claire laporte, "life sciences ip"

Life Sciences IP 2016 … and 2017 in Preview

Claire Laporte January 23, 2017

© 2017 Foley Hoag LLP. All Rights Reserved. 1

Agenda

A corner of the ACA: the biologics statute From patents to trade secrets


The IP Corner of the ACA

The ACA touches IP by including Biologics Price Competition and Innovation Act (BPCIA). BPCIA: a pathway for the approval of biosimilars Like generics for biologics


Generic Drugs

Identical in “dosage form, safety, strength, route of administration, quality, performance characteristics and intended use” Not identical in price! Must be approved by FDA Hatch-Waxman Act provides

pathway for approval … and also a pathway for

patent issues to be resolved.


Biologics

Injected or infused Complex biomolecules such as antibodies Manufactured in genetically modified living cells High price, high profit

Costly to develop … and until BPCIA,

no pathway for generic-type (biosimilar) entry


BPCIA Establishes Biosimilars Pathway

Biosimilar applicant must establish that its drug is “biosimilar” to a “reference product” based on analytical, animal, and clinical studies. FDA cannot approve a biosimilar until 12 years after it

licenses the reference product. Biosimilars now approved: Zarxio® (filgrastim), Sandoz’s biosimilar to Amgen’s Neupogen® Inflectra® (infliximab), Celltrion’s biosimilar to Janssen’s

Remicade® Erelzi™ (etanercept), Sandoz’s biosimilar to Amgen’s Enbrel® Amjevita™ (adalimumab), Amgen’s biosimilar to AbbVie’s Humira®

Biosimilars are not as cheap as generics compared with the branded drug. Wholesale ACA repeal would eliminate pathway entirely.


And Now, the IP Dimension …

Statute sets up a “patent dance” to resolve issues about patents protecting the reference product:


Patent Dance?

Sandoz (and others) assert that patent dance is OPTIONAL. You decide: BPCIA (42 U.S.C. §262(l)(2)(A)): Biosimilar applicant

“shall provide to the reference product sponsor a copy of the application … and such other information that describes the process or processes used to manufacture the biological product.”

But BPCIA (§262(l)(9)(C)): “If a [biosimilar] applicant fails to [initiate the patent dance], the reference product sponsor, … may bring an action … for a declaration of infringement, validity, or enforceability of any patent that claims the biological product or a use of the biological product.”


Major Pros and Cons of Sitting Out the Dance

Pros

Postpone disclosure of application and manufacturing information More difficult for RPS to

allege infringement of manufacturing process patents Avoid requirement of

detailed, pre-litigation invalidity and non-infringement contentions

Cons

Lose chance to get list of relevant patents and RPS’s pre-litigation infringement and validity contentions Loss of control over timing

of litigation and number of patents RPS will eventually get

access to same information through discovery


The Courts Decide …

Federal Circuit: “[R]ead in isolation, the ‘shall’ provision … appears to

mean that a [biosimilar] applicant is required [to initiate patent dance] ….” BUT “the ‘shall’ provision … cannot be read in isolation. In

other provisions, the BPCIA explicitly contemplates that a [biosimilar] applicant might fail to [initiate dance] ….”

Supreme Court cert. granted on January 13.


But Wait, There’s More

Reference product gets 12 years of exclusivity…. BUT: BPCIA (l)(8)(A): “The [biosimilar] applicant shall

provide notice 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).” Federal Circuit: “We agree with Amgen that … a

[biosimilar] applicant may only give effective notice of commercial marketing after the FDA has licensed its product.” Cert granted on this too. 12 and a

half…


What Lies Ahead in 2017

Blockbuster decision in Amgen/Sandoz expected before July Questions: Will information exchange requirements and costs of

litigation create a disincentive to filing biosimilars applications? If the Supreme Court validates the alternative pathway

(no patent dance), will applicants dance or not? How will approval of biosimilars affect pricing models?


Agenda

A corner of the ACA: the biologics statute From patents to trade secrets


The Old Regime in the Life Sciences: Patents

Product development Long lead times Companies need to attract early investment Patents as proxies for company value

Licensing Non-exclusive licenses for platform technologies Exclusive licenses under Bayh-Dole for product-oriented patents Cross-licensing and royalty stacking

Litigation Patents protect products Every minute of patent term counts Litigation is typically brought by practicing entity


Trolls Destabilize the Patent System

“Troll” litigation in Eastern District of Texas Total cost of patent litigation

leaps into the high 7 figures Congress and the courts try to

fix the situation


The Supreme Court and “Patent Eligibility”

Section 101: from backwater to front line “Whoever invents or discovers any new and useful process,

machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.” Old Supreme Court cases had established non-textual

exceptions: Products of nature Abstract ideas Laws of nature

Among patent lawyers, nobody cared. Patent challengers brought cases based on the old

exceptions … and the Court began knocking off patents


Ariosa v. Sequenom (Fed. Cir. 2015)

Patent was based on insight that pregnant women’s plasma and serum contained cell-free fetal DNA. Law of nature??? Patent claimed a method of detecting “paternally

inherited nucleic acid of fetal origin” by amplifying the DNA from the serum or plasma sample. Product was MaterniT21 test, an alternative to

amniocentesis and CVS. Held: patent is invalid Cert denied 2016


Defend Trade Secrets Act of 2016

Legislation flew through otherwise gridlocked Congress Very similar to Uniform Trade Secrets Act Commerce Clause-based: applies only to trade

secrets “related to a product or service used in, or intended for use in, in interstate or foreign commerce” Jurisdiction in either federal or state court Diversity no longer needed to bring a trade secret action

in federal court But seizure provisions are effectively federal only

No preemption of state law


Patents or Trade Secrets?

PATENTS TRADE SECRETS

Require public disclosure Destroyed by public disclosure

Term: 20 years Term: as long as you keep the secret

Can protect reverse-engineerable items

No protection against reverse engineering

Obtained by prosecution; maintained by payments

Can be labor-intensive to maintain; requires reasonable efforts to keep secret

Exclusive: no unlicensed use permitted Non-exclusive: use prohibited only if it results from misappropriation

Must be non-obvious, adequately described, and useful

Must acquire value from not being generally known


Collaborations and Trade Secrets

Life science collaborations must now: Provide for reasonable measures to safeguard trade

secrets Be clear who “owns” trade secrets developed in the

collaboration A rogue co-owner can destroy the entire value of the trade secret – trade secrets are more vulnerable than patents

Consider including contract provisions to determine how information will be protected: patent or trade secret?


What Lies Ahead for 2017

Development of a new body of decisional law about trade secrets in federal court Increasing importance of trade secrets in the life

science economy: Manufacturing methods Targets Genotype/phenotype associations

Possible suppression of scientific knowledge to preserve secrecy of trade secrets


Questions?

Life Sciences IP 2016 … and 2017 in Preview

Claire Laporte January 23, 2017

claire laporte, "life sciences ip"

Healthcare