1. Patent-Related Aspects of Recently Enacted Biosimilar Legislation Chris Holman UMKC School of Law Utah State Bar IP Summit February 18, 2011

2. Hatch Waxman Facilitates Generic Drug Competition 35 USC 271(e)(1) regulatory approval exemption – applicable to process of drug or veterinary biologicals development Access to innovator data after five year data exclusivity for new chemical entity (NCE) –No clinical trials Interchangeability/substitutability Orange Book and preapproval patent resolution process (Paragraph IV litigation)

3. Patents Extremely Important under Hatch Waxman Short five year data exclusivity period Effective exclusivity period for traditional drugs has been about 12 to 14 years –Provided by patents Some would argue patents have become too important

4. Patents Extremely Important under Hatch Waxman Requirement of “same active ingredient” for generics ANDA has rendered composition of matter patents covering the active ingredient (“COM” patents) extremely effective –Impossible to design around narrow COM patent and still take advantage of abbreviated approval process Other types of patents have proven substantially less effective

5. The Call for “Biogenerics” A true “biogeneric” would have the “same” active ingredient, and would be fully substitutable True biogeneric generally thought to be technically infeasible with current state of technology –The product is the process –Potential for differential folding or post- translational modification, viral contamination, degradation products, immunogenicity issues FDA arguably lacked authority under the statute

6. Biosimilar Legislation Several bills introduced in both houses of Congress Ultimately enacted as part of healthcare reform –Patient Protection and Affordable Care Act, Biological Price Competition and Innovation Act of 2009, Pub. L. No. 111-148,Title VII, Subtitle A, Sections 7001-7003, codified at 42 U.S.C. 262.

7. Biosimilar Legislation Congress could revisit biosimilar provisions –Some are pushing to shorten data exclusivity period 2009 FTC Report –Move to dismantle healthcare reform

8. Biosimilar Legislation Access to innovator data –But some clinical trials will probably still be necessary 12 years of data exclusivity Increases the importance of patents for biologic drugs, but still not as important as for conventional drugs –Core patents more likely to have expired after 12 years

9. Biosimilar Legislation Patent scope could be much more important than it is for conventional drugs\ Depending upon how FDA defines “biosimilarity,” there is the potential that a competitor could design around a relatively broad patent covering the innovator product, while retaining sufficient biosimilarity to take advantage of abbreviated approval process safe

10. Biosimilar Legislation No automatic substitutability –Provisions for “interchangeable” biologics, including exclusivity incentive for first to bring interchangeable products to market –Contrast with Hatch Waxman, where the incentive is provided for first to challenge patent No Orange Book –Complex “patent disclosure dance”

11. Biosimilars Are Not Biogenerics “Abbreviated” approval process could still require substantial investment, clinical trials –Will depend upon complexity of product, degree of similarity, developments in analytical and manufacturing technology, FDA implementation –Look to European experience, and US experience with biologics recommended under FDCA

12. Biosimilars Are Not Biogenerics Price drop likely to be much less than in case of generic drug market entry –Not substitutable –Typically administered in clinical setting –Federal judge found that biosimilar market entry could actually result in higher costs Amgen v. Hoffman-La Roche –Again, look to European and (limited) US experience

13. Paragraph IV Patent Challenges Active ingredient, formulation and method of use patents listed in Orange Book Paragraph IV certification –Innovator can file suit within 45 days –Automatic 30 month stay Effectively a preliminary injunction without need to show cause –180 day generic exclusivity for first to file Paragraph IV certification

14. The Patent Disclosure Dance No Orange Book for biologics regulated under Public Health Services Act –Patents on methods and reagents used in production process play a much more important role The dance begins when FDA accepts application for approval of biosimilar for review

15. The Patent Disclosure Dance Within 20 days, applicant for approval of biosimilar (“applicant”) must provide innovator with a copy of the application, plus description of manufacturing process Within 60 days, the reference product sponsor (“innovator”) must provide a list of patents owned or “exclusively licensed” that could “reasonably be asserted” (List I)

16. The Patent Disclosure Dance Within 60 days, applicant may provide a list of innovator patents that could reasonably be asserted, and must provide a detailed, claim-by-claim statement providing factual and legal basis for opinion that each patent on List I is invalid, unenforceable or would not be infringed, or that biosimilar will not be marketed prior to patent expiration

17. The Patent Disclosure Dance Within 60 days, innovator must provide claim by claim statement of factual or legal basis for opinion that listed patents are valid, enforceable and would be infringed Third party owners of exclusively licensed patents apparently do not need to participate in dance

18. The Patent Disclosure Dance Parties have 15 days to negotiate and agree to list of patents to be litigated If parties agree to a list (List IIa), innovator has 30 days to file a lawsuit asserting listed patents If parties cannot come to an agreement, applicant must notify innovator of number of patents it thinks should be litigated

19. The Patent Disclosure Dance Within five days of applicant providing number to innovator, the parties will simultaneously exchange lists of patents Innovator’s list of patents cannot exceed number of patents listed by applicant – Innovator can list one patent it applicant lists zero Innovator has 30 days to file a lawsuit asserting patents appearing on either list (List IIb)

20. The Patent Disclosure Dance Innovator must update List I within 30 days of issuance, or exclusive license taken to, a patent that could reasonably be asserted A patent appearing on List I but not List II (List III) cannot be subject of declaratory judgment action –Unless applicant fails to perform required action

21. The Patent Disclosure Dance Applicant must provide 180 day notice of commercial marketing Innovator can seek preliminary injunction for List III patent once notice of imminent commercial marketing is given

22. Confidentiality Confidential information provided to outside counsel (one or more), in-house counsel (one), and representative of third- party patent owner Attorneys cannot be involved in patent prosecution” relevant or related to the reference product” Biotech company might have to hire patent attorney specifically for this purpose

23. Carrots and Sticks Court shall order permanent injunction if List II patent is found valid and infringed in final court decision (appealable only to Supreme Court) Patents not timely included in List I is unenforceable with respect to biosimilar Only remedy available for List II patent not asserted in timely manner, or settled without prejudice, or prosecuted in bad faith, is reasonable royalty damages

24. How Effective Will Patents Be For Protecting Biologics? FTC argued for short data exclusivity period based on assertion that patents will be just as effective for protecting biologics as they have been for conventional drugs Historically, use of patents to protect biologics has been fundamentally different than use of patents to protect conventional drugs

25. How Effective Will Patents Be For Protecting Biologics? COM patents have been very effective in protecting small molecule drugs Other sorts of patents on methods of use, production processes, formulations and the like have proven much less effective

26. How Effective Will Patents Be For Protecting Biologics? Composition of matter patents claiming active ingredient per se have played very minor role in protection of biologics Gene patents, and other patents relating to methods and reagents used in production have been very important –Many have been successfully designed around

27. Exemplary Claims Asserted Against “Biosimilars” Amgen v. Chugai (1987) –“A purified and isolated DNA sequence consisting essentially of a DNA sequence encoding human erythropoietin.”

28. Genentech v. Insmed U.S. Patent No. 5,258,287 –Claim 1: An isolated DNA molecule comprising a sequence that hybridizes, under stringent conditions of 50% formamide with 0.75M NaCl and 0.075M sodium citrate, at 42.degree. C., to the portion of the DNA sequence of FIG. 3 coding for mature BP53 or the preprotein for BP53 and which encodes a BP53 protein that binds to IGF-I or IGF-II, excluding BP28, PP12, and HEP-G2.

29. Schering v. Amgen 4,530,901 –1. A recombinant DNA molecule consisting of segments of DNA from different genomes which have been joined end-to-end outside of living cells and which have the capacity to infect some host and to be maintained therein, and the progeny thereof, comprising a DNA sequence selected from the group consisting of: (a) the DNA inserts of Z-pBR322(Pst)/HcIF-2h (DSM 1700), Z- pBR322(Pst)/HcIF-SN35 (DSM 1701), Z-pBR322(Pst)/HcIF-SN42 (DSM 1702) and Z-pKT287(Pst)/HcIF-2h-AH6 (DSM 1703), (b) DNA sequences which hybridize to any of the foregoing DNA inserts and which code on expression for a polypeptide of the IFN-α type, and (c) DNA sequences which code on expression for a polypeptide of the IFN-α type coded for on expression by any of the foregoing DNA sequences and inserts, said DNA sequences and inserts being operatively linked to an expression control sequence in said recombinant DNA molecule.

30. University of California v. Eli Lilly 4,431,740 –2. A DNA transfer vector comprising an inserted cDNA consisting essentially of a deoxynucleotide sequence coding for human proinsulin, the plus strand of said cDNA having a defined 5' end, said 5' end being the first deoxynucleotide of the sequence coding for said proinsulin.

31. Genzyme v. TKT 5,356,804 –1. A method for producing human α-galactosidase A comprising: (a) culturing a mammalian cell containing a chromosomally integrated nucleotide sequence encoding human α- galactosidase A controlled by a regulatory sequence that promotes gene expression and a selectable marker controlled by the same or different regulatory sequence, so that the α- galactosidase A nucleotide sequence is stably overexpressed and an enzymatically active α-galactosidase A enzyme is secreted by the mammalian cell; and (b) isolating enzymatically active α-galactosidase A enzyme from the mammalian cell culture.

32. Genzyme v. TKT 10. A mammalian cell comprising a chromosomally integrated nucleotide sequence encoding human α-galactosidase A controlled by a regulatory sequence that promotes gene expression and a selectable marker controlled by the same or different regulatory sequence, so that the α-galactosidase A nucleotide sequence is stably overexpressed and an enzymatically active α-galactosidase A enzyme is secreted by the mammalian cell.

33. Amgen v. Hoffman LaRoche 5,547,933 –3. A non-naturally occurring glycoprotein product of the expression in a mammalian host cell of an exogenous DNA sequence comprising a DNA sequence encoding human erythropoietin said product possessing the in vivo biological property of causing bone marrow cells to increase production of reticulocytes and red blood cells.

34. Amgen v. Hoffman LaRoche 5,955,422 1 –A pharmaceutical composition comprising a therapeutically effective amount of human erythropoietin and a pharmaceutically acceptable diluent, adjuvant or carrier, wherein said erythropoietin is purified from mammalian cells grown in culture.

35. Centocor v. Abbott 7,070,775 –[2]. An isolated recombinant anti-TNF-alpha antibody or antigen-binding fragment thereof, said antibody comprising a human constant region, wherein said antibody or antigen binding fragment (i) competitively inhibits binding of A2 (ATCC Accession No. PTA- 7045) to human TNF-alpha, and (ii) binds to a neutralizing epitope of human TNF-alpha in vivo with an affinity of at least 1x10 8 liter/mole, measured as an association constant (Ka), as determined by Scatchard analysis, wherein the antibody or antigen-binding fragment comprises a human constant region and a human variable region.

36. How Effective Will Patents Be For Protecting Biologics? Developments in technology will effect the role of patents in protecting innovative biologics –Increasing importance of monoclonal antibodies and substantially engineered variants of naturally occurring proteins –Decreasing relevance patents on naturally occurring genes

37. How Effective Will Patents Be For Protecting Biologics? Developments in the law will effect the role of patents in protecting innovative biologics –Written description requirement (Ariad v. Lilly and Centocor v. Abbott) – Nonobviousness requirement (KSR and Kubin) –Obviousness type double patenting (Sun v. Eli Lilly) –Shift to patent term of 20 years from filing date Largely precludes evergreening by continuation practice

38. Issues How will FDA implement abbreviated approval process? How will legislation be applied to non- protein therapeutic biologics, such as therapeutic virus? –REOLYSIN, Oncolytics Biotech Inc.

39. Issues Will abbreviated approval process facilitate market entry by “biobetters” Will patent term extension be available under 35 USC 156? The patent disclosure dance appears to be much more complex and ambiguous than the preapproval patent resolution process under Hatch Waxman –Companies will need to be prepared to litigate these ambiguities

40. Recommendations Innovators will want to have input when FDA establishes criteria for “highly similar” in standards of interchangeability Innovators should seek to maintain trade secret status of manufacturing process Due to short timelines, innovators should identify in-house and outside counsel and relevant patents prior to receiving notice

41. Recommendations Innovators should track status of relevant patent applications Innovators should be prepared to seek preliminary injunction in order to block “at risk” market entry by biosimilar