Senator Hatch Files Amendment to Restrict Biosimilar, Generic Litigation Options

Senator Orrin Hatch, R-Utah, has filed an amendment to the Creating and Restoring Equal Access to Equivalent Samples Act (CREATES Act), which was advanced to the Senate by the Judiciary Committee on June 14, 2018.

The amendment, S.974 #EHF18270, which Hatch has titled the “Hatch-Waxman Integrity Act of 2018,” would prevent generic and biosimilar drug applicants from availing themselves of both standard litigation procedures (provided for under the Hatch-Waxman Act and the Biologics Price Competition and Innovation Act [BPCIA]) and inter partes review (IPR) or post-grant review (PGR) proceedings in seeking to invalidate patents held by innovator product sponsors.

The proposed amendment would require that a generic drug applicant certify that it has not filed—nor does it plan to file—a petition to institute an IPR or PGR for a patent covering the innovator drug; in essence, if a generic developer hopes to use the abbreviated Hatch-Waxman pathway to approval, it must promise not to utilize the IPR or PGR process. The amendment makes a similar provision for biosimilars; if a biosimilar developer plans to use the BPCIA approval pathway for its product, it must certify that it has not filed, and will not file, a petition to institute an IPR or PGR.

Finally, the proposal seeks to prevent the “manipulative and deceptive use” of IPRs by restricting anyone from engaging in a short sale of a publicly traded security held by a patent owner during a 90-day period before or after that individual or affiliate petitions for an IPR proceeding on that patent.

According to Hatch’s remarks prepared for the Judiciary Committee, “My amendment would preserve Hatch-Waxman as the standard path for generic companies to challenge brand patents, while keeping IPR as an option in situations where other interests come into play.” He added that the legislation “would prevent companies from using IPR to put added litigation pressure on innovators above and beyond what Hatch-Waxman already provides. And it would prevent a company that rightfully loses a Hatch-Waxman suit from getting a second bite at the apple.”

The IPR process, recently upheld by the Supreme Court of the United States after challenges to the constitutionality of the process, has become an integral part of the patent challenge landscape in the biosimilar and generic context given that IPR may be faster and less costly than the standard litigation process.

The Association for Accessible Medicines (AAM), which represents generic and biosimilar drug developers and has been a vocal supporter of the CREATES Act, told The Center for Biosimilars^® in an email that it is recommending that lawmakers vote no on Hatch’s amendment; “IPR and Hatch-Waxman patent litigation serve [2] different but equally vital functions, and Congress intended to make both systems available,” said AAM, adding that “Eliminating invalid patents by brand name drug companies is necessary to permit patient access to more affordable generic and biosimilar medicines. Generics are a proven solution to high drug prices and policies that continue to foster generic access are needed. The IPR process is just one of those policies.”