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What You Need to Know About Biosimilars: Products, Recent Deals, IP Issues and Licensing August 2, 2012 Madison C. Jellins 1.

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Presentation on theme: "What You Need to Know About Biosimilars: Products, Recent Deals, IP Issues and Licensing August 2, 2012 Madison C. Jellins 1."— Presentation transcript:

1 What You Need to Know About Biosimilars: Products, Recent Deals, IP Issues and Licensing August 2, 2012 Madison C. Jellins 1

2 Biologics Price Competition and Innovation Act Biologics Price Competition and Innovation Act of 2009 (“BPCIA”) signed into law March 2010 Statute requires third-party patents – exclusively licensed by the Reference Product Sponsor – and covering the reference biologic product, manufacture or use, – be subjected to the patent dispute resolution procedure – or the third party owner will risk forfeiture of its patent rights Both parties to an exclusive license agreement should ensure that current and future license agreements address possibility that licensed patents may be subject to a biosimilar dispute 2

3 Patent Dispute Resolution Procedure BPCIA was modeled on Hatch-Waxman Act BPCIA establishes mechanism for resolving patent disputes – between sponsors of brand name biologics and biosimilar applicants – prior to commercial marketing of the biosimilar But unlike Hatch-Waxman, the Act does not specify which patents will be subject of litigation – No Orange Book with listing of patents covering drug product 3

4 Patent Dispute Resolution Procedure The parties must negotiate in good faith to reach agreement on the patents that will be litigated The Biosimilar Applicant controls the number of patents that will be litigated in the first phase of litigation 4

5 Patent Dispute Resolution Procedure Triggered by FDA’s acceptance of biosimilar application 20 days later, Biosimilar Applicant must provide biosimilar application and information on manufacturing to Reference Product Sponsor Within 60 days, RPS must identify patents it “ reasonably ” believes would be infringed and identify any patents it is prepared to license Within 60 days of receiving initial list, Biosimilar Applicant must identify patents it believes RPS reasonably could assert and provide: – Statement that it does not intend to commence marketing before expiration or – Statement of non-infringement, invalidity or unenforceability contentions Within 60 days, RPS must state for each patent on either list why the patent would be infringed and respond to invalidity and unenforceability assertions 5

6 Patent Dispute Resolution Procedure After exchange of statements, parties must negotiate number of patents to be litigated 15 days later, Biosimilar Applicant identifies number of patents 15 days later, parties agree on number of patents to be litigated 20 days later, RPS commences action on specified patents 6

7 Negotiation of Number of Patents in Suit The parties must negotiate in good faith to try to reach agreement on the patents that will be litigated If negotiation succeeds, the listed patents will be litigated If negotiation fails, the Biosimilar Applicant specifies the number of patents that will be litigated 7

8 Second Phase of Litigation 180 days before launch (12 years after approval), Biosimilar Applicant must provide notice of intention to market 30 days later, reference product sponsor may assert “ deferred ” patents and “ late issued ” patents and seek preliminary injunction If patent owner wins on early asserted patent, permanent injunction until patent expires 8

9 Exclusively Licensed Patents Included Unlike Hatch-Waxman, BPCIA includes process patents – May be exclusively licensed by RPS BPCIA permits but does not require the RPS to share the biosimilar application with third party owners of patents exclusively licensed to the RPS BPCIA requires RPS to include relevant exclusively licensed third-party patents in its patent list Exclusively licensed patents could be included in patent dispute procedure without licensor being aware of litigation or of biosimilar application 9

10 Penalties for Failure to List Third Party Patents BPCIA includes several penalties for failure of RPS to include exclusively licensed patents in its list Can result in forfeiture of rights for the third party patent owner/exclusive licensor – regardless of whether third party owner/licensor was involved in process or aware of possible infringement of its patent 10

11 Penalties for Failure to List Third Party Exclusively Licensed Patents RPS can seek a preliminary injunction prior to first commercial marketing for any patent not in litigation – if the patent was included on the RPS’s patent list or the Biosimilar Applicant’s list The owner of a patent that should have been included on the patent lists, but was not, may not bring an action for infringement of the patent Where a patent was on the lists, but the RPS was not timely in bringing suit, the suit was dismissed without prejudice, or the suit was not prosecuted to judgment in good faith, the sole remedy is a reasonable royalty 11

12 Existing and Future Exclusive License Agreements Review existing exclusive license agreements to determine whether licensed patent may be subject to biosimilar patent dispute For prospective licenses, evaluate value of granting an exclusive license against litigation risks and potential forfeiture of patent rights 12

13 Exclusive License Provisions Licensor will want exclusive licenses to include: – Prompt notice of any potential biosimilar application – Right to review biosimilar application – Right to participate in determination whether to include licensed patent on RPS’ patent list – Right to participate in litigation as to licensed patent Licensee/RPS will want exclusive license to include: – Limited involvement of exclusive licensee in patent dispute – Ability to assert licensed patent – Control of course of litigation and settlement 13

14 Recent IP Developments Abbott petitioned FDA to prevent Humira biosimilars on April 2, 2012 – FDA would have no choice but to use trade secrets in Abbott’s BLA to support approval of competitor products – Taking under the Fifth Amendment – FDA should not accept for filing, file, approve or discuss with any company, or otherwise take any action indicating that the agency will consider any application for a biosimilar that cites the Humira BLA 14

15 Recent IP Developments Previous court rulings have found that data submitted to the FDA constitutes trade secrets Argument extended to any drugmaker that submitted a BLA for product approval prior to the enactment of the BPCIA The BPCIA introduced a statutory bargain under which FDA may approve biosimilars that are highly similar to a reference product that has been approved by FDA under a BLA In exchange for this partial taking of its trade secrets, the RPS receives a 12 year period of exclusivity and the opportunity for pre-market patent litigation This bargain raises serious constitutional concerns if applied retroactively Note: BIO disagrees: – “We continue to believe that the biosimilars law applies, and should apply, to all biological products, whether the reference product was approved pre- or post enactment of the law." 15

16 Recent IP Developments Humira was Abbott’s top-selling drug last year with about $3.4 billion in revenue Humira predicted to be the No. 1 selling drug this year with sales reaching an $9.3 billion The patent on Humira expires in December 2016 At least three companies have begun pre-clinical or clinical testing of a Humira biosimilar Abbott plans to spinoff AbbVie later this year – Humira will be 45% of the new company's sales and 85% of its profit – Biosimilar competition would impact new company that draws most of its profits from a single drug 16

17 Contact Information Madison C. Jellins HelixIP LLP, Silicon Valley Direct: 650-241-0192 17

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