March 23, 2020 marked the tenth anniversary of the enactment of the Biologics Price Competition and Innovation Act (BPCIA), which provided the approval pathway for biosimilar products. While it was five years before the first biosimilar—Sandoz’s Zarxio—was introduced in the United States, we now have twenty-six approvals and seventeen biosimilars on the market. With the steep increase in biologic drugs, presently accounting for 50% of sales within the pharmaceutical market, the pace of biosimilar development and approvals is increasing. Indeed, we now have multiple biosimilars competing in the same categories (e.g., five biosimilars of cancer immunotherapy drug Herceptin and six of autoimmune treatment Humira) and this occurrence will certainly reoccur.

Since BPCIA enactment, there have been numerous litigations and post-grant reviews relating to the patent portfolios of reference product sponsors (RPS). These disputes have served to clarify the contours of the “patent dance” between the biosimilar manufacturer and the RPS as well as to help manufacturers hone the strategy of clearing a path through patent portfolios for entry into the market. With these lessons in mind, we have a clearer view of the next ten years under the BPCIA pathway and can query: how will today’s emerging and blockbuster immunotherapy treatments fare?

The Advent of Immunotherapy Biologics and the Impact of the BPCIA

The development of immunotherapy biologics—large-molecule drugs that harness the immune system to inhibit or attack harmful cells—has transformed the therapy landscape. For example, monoclonal antibody treatments are now available for a host of diseases, including many types of cancer, autoimmune and inflammatory diseases, multiple sclerosis, and rare disorders such as paroxysmal nocturnal hemoglobinuria. As the therapeutic biologics market grew exponentially and many of the largest biopharmaceuticals manufacturers focused on immunotherapy research and development, so too did their biosimilar competitors. A number of innovator companies such as Amgen and Pfizer jumped into biosimilar development as well.

While the early biosimilars included glycoprotein cytokines (epoetin alfa, filgrastim) and growth hormones (somatropin), immunotherapy biosimilars constitute the bulk of current challenges, including challenges to the cancer treatments infliximab (Remicade) and trastuzumab (Herceptin) and rheumatoid arthritis blockbuster adalimumab (Humira). In many ways, biosimilar challenges to immunotherapy drugs have defined and clarified BPCIA litigation and inter partes review proceedings, thereby providing insight into the future of such challenges. Some of the lessons we have learned are:

  • The bulk of challenges have been litigated under the BPCIA—despite the ruling in Sandoz v. Amgen (the “patent dance” is not mandatory), most challengers at least initiate the “dance.”
  • Manufacturing patents have been key to BPCIA litigations (especially for older, legacy biologics with expired composition claims). Many biosimilar manufacturers submit abbreviated Biologics License Applications (aBLAs), but few have provided other manufacturing information, leading to a plethora of discovery motion practice (see 42 U.S.C. § 262(l)(2)).
  • What exactly “such other information that describes the process or processes used to manufacture the biological product” under section 262(l)(2)(A) entails, is yet to be fully determined by the courts.
  • An applicant may not be barred from bringing counterclaims and defenses in litigation that were not disclosed during the patent dance, Genentech v. Amgen, 2020 WL 636439 (D. Del. Feb. 11, 2020).
  • Only a handful of challengers have completely opted out of the dance, as there are clear disadvantages—by opting out, an applicant loses control over the scope of litigation, and 42 U.S.C. § 262(l)(8)(A) allows the RPS to then file a declaratory judgment (DJ) suit, opening the door to a possible injunction.
  • Skipping the dance precludes the challenger from filing its own DJ action.
  • The challenges have rarely made it to decision, as they are often resolved through settlement—about 50%—or launch at risk.
  • Obtaining an injunction to stop the launch of a biosimilar to an RPS outside the exclusivity period has proven difficult—a PI was not obtained to stop the launch of either the Kanjinti or Mvasi biosimilars.
  • IPRs have proven a popular way to clear patents for market entry, in particular for products that no longer have regulatory exclusivity and are relying upon manufacturing, formulation and treatment patents. A review of the patents relating to immunotherapy drugs reveals that both the rates of institution and the findings of unpatentability are about 50%.
  • In filing an IPR, timing is key for a challenger. In the wake of standing arguments made in Momenta v. Bristol-Myers Squibb, litigants consider the filing of an aBLA the crucial factor in timing the filing of a petition. Otherwise, there is a possibility of the challenger not having standing (i.e., no potential injury without an infringing product) at the time the litigants reach the Federal Circuit.

Modeling for Biosimilar Challenges Over the Next 10 years (and Beyond)

While past disputes provide insights to litigating under the BPCIA provisions, there are still many open issues to be addressed when planning responses to future challenges. For instance, we have yet to see a challenge by a biosimilar manufacturer to a biologic with most of its twelve-year exclusivity ahead. Leading immunotherapy drugs, such as Keytruda, Opdivo, Tecentriq, and Darzalex, have seen no challenges yet—i.e., no applicants have initiated the patent dance upon expiry of the four-year period following licensure of the RPS. In light of this, we must look at a number of factors to determine the best way to proceed in instances with long exclusivity periods remaining. What is the model for a challenge in this situation? Is a biosimilar challenge likely? When is a challenge likely? What preparation should be undertaken? Factors to be considered and monitored include:

  • Present and forecasted sales of the reference product (RP)
  • Third-party competitors with approved or pipeline products with the same or similar mechanism of action
  • Indications and potential for label expansion
  • Discovery of new mechanisms of action to target
  • Clinical trials using the RP as a comparator for a biosimilar (and requests for biologic samples for this purpose or registrations for clinical trials with the FDA)
  • Patent expiration dates (before or after market exclusivity)

The takeaway for developers of biosimilars and biologics is that with an exclusivity period of twelve years, much can happen in the marketplace—e.g., new drugs, new targets, better treatments—leading to a conclusion that it may not be practical to anticipate a biosimilar challenge to every biologic at the four-year mark when data exclusivity ends. Within certain immunotherapy sectors, e.g., check-point inhibitors, all approved drugs may not succeed over a twelve-year span, and therefore it may be precipitous to begin a challenge early in the exclusivity period of a reference biologic. Of course, if a biologic benefits from label expansion and adds new indications (e.g., Remicade, Rituxan, Humira), there may be increased commercial pressure for a biosimilar version. In essence, assessing the viability of a biosimilar version requires ongoing monitoring of the marketplace. Similarly, the preparation for a challenge to the RP calls for a regular assessment of the above factors. The timeline for an RPS envisions due diligence that ensures preparedness in and around the earliest aBLA filing date, for both post-grant challenges and litigation within the “patent dance” framework. With new biosimilars in clinical studies and aBLAs in the pipeline, we may soon have some concrete examples to assess as we move forward.