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calls about whether the supporting data is ripe enough to adequately support commercially relevant patent

claims. If not, absent some

overriding need to publish, accepting an occasional significant publication delay may be in a company’s best interest.

The Biologics Price Competition and Innovation Act of 2009

Te Biologics Price Competition and Innovation Act of 2009 (Biosimilars Act) has provided, for the first time, an abbreviated regulatory pathway for follow-on biological products. As compared to the Hatch Waxman Act of 1984 (which created an abbreviated pathway for small molecule generics), the Biosimilars Act provides a

very different patent dispute-resolution

procedure that places increased importance on process patents.

First, as part of the statutory patent dispute- resolution procedure, the process of making a biosimilar product must be disclosed by the generic applicant to the FDA approval holder, although there is still uncertainty whether the FDA and/or the courts will force generic applicants to disclose every detail. In any event, in contrast to Hatch Waxman, this requirement of the Biosimilars Act largely eliminates the commonly heard concern that process patents can be hard to police.

Second, the Biosimilars Act recognises two classes of biosimilar products: biological products that are ‘biosimilar’ to an approved product and biological products that are ‘interchangeable’ with an approved product. Only products deemed interchangeable


be substituted for an approved product by a pharmacist without the intervention of the healthcare provider who prescribed the approved product. In contrast, biosimilar products that are not deemed interchangeable by the FDA require a separate prescription. Clearly, whether a biosimilar product is ‘interchangeable’ or just ‘biosimilar’ has major financial ramifications for both the innovator patent holder and the potential generic challenger.

It is generally accepted in biotechnology that the ‘process is the product’. For example, in 2002, Genentech and XOMA reported that minor manufacturing modifications made to allow for large-scale production of Xanelim™ (efalizumab) increased serum concentration. Tus, a generic challenger forced to invent around process patents to avoid patent infringement runs the risk of altering a biological product’s profile. In short, the more process patents that must be invented around, the less likely it is that a biosimilar product will be interchangeable.

Data exclusivity protection is not the same as patent protection

Te Biosimilars Act also provides data exclusivity to the approval holder, prohibiting the FDA from approving biosimilar products for 12 years aſter the reference product was first licensed by the FDA. In contrast, data exclusivity for new chemical entities (i.e. small molecule drugs approved for the first time under Hatch Waxman) is only five years. Te 12-year versus five-year discrepancy is very controversial and some believe will be addressed legislatively.

Data exclusivity applies against generic applicants seeking abbreviated approval under the Biosimilars Act, but not against competing follow-on biologicals (e.g. bio-betters, etc.) for which ‘regular’ approval is sought. In contrast, patent protection applies generally and can be obtained anywhere along the development lifeline of a drug. So with good patent protection, it may be possible to stop the sale of a follow-on biological

drug in situations where exclusivity does not apply.

Inventorship disputes Developing a biological product through FDA approval typically involves interacting with a significant number of outside collaborators, including service providers, scientific collaborators and clinical trial investigators. As positive reports emerge from clinical trials and a drug’s prospective value

increases, companies are sometimes

contacted by past collaborators (or, more likely, their attorneys) alleging that the collaborator should also have been named as a co-inventor.

While inventorship disputes cannot be totally avoided, a few relatively simple safeguards can be put into place to minimise risk. First, all collaboration agreements should be put in writing before the collaboration begins to minimise opportunistic claims by collaborators that their inventive contributions occurred outside of, and are not bound by, the terms of the agreement. Second, the agreement should be structured such that inventorship does not drive ownership. In other words, the company should consider only collaborating with those willing to agree contractually to automatically assign any inventions to the company.

Inventorship disputes can be much more than a nuisance. US law provides that, absent a contract stating otherwise, an inventor of a single claim of a patent is a co-owner of the entire patent even if the inventor is not an inventor of any other claim. And, absent a contract stating otherwise, co-owners of US patents are free to assign or license them to third parties without accounting to the other co-owner(s).

36 Life Sciences Intellectual Property Review 2011 data Third-party patents

Typically, companies perform collection searches (also termed freedom to operate studies) for third-party patents and published patent applications in stages. Initial searches oſten occur prior to entering clinical trials and involve ‘clearing’ the target, screening methods, the actual product and potential indications.

Once clinical trials are entered, however, the

searches become more detailed and

include commercial manufacturing materials and methods, such as expression vectors, production cells, culture conditions and media, as well as patient-focused protocols, such as dosing schedules, dosage forms and pharmacokinetic data. It is important before commercial manufacturing methods and patient administration protocols are set with the FDA (which may occur in phase II) to identify all relevant patents and patent applications that may issue in the future. Also, it is important that there is a satisfactory strategy, whether obtaining a licence or relying on a non-infringement and/or invalidity position, for each relevant patent. For obvious reasons, it is preferable to invent around third-party patents prior to reaching the latter stages of clinical trials.

Eric K. Steffe is a director at Sterne, Kessler, Goldstein & Fox P.L.L.C. He can be contacted at:

Te author would like to thank Jorge Goldstein and Elizabeth Haanes for their editorial comments.

Eric K. Steffe is a director at Washington, DC-based intellectual property law firm Sterne, Kessler, Goldstein & Fox P.L.L.C., where he counsels domestic and foreign clients in various matters involving biotechnology patent law, specifically issues related to all phases of drug development and clinical trials.

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