In the last decade, many new types of therapeutic biological products have been approved for the treatment of diseases. Hence, there is a desire to make generic biological products (i.e., biosimilars) available like current generic drugs. An approval pathway for biosimilars was created by the recent health care legislation—the Patient Protection and Affordable Care Act (HR 3590). This Act was signed into law on March 24, 2010. Title VII of the Act amends § 351 of the Public Health Service Act (42 U.S.C. § 262) to provide, inter alia, (a) an approval pathway for a biologic product that can be established as biosimilar to or interchangeable with the approved biological product, (b) an exclusivity period for the company who developed the approved product, and (c) a litigation schedule regarding patents that cover the approved biological product. This legislation only sets up a framework for an approval process of biosimilar biological drugs by the FDA. The FDA will now need to promulgate new rules to implement this approval process. This summary provides an overview of the key provisions of the new law including definitions of key terms, required information, exclusivity, and patent disputes.

I. Background

The Drug Price Competition and Patent Term Restoration Act of 1984 (“Hatch-Waxman Act”) aimed to reduce consumer costs on prescription drugs while protecting the investment of the company who developed the prescription drug by providing patent term extensions to recover some exclusive marketing time lost due to regulatory approval process at the FDA. The Hatch-Waxman Act provided for the abbreviated new drug application (“ANDA”), which allows an applicant (i.e., generic company) to use the innovator’s data to forgo clinical trials. However, the applicant must show its product is therapeutically equivalent to the branded prescription drug by showing pharmaceutical equivalence and bioequivalence. This process cannot be duplicated for a biological product due to the complexity of the biological molecule that serves as the active ingredient and the importance of the process of producing the biological product on the structure and function of the biological molecule.

II. Definitions

The term “biosimilar” is used to describe the proposed biological generic drug because the biosimilar product does not have to be identical to the approved product. The legislation defines a “biosimilar” biological product as (a) highly similar to the approved product notwithstanding minor differences in clinically inactive components and (b) having no clinically meaningful differences as compared to the approved product in terms of safety, purity, and potency. Before such an approval process can be implemented, the meaning of these terms will need to be established. “Highly similar” will need to be defined with regard to both structural and functional characteristics of the biosimilar product as compared to the approved biological product.

An “interchangeable” product as defined by the legislation is a biosimilar product (a) that may be substituted without intervention of the health care provider and (b) where the risk in terms of safety or diminished efficacy of alternating or switching between the biosimilar product and the approved product is not greater than the risk of using the approved product without alternation or switching.

III. Required Information

In contrast to non-biological small molecule drugs, an applicant that wants to develop a biosimilar product cannot completely copy all aspects of the approved product's data. Studies of the biosimilar product will have to be performed to show safety, purity, and potency since the biosimilar product is not an exact copy. The legislation provides that an application for approval of a biosimilar product shall include that

(I) the biological product is biosimilar to a reference product (the FDA approved and licensed product) based upon data derived from—

(aa) analytical studies demonstrating that the product is highly similar notwithstanding clinically in active components;

(bb) animal studies (including toxicity); and

(cc) clinical studies (including immunogenicity and pharmacokinetics) to demonstrate safety, purity, and potency;

(II) utilizes the same mechanism of action for the condition of use;

(III) same conditions of use approved for reference product;

(IV) route of administration, dosage form, and strength of product are the same as the reference product; and

(V) the facility of manufacture meets FDA standards.

IV. Exclusivity

Under the newly enacted legislation, there is 12 years of market exclusivity for the innovator product, which includes 4 years of data exclusivity. This market exclusivity period is irrespective of patents, which are tied to a filing date and may even expire prior to the market exclusivity expiration. Another 6 months of exclusivity is granted when the innovator provides acceptable pediatric data on the product.

There is also an exclusivity period for the first biosimilar biologic product approved. The legislation indicates that a second biosimilar may not seek approval until the earlier of

(a) 1 year after 1st commercial marketing after approval of the 1st biosimilar as interchangeable;

(b) 18 months after final resolution on all patents in suit; or

(c)  (i) 42 months after approval of the 1st biosimilar if 1st applicant still has litigation pending; or

(d)  (ii) 18 months after approval of 1st biosimilar if 1st applicant has not been sued.

V. Patent Disputes

This legislation also establishes a complicated regime of information exchanges and tight deadlines relating to any lawsuit concerning patents that cover the approved product between the biosimilar applicant and the approved biologic product sponsor (i.e., the entity approved to make and distribute the biologic product). Patents on approved biological products that cover the active ingredient, formulation, and method of treatment as well as the method of producing the biologic product can be litigated.

Under this law, there will be no Orange Book (the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations) listing for biologic products. The Orange Book lists patents on approved non-biological prescription drugs that cover the active pharmaceutical ingredient, formulation, or method of treatment. Instead, the biosimilar applicant must provide the approved biologic product sponsor with a copy of the FDA application and information regarding the biosimilar product and its production. This exchange of information starts the procedure of multiple exchanges of confidential information and patent lists. During these exchanges, each side must provide the other side with a detailed statement that describes the legal and factual basis of validity, enforceability, and infringement of any patents listed on a claim by claim basis.

The biosimilar applicant must also provide at least a 180-day notice of marketing of the biosimilar product to the approved biologic product sponsor. Neither the applicant nor the approved biological product sponsor can file a declaratory judgment until the 180-day notice of marketing, provided the requirements of the patent dispute regime are followed.

VI. The New Pathway

Although the biosimilar approval pathway generally parallels the ANDA for non-biological prescription drugs set forth by the Hatch-Waxman Act, there are significant differences. For example, the biosimilar product does not have to be an exact copy of the approved biologic product. Thus, the biosimilar applicant will have to show the safety, purity, and potency of the biosimilar. The legislation provides 12-year market exclusivity for the approved biological product, and the first biosimilar product approved is also granted a limited exclusivity. This legislation also establishes a complicated regime of information exchanges and tight deadlines relating to any lawsuit concerning patents that cover the approved product between the biosimilar applicant and the approved biologic product sponsor. Patents encompassing the active ingredients, methods of treatment, and methods of producing the biosimilar can be litigated. The pathway for biosimilar approval as framed by the new law will now require further action by the FDA in order to define what key terms such as “biosimilar” mean and to provide for regulations that will govern the application process, the exclusivity periods, as well as patent disputes.