New Suit Filed as Drug Makers Debate the Aims of the BPCIA

Drug maker Pfizer announced today that it has filed a district court lawsuit in the Eastern District of Pennsylvania against Johnson and Johnson.

The suit alleges that Johnson and Johnson has engaged in exclusionary contracts and anti-competitive practices related to its originator infliximab (Remicade) that have effectively denied patients access to biosimilar therapies (including Pfizer’s Inflectra) and have undermined price competition in the biologics marketplace. According to the complaint, Johnson and Johnson threatened to withhold rebates from insurers unless they agreed to exclude biosimilars from their formularies, and that Johnson and Johnson continues to increase Remicade’s price as it maintains its exclusive position. The suit alleges that Johnson and Johnson's contracts kept 70% of patients with commercial insurance from gaining access to Pfizer's biosimilar.

The suit also claims that Johnson and Johnson’s attempts to retain its market share for Remicade violate the aims of the Biologics Price Competition and Innovation Act (BPCIA). According to Douglas Lankler, executive vice president and general counsel for Pfizer, “Congress enacted the BPCIA to improve patient access to more affordable treatment options and to foster meaningful price competition for biologic products. [Johnson and Johnson’s] behavior runs counter to the spirit of this law and to [US] antitrust laws. We are filing this suit to help ensure that patients can benefit from, and have access to, lower cost biosimilar therapies.” Laura Chenoweth, deputy general counsel at Pfizer, called the suit a "bellweather case" with respect to exclusionary contracting.

Recently, the goals of the BPCIA have been a topic of much discussion among healthcare stakeholders, especially as biosimilar developers seek to bring their products to market in the face of lengthy patent litigation. That litigation is made all the more challenging due to growing uncertainties about the BPCIA; the Federal Circuit is currently deciding whether remedies exist under state law for a biosimilar applicant’s failure to comply with the BPCIA’s so-called “patent dance” after the Supreme Court ruled that no federal remedies apply.

Speaking to Bloomberg, attorney Chuck Klein of Winston and Strawn LLC, said of the current BPCIA litigation landscape, “right now it’s a little weird.” The BPCIA is “a relatively new law, so the effects are new.”

The newness and uncertainties of the BPCIA stand in stark contrast to the relatively straightforward patent litigation process for small-molecule drugs, which are addressed under the Hatch-Waxman Act. According to Bloomberg, Hatch-Waxman litigation has “become so streamlined that trucks full of generic drugs leave the warehouse as soon as FDA approval is granted.” The BPCIA process, however, has thus far resulted in only 3 biosimilar products—of a total of 7 FDA-approved molecules—making their way to the US marketplace.

In a recent interview with The Center for Biosimilars^®, Robert Cerwinski, JD, partner at Goodwin, said that “The policy behind the BPCIA is at least roughly the same as the policy behind the Hatch-Waxman laws, which is: Let’s encourage early biosimilar entry by giving a mechanism for resolving patent infringement lawsuits prior to actual marketing—let’s incentivize both sides to get this dispute out of the way early, so that biosimilars can reach the market as soon as possible.” However, Cerwinski explained, “The Hatch-Waxman laws were enacted in 1984, and we’ve had a lot of practice with these litigations in the district courts…the metes and bounds of the Hatch-Waxman laws have been pretty well defined in decades of adjudication.” The BPCIA, by contrast, is “a new statute; courts are just adjudicating it now for the first time, and we are seeing a lot of testing of the gray areas of the statute.”

Other legal experts have suggested that there exists the potential for lawmakers to work to revise or refine the BPCIA in order to better facilitate its goals of allowing for biosimilar market entry. Also in an interview with The Center for Biosimilars^®, Ha Kung Wong, JD, partner at Fitzpatrick, Cella, Harper and Scinto, said, “We saw Congress reform the Hatch-Waxman Act several times as procedural issues arose. For example, the Hatch-Waxman Act was amended in 2003 to address some patent listing and enforcement strategies issues. If we continue to see the same sorts of issues arise, or, for example, if we see a number of at-risk launches that end with biosimilar injunctions, Congress could well decide to amend the BPCIA.” However, Wong added, “One thing I don’t like to predict is what Congress will and won’t do.”