SCOTUS denies cert in biosimilar licensing dispute

The Federal Circuit’s decision finding it mandatory that a biosimilar-product applicant give a post-licensure notice to the manufacturer of the original FDA-approved biologic (the reference product sponsor) 180 days prior to beginning commercial marketing will remain law, because the Supreme Court denied a petition for writ of certiorari in Apotex Inc. v. Amgen Inc. A preliminary injunction granted by a district court will remain in effect, despite the biosimilar applicant giving notice to the reference product sponsor of its filing of an application to market the biosimilar (see Biosimilar applicant must give 180-day post-licensure notice to reference sponsor, Health Law Daily, July 6, 2016).

Background

In 2002, Amgen Inc. received a biologics license from the FDA for Neulasta® (pegfilgrastim), a human-engineered protein for patients undergoing chemotherapy. In 2014, Apotex Inc. filed an application for an FDA license to market a biosimilar version of Neulasta, invoking the abbreviated pathway for regulatory approval of follow-on biological products that are highly similar to a previously approved reference product. The abbreviated biosimilar pathway was allowed by the Biologics Price Competition and Innovation Act of 2009 (Biologics Act), which was created by sections 7001-7003 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148).

Under the Biologics Act, a biosimilar-product application may not be submitted until four years after the reference product was first licensed by the FDA and a biosimilar-product license may not be made effective until 12 years after the reference product was first licensed. The Biologics Act also contains detailed requirements that are focused on ways to avoid or streamline potential patent litigation by requiring the exchange of patent information between the biosimilar-product applicant and the reference product sponsor after the FDA accepts the biosimilar-product application for review. Finally, the Biologics Act requires the biosimilar-product applicant to give notice to the reference product sponsor 180-days before commercial marketing of its FDA-licensed product.

After the FDA accepted Apotex’s application for review, Apotex and Amgen engaged in the exchange of patent information as required by the Biologics Act. After negotiations, the parties agreed to an action for infringement of two patents, but after one of the patents expired, Amgen’s patent infringement action against Apotex was only based on the one remaining disputed patent. This appeal, however, did not involve the infringement action but rather Amgen’s motion for a preliminary injunction to require Apotex to provide Amgen notice if and when it receives a license from the FDA and to delay any commercial marketing for 180 days from that notice. The Federal Circuit upheld the injunction and found that giving post-licensure notice to the manufacturer was mandatory.

Supreme Court

In September 2016, Apotex filed a petition for writ of certiorari with the Supreme Court. It requested review of two issues: (1) whether the Federal Circuit erred in holding that biosimilar applicants that make all disclosures necessary under the Biologics Price Competition and Innovation Act for the resolution of patent disputes must also provide the reference product sponsor with a notice of commercial marketing; and (2) whether the Federal Circuit improperly extended the statutory 12-year exclusivity period to 12 1/2 years by holding that a biosimilar applicant cannot give effective notice of commercial marketing for its biosimilar product until it receives a FDA license and therefore may not commercially market its biosimilar product for 180 days after receiving its license. On December 12, 2016, the Court denied Apotex’s petition.

Next abortion legislation arguments will use mixed evidence on fetal pain

Reproductive health issues have long been controversial, and one law professor believes that the next wave of abortion restriction legislation and court cases will take a new approach by discussing the effects of abortion on the fetus. In an article published in the New England Journal of Medicine, Professor R. Alta Charo projects that, because the recent arguments supporting abortion restrictions focusing on women’s safety were shot down due to medical evidence, the focus will turn to the effects on the fetus.

New focus on evidence

The recent U.S. Supreme Court decision Whole Woman’s Health v. Hellerstedt shot down a Texas law requiring physicians performing abortions to have admitting privileges at local hospitals while reasoning that the procedures have become so safe that such a requirement is not necessary. This reasoning signals a shift in court thinking and a new willingness to dive into the medical evidence surrounding the issue rather than defer to the legislature on factual issues. Charo pointed out that in 2007, when the Supreme Court upheld a statute banning dilation and extraction based on the legislature’s findings that such a procedure is not necessary to protect a woman’s health, the Gonzales v. Carhart opinion accepted the legislature’s factual findings because of mixed evidence. Even so, the opinion indicated that the court had a duty to review the facts underlying decisions involving constitutional rights.

Next steps

Charo believes that a shift will occur because medical evidence does not support the argument that abortion is unsafe and presents significant health risks to women. This shift will involve claims that a fetus can feel pain about 20 weeks after conception, based on fetal movement and hormonal activity in response to stimuli and stress. Charo observed that there are growing efforts to require fetal anesthesia, outlaw second-trimester use of dilation and evacuation, and prevent abortion starting at 20 weeks following conception. The opportunity arises for a legislature to state that medical opinion is mixed in light of studies showing that a fetus cannot feel pain due to the development timeline until almost 30 weeks. Charo believes that the Gonzales decision prioritized fetal concerns over women’s health and that that the opportunity may arise again. However, Whole Woman’s Health presents the possibility that the court will consider further evidence rather than deferring to the legislature’s fact finding.

Florida health care provider settles monopolization, conspiracy claims

Health First, Inc. and its subsidiaries have settled allegations that they attempted to establish a vertically integrated, self-reinforcing, illegally-maintained health care monopoly in Southern Brevard County, Florida. Just days after denying Health First’s motion for summary judgment, the federal district court in Orlando dismissed the antitrust claims with prejudice.

Omni Healthcare, Inc. and other physicians and physician practice groups filed suit against “fully integrated” health care corporation Health First, Inc. and three of its wholly owned subsidiaries: Holmes Regional Medical Center, Inc.; Health First Health Plans, Inc., and Health First Physicians, Inc. Omni alleged that Health First engaged in an anticompetitive scheme to monopolize Southern Brevard County’s interrelated health care markets for years and that the scheme has largely been successful.

The court denied Health First summary judgment on August 13, 2016, finding that Omni and other physicians and physician groups created genuine issues of material fact in whether Health First monopolized, attempted to monopolize, and conspired to monopolize the markets for physician services, Medicare Advantage, and ancillary services.

Anthem first to respond to merger challenges, government opposes quick trial

Two large insurance mergers–Cigna-Anthem and Aetna-Humana–have been hot topics since the deals were proposed. The latest hurdle, suits filed by the Department of Justice (DOJ), may be a bigger issue than anticipated, as the government argued against Anthem, Inc.’s request for a speedy trial. The DOJ argued that the issues at hand are more complex than other cases, requiring more time than the 88-day scheduling range Anthem requested.

The inevitable lawsuit 

On July 21, 2016, the DOJ filed lawsuits challenging both the Cigna-Anthem merger and the Aetna-Humana merger. Attorney General Loretta Lynch stated that the mergers would eliminate too much competition and, therefore, the motivation for insurers to lower their premiums and offer better benefits. Aetna and Humana both stated they would contest the suit, arguing that the deal would actually improve options for Medicare patients. These companies are two of the four largest Medicare Advantage providers. According to the DOJ, an Anthem-Cigna merger would result in only three insurers with networks that would sufficiently serve the country’s largest employers.

Cigna’s response to the suit was less robust, stating that if the deal closed at all, it would be sometime next year. The company is reviewing the merger agreement, which may require defense of the deal, and analyzing its options. Anthem took the position that the suit was a “step backwards” for consumers, but seemed open to a settlement.  A joint statement from Aetna and Humana suggested that some divestitures could preserve competition, but the government was doubtful.

The American Hospital Association (AHA) and the American Medical Association (AMA) believe that the suit protects consumers, and that fewer coverage options would undermine innovation. The Center for Healthcare Research & Transformation director noted that even if the deals reduced prices insurers pay to providers, consumers may not see any savings. She believes that the suits will be difficult for the companies to win. Failure would be costly for Aetna and Anthem, as the agreements state that Anthem would pay Cigna $1.85 billion and Aetna would pay Humana $1 billion in termination fees.

State responses

States are taking action on the suits as well. Eleven states, plus the District of Columbia, joined the DOJ’s challenge against the Cigna-Anthem merger, while eight states and D.C. joined to fight Aetna-Humana. Other state actions are pending as well, such as the New Hampshire Insurance Department’s is review of the Cigna-Anthem proposal. An AMA analysis found that the  merger would result in control of 64 percent of the state’s insurance market. According to the state, the two proceedings are separate, and the insurance commissioner still has the authority to act in the event that the lawsuit does not succeed. The state department is not yet prepared to hold hearings, and will wait to take action until the lawsuit is resolved.

Speedy trial

Anthem, the only company that has filed an answer in the lawsuits, requested that the judge provide a trial within 88 days, with a decision on the injunction coming within 35 days of the trial’s conclusion. The government strongly opposes such a quick timeline, as the case comes against the largest health care merger ever to be proposed. The DOJ finds that the case is more complex than another recent coal antitrust suit that was quickly resolved, which Anthem relied upon as an example in its answer.