April 26, 2017
WRITS OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE FEDERAL CIRCUIT
Biologies Price Competition and Innovation Act of 2009
(BPCIA or Act) provides an abbreviated pathway for
obtaining Food and Drug Administration (FDA) approval of a
drug that is biosimilar to an already licensed biological
product (reference product). 42 U.S.C. §262(k). It
also provides procedures for resolving patent disputes
between biosimilar manufacturers (applicants) and
manufacturers of reference products (sponsors).
§262(I). The Act treats the mere submission
of a biosimilar application as an "artificial"
act of infringement, enabling parties to bring patent
infringement actions at certain points in the application
process even if the applicant has not committed a
traditional act of patent infringement. See 35 U.S.C.
§262(Q(2)(A), an applicant seeking FDA approval of a
biosimilar must provide its application and manufacturing
information to the sponsor within 20 days of the date the
FDA notifies the applicant that it has accepted the
application for review. This triggers an exchange of
information between the applicant and sponsor designed to
create lists of relevant patents and flesh out potential
legal arguments. §262(Z)(3). The BPCIA then channels
the parties into two phases of patent litigation. In the
first, the parties collaborate to identify patents on the
lists for immediate litigation. The second phase-triggered
when the applicant, pursuant to §262(Z)(8)(A), gives
the sponsor notice at least 180 days before commercially
marketing the biosimilar-involves any listed patents not
litigated in the first phase. The applicant has substantial
control over the timing and scope of both phases of
to comply with these procedural requirements may lead to
two consequences relevant here. Under §262(Q(9)(C), if
an applicant fails to provide its application and
manufacturing information to the sponsor under
§262(Q(2)(A), then the sponsor, but not the applicant,
may immediately 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." And under §262(T)(9)(B), if
an applicant provides the application and manufacturing
information but fails to complete a subsequent step in the
process, the sponsor, but not the applicant, may bring a
declaratory-judgment action with respect to any patent
included on the sponsor's list of relevant patents.
is a filgrastim product marketed by Amgen, which claims to
hold patents on methods of manufacturing and using
filgrastim. Sandoz sought FDA approval to market a
biosimilar filgrastim product under the brand name Zarxio,
with Neupogen as the reference product. A day after the FDA
informed Sandoz that its application had been accepted for
review, Sandoz notified Amgen that it had submitted an
application and that it intended to market Zarxio
immediately upon receiving FDA approval. It later informed
Amgen that it did not intend to provide the application and
manufacturing information required by §262(Q(2)(A) and
that Amgen could sue immediately for infringement under
sued Sandoz for patent infringement and also asserted that
Sandoz engaged in "unlawful" conduct in violation
of California's unfair competition law. This latter
claim was predicated on two alleged violations of the
BPCIA: Sandoz's failure to provide its application and
manufacturing information under §262(T)(2)(A), and its
provision of notice of commercial marketing under
§262(Q(8)(A) prior to obtaining licensure from the
FDA. Amgen sought injunctions to enforce both BPCIA
requirements. Sandoz counterclaimed for declaratory
judgments that the asserted patent was invalid and not
infringed and that it had not violated the BPCIA.
the case was pending, the FDA licensed Zarxio, and Sandoz
provided Amgen a further notice of commercial marketing.
The District Court subsequently granted partial judgment on
the pleadings to Sandoz on its BPCIA counterclaims and
dismissed Amgen's unfair competition claims with
prejudice. The Federal Circuit affirmed in part, vacated in
part, and remanded. The court affirmed the dismissal of
Amgen's state-law claim based on Sandoz's alleged
violation of §262(Z)(2)(A), holding that Sandoz did
not violate the BPCIA in failing to disclose its
application and manufacturing information and that the
BPCIA provides the exclusive remedies for failure to comply
with this requirement. The court also held that under
§262(f)(8)(A) an applicant must provide notice of
commercial marketing after obtaining licensure, and that
this requirement is mandatory. It thus enjoined Sandoz from
marketing Zarxio until 180 days after the date it provided
its second notice.
Section 262(f)(2)(A) is not enforceable by injunction under
federal law, but the Federal Circuit on remand should
determine whether a state-law injunction is available. An
applicant may provide notice under §262(f)(8)(A) prior
to obtaining licensure. Pp. 10-18.
Section 262(f)(2)(A)'s requirement that an applicant
provide the sponsor with its application and manufacturing
information is not enforceable by an injunction under
federal law. The Federal Circuit reached the proper result
on this point, but its reasoning was flawed. It cited
§271(e)(4), which expressly provides the "only
remedies" for an act of artificial infringement. In
light of this language, the court reasoned that no remedy
other than those specified in the text-such as an
injunction to compel the applicant to provide its
application and manufacturing information-was available.
The problem with this reasoning is that Sandoz's
failure to disclose was not an act of artificial
infringement remediable under §271(e)(4). Submitting
an application constitutes an act of artificial
infringement; failing to disclose the application and
manufacturing information required by §262(f)(2)(A)
provision, §262(f)(9)(C), provides a remedy for an
applicant's failure to turn over its application and
manufacturing information. It authorizes the sponsor, but
not the applicant, to bring an immediate
declaratory-judgment action for artificial infringement,
thus vesting in the sponsor the control that the applicant
would otherwise have exercised over the scope and timing of
the patent litigation and depriving the applicant of the
certainty it could have obtained by bringing a
declaratory-judgment action prior to marketing its product.
The presence of this remedy, coupled with the absence of
any other textually specified remedies, indicates that
Congress did not intend sponsors to have access to
injunctive relief, at least as a matter of federal law, to
enforce the disclosure requirement. See Great-West Life
& Annuity Ins. Co. v. Knudson, 534 U.S. 204, 209.
Statutory context further confirms that Congress did not
authorize courts to enforce §262(f)(2)(A) by
injunction. Pp. 10-13.
Federal Circuit should determine on remand whether an
injunction is available under state law to enforce
§262(f)(2)(A). Whether Sandoz's conduct was
"unlawful" under California's unfair
competition statute is a question of state law, and the
Federal Circuit thus erred in attempting to answer that
question by referring only to the BPCIA. There is no
dispute about how the federal scheme actual- ly works on
the facts of this case: Sandoz failed to disclose the
requisite information under §262(Q(2)(A), and was
accordingly subject to the consequence specified in
§262(Q(9)(C). As a result, there is nothing to decide
on this point as a matter of federal law. The court on
remand should determine whether California law would treat
noncompliance with §262(Z)(2)(A) as "unlawful,
" and whether the BPCIA pre-empts any additional
state-law remedy for failure to comply with
§262(7)(2)(A). Pp. 13-15.
An applicant may provide notice of commercial marketing
before obtaining a license. Section 262(Z)(8)(A) states
that the 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)."
Because the phrase "of the biological product licensed
under subsection (k)" modifies "commercial
marketing" rather than "notice, "
"commercial marketing" is the point in time by
which the biosimilar must be "licensed."
Accordingly, the applicant may provide notice either before
or after receiving FDA approval. Statutory context confirms
that §262(T)(8)(A) contains a single timing
requirement (180 days before marketing), rather than the
two requirements posited by the Federal Circuit (after
licensing, and 180 days before marketing). "Had
Congress intended to" impose two timing requirements
in §262(Z)(8)(A), "it presumably would have done
so expressly as it did in the" adjacent provision,
§262(Z)(8)(B). Russello v. United States,
A&A U.S. 16, 23. Amgen's contrary arguments
are unpersuasive, and its various policy arguments cannot
overcome the statute's plain language. Pp. 15â18.
794 F.3d 1347, vacated in part, reversed in part, and
THOMAS, J., delivered the opinion for a unanimous Court.
BREYER, J., filed a concurring opinion.
cases involve 42 U.S.C. §262(Z), which was enacted as
part of the Biologies Price Competition and Innovation Act of
2009 (BPCIA), 124 Stat. 808. The BPCIA governs a type of drug
called a biosimilar, which is a biologic product that is
highly similar to a biologic product that has already been
approved by the Food and Drug Administration (FDA). Under
§262(Z), an applicant that seeks FDA approval of a
biosimilar must provide its application materials and
manufacturing information to the manufacturer of the
corresponding biologic within 20 days of the date the FDA
notifies the applicant that it has accepted the application
for review. The applicant then must give notice to the
manufacturer at least 180 days before marketing the
first question presented by these cases is whether the
requirement that an applicant provide its application and
manufacturing information to the manufacturer of the biologic
is enforceable by injunction. We conclude that an injunction
is not available under federal law, but we remand for the
court below to decide whether an injunction is available
under state law. The second question is whether the applicant
must give notice to the manufacturer after, rather than
before, obtaining a license from the FDA for its biosimilar.
We conclude that an applicant may provide notice before
obtaining a license.
complex statutory scheme at issue in these cases establishes
processes both for obtaining FDA approval of biosimilars and
for resolving patent disputes between manufacturers of
licensed biologies and manufacturers of biosimilars. Before
turning to the questions presented, we first explain the
biologic is a type of drug derived from natural, biological
sources such as animals or microorganisms. Biologies thus
differ from traditional drugs, which are typically
synthesized from chemicals. A manufacturer of a biologic may
market the drug only if the FDA has licensed it pursuant to
either of two review processes set forth in §262. The
default pathway for approval, used for new biologies, is set
forth in §262(a). Under that subsection, the FDA may
license a new biologic if, among other things, the
manufacturer demonstrates that it is "safe, pure, and
potent." §262(a)(2)(C)(i)(I). In addition to this
default route, the statute also prescribes an alternative,
abbreviated route for FDA approval of biosimilars, which is
set forth in §262(k).
obtain approval through the BPCIA's abbreviated process,
the manufacturer of a biosimilar (applicant) does not need to
show that the product is "safe, pure, and potent."
Instead, the applicant may piggyback on the showing made by
the manufacturer (sponsor) of a previously licensed biologic
(reference product). See §262(k)(2)(A)(iii). An
applicant must show that its product is "highly
similar" to the reference product and that there are no
"clinically meaningful differences" between the two
in terms of "safety, purity, and potency."
§§262(i)(2)(A), (B); see also
§262(k)(2)(A)(i)(I). An applicant may not submit an
application until 4 years after the reference product is
first licensed, and the FDA may not license a biosimilar
until 12 years after the reference product is first licensed.
§§262(k)(7)(A), (B). As a result, the manufacturer
of a new biologic enjoys a 12-year period when its biologic
may be marketed without competition from biosimilars.
sponsor may hold multiple patents covering the biologic, its
therapeutic uses, and the processes used to manufacture it.
Those patents may constrain an applicant's ability to
market its biosimilar even after the expiration of the
12-year exclusivity period contained in §262(k)(7)(A).
BPCIA facilitates litigation during the period preceding FDA
approval so that the parties do not have to wait until
commercial marketing to resolve their patent disputes. It
enables the parties to bring infringement actions at certain
points in the application process, even if the applicant has
not yet committed an act that would traditionally constitute
patent infringement. See 35 U.S.C. §271(a)
(traditionally infringing acts include making, using,
offering to sell, or selling any patented invention within
the United States without authority to do so). Specifically,
it provides that the mere submission of a biosimilar
application constitutes an act of infringement.
§§271(e)(2)(C)(i), (ii). We will refer to this kind
of preap-proval infringement as "artificial"
infringement. Section 271(e)(4) provides remedies for
artificial infringement, including injunctive relief and
BPCIA sets forth a carefully calibrated scheme for preparing
to adjudicate, and then adjudicating, claims of infringement.
See 42 U.S.C. §262(Z). When the FDA accepts an
application for review, it notifies the applicant, who within
20 days "shall provide" to the sponsor a copy of
the application and information about how the biosimilar is
manufactured. §262(Z)(2)(A). The applicant also
"may provide" the sponsor with any additional
information that it requests. §262(/)(2)(B). These
disclosures enable the sponsor to evaluate the biosimilar for
possible infringement of patents it holds on the reference
product (i.e., the corresponding biologic).
§262(Z)(1)(D). The information the applicant provides is
subject to strict confidentiality rules, enforceable by
injunction. See §262(Z)(1)(H). The first question
presented by these cases is whether §262(Z)(2)(A)'s
requirement-that the applicant provide its application and
manufacturing information to the sponsor-is itself
enforceable by injunction.
the applicant makes the requisite disclosures, the parties
exchange information to identify relevant patents and to
flesh out the legal arguments that they might raise in future
litigation. Within 60 days of receiving the application and
manufacturing information, the sponsor "shall
provide" to the applicant "a list of patents"
for which it believes it could assert an infringement claim
if a person without a license made, used, offered to sell,
sold, or imported "the biological product that is the
subject of the [biosimilar] application."