Friday, October 2, 2015

Biosimilar Launches: Ready, Set, Not-so-Fast!

Stanton R. Mehr, President, SM Health Communications LLC

I’ve written as recently as this past January on the impending FDA decision to approve Sandoz’s version of filgrastim (brand name, Zarzio). By March, FDA had approved the agent, but Sandoz was unable to launch until September 3 because of legal action by Amgen that claimed Sandoz did not adhere to the specific, somewhat tortuous pathway that a biosimilar manufacturer has to follow to demonstrate that that their agent has not violated the patent of the innovator’s manufacturer. This pathway, promulgated by legislation, includes the ability for the innovator’s manufacturer to respond in kind to steps taken by the biosimilar company, all of which must be done within a certain time table. Here’s a piece that I wrote for the Health Payer Council (www.healthpayercouncil.com) a few months ago that more fully explained this situation, which is frustrating payers’ desire to start saving some money on specialty drugs.

We are on the cusp of the long-awaited new era in biologic treatment, the introduction of biosimilars to the armamentarium. They are estimated to save the health care system tens of billions of dollars over the course of a decade, and should start saving dollars to some extent (through better contracting with the innovator product, discounted pricing from the biosimilar manufacturer, or both) the moment the initial launch takes place. However, a scenario familiar to all payers may yet unfold that can significantly slow the pace of biosimilar introductions.

Challenges to product patents have a long and infamous history in the US pharmaceutical industry. They have been the cause of delayed generic introductions and accusations of manufacturer collusion, and the source of relentless bad press for the pharmaceutical industry. Yet, they work. They delay the loss of millions of dollars in revenue for brand manufacturers, and can postpone by years the launch of more cost-effective agents. Therefore, patent challenges to biosimilars were inevitable, and there are other legal challenges as well.

The Biologics Price Competition and Innovation Act of 2009, a subsection of the Affordable Care Act, not only directed FDA to set up the 351(k) pathway for biosimilars but also set up a framework for working through biosimilar patent disputes. Although similar to the statutory regulations contained in the Hatch–Waxman Act to address conflicts over patents for branded products by generic drug manufacturers, there are complex differences. According to one analysis of the Act.1 “The filing of a biosimilar application under the Biologics Act constitutes an act of ‘infringement’ sufficient to allow the maker of the innovative product to bring an action against the follow-on applicant in federal district court, but a series of patent exchanges must occur between the parties before any such suit is initiated.”

The first step in this complicated process is that the biosimilar manufacturer supply a copy of its application to the innovator company within 20 days of application acceptance. Then within 60 days, the innovator must send the biosimilar manufacturer a list of patents it believes would be infringed by the new agent. At this point, the originator’s manufacturer is compelled to list which, if any, of these patents it may be willing to license to the biosimilar’s manufacturer. Within another 60 days, the prospective biosimilar manufacturer is directed to detail for each patent on the list their factual and legal support for why it believes that the patent is not valid, unenforceable, or will not be infringed or a statement that the applicant does not intend to begin commercial marketing of the biological product before the official patent expiration date. Within yet another 60 days, the originator’s manufacturer must refute these arguments.1 Each of these steps in general represent opportunities for noncompliance and ongoing litigation.2,3

Sandoz, which gained the FDA nod for its biosimilar version of filgrastim (Zarzio) on March 6, has been battling Amgen over its US patent.4 Amgen’s product patent for filgrastim (Neupogen) expired in 2013. However, biosimilar manufacturing is more complex and more variable than that of conventional generic products. US patent law (unlike European patent law) stipulates that Sandoz must reveal its manufacturing process to Amgen so that the latter can better determine whether its patents have been violated. Sandoz, however, has not complied.

In May, a U.S. Court of Appeals overturned a March 19 ruling by Judge Richard Seeborg, from the San Francisco federal court, disallowing the launch of Zarxio until an appeal by Amgen is heard. Judge Seeborg had ruled that the “patent dance” outlined above was not mandatory but optional. Amgen appealed, arguing further that Zarxio would cause “irreparable price erosion” to Neupogen. However, this win can cost Amgen plenty down the line. In the event that Amgen ultimately loses its appeal, it must post a bond to reimburse Sandoz for each day of lost sales revenue from Zarxio.5  As lawsuits and motions are fired back and forth across the biosimilar battlefield, this sets up precedents for other legal actions involving biosimilars, explains legal experts.3,5 (The appeals court later ruled on July 22 that provision of the biosimilar application to the originator company within 20 days of filing was indeed optional, clearing the way for a launch after September 2.)

In an unrelated case, Sandoz filed suit to have Amgen’s patent for etanercept invalidated, even before Sandoz filed a biosimilar application. In this instance, the judge threw out the case because Sandoz had not yet filed the application and thus had no standing under the Act. (Sandoz subsequently filed for FDA review on October 2, and it is unclear whether the company will refile its suit).

Celltrion filed a 351(k) biosimilar application for its own form of infliximab (Remsima) in 2014, but the patent for Johnson & Johnson’s pioneer product Remicade was not set to expire until 2018 in the US (it expired in 2014 in Europe, where Remsima is available currently). In February, the US Patent and Trademark Office rejected the 2018 patent expiration, however, and Celltrion has said that if FDA approval is received, it will launch this year.6,7 A statement from J&J claimed that it will "pursue all available appeals" to protect its patent through the 2018 expiration date.7

Another aspect of legal challenges to biosimilars will involve their use in combination therapies. As the patent expiration approaches for some biologics, their manufacturers have sought to expand their market by pairing their product with another agent or conjugate. Can the approved biosimilar component be substituted and paired with the combination agent, and will the outcomes be the same? 

This issue may be tested legally for biosimilars, particularly for oncology agents like trastuzumab.8
This is a very slow learning process for payers who are hoping to see biosimilar savings or at least innovator company discounts, but finding it difficult to predict when this vision may be realized.

SM Health Communications provides writing, consulting, and innovative market research services for the payer markets. Its proprietary P&T Insight™ virtual P&T Committee program is the leading mock P&T Committee product in the field. We’ve participated in many market research projects involving biosimilar development and launch, from the point of view of the biosimilar and the innovator drug manufacturer. For more information, please visit www.smhealthcom.com or contact Stanton R. Mehr, President, at stan.mehr@smhealthcom.com.

References
1. The Biologics Price Competition and Innovation Act of 2009. (http://fdaregulatory.net/index.php/fda-regulatory-articles/buiologics). FDA Regulatory.Net 2013. Accessed June 19, 2015.
2. Stotland Weiswasser E, Gauger M. Biosimilar patent disputes: an update of the last 6 months. Law 360 March 31, 2015 (http://www.law360.com/articles/637389/print?section=appellate). Accessed June 15, 2015.
3. Rosenthal M. Biosimilars arena still littered with litigation. Specialty Pharmacy Continuum June 4, 2015. (http://www.specialtypharmacycontinuum.com/ViewArticle.aspx?d=Web%2BExclusives&d_id=530&i=June%202015&i_id=1199&a_id=32622). Accessed June 20, 2015.
4. Ledford H. First biosimilar drug set to enter US market. Nature January 13, 2015 (http://www.nature.com/news/first-biosimilar-drug-set-to-enter-us-market-1.16709). Accessed June 16, 2015.
5. McDermid R. Court blocks Novartis AG (NVS)'s recently approved "biosimilar" form of Amgen (AMGN)'s Neupogen. Biospace.com May 8, 2015 (http://www.biospace.com/news_story.aspx?StoryID=376077). Accessed June 19, 2015.
6. Staton T. Celltrion revs up Remicade biosim for U.S. rollout this year. Fierce Pharma April 1, 2015 (http://www.fiercepharma.com/story/celltrion-revs-remicade-biosim-us-rollout-year/2015-04-01). Accessed June 16, 2015.
7. Johnson & Johnson announces Patent and Trademark Office action related to Remicade (press release). PR Newswire February 18, 2015 (http://www.prnewswire.com/news-releases/johnson--johnson-announces-patent-and-trademark-office-action-related-to-remicade-300035468.htm). Accessed June 15, 2015.

8. Nelson KM, Gallagher GC. Biosimilars lining up to compete with Herceptin: opportunity knocks. Expert Opin Ther Patents. 2014;24(11):1149-1153.