Tony Hagen is senior managing editor for The Center for Biosimilars®.
Republican opponents of the Affordable Care Act (ACA), led by the state of Texas, fired opening salvos in the Supreme Court case over the landmark law's constitutionality. If the entire law is thrown out, approval for biosimilars under the Biologics Price Competition and Innovation Act (BPCIA) would disappear, too.
Opening salvos in the Supreme Court battle over the Affordable Care Act (ACA), with the biosimilar approval pathway hanging in the balance, were fired.
On Thursday, June 25, 2020, Texas Attorney General Ken Paxton, who is leading the charge for Republican states who want the ACA repealed, filed a brief demanding that the court strike down the entire ACA. And the Trump administration via a late-night Justice Department filing also declared that the entire ACA should be repealed, a demand that House Speaker Nancy Pelosi described as "an act of unfathomable cruelty" to the millions of individuals struggling without jobs or coverage during the pandemic.
The Supreme Court is not expected to address the case until after the November election.
“Obamacare has failed, and the sooner it is invalidated, the sooner each state can decide what type of health care system will best provide for those with preexisting conditions, which is the way the Founders intended,” Paxton said in a statement accompanying his filing.
The Biologics Price Competition and Innovation Act (BPCIA), which made the abbreviated biosimilars approval pathway possible, is one of the provisions of the ACA. If the Supreme Court determines that it cannot be “severed” from the ACA and thereby saved in the event the ACA is ruled invalid, then it will become invalidated, too.
"The Texas attorney general’s brief is significant because it confirms that the ACA’s challengers are asking the Supreme Court to strike down the entire ACA. The attorney general could have sought a narrower remedy that would preserve some portions of the ACA, such as the BPCIA. Therefore, the lawsuit continues to threaten the viability of the abbreviated pathways for approval of follow-on biologics that the biologics industry has relied on for the past decade," Stacie Ropka, a partner with Axinn, Veltrop & Harkrider LLP, told The Center for Biosimilars®.
The Individual Mandate
The key issue with the ACA is the individual mandate that requires the purchase of health insurance not otherwise covered. This was ruled unconstitutional by lower court judges and yet it is so intertwined with the rest of the ACA that the question before the Supreme Court is whether any parts of the ACA can be salvaged, including the BPCIA.
Although, previously, the lines of battle over the ACA were more closely delineated by the political stripes of the combatants—Republican versus Democrat—the huge increase in the unemployed caused by the new coronavirus 2019 (COVID-19) pandemic has reportedly weakened the strength of opposition toward the ACA because the coverage guarantee it offers has become much more important to many Americans.
Last week, another 1.5 million workers filed claims for state unemployment insurance, which constituted the 14th consecutive week that the unemployment figure has topped 1 million, the Labor Department reported today. In addition, 728,000 workers filed for coverage through a federally funded pandemic emergency program for those who don’t qualify for traditional unemployment insurance.
The Center for American Progress contended this week that 23.3 million Americans would lose health care coverage if the ACA were ruled invalid in its entirety, “about 3 million more (15%) than was forecast before the coronavirus pandemic.”
The Hill reported Wednesday that some Republicans have been backing off their criticism of the ACA amid poll results that show President Trump trailing in the presidential race against Democratic contender Joe Biden and Republican Senate seats in jeopardy. But primary litigants in the ACA case are forging ahead.
“When the statutory text proclaims the individual mandate ‘essential,’ then the remainder of the law cannot stand without the unconstitutional mandate,” read the statement from the Texas Office of the Attorney General.
There are multiple ways the Supreme Court could rule, and throwing out the BPCIA along with the rest of the ACA is one of them. This has the potential to disadvantage biosimilar developers who gain from the patent dispute resolution process that is built into the BPCIA. Without this, more products may have to launch at risk of litigation from originator drug companies seeking to recoup revenues lost to biosimilars and block competitors, and this may lead to a reduction in biosimilar competition, causing a loss of access to these medications for patients.
A Possible Constitutional Ruling
The Supreme Court may yet decide that the individual mandate is constitutional, which would be good for the BPCIA. And it may decide that the BPCIA, among other provisions, is severable, meaning it does survive.
“Looking at the BPCIA, it was originally debated as, and is intended to be, a standalone bill with provisions that are not interwoven with any other provisions of the ACA. It was sort of shoehorned into the ACA at the last minute. Thus, there's a credible argument that Congress intended the BPCIA to remain intact even if other provisions of the ACA are found unconstitutional,” Ropka told The Center for Biosimilars® in a May interview.