First-Ever Judicial Interpretation of Biosimilar Patent Litigation Statute Results in Dismissal of DJ Action

Sandoz v. Amgen and Hoffman-La Roche, No. 13-204 (N.D. Cal.)

    by Aaron F. Barkoff

In what appears to be the first court decision interpreting the patent litigation provisions of the BPCIA (the "Biosimilar Act"), the U.S. District Court for the Northern District of California granted Amgen's motion to dismiss Sandoz's declaratory judgment complaint concerning patents protecting Enbrel (etanercept).  In its order dismissing the case, the court stated that "neither a reference product sponsor, such as Amgen, nor [a biosimilar] applicant, such as Sandoz, may file a lawsuit unless and until they have engaged in a series of statutorily-mandated exchanges of information."

Sandoz filed its complaint in June, alleging that it is conducting clinical trials on a "biologic drug containing etanercept" and that it "intends to file an FDA application for licensure of its etanercept product as biosimilar to Enbrel" upon completion of the clinical trials.  Sandoz sought a declaration that its biosimilar product does not infringe either U.S. Patent No. 8,063,182 or 8,163,522 and that the two patents are invalid and unenforceable.

Amgen responded by filing a motion to dismiss for lack of subject matter jurisdiction, arguing that the complaint was premature for two reasons: (1) a district court lacks statutory authority to consider a patent dispute involving a biosimilar product until after such time as an application for FDA approval of the biosimilar product has been filed, and (2) as a factual matter, a cognizable case or controversy does not presently exist.

Sandoz argued in its opposition brief that the Biosimilar Act "provides [declaratory judgment] actions can be filed by either party upon the biosimilar manufacturer's notice of commercial marketing, which Sandoz has given here."  But the court disagreed:

First, as set forth in the section on which Sandoz relies, a "notice of commercial marketing" is required to be given by the applicant to the reference product sponsor "not later than 180 days before the date of the first commercial marketing of the biological product licensed under subsection (k)."  Here, Sandoz cannot, as a matter of law, have provided a "notice of commercial marketing" because, as discussed above, its etanercept product is not "licensed under subsection (k)."  Second, even after an applicant provides a "notice of commercial marketing," it cannot bring an action for declaratory relief until, at a minimum, it has complied with its obligations under § 262(l)(2)(A).

In addition, the court determined that Sandoz failed to establish a "case or controversy" as required by Article III of the Constitution.  Here, the court found that Amgen never threatened to sue Sandoz and that Sandoz did not submit "evidence demonstrating [Amgen], by some means other than an express threat to sue, subjected Sandoz to an 'immediate' threat of injury."  Further, citing two Federal Circuit cases in support, the court found that "Sandoz's allegation that it intends in the future to file an application with the FDA is insufficient to create a case or controversy."

Ever since the Biosimilar Act was passed in 2010, litigators have studied the patent litigation provisions of the Act and debated which strategies to pursue.  The court's interpretation of the Act in this case is significant--particularly since it is the first.  If other district courts interpret the Act in the same way, certain litigation strategies will be off the table.

First-Ever Judicial Interpretation of Biosimilar Patent Litigation Statute Results in Dismissal of DJ Action