Legal news and trends for Canadian in-house counsel and c-suite executives
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By Adrian Zahl 'Biosimiliar' competition Biological drugs likely to face new field of play. U ntil now, biological drugs — which include some of the costliest pharma- ceuticals on the mar- ket — have enjoyed an existence essentially free of competition from "copycat" drugs. This is in stark contrast with conventional drugs, which are under intense pressure from gener- ics. However, recent administrative and legislative changes in Canada and the United States could change the landscape for biotech drugs and lead to protracted patent battles in both countries. The prolonged exclusivity for bio- logical drugs has largely been due to the delays by drug approval agencies in Canada and elsewhere in developing standards for approval of "biosimilar" versions of such drugs. The complexity of biological drugs prevents them from being precisely copied, and, as a result, they do not meet the requirements for a generic drug. Health Canada has recently followed the lead of the European Medicines Agency and has developed standards for what they term "subsequent entry biolog- ic" drugs, or SEB. The requirements for approval are described in a new guidance document, which establishes an inter- mediate pathway between the extensive requirements for approval of a new drug and the simplified generic pathway. A subsequent entry drug must be shown to be substantially similar to a previously approved "reference product," which is normally a drug that has been approved and extensively used in Canada. In some cases, a reference product used elsewhere can qualify as a "proxy." Considerable data is required to support the SEB, including clinical trials to compare the safety and efficacy of the SEB with the reference product. Interestingly, if this data shows that the SEB is superior to the reference product, the SEB could be deprived of its status as an SEB, thereby, potentially sub- jecting the drug to more comprehensive data requirements, but also removing it from being subject to data exclusivity and other limitations. Additional clinical data is usually required to establish that the SEB can treat one or more of the same disease conditions for which the reference product was approved. While reduced from the data required to support an original drug, the requirements will still present a signifi- cant hurdle for biosimilar companies. The guidance states that subsequent entry biologic drugs must comply with patented medicines regulations. An SEB is also subject to any data exclusivity of the originator's drug, and is, finally, sub- ject to patent infringement actions if the product infringes one or more Canadian patents owned by the originator or any other party. The U.S has also introduced a pathway for approval of biosimilars, in the form of Title VII of the comprehensive health-care bill passed earlier this year. The legislation has two major prongs, the first being a framework for comparing the similarity of a biosimilar with its reference product. The second prong establishes a complex mechanism by which the biosimilar man- ufacturer must address the originator's patents. The biosimilar manufacturer is required to disclose its full drug applica- tion and proposed manufacturing process to the originator on a confidential basis. The originator must then provide a list of patents that it reasonably believes might be infringed by the biosimilar product or its manufacturing process. The respective sides have an opportunity to agree on the patents that will be litigated following which the originator can sue the biosimi- lar company for infringement of these patents. The originator can bring a sec- ond wave of infringement litigation based on additional patents that were included in the initial list. The first biosimilar to obtain approval for a drug is provided with a 12-month window during which no other biosimi- lar will be approved for that drug. Title VII provides a lengthy period of exclusivity for originators. The data exclusivity period is extended from five to 12 years for biological drugs. As well, once the patent litigation is triggered, they enjoy an indefinite preliminary injunc- tion against the approval of the biosimilar, pending resolution of the patent issues. The administrative and legislative changes in both countries will require bio- tech and drug companies to look closely at their patent strategies. Originators' patents must be sufficiently broad and robust to encompass a range of future biosimilar products that can differ from the original product in unpredictable respects. The new U.S. rules place a pre- mium on comprehensive patent protec- tion for biotech drugs, including patents that outlive the lengthy new data exclu- sivity period. Similar strategies will be useful in Canada, although the shorter data exclusivity periods will require originators to place greater reliance on listing patents in Health Canada's patent register to maintain a wall of protection from biosimilars. IH Adrian Zahl is a partner of Ridout & Maybee LLP in Ottawa. His practice focuses on patent prosecution, licens- ing, and related litigation, primarily in the pharmaceutical and biotechnology sectors. INHOUSE FEBRUARY 2011 • 9