15 days of negotiations.
• If agreement is reached, RPS must bring suit on agreed patent within 30 days.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Determination of Patents to be Included in Suit (if no agreement )
1) 351(k) applicant must disclose the number of patents it will include on Paragraph 5 List.
2) 5 days later, parties simultaneously exchange Paragraph 5 Lists. RPS is limited to the greater of one patent
or the number disclosed by applicant.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Scope of Litigation
The RPS “shall bring an action for patent infringement with respect to each patent that is included on [the Paragraph 5] lists.”
PHSA § 351(l)(6)(B).
• Patents that appear on either Paragraph 5 List must be included in suit.
• Patents that did not appear on a Paragraph 3 List may not be included in suit.
35 U.S.C. § 271(e)(6)(C).
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Scope of Litigation – Excluded Paragraph 3 Patents
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Can RPS sue on a patent that appeared on a Paragraph 3 List, but not on a Paragraph 5 List?
35 U.S.C. § 271(e)(2)(C)(i) defines the act of infringement in termsof Paragraph 3-listed patents, not Paragraph 5 Lists.
What is the point of empowering the 351(k) applicant to limit the number of patents on the RPS’s Paragraph 5 Lists?
Filing of Suit
The RPS must bring suit within 30 days of exchanging Paragraph 5 Lists.
Failure to timely file suit will limit remedies available to the RPS.
• Reasonable royalty only.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Preliminary Injunctions
351(k) applicant must notify RPS of impending commercial marketing at least 180 days prior to launch.
“Paragraph 8(A) Notice”
After receiving notice, but before launch:
• RPS may seek preliminary injunction on any Excluded Paragraph 3 Patent.
• The parties must “reasonable cooperate to expedite such further discovery as is needed…” PHSA § 351(l)(8)(C).
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Preliminary Injunctions
The Biologics Act does not expressly prohibit preliminary injunctions on Paragraph 5-listed patents, or on patents otherwise in suit.
The RPS “may seek a preliminary injunction prohibiting the subsection (k) applicant from engaging in the commercial manufacture or sale of [the FOB] with respect to any [Excluded Paragraph 3 Patent].”
PHSA § 351(l)(8)(B).
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Declaratory Judgment
Neither party may seek declaratory judgment on an Excluded Paragraph 3 Patent unless/until the 351(k) applicant provides a Paragraph 8(A) Notice.
Unless:
• 351(k) applicant fails to provide the mandatory disclosures - RPS may seek D.J. on any patent.
• 351(k) applicant fails to perform other statutory duties – RPS may seek D.J. on Excluded Paragraph 3 Patents.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Other Remedies
Once infringement is found:• Mandatory stay of FDA approval until the
patent expires.
• Damages – “only if there has been commercial manufacture, use, offer to sell, or sale within the United States or importation into the United States”
• Permissive permanent injunction until patent expiry.
35 U.S.C. § 271(e)(4).
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Other Remedies
New mandatory permanent injunction if :
• The finding of infringement is a “final court decision”.
• The action was brought under the Biosimilars Act. (Actions under 35 U.S.C. § 271(a) do not qualify.)
• The injunction is obtained before expiration of the RPS’s 12-year data exclusivity period.
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Limitations on Remedies
Exclusive remedy is a reasonable royalty if:
• RPS fails to timely bring suit on a Paragraph 5-listed patent,
• Prior timely filed action was dismissed without prejudice, or
• Action is “not prosecuted to judgment in good faith”.
35 U.S.C. § 271(e)(6).
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Limitations on Remedies
Action under § 271(e) is not available if:
• RPS failed to list a relevant patent on its Paragraph 3(A) List.
Express language, “…may not bring an action under this section…” does not appear to prohibit a later action under § 271(a)-(c).
35 U.S.C. § 271(e)(6)(C).
Mandatory Disclosure
Paragraph 3 Lists
Negotiation
Paragraph 5 Lists
Suit filed
Conclusions
• Biosimilars Act shares many provisions with the Hatch-Waxman Act.
• Biosimilars Act includes several new procedures: Can be navigated with exercise of sufficient
care. Stiff penalties for failure to comply.
• Biosimilars Act includes several ambiguities to be interpreted by the courts.
