The Biologics Price Competition and Innovation Act of 2009 (BPCIA), embedded in the Patient Protection and Affordable Care Act (PPACA), established a statutory approval pathway and patent dispute resolution scheme for biological medicines. The biotechnology and pharmaceutical industries must be ready to implement BPCIA strategies once the FDA’s regulatory framework is finalized. This article will provide an overview of biologics, the scientific issues surrounding implementation of an abbreviated biosimilar licensure pathway, the biosimilar regulatory process and the BPCIA’s new patent information exchange and litigation provisions.


Biologics are complex medicinal agents produced and then isolated from living bioreactors, such as micro-organisms, animal cells or animals. Examples of biologics include blood components, nucleic acids for gene therapies, proteins, tissues, cells and vaccines. Specific examples on the market include Humira (rheumatoid arthritis), Avastin (cancer) and Epogen (anemia). Biologics are large “macromolecules” that are more complex than small-molecule drugs, which have an easily defined structure. The complexity of biologics makes it difficult for a generic manufacturer to produce an identical version of an innovator’s biologic. Instead, a generic manufacturer may only be able to produce a similar agent, a biosimilar.

Scientific Issues

Scientific issues raised during the lengthy BPCIA negotiations included whether: (1) slight differences in manufacture would yield a divergent product that may have potentially lethal characteristics; (2) the similarity of a biologic and its biosimilar could be determined using current analytical methods of structure and biological activity characterization; and (3) a clinical trial was necessary to determine the interchangeability (i.e., the safety and efficacy) of a biosimilar and its brand-name counterpart. Negotiations also considered whether current analytical characterization methods are sufficient to replace clinical trials in predicting the immunogenicity (i.e., the ability of the drug to provoke an immune response) of a biosimilar. The FDA suggested that (1) it may be possible to determine similarity between products without reference to manufacturing processes; (2) current analytical methodologies may be sufficient in most cases for comparison of a biologic to a biosimilar; and (3) interchangeability between a biologic and its biosimilar may be shown, but there are varying views over the necessity of clinical trials in this analysis.

Biosimilar Regulatory Process

The goal of the BPCIA is similar in concept to the Hatch-Waxman Act of 1984. Hatch-Waxman created the existing approval framework for “small molecule” generics where an applicant seeks approval to market a generic drug based on prior approval of the same drug by its innovator. The approval framework requires the generic to have the same active ingredient, strength, dosage form and route of administration as the prior approved drug. A generic manufacturer is not required to submit preclinical and clinical data to demonstrate safety and efficacy of the drug, and is permitted to rely on the innovator’s previously submitted drug safety and efficacy studies, which are costly and time-consuming. The generic applicant must only demonstrate the product is bioequivalent to the reference drug (i.e., the drugs are the same chemically and the generic acts the same way in the body as the reference drug). In many cases, a biologic cannot be shown to be a bioequivalent and the Hatch-Waxman scheme is not applied.

To overcome the difficulty in approval of a biosimilar, the BPCIA amends Section 351 of the Public Health Service Act (42 USC §262) and provides an abbreviated pathway for biologics relying on similarity, rather than equivalence. Section 351(i) defines biosimilarity to mean “the biological product is highly similar to the reference product notwithstanding minor differences in clinically inactive components” and “there are no clinically meaningful differences between the biological product and the reference product in terms of the safety, purity and potency of the product.” A biosimilar may only be approved for the same indications, route of administration, dosage form and strength as the reference product. An applicant must demonstrate biosimilarity by: (1) analytical studies; (2) animal studies; and (3) clinical studies, unless the FDA believes one or more of the studies are unnecessary to determine the biosimilarity of the particular biologic.

To encourage innovation, the act provides the drug innovator with a 12-year regulatory data exclusivity period beginning on the first licensure date. A biosimilar applicant may, however, file an application four years after the date on which the reference product was first licensed. But the biosimilar application may not be approved until the innovator’s 12-year data exclusivity period ends.

If a biosimilar is deemed “interchangeable,” it “may be substituted for the reference product without the intervention of the health care provider who prescribed the reference product.” The statute also provides for an exclusivity period for the first interchangeable biologic, granting at least a one-year generic industry monopoly for the first biosimilar applicant.

The ability to swap a biosimilar for a prescribed biologic is likely to provide a significant marketing benefit to the biosimilar industry and is at the heart of the act’s desired price competition platform. A recent BioTrends Research Group Report concluded that U.S. managed care organizations will require manufacturers to price their biosimilar products 26 percent lower than the reference brand. If such a price reduction is not had, the biosimilar will not be included in their formularies. Those manufacturers offering a greater cost savings may also be rewarded with fewer reimbursement restrictions.

Patent Information Exchange and Litigation

The BPCIA sets default procedures for patent information exchange and litigation. The parties may agree to an alternative procedure. Under the Hatch-Waxman scheme, patent information about an approved drug is publicly provided in the Orange Book. But under the BPCIA, patent information is provided through the below outlined patent exchange process between the parties:

• Within 20 days after a biosimilar application has been accepted for review, the biosimilar applicant must provide the innovator with the application and a description of its manufacturing process.

• Within 60 days of receipt, the innovator must provide the biosimilar applicant with a list of all patents the innovator believes could reasonably be asserted against the biosimilar applicant and identify those patents it would be willing to license.

• Within 60 days of receipt, the biosimilar applicant may provide its own list of potentially infringed patents that could be asserted by the innovator and must provide either (1) a detailed, claim-by-claim statement of the factual and legal basis of the opinion that patent(s) cited by the innovator are invalid, unenforceable or not infringed, or (2) a statement that the biosimilar applicant will wait for the listed patent(s) to expire. The applicant must also provide a response regarding offers to license.

• Within 60 days, the innovator must respond to the biosimilar applicant’s list/description with a detailed, claim-by-claim statement of the factual and legal basis that the patent(s) will be infringed, and a response to the applicant’s statements regarding validity and enforceability.

Following the patent exchange process, the BPCIA sets forth a default patent dispute and resolution procedure containing two separate litigation provisions.

First, for up to 15 days after the final patent exchange, the applicant and innovator must engage in good-faith negotiations to determine a list of patents to be litigated immediately. If an agreement is reached, the innovator has 30 days to bring suit on the listed patents. If an agreement is not reached, the patents to be litigated immediately are determined as follows:

• The applicant must give the innovator the number of patents that it will cite in its list of patents to be litigated.

• Within five days, both parties shall simultaneously exchange lists of patents they believe should be litigated immediately, with the caveat that the number of patents submitted by the innovator cannot exceed the number listed by the applicant in the previous step. If the applicant does not list any patents, the innovator may list one patent.

• The innovator shall bring suit on each patent on both lists within 30 days.

By failing to list a patent on the exchanged lists, a patentee may lose the right to bring suit over the omitted patent. The limited exchange provisions above exemplify the need for careful due diligence for both parties.

Additional provisions provide that initiating a suit under the BPCIA does not stay biosimilar application approval by the FDA, as occurs under the small-molecule generic pathway. Nor is there a statutory restriction on FDA approval when the applicant indicates it will wait until patent expiration.

Second, the BPCIA requires a biosimilar applicant to provide notice to the product innovator 180 days before commercial marketing. Once notice is received, the innovator may seek a preliminary injunction on any patent identified in the initial exchange lists and any patent identified in a supplement to the list, but not previously litigated patents.

Filing an application for biosimilar approval is an act of infringement (35 USC §271(e)(2)(C)), and a patentee may obtain the following relief:

• The innovator or patent owner may seek injunctive relief against infringement to prevent the commercial manufacture, use, offer to sell or sale within the U.S. or importation into the U.S. until expiration of a patent.

• Damages or other monetary relief are available only if there has been commercial manufacture, use, offer to sell or sale in the U.S. or importation into the U.S. of an approved biological product.

• A permanent injunction is available only after a final court decision and will be set to expire no earlier than the date of patent expiration.

• If the patent is on the negotiated or exchanged lists and an action for infringement was brought, resulting in the suit being dismissed without prejudice, not litigated to judgment in good faith, or was brought after the expiration of the 30-day period, the sole remedy for infringement is a reasonable royalty.

• If a patent is not timely included on an initial patent list exchanged with a biosimilar applicant, the patent owner may not bring an action under 35 USC §271 for infringement of the patent.

What to Expect

Many drug manufacturers are active with plans to develop biosimilars. The Biosimilar Guidance Webinar held February 15 showed that the FDA received nine applications for biosimilars, 35 pre-application meeting requests for proposed biosimilar products to 11 reference products and conducted 21 pre-application sponsor meetings. Nonetheless, the industry is watching for final rulemaking from the FDA to further develop biosimilar strategies.

According to an AARP study, global biologic drug sales are expected to reach nearly $200 billion by 2015, up from $138 billion in 2010, nearly half of which is concentrated in the United States. The BPCIA patent provisions will be tested by biosimilar applicants and innovators. •

Douglas J. Bucklin, an associate at Volpe and Koenig, concentrates his practice on patent-related matters both foreign and domestic. His technical experience includes biotechnology, plant genetics, pharmaceuticals, chemical inventions and medical devices. He is a registered patent attorney with the USPTO and can be contacted at

Max S. Morgan is a law clerk at the firm and a third-year law student at Rutgers University School of Law-Camden. He can be contacted at