Guest Column | July 20, 2017

Supreme Court Biosimilar Decision — What Developers Need To Know

By Lisa M. Ferri and Christopher M. Mikson, M.D.


Congress passed the Biologics Price Competition and Innovation Act (BPCIA) in 2010, establishing a long-awaited abbreviated approval pathway for follow-on biologics. Under the BPCIA, a product is biosimilar if it is highly similar to the reference biological product and there are no clinically meaningful differences between the products, and it may be interchangeable if the risks are not increased by switching the two products. Under the laws of the states, an interchangeable biosimilar may be substituted for the reference biologic, just as generic drugs are currently substituted for branded drugs.

The BPCIA also established a specialized procedure for patent litigation addressing alleged infringement by biosimilar makers, similar in concept to Hatch-Waxman litigation for patents that may be infringed by generic drug makers. The BPCIA procedure has been dubbed the “patent dance” for its complex stepwise exchange of information relating to the products and patents. Seven years have passed since the BPCIA was enacted, yet only a handful of biosimilar products have been approved, some of which have not been launched because of ongoing litigation over the interpretation and application of the statute. When the U.S. Supreme Court granted certiorari in the Sandoz v. Amgen litigation earlier this year, many were hoping for a decision that would clarify some key issues pertaining to the requirements of the BPCIA. But the decision left a number of questions unanswered.

Supreme Court Agrees To Review The BPCIA

Two provisions of the BPCIA were at issue in the litigation. First, the initial step of the patent dance is a disclosure procedure whereby a biosimilar applicant “shall” provide the reference biologic sponsor with a copy of the biosimilar application and manufacturing information. Second, the BPCIA contains a notice provision requiring the biosimilar applicant to provide the reference sponsor with notice of commercial marketing at least 180 days before product launch. Sandoz had submitted a biosimilar licensing application to the FDA and notified Amgen, the reference biologic license holder, of the filing and that it intended to launch the product upon FDA licensure. Sandoz did not provide a copy of its license application and manufacturing information, and took the position that notice of commercial marketing may be given before the FDA issues the biosimilar license. Characterizing the interpretation of these provisions as “issues of first impression relating to the . . . BPCIA,” the Federal Circuit held that (1) the first step of the patent dance is not mandatory and is thus unenforceable by injunction under the BPCIA, and (2) a biosimilar applicant may not give notice of commercial marketing under the BPCIA until actual licensure by the FDA. The Supreme Court granted writs of certiorari on these issues and consolidated the two related cases for briefing and argument.

A broad range of stakeholders in industry, government, and academia filed amicus briefs, which was unsurprising given the gravity of the issues. Whether a biosimilar applicant must provide the reference sponsor with its application and manufacturing information at the outset of the application process could profoundly affect the development and regulatory strategies for biosimilar developers and reference license holders alike. Likewise, a determination that a developer must wait until the FDA actually issues the biosimilar license before giving 180-day notice of commercial marketing would effectively delay market entry by six months past the expiration of the reference product’s 12-year marketing exclusivity.

Oral Argument Over A “Somewhat Ambiguous” Statute

Oral argument took place on April 26. The court spent considerable time acknowledging what counsel, stakeholders, and the Federal Circuit had lamented, that the BPCIA is highly complex and seemingly self-contradictory. The court allowed extra argument time, which is unusual, and Justice Breyer candidly stated, “We are being asked to interpret very technical provisions that I find somewhat ambiguous, and I am operating in a field I know nothing about.”

Justice Breyer also stated that the court might be better off seeking the FDA’s input on the interpretation of the statute through rulemaking, a clear manifestation of the court’s struggle with the complexity of the statute. His observation also seemed to be a manifestation of what is often seen in litigation involving the FDA, namely, the courts affording extensive – some might say over-extensive – deference to the agency on matters the court deems complex and specialized, and thus within the unique purview of the agency’s expertise. The court appeared to take a similar approach with respect to the provision requiring180-day notice of commercial marketing, suggesting that the FDA could provide for a tentative approval resembling that used in Hatch-Waxman, since this BPCIA issue is relatively narrow and relates directly to the FDA’s procedures for licensing approval.

Justice Sotomayor suggested the potential for state law to provide an alternative remedy, such as an injunction, when the BPCIA does not. Recognizing that this suggestion could render biosimilar patent litigation more complex and unpredictable, Chief Justice Roberts commented, “If we apply California law, then presumably in some circumstances we apply the law of every other state and maybe they reach different consequences.” Overall, the questions and arguments – and silence of some of the justices – provided little insight as to how the court would ultimately rule on these issues.

The Sandoz v. Amgen Decision

The court issued its unanimous opinion on June 12. The decision did not squarely address all of the questions raised, and thus has left open a number of issues relating to the BPCIA’s procedures.

Question 1: Whether The Patent Dance Is Mandatory

As to the first issue, the court actually framed the question as “whether the requirement that an applicant provide its application and manufacturing information to the manufacturer of the biologic is enforceable by injunction,” rather than whether that requirement is mandatory under the BPCIA, as the litigants had framed the issue.

The court noted that while the BPCIA states that the biosimilar applicant “must” provide its application and manufacturing information, the statute “provides a remedy for an applicant’s failure to turn over its application and manufacturing information.” Under the BPCIA, if the biosimilar applicant provides the information, then it may initiate patent litigation well before product launch and effectively choose the patents identified in the initial round of litigation. If the biosimilar applicant does not provide the information, the reference sponsor has the exclusive right to bring an immediate suit for a declaration of infringement. In that event, the biosimilar applicant loses the ability to challenge the patents before launching the product, and instead must wait to be sued for infringement.

The court also observed that the BPCIA expressly allows injunctive relief for breach of the confidentiality provisions in the notice requirement, but not for breach of the notice requirement itself. Thus, the court concluded that the disclosure requirement is not enforceable by injunctive relief, and therefore “there is nothing to decide on this point as a matter of federal law.” However, the court noted that the case included claims under California’s unfair competition law, which provides injunctive relief for “unlawful” conduct.

The court remanded this latter point to the Federal Circuit for a determination as to whether a biosimilar applicant’s failure to satisfy this provision – which the court termed a “requirement” of the BPCIA in its opinion – rises to the level of conduct necessary for relief under California law. This intriguing scenario leaves open the possibility that noncompliance with a federal requirement may give rise to relief under state law, when such relief is not available under federal law. If this were to be the case, then the question arises whether the state law remedy might be preempted by federal law. The court “express[ed] no view on whether a district court could take into account” a biosimilar applicant’s noncompliance with the disclosure requirement in deciding whether to grant a preliminary injunction against marketing the biosimilar.

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Question 2: Whether Notice Of Commercial Marketing Must Await Licensure

As to the second issue, the Federal Circuit had issued an injunction prohibiting marketing of the biosimilar until 180 days after licensure. The Supreme Court reversed and held that a biosimilar applicant may indeed provide notice of commercial marketing before the FDA has formally granted the biosimilar license. The BPCIA states that the biosimilar maker “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).” The court found that this language required the biosimilar to be licensed before commercial marketing commenced, but an FDA license was not required before providing notice to the sponsor. The court noted that to read the language otherwise would be “to impose two timing requirements.” The court further observed that “[a]n adjacent provision expressly sets forth just that type of dual timing requirement,” and emphasized that “Congress did not use that structure” in this provision. This ruling confirms that biosimilar developers may give notice before final approval –and even before tentative approval if the FDA employs that mechanism – and thus may launch as soon as the reference product’s 12-year exclusivity period expires.

Finally, Justice Breyer wrote a short concurring opinion raising his point from oral argument regarding the expertise of the FDA. He characterized the court’s opinion as “a reasonable interpretation” of the BPCIA, but stated “if [FDA], after greater experience administering this statute, determines that a different interpretation would better serve the statute’s objectives, it may well have authority to depart from, or to modify, today’s interpretation, . . . though we need not now decide any such matter.” Thus far, FDA has declined to weigh in on the BPCIA patent dance.


The purpose of the BPCIA was to provide an approval mechanism for biologics that strikes a balance between incentivizing innovation and reducing drug costs, conceptually similar to what has been achieved with small-molecule drugs through Hatch-Waxman. In some ways, the Supreme Court’s ruling may turn out to be another step in that direction. The opinion settled the question of whether the 12-year exclusivity period might effectively total 12½ years by prohibiting a biosimilar product launch until 180 days after licensure. This result potentially hastens the arrival of less-expensive biosimilars in the marketplace, while possibly hampering the ability of the reference sponsor to seek an injunction before product launch. The court did not ultimately settle the disclosure requirement, leaving it to be determined by the Federal Circuit, and potentially the FDA. However, it seems likely that biosimilar applicants may still be required to provide their applications and manufacturing information at approximately the same time as they would under the patent dance, as the reference sponsor may bring a declaratory judgment action and obtain that information in discovery if the biosimilar applicant has not already disclosed it. Thus, the lingering uncertainty in the wake of the court’s decision may ultimately end up being a matter of degree.

Including Sandoz v. Amgen, the Supreme Court decided six patent cases this term and reversed the Federal Circuit in all six cases. It remains to be seen whether this trend bodes ill for another, more far-reaching patent case that the court has agreed to hear next term. The court has granted certiorari in Oil States v. Green’s Energy Group and will review the Federal Circuit’s determination that the administrative patent trial processes established in 2012 by the America Invents Act (AIA) are constitutional. At stake is whether these programs will continue, or whether patent challenges must be heard in federal district court. While Sandoz v. Amgen is certainly pivotal to the biosimilars industry, Oil States could have significant consequences for many industries, including biosimilars. The AIA patent trials held before the Patent Trial and Appeal Board, including inter partes review and post grant review, are currently the primary alternative to the BPCIA for biosimilar developers to challenge patents on reference products prior to commercialization. This development adds as much, if not more, uncertainty for stakeholders in the biosimilar field, as we now must wait for additional court decisions that will decide how biosimilar applicants and reference sponsors can and should navigate the regulatory and patent litigation processes.

About The Authors:

Lisa M. Ferri is a partner in Mayer Brown’s Intellectual Property practice and serves as the IP Practice Leader for the New York Office. She serves as lead trial and appellate counsel on behalf of high-profile companies in the pharmaceutical, biotechnology, and medical device industries. Lisa is a seasoned and versatile litigator having tried high-stakes cases in federal courts across the country and the International Trade Commission, argued before the Patent Trial and Appeal Board (PTAB), and the Federal Circuit Court of Appeals. She has significant expertise guiding companies through patent challenges under the Hatch-Waxman Act and Biologics Price Competition and Innovation Act (BPCIA).

Christopher Mikson is a partner in Mayer Brown’s Washington, DC, office. With his unique combination of training and experience as a physician, registered patent attorney, and seasoned trial lawyer, he practices at the intersection of patent law and FDA regulatory law. Chris has served as trial counsel in patent litigation for some of the world’s largest drug and biologic companies. He also has counseled and represented clients in FDA regulatory matters concerning product development, clinical trials, premarket approval, citizen petitions, inspections, recalls and enforcement actions. He has extensive experience in patent cases and regulatory matters involving the Hatch-Waxman Act and the Biologics Price Competition and Innovation Act (BPCIA).