Courts: Biosimilars Must Give Brand-Name Drug Makers Advanced Notice

A new federal court ruling requires biosimilar makers to inform their brand-name rivals approximately 6 months before launching expensive biologic medicine, delaying competition for the costly drugs and preventing as much as $44 billion in cost savings over the next decade.

The new appeal, an action brought by Amgen Inc and Amgen Manufacturing Limited (collectively Amgen), says that, per a requirement in the Biologics Price Competition and Innovation Act, a biosimilar company must provide a brand-name rival with 180-day notice before the product launches. This allows brand-name drug makers to decide if there are patent challenges that can be pursued before the biologic is released.

Although the federal appeals court says that a 180-day notice is required even if the biosimilar makers provide the brand-name company a marketing application, notice cannot be given to the brand-name drug maker until the FDA approves a lower-cost version to the biosimilar company.

In a similar case, Amgen v Sandoz, seen by the same court last year, Sandoz contended the law to allow it to give Amgen notice of any biosimilar market plans 180 days before FDA approval. The company lost and recently asked the Supreme Court to review the case. It is unclear if the court will revisit this case again in light of the new ruling. 

Notably, under the new ruling, the FDA can alter the near-term situation by issuing a marketing license for a biosimilar that would go into effect on the day of marketing approval. This would narrow the 6-month period that brand-name drug makers retain market exclusivity, though the FDA would need to take a formal step to issue a new regulation, according to William Jay, partner at Goodwin Procter law firm.

Biosimilars are estimated to save as much as $44 billion in US health care costs over the next decade. Although the number is constantly changing, many insurers and analysts forecast that the cost of biosimilars will be 10% to 30% less than brand-name biologics.

Reference:

United States Court of Appeals for the Federal Court. Amgen Inc., Amgen Manufacturing Limited v. Apotex Inc., Apotex Corp. https://freepdfhosting.com/f0f95da59d.pdf. Published July 5, 2016. Accessed July 6, 2016.