The case hinged on a little-known aspect of the Affordable Care Act that would expedite the release of generic drugs, a provision contested by major pharmaceuticals firms.
The Supreme Court dealt a blow to big pharma on Monday, ruling that companies making generic “biosimilars” to brand-name drugs don’t have to wait an extra six months after gaining federal approval before selling their drugs.
The ruling, written by Justice Clarence Thomas for the unanimous court, is expected to speed up how quickly generic drugs become available to consumers.
The dispute centered on a section of the 2010 Affordable Care Act that created an expedited path for regulatory approval of biosimilars while trying to respect the patent rights of brand-name manufacturers.
Unlike traditional drugs, biologics are made from living cells rather than chemicals, and cannot be copied exactly to make generic versions.
But Amgen said Zarxio was a near-copy of its cancer drug Neupogen and sued Sandoz in federal court in San Francisco alleging patent infringement, violations of the Biologics Price Competition and Innovation Act of 2009, and unlawful conduct in violation of California’s unfair competition law. Sandoz filed a counterclaim.
Both drugs boost white blood cell counts in cancer patients to help fight infections.
While the case was pending, the FDA licensed Zarxio, and Sandoz provided Amgen a further notice of commercial marketing. A federal judge later granted partial judgment on the pleadings to Sandoz on its counterclaims and dismissed Amgen’s unfair competition claims with prejudice.
In July 2015, the Federal Circuit ruled that the 180-day notice must be given after Food and Drug Administration approval. Sandoz immediately appealed to the Supreme Court, and the Trump administration threw its support behind the appeal.
Sandoz argued that the Federal Circuit effectively have Amgen an extra six months of market exclusivity.
In his ruling, Justice Thomas said the Federal Circuit erred because injunctive relief is not available to Amgen under federal law. In remanding the case, he said the appeals court should determine whether a state-law injunction is available.
“Whether Sandoz’s conduct was “unlawful” under California’s unfair competition statute is a question of state law, and the Federal Circuit thus erred in attempting to answer that question by referring only to the BPCIA,” Thomas wrote.
“Because Sandoz fully complied with §262(l)(8)(A) when it first gave notice (before licensure) in
July 2014, the Federal Circuit erred in issuing a federal injunction prohibiting Sandoz from marketing Zarxio until 180 days after licensure. Furthermore, because Amgen’s request for state-law relief is predicated on its argument that the BPCIA forbids prelicensure notice, its claim under California’s unfair competition law also fails,” Thomas said.