SAN FRANCISCO — After a decade of work and tens of millions in spending, Sandoz fears its debut of a drug for the skin condition psoriasis will be met with a crippling patent infringement suit.
Sandoz has high hopes for its drug, which could be one of the first biosimilars to reach the U.S. market. But U.S. District Judge Maxine Chesney ruled this week that the company cannot ward off a patent offensive from the market leader, Amgen, until it has a bona fide drug to protect. Sandoz has not yet filed an application with the Food and Drug Administration, much less received the stamp of approval it will need to bring its drug to patients.
“Defendants contend the instant action is premature … The Court agrees,” Chesney wrote in an order granting Amgen’s motion to dismiss the suit this week.
The suit offers an early glimpse of how patent litigation may unfold in the burgeoning field of biosimilars, a class of medications that mimic biologic drugs much like generics imitate pharmaceutical drugs. The FDA did not pave a path for the drugs to gain approval for use in the United States until 2010 with the adoption of the Biologics Price Competition and Innovation Act. Sandoz appears to be one of the first companies to file suit under the new regime.
Sandoz is in the last stages of developing a biosimilar for Amgen’s Enbrel, which uses a recombinant protein to treat inflammatory diseases including rheumatoid arthritis and chronic plaque-type psoriasis. But the company did not want to make the final investments needed to secure FDA approval without an assurance from the court that it will be able to keep its drug on the market. Represented by Winston & Strawn, Sandoz filed for declaratory judgment in June that it does not infringe Amgen’s patents.
“Unless Sandoz obtains clarity of its rights, it will be required to shelve its product or risk the potential for significant liability by launching it,” James Hurst, a partner at Winston & Strawn in Chicago, wrote in Sandoz’s opposition to Amgen’s motion to dismiss.
Sandoz must still complete a Phase III clinical trial to show how a large population of patients suffering from psoriasis responds to its biosimilar drug as compared to the original, Enbrel. But the company argued that the clinical trial is “merely confirmatory” after a series of successful tests. And Sandoz added that it would be able to ride the coattails of its adversary, Amgen.
“The clinical trial of a biosimilar drug does not start from a blank slate, but relies on the safety and efficacy already demonstrated by the reference biologic product in treating a given condition,” Hurst wrote.
But Chesney heeded Amgen’s warning that Sandoz was getting ahead of itself. The U.S. Court of Appeals for the Federal Circuit has barred life sciences companies from filing for declaratory action before wrapping up Phase III clinical trials, argued Amgen’s lawyers at Sidley Austin, which included San Francisco–based partners Patricia Thayer and Vernon Winters. And the FDA has yet to finalize its rules for biosimilars, adding another layer of uncertainty, they added.
“Plaintiff’s papers do not explain how it can be so confident that it will be in a position to submit an application demonstrating that its clinical candidate is ‘highly similar’ when the FDA has not even told the industry what that phrase means,” Winters wrote in Amgen’s reply brief.
Chesney sided with Amgen, finding that Sandoz cannot file suit yet because it is not far enough along in the FDA’s approval process.
A spokesman for Sandoz declined to comment.
“We believe in the validity of our patents,” an Amgen spokeswoman said in a statement.
Enbrel generates $4.2 billion each year in North American sales for Amgen, according to court papers.
The ruling is a blow for Sandoz, which has already spent more than nine years honing its biosimilar. The company timed the development of its drug to coincide with the expiration of patents protecting Enbrel. But shortly before Amgen’s patents were set to run out, the company announced that the U.S. Patent and Trademark Office had granted two new ones that will block biosimilar competition until 2029, according to court papers. Sandoz was blindsided, its lawyers contend.
“Amgen’s threats under these new patents, issuing from unpublished submarine applications, have upended Sandoz’s settled expectations and cast uncertainty over its product and business as a whole,” Hurst wrote.
Now, Sandoz is trying to shield itself from the patents under the doctrine of prosecution laches. That doctrine holds that a patent holder may not be able to enforce its rights against a company if there was a delay in the prosecution that put the infringer at a disadvantage.
Amgen argues that Sandoz may not move for relief because it has not even been threatened with a suit. In the absence of a complaint, Sandoz has taken Amgen’s public statements about its patent monopoly as a personal threat.
Amgen “cannot be heard to threaten the entirety of its competitors, and then claim there is no ‘controversy’ when a particular competitor seeks adjudication of its rights,” Hurst wrote.
But what Hurst was really doing, Winters wrote, was asking the court, “in effect, to overrule the FDA.”
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