Unsealed Price-Fixing Complaint Reveals Emails

Issue 406 • 5 July 2019

knew what they were doing was illegal,” Tong insisted, “and that’s why they sought to mislead Congress, destroyed evidence, and cautioned each other to keep their collusive conversations offline. Our investigation is ongoing and expanding and the evidence released today reinforces the allegations in the complaint.”

‘POLITE F-U LETTERS’ AND ‘CO-OPETITION’ Among the emails highlighted by the Connecticut attorney general’s office is an email from Heritage Pharmaceuticals in which the firm “co-ordinated a response with counsel for Teva and Mylan” to a Con- gressional investigation into price increas- es led by Bernie Sanders and Elijah Cum- mings, who have recently urged criminal Unsealed Price-Fixing action over the current allegations. According to the email addressed to Heritage Pharmaceuticals’ Jeff Glazer, the Complaint Reveals Emails attorney general’s office noted, Teva and DAVID WALLACE [email protected] Mylan had both been in contact with the US Generic Pharmaceutical Association series of emails between gener- the states’ motion to unseal the com- (GPhA) – now known as the Association ics firms published as part of plaint, Tong pointed out, “among the ev- for Accessible Medicines (AAM) – to co- A an unredacted lawsuit alleging idence now public are emails between ordinate the response. “The consensus widespread price-fixing in the US gener- generic drug manufacturers coordinat- at this point is that the response will be ics industry reveals “brazen co-ordination ing their response to a Congressional ‘polite f-u letters’,” the email reads. to artificially inflate prices, hinder com- inquiry, emails enforcing ‘fair share’ and Further written evidence disclosed petition and unreasonably restrain trade ‘playing nice in the sandbox’ market al- by the filing shows firms requesting “no across the industry,” according to Con- location, ‘fluff pricing’ strategy and other emails please – phone call,” which the necticut attorney general William Tong. brazen co-ordination.” attorney general’s office described as an Tong had spearheaded the Connecti- These “commonly-used code-words” attempt to “cover their tracks” and was cut district court complaint filed in May were used to “co-ordinate on price in- “ample written evidence of their conspir- by a coalition of 44 US states, initially in creases in violation of federal antitrust acy…that show consciousness of guilt.” a redacted form, that named Teva, San- law,” the attorney general’s office claims. “In one series of exchanges,” the at- doz and Mylan, along with 17 other ge- “The evidence is undeniable and the con- torney general’s office notes, “senior -ex nerics manufacturers, as being involved spiracy is unconscionable,” Tong stated. “Our ecutives at Mylan and Sandoz allegedly in “a broad conspiracy to artificially inflate lawsuit alleges that generic drug manufac- colluded to divvy up market share for a and manipulate prices, reduce competi- turers engaged in a brazen, industry-wide blood pressure medication” when the tion and unreasonably restrain trade for conspiracy to fix prices and allocate market two firms were first to launch generic val- more than 100 different generic drugs.” share for drugs that we rely on every day.” sartan/hydrochlorothiazide on the same With the court having now granted “The evidence demonstrates that they day, 12 September 2012, with Mylan en-

FOR THE LATEST INSIGHT ON GENERICS AND BIOSIMILARS VISIT: GENERICS.PHARMAINTELLIGENCE.INFORMA.COM

PRICING BIOSIMILARS REGULATION German Price Henlius Has First ‘China- UK Government Anniversary Shows Developed’ Biosimilar Accepted Plans Express Freight Split In Perspectives, p. 6 For EMA Review, p.12 For Medicines, p.16 IN THIS ISSUE

Ongoing price-fixing allegations in the US took another turn this week with the publication of an unredacted version of a multi-state lawsuit alleging collusion and anti-competitive behaviour among some of the industry’s biggest players. While firms are vigorously rebutting the allegations, the details re- from the editor vealed by emails and other evidence cited in the price-fixing [email protected] lawsuit (see front cover) have led to negative headlines and coverage for the industry in the mainstream press.

Also this week, Akorn has received a further warning letter from the US Food and Drug Administration, exacerbating its compliance woes (p.4). And Glenmark has received a complete response letter from the agency over its Ryaltris nasal spray, pushing back approval into next year at the earliest (p.5).

It has not all been bad news this week, however. Biocon has been bolstered by a European approval for one of its key biosimilar manufacturing sites, opening doors in Europe for the Indian firm (p.9). And Shanghai Henlius Biotech has broken “While firms are new ground after its trastuzumab candidate became the first vigorously rebutting ‘China-developed’ biosimilar to have a marketing authoriza- the allegations, tion application accepted for review by the European Medi- cines Agency (p.12). details revealed by emails cited in Meanwhile, in the UK preparations for Brexit continue, with the price-fixing contingency planning – including express freight arrangements to ensure continuity of supply – being met with a lawsuit have led to guarded welcome from the country’s pharmaceuticals and life negative headlines” sciences sector (p.16).

LEADERSHIP SUBSCRIPTIONS DESIGN SUPERVISOR Phil Jarvis Val Davis Gayle Rembold Furbert Mike Ward ADVERTISING PRODUCTION Karen Coleman Rob Coulson Debi Robinson

EDITOR IN CHIEF Eleanor Malone CUSTOMER SERVICES TO SUBSCRIBE, VISIT [email protected] generics.pharmaintelligence.informa.com EXECUTIVE EDITOR Aidan Fry UK & Europe�� +44 (20) 337 73737 TO ADVERTISE, CONTACT [email protected] EXECUTIVE EDITOR David Wallace US Toll-Free �� +1 888 670 8900 EDITORIAL OFFICE US Toll �� +1 908 547 2200 SENIOR REPORTER Akriti Seth 4 Poplar Road Australia �� +61 2 8705 6907 Dorridge, Solihull B93 8DB CUSTOM CONTENT Andrea Charles Japan �� +81 3 6273 4260 All stock images in this publication courtesy of Generics Bulletin is published by Informa UK Limited. ©Informa UK Ltd 2019: All rights reserved. ISSN 0143 7690. www.shutterstock.com unless otherwise stated

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exclusive online content inside: Sandoz Data Suggest Safety And COVER / Unsealed Price-Fixing Complaint Reveals Emails Efficacy In Adalimumab Switching Sandoz presented data at EULAR 2019 proving the safety 4 Akorn Receives Second Warning and efficacy of switching from reference brand Humira Letter In Six Months to Hyrimoz, the company’s biosimilar adalimumab. https://bit.ly/2JiAO4r 5 Glenmark Suffers US Ryaltris Setback Amid Search For A Partner European Industry Backs 6 German Price Anniversary Shows Split In Perspectives Commitment To Access A renewed commitment to European access to healthcare 7 Sandoz Will Consider Local Partnerships In China made by the European Council has received the backing of industry, which has set out six key policy proposals. 9 Biocon’s Biosimilar Ambitions Get https://bit.ly/2Xf4XXi A Boost With European Site Approval

People Round-Up: Saraf Heads 10 Top US Generics Players Thwarted On Amneal’s Corporate Development August At-Risk Launch Of Fingolimod Apurva Saraf heads up corporate development for Amneal, Salvatore Butti becomes Stada’s general manager in Italy 12 Henlius Has First ‘China-Developed’ and Vectura searches for a new CEO. Biosimilar Accepted For EMA Review https://bit.ly/2XFWK2x 13 API Manufacturing Must Be High On Europe’s Agenda US FDA Will Allow Transitioning Products To Continue Referencing 16 UK Government Plans Express Freight For Medicines Drug Master Files 17 AAM Maintains Pressure On USTR To Shield The ‘technical detail’ needed to be resolved in part to Pharmaceuticals From China Tariffs ensure there would be no shortages after the 2020 change from regulation as drugs to biologics for certain protein 19 Coherus Chief: FTC Must Probe Originators’ products, the agency said. Anti-Competitive Tactics https://bit.ly/2XdJazn 20 Mayne Cannot Revive US Antifungals Patent Industry Prepares For Advent Of SPC Manufacturing Waiver 20 Spain’s Aeseg Warns Against Tender Proposals As the generics and biosimilars industries prepare for the 21 US Court Sticks To Status Quo European SPC manufacturing waiver to come into effect on 1 On Rotigotine Patch July, Generics Bulletin traces the history of the mechanism from early industry lobbying efforts to its ultimate entry into force. 22 Oklahoma Judge Okays $85m Teva https://bit.ly/2YrU7P4 Opioid Out-of-Court Settlement China Releases List To Encourage Competition China’s National Health Commission issues list of 34 generic drugs that have ‘insufficient’ competition, seeking public comments. /company/genericsbulletin https://bit.ly/2XhvyrH @genericbulletin

genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 3 PRICING

joying 180-day exclusivity and Sandoz mark and Taro were top-ranked, accord- “Like all products sold in a free market, launching an authorized generic via par- ing to the complaint, with Apotex and prices of pharmaceuticals are subject to ent company Novartis. Zydus lowest-ranked. a broad range of factors, but market data “Leading up to the launch, records shows that average prices in the gener- show company representatives spoke at SANDOZ AND MYLAN ‘VIGOROUSLY’ ics industry have been going down year least 21 times by phone to divvy up the CONTEST CLAIMS after year.” market so that each competitor could Responding to the latest developments, Meanwhile, a Mylan spokesperson told obtain roughly 50% market share,” the at- a spokesperson for Sandoz told Generics Generics Bulletin that the Connecticut torney general’s office alleges. Bulletin that the allegations were base- complaint “consists of unproven allega- The conspiracy “apparently pleased less. “We believe that the civil claims in tions pertaining to Mylan and we con- company executives,” the office stated, the private cases and the state attorney tinue to remain confident, as we have for citing a “senior-most executive of Sandoz general cases are without merit, and we years, that the claims will prove meritless Germany” as stating “sometimes a little will vigorously contest them,” he said. when examined in the court of law.” help from our competition is welcome” as “Novartis and Sandoz are proud to be “As previously stated, we have investi- well as another senior executive of San- a part of the generics industry; we are gated thoroughly and have not found evi- doz North America replying “I guess this proud of the work that we do and how dence of price fixing on the part of Mylan is what they call co-opetition.” we do it. Generic medicines make a sig- or its employees. Mylan intends to defend Meanwhile, evidence included in the nificant contribution to keeping the US this case vigorously on behalf of itself and filing also includes numerical rankings health system sustainable,” Sandoz in- its employees and looks forward to the assigned by Teva to generic competi- sisted. “To put this in perspective, the US opportunity to present a full defense.” tors based on their collusive relation- healthcare system has saved $2tn in the At the time of writing, Teva had not yet ships, “with +3 assigned to the most last decade due to the availability of low- responded to requests for comment. collusive and -3 assigned to the least.” cost generics. In fact, generic medicines Mylan, Watson/Actavis, Sandoz, Glen- generated $293bn in savings just in 2018.” Published online 25 June 2019

MANUFACTURING Akorn Receives Second Warning Letter In Six Months AKRITI SETH [email protected]

cleaning and maintenance of equipment were deemed “deficient”. Acknowledging the warning letter, Doug Boothe - who was hired as Akorn’s President and CEO starting 2019 to turn the company back into a profitable, high- value drug company - stated, “Akorn is committed to resolving the warning letter in a comprehensive and effective manner. Boothe said Akorn had “launched a company-wide action plan to improve the timing and effectiveness of the operations, quality systems and compliance en- hancement initiatives, with an emphasis korn has received its second cerns efficiently and transparently.” on transparency and quality.” He insisted warning letter from the US Food The warning letter came after a 22-page that “the execution of this action plan, A and Drug Administration in the Form 483 detailing quality-control prob- which has already begun to yield tangible span of six months. This warning letter lem in 11 observations, as per which it was results, will strengthen and further stan- was regarding the inspection that took found that batches of azelastine 0.05% dardize the company’s quality systems.” place from 23 July to 30 August 2018 at ophthalmic solution had failed controlled- Akorn’s Somerset, New Jersey facility. room temperature stability testing. The MULTIPLE MANUFACTURING An Akorn spokesperson told Generics FDA also said that responsibilities and pro- SETBACKS FOR AKORN Bulletin that the company “takes the FDA cedures applicable to the quality-control Earlier this year, the FDA issued a warn- warning letter seriously and is working unit were not in writing and fully followed, ing letter to Akorn outlining data inaccu- diligently to address the agency’s con- while laboratory records – as well as the racies, contamination and quality risks at

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the Decatur plant, Illinois. The company had received a Form 483 for the same last Glenmark Suffers US Ryaltris year where the highlighted observations included inadequate aseptic controls and cleaning procedures. Setback Amid Search For A Partner In April last year, Fresenius announced AIDAN FRY [email protected] that it had decided to terminate a $4.75 bn takeover deal, claiming that Akorn’s fi- lenmark Pharmaceuticals has suf- Having hitherto signed deals to out- nancial performance represented a “ma- fered a major blow to its US respi- license Ryaltris in China to Grand Pharma terial adverse effect” and that Akorn had G ratory plans after the Food and and in South Korea to Yuhan Corporation, breached representations, warranties Drug Administration issued a complete re- Glenmark had previously hinted that it was and covenants in the merger agreement. sponse letter just as the Indian firm hoped considering various US commercial models To tackle the manufacturing deficiency to secure approval for its Ryaltris (olopata- for the nasal spray. and compliance issues that, in part, de- dine hydrochloride/mometasone furoate) railed the Fresenius transaction as well nasal spray. The regulatory setback, which NO IMPACT ANTICIPATED as hurt Akorn’s financial performance, will push any approval into 2020 at the ear- ON EXITING ALLIANCES the company created a quality systems liest, could also hamper the Indian firm’s The Indian company told Generics Bulletin’s corrective action plan (QSCAP), for which attempts to recruit a commercial partner sister publication, the Pink Sheet, that it does Boothe chairs the steering committee. for the seasonal allergic rhinitis treatment. not expect the CRL to “impact the product According to Glenmark, the CRL cites or any of our partnerships” for Ryaltris. CORRECTIVE MEASURES deficiencies in the Drug Master File per- Respiratory drugs are a key strategic focus BEING IMPLEMENTED taining to one of the active pharmaceuti- for Glenmark, which is currently “in active Commenting on the remedial measures, cal ingredients and in the manufacturing discussions” to form a partnership before the company spokesperson said, “Akorn’s facilities. “The CRL does not specify any embarking on Phase III clinical trials for its company-wide action plan has been a pri- deficiencies with the clinical data support- GBR310 biosimilar omalizumab candidate. ority for the new management team, which ing the new drug application for Ryaltris,” The firm recently announced positive Phase has been investing in the appropriate per- stressed the company, which filed the I read-outs suggesting GBR310 has similar sonnel, systems and quality improvements.” combination 665µg/25µg spray through pharmacokinetic and pharmacodynamic, Akorn previously reported making the FDA’s hybrid 505(b)(2) pathway. safety and immunology profiles to Novartis “sustained” progress in fixing quality- and Genentech’s Xolair omalizumab original. control problems that have landed the SIX TO NINE MONTHS To help round out its global respiratory firm in trouble with the FDA. The compa- TO RESOLVE ISSUES offering, the Indian company has just linked ny continues to foresee improved earn- “We feel confident that we should be able up with Novartis to market the Swiss group’s ings in 2019 after reporting better-than- to resolve these issues within the next six to Seebri (glycopyrronium bromide), Onbrize expected first-quarter results. nine months,” Glenmark stated, pledging to (indacaterol) and Ultibro (glycopyrronium/ Akorn also cut its total pending ab- work closely with the FDA to “determine the indacaterol) inhalers in Brazil from 1 July. breviated new drug application pipeline appropriate next steps” as it works towards All three three of the Novartis respiratory to focus on developing and launching regulatory approval. The FDA had previous- brands are indicated for relieving symp- products that make the most financial ly pushed back by three months to 21 June toms in adults with chronic obstructive sense. According to Boothe, “because of 2019 the Prescription Drug User Fee Act (PD- pulmonary disease. changes in the market size or competi- UFA) date for the Ryaltris combination spray. Under the terms of the alliance, Glenmark tive landscape, the expected commercial Announcing its annual results a few weeks will be responsible for promoting, commer- opportunity for these ANDAs no longer ago, Glenmark had revealed that it was “eval- cializing and distributing the three brands. justifies further investment of time or uating bringing in a partner to jointly com- Novartis will retain the marketing authori- funds required to obtain the approval.” mercialize Ryaltris in the US market.” zations and will continue to manufacture “We are looking at bringing on a part- the drugs that are delivered through the Published online 27 June 2019 ner who can commercialize alongside Breezhaler device. with us,” said chairman and managing di- “This arrangement with a leading global rector Glenn Saldanha, suggesting even pharmaceutical company will strengthen before the CRL that a launch “won’t be our respiratory franchise in Brazil,” com- Get Our Free before October.” “Today we don’t have the mented Saldanha. “This partnership is in Email Newsletter infrastructure set up, and we don’t antici- line with our vision to expand our respira- pate putting in the infrastructure until we tory product offerings for patients and pre- Sign up to receive daily alerts have the approval,” he stated. By deferring scribers in Brazil, and to further consolidate from Generics Bulletin taking on a contract salesforce until after our position in this segment.” approval, he said the firm could avoid in- Visit: https://bit.ly/2RP5ltT curring additional costs at present. Published online 28 June 2019

genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 5 PRICING

German Price Anniversary Shows Split In Perspectives

AIDAN FRY [email protected]

ault lines between industry and erence prices shows how important this payers in Germany have been high- instrument has been in stabilizing drug F lighted by the 30th anniversary of prices,” GKV-Spitzenverband claims. the introduction of country’s pharmaceu- “The savings through this scheme now tical reference pricing on 19 June 1989. run to €8.2bn per year,” the funds’ umbrel- While the umbrella body representing “Because reference- la body asserts “The miserable prospects Germany’s 109 statutory health insurance for the future of medicines provision and funds described the system as “a model price levels are for medical progress that the pharma of success,” local off-patent medicines as- largely defined industry prophesized when it was intro- sociation Pro Generika says the system duced have not proven correct.” was partly responsible for drug shortages according to quantity “With reference prices, an instrument by driving down prices to an extent that was created through which the some- players were pulling out of the market. of active ingredient what exaggerated price expectations of “The current reference-price system and pack sizes,” the pharma industry could durably and does not represent any sound founda- efficiently be combated, without insures tion for sustainable market develop- the BAH elucidated, having to accept poorer quality provi- ment,” Pro Generika told Generics Bulle- sion of medicines,” commented GKV-Spit- tin. The industry association explained “delivery forms that zenverband’s deputy chairman, Johann- that generics were particularly affected are difficult to produce Magnus von Stackelberg. He maintained by the pressure exerted by reference that reference pricing had developed over pricing’s so-called ‘cellar stairs effect’ of often receive the many years as “a success story” that had constantly pushing down prices with combined with other measures to ensure each revision. same price as “a high-quality and simultaneously afford- “This effect leads to prices continuing less complex forms” able provision of medicines” in Germany. to fall so that even fewer suppliers are Pro Generika takes a very different able to provide active ingredients for care – BAH view. Pointing out that by accounting settings,” the industry body outlined. As for just 9.3% of the country’s medi- evidence, it cited data showing that the cines expenditure in return for 78% of proportion of ingredient for which 80% volumes, generics were “the backbone of prescriptions were provided by one of drug provision” in Germany, the in- or two corporate groups had increased dustry association warned that their from 53% in 2010 to 62% in 2018. vital contribution to public health was “At the same time,” Pro Generika con- under threat. tinued, “the number of medicines free from patient co-payments has fallen INTERPLAY WITH TENDERS from 7,116 in 2011 to just 3,950 in 2018.” rently benefit from this co-payment ENDANGERS SUPPLIES To be exempt from patient co-pay- exemption provision, which was intro- “The figures prove it: the interplay be- ments in the range of €5-€10 ($6-$11), duced in 2006. It also currently covers tween reference prices and rebate ten- medicines that fall into reference-price around 4,000 medicines across 155 dif- der contracts leads to pricing pressure, groups determined by Germany’s G-BA ferent reference-price groups. market concentration and, as a result, federal committee must have a list price to provision being placed under threat,” at least 30% below the relevant reference REFERENCE PRICES CLAIMED Pro Generika argued. “At the end of day, price set by the insurance funds’ umbrella TO STABILIZE SPENDING one party suffers from this more than organization, GKV-Spitzenverband. Pa- GKV-Spitzenverband says it regularly re- most – the patient.” tients must pay any difference if a drug views reference prices and alters them Pro Generika is not alone in the Ger- costs more than its reference price, but as necessary to “changed market condi- man pharma sector in voicing criticism the funds says they do not occur for al- tions.” It has currently categorized more of the effects the deflationary reference- most 95% of all prescriptions for drugs than 30,000 finished-dose products pricing has had on security of supply. covered by the scheme. across 449 reference-price groups. “The Germany’s medicines manufactur- According to the body representing fact that, at present, 80% of all drug pre- ers’ association, the BAH, described the statutory funds that cover around 70m scriptions and 35% of the entire spend- reference-pricing system as “urgently in Germans, “several million insurees” cur- ing volume on medicines fall under ref- need of reform.”

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“Above all,” the BAH criticized, “it does not sufficiently differentiate between Sandoz Will Consider Local medicines on therapeutically relevant criteria, and the framework for forming groups is far too unrefined.” As a result, Partnerships In China children and the elderly suffered, the as- AIDAN FRY [email protected] sociation claimed. “Because reference-price levels are largely defined according to quantity of active ingredient and pack sizes,” the BAH elucidated, “delivery forms that are difficult to produce often receive the same price as less complex forms. So certain patient groups can often only get the medicine they need by paying more – or their medicine disappears from the market entirely, because the manufacturer is no longer able to cover its costs of production.”

CHILDREN AND ELDERLY WORST AFFECTED andoz will consider recruiting local partners to help it promote individual prod- “Those affected are particularly chil- ucts as it rolls out its product pipeline in China. dren and older people who often need S “We are developing a pipeline to play in China,” interim CEO Francesco Bal- specific delivery forms, such as a liquid estrieri told analysts during an investors’ day held recently by parent group Novartis. instead of a tablet,” explained the BAH’s “We will then assess case-by-case whether we are best positioned to commercialize recently appointed managing director, the pipeline ourselves or in partnership with local players.”. Hubertus Cranz. But the current system Last month, Sandoz received a major boost in its plans to target the Chinese market often did not recognize that making a by obtaining approval for generic rosuvastatin that was the first-of-its-kind for a mul- liquid formulation was more difficult tinational company and paved the way for Sandoz to participate in Chinese tenders. and expensive, nor did it reward manufacturers adequately for such incre- ROSUVASTATIN AIDS PUSH INTO CHINESE TENDERS mental improvements. The “regulatory milestone” approval from China’s National Medical Products Administra- “Anyone describing the current sys- tion for Sandoz’ generic rosuvastatin – received under the NMPA’s Quality Consistency tem as ‘durable and efficient’, as the GKV- Evaluation (QCE) system, part of a wider package of healthcare reforms introduced by the Spitzenverband has done, is closing their Chinese government in recent years – demonstrates Sandoz’ “long-term strategic focus eyes to reality, at the expense of patients,” on pioneering access to high-quality medi- Cranz concluded. cines in world’s largest, and rapidly-growing, generics market,” the firm insisted. Published online 28 June 2019 “Sandoz is the first multinational phar- “The new quality maceutical company to receive such an approval under the recently introduced QCE standards will give an system, which aims to ensure that all gener- edge and an advantage WaveData ic medicines marketed – or manufactured – in China meet internationally-recognized in the market to the Pricing you into quality standards,” the company explained the market upon approval, noting that the QCE path- companies that have it” way offers the opportunity for firms to “accelerate national generic registration time- – Francesco Balestrieri The Pharma lines significantly.” Pricing Info That In a question-and-answer session dur- Puts You In Control ing the investors’ day, Balestrieri recognized that “local competitors are clearly well placed,” but predicted that the improved quality standards would favor multinationals. To find out more... call “The new quality standards will give an edge and an advantage in the market to the +44 1702 425125 companies that have it,” he believed. The operating environment in China would, he fore- or email [email protected]. casted, “become more and more restrictive towards who can compete in the market – so Visit www.wavedata.co.uk CONTINUED ON PAGE 9

genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 7 BUSINESS STRATEGY Do you have money to burn? Your old NDAs and ANDAs are VALUABLE ASSETS and withdrawing them from the Orange Book is like BURNING MONEY.

No matter the condition of your A/NDA, it should never be withdrawn from the Orange Book. We will make you a cash offer, regardless of the condition or age of your file. Remember: Once approval of your A/NDA is withdrawn, there is no way to bring it back!

Don’t make the same mistake other owners have already made! For more information: [email protected]

8 | Generics Bulletin | 5 July 2019 © Informa UK Ltd 2019 STRATEGY

CONTINUED FROM PAGE 7 a broad alliance with China’s Gan & Lee to that is why we are going in this direction.” develop, produce and market three bio- Do you have While the stricter quality standards would “Probably a more similar insulin analogs. help to “level the playing field” in China, Bal- tender-driven China The deal for glargine, lispro and as- estrieri also highlighted moves towards a part forms of insulin gives Sandoz full money to burn? “much faster regulatory path”. “Registration suits the type of responsibility for commercializing the timing has dropped significantly versus medicines in the European Union, the where it was in the past,” he stated. business we want US and Switzerland, as well as in Japan, South Korea, Canada, Australia and New Your old NDAs LOCAL MARKET COULD to do there” Zealand. The Novartis division will also BE WORTH $70BN – Philippe Deecke support Gan & Lee’s development and and ANDAs are Estimating the Chinese generics mar- manufacturing activities. ket to be worth $60bn to $70bn, he ob- Balestrieri told investors that the insu- VALUABLE ASSETS served that “still a large portion of the originator and generic products to hospi- lins alliance would help to satisfy “unmet population is underserved.” Behind pro- tals and towards “a tender-type setting”. need” among more than 400m diabetes and withdrawing jected 3% to 5% value growth in China “Probably a more tender-driven China patients worldwide. Pointing out that lay “much higher volume growth” as suits the type of business we want to do patients in affluent markets such as the them from the more people gained access to medicines. there,” he commented. US were struggling to afford insulin, he However, he cautioned, this would likely insisted this represented “a market dy- Orange Book lead to “more and more price pressure.” ANTICIPATING COMPETITION namic where clearly biosimilars play a Sandoz’ former CEO, Richard Francis, FROM INDIA role.” Moves to transition biosimilars in is like told Generics Bulletin late last year that “We have been investing in the Chinese the US to the biosimilars regulatory path- he viewed an increasingly open Chinese pipeline for a couple of years already,” way by March 2020 would make seeking market as a promising part of the firm’s Deecke pointed out. Acknowledging that approval “easier and more predictable.” BURNING MONEY. selective approach to expanding in Asia. Sandoz would face competition not only “We scanned the marketplace for who is Commenting on operating conditions from domestic generics producers, but the best partner, and with Gan & Lee we in China during the investors’ day, Sandoz’ also from a host of Indian companies that found a partner that has years of experi- chief financial officer, Philippe Deecke, were increasingly looking to China for ence in the insulins space, that has built highlighted the ‘4+7’ procurement mod- growth, he maintained that “this will be up really good capacity and is willing to in- el recently implemented across 11 of the a very competitive space, but I think the vest in building the capacity that is need- country’s largest cities. size makes it interesting, and we will have ed to address the high-volume demands This purchasing shift, Deecke said, to see how much we do ourselves versus in the insulins market,” he explained. No matter the condition of your A/NDA, was moving the market away from a reli- how much we do with partnerships.” it should never be withdrawn ance on vast salesforces promoting both At the end of last year, Sandoz formed Published online 28 June 2019 from the Orange Book. STRATEGY We will make you a cash offer, regardless of the condition or age of your file. Biocon’s Biosimilar Ambitions Get Remember: Once approval A Boost With European Site Approval of your A/NDA is withdrawn, PENELOPE MACRAE he European Medicines Agency double-digit Biocon revenue growth of the biosimilar manufacturing facilities there is no way to bring it back! has approved Biocon’s biosimi- over the next few years. gives the company a big leg-up toward T lar manufacturing facilities in the Biocon is already taking a leading role achieving its strategy. southern Indian city of Bengaluru after on biosimilars in Asia, with a portfolio The EMA’s GMP certificate covers Bio- an inspection in March. The decision will spanning recombinant human insulin con’s biologics drug product and drug help Biocon exploit expanding EU bio- and insulin analogs to monoclonal anti- substance facilities at Biocon Park, Ben- Don’t make the same mistake other owners have already made! similar market opportunities. The EMA’s bodies and other biologics for diabetes, galuru. “This was a surveillance inspec- award of its certificate of good manu- oncology and immunology. But while tion of our existing drug-product and For more information: [email protected] facturing practice compliance coincides Biocon-supplied biosimilars dominate in drug-substance facilities and a pre-ap- with the advent of what analysts call many emerging markets, the firm is look- proval inspection of our additional drug- “payback time” for Biocon after years of ing to the developed markets of Europe product manufacturing line,” a company investment in biologics R&D. Analysts ex- and especially of the US to provide the spokesperson said. “This certification will pect the biologics business to drive high real growth trigger. The EMA’s approval enable us to continue addressing grow-

genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 9 STRATEGY

ing needs of patients in EU markets and toid arthritis biosimilar adalimumab by logics business globally could generate enhance access to our high-quality bio- Biocon’s partner Mylan in Europe. $1bn in sales by 2025. similars,” the spokesperson said. Biocon now has approval in the US for Separately, Biocon has announced that two biosimilars and three in Europe. As it is selling its Branded Formulations India LANDMARK YEAR FOR BIOLOGICS well as its Mylan partnership, it struck business, consisting mainly of biosimi- BUSINESS AS REVENUES CROSS $200M a deal with Sandoz last year to develop lars, on a “going-concern” basis to wholly Biocon recently celebrated a landmark “next-generation” oncology and immu- owned unit Biocon Biologics India Ltd for year as its biologics business achieved a nology biosimilars. INR450m. The “slump sale” will put BFI’s $200m revenue milestone, led by launch Biocon’s game-plan involves commer- marketing and manufacturing under a of biosimilars in the US and Europe and cializing its biosimilars through a large single roof “with common leadership and a ramp-up of sales in emerging markets. established partner in developed mar- achieve synergies/value accretion for the “Our biosimilars strategy has begun kets. “Europe will definitely, overall, be an group,” the company said. The BFI sale is to deliver with the start of monetization important part of our mix going forward,” seen as one of various “housekeeping” of our biosimilars pipeline in the devel- the company said. tasks by Biocon to consolidate operations oped markets of US and EU,” Biocon’s Biologics accounted for 27% of total under Biocon Biologics ahead of an ex- chairperson and managing director, Kiran revenue in fiscal 2019. Brokerage ICICI pected initial public offering. Mazumdar-Shaw, told analysts after the and other investment houses expect the “We certainly have plans to take the firm reported net profit for the financial biologics segment to grow by a com- [Biocon Biologics] company to an IPO in year to March 2019 that soared by 143% pound annual growth rate of around the next few years and we’ll do it at the to INR9.1bn ($131m) on revenue that 50% to INR34.3bn from fiscal 2019-21 as right time when we can monetize maxi- climbed by 31% to INR56.59bn. Europe and the US come more into play. mum value,” Mazumdar-Shaw told India’s The launch of oncology biosimilar peg- That expansion would significantly out- CNBC-TV18 channel last month. Four filgrastim in the US and sales of Biocon’s pace expected global biosimilars CAGR years ago, Biocon staged an IPO of its con- breast cancer biosimilar trastuzumab in of 35.2% from 2018 to 2026. The biolog- tract-research arm Syngene International emerging markets were key growth driv- ics division’s contribution to overall rev- Ltd, India’s largest contract research orga- ers. Other highlights included launch enue is seen climbing climb to around nization (CRO), raising INR5.5bn. of biosimilar insulin glargine, biosimilar 45% during the 2019-21 timeframe, trastuzumab and in-licensed rheuma- while the company forecasts that its bio- Published online 24 June 2019

INTELLECTUAL PROPERTY Top US Generics Players Thwarted On August At-Risk Launch Of Fingolimod AIDAN FRY [email protected]

he prospect of “massive and im- the ‘405 patent – which claims a method in which they sell approximately $1.8bn mediate price erosion in the mar- for treating RRMS at a 0.5mg daily dos- of drugs each year,” Stark calculated. “To T ket for oral treatment of relaps- age, “absent an immediately preceding me,” he stated, “that balance clearly fa- ing-remitting multiple sclerosis” if up to loading dose regimen” – expires on 25 vors Novartis under the circumstances.” six generic fingolimods were launched December 2027. And while consumers might benefit at-risk in the US when a molecule pat- Last year, Novartis posted US Gilenya from lower prices through greater com- ent protecting Novartis’ Gilenya expires sales ahead by 3% to $1.765bn, making petition, “the public has an interest in in mid-August this year has persuaded a the multiple sclerosis brand the Swiss protecting valid patent rights in main- Delaware district judge to grant an pre- group’s best-selling innovative medicine in taining incentives for the massive invest- liminary injunction barring generic com- both the US and worldwide. Global sales of ments required for drug development.” petition until a decision at trial. the brand grew by 5% to $3.341bn. Stark also voiced concerns over poten- Delaware District Judge Leonard Stark tial adverse impacts on the availability was not convinced by any of the three IMBALANCE IN SUMS PARTIES of first-dose observation for at least six arguments brought by generics defen- ARE SET TO LOSE hours because fingolimod could cause a dants including Accord Healthcare, Apo- “Defendants stand to lose the opportu- slowing in heart rate. tex, Endo’s Par, Glenmark, Sun Pharma nity to earn on the order of $50m collec- Looking at the issue of irreparable harm, and Teva as to why US method-of-treat- tively by not being able to compete over Stark said Gilenya could face “as long as a ment patent 9,187,405 was invalid. In- approximately the next year, whereas year of generic competition by the time cluding a six-month pediatric extension, Novartis will irreparably lose a market we get to trial” if generics were allowed to

10 | Generics Bulletin | 5 July 2019 © Informa UK Ltd 2019 INTELLECTUAL PROPERTY

launch when a six-month pediat- that patents were not required to ric extension to the fingolimod tell a story about how the inven- molecule patent 5,604,229 ends tion was discovered, he described on 18 August this year. With No- much of the attack on an alleged vartis unable to return its price to lack of adequate written descrip- the brand to pre-generic levels tion as “legal irrelevancies.” even if it prevailed at trial – or at least not the arguments before me at this stage, On the third defense, a lack of enable- without drawing criticism and injuring its my finding is that defendants are not at ment of utility in teaching the POSA the goodwill in the market – the judge felt all likely to prevail at trial on invalidity,” full scope of an invention that is useful, that calculating future damages for lost he summarized. Stark found that Novartis “has adequately sales “may be impossible.” demonstrated, as the patent office simi- GENERICS FIRMS PROPOSED larly found, that when read in its full con- NOVARTIS DID NOT BRING WRONG SKILLED PERSON text, a person of skill does understand the HARM ON ITSELF “Highly relevant to my finding on likeli- patent to preclude a loading dose.” A phar- By contrast, Stark disagreed with the hood of success on the merits is that the macologist would, he said, understand generic firms’ assertion that the origina- defendants have proposed the wrong per- how disclosed experimental autoimmune tor had brought harm on itself by de- son of ordinary skill in the art, the wrong encephalomyelitis (EAE) studies related to laying suit on the ‘405 patent. “Novar- POSA,” Stark stated. The POSA team would, the stated human doses. tis did nothing inequitable in waiting he said, include not just a clinician, but also Stark ordered the parties to submit by to bring suit until after it had received a pharmacologist. “The patent contains 28 June a joint status report addressing all of the many paragraph IV certifica- parts that would be best understood by a issues including: whether the trial date tions and after the inter partes review pharmacologist, even though the claims should be accelerated; how long the par- was completed, especially because the are principally directed to treatment and ties are likely to need for their trial pre- ‘405 patent was one that was never eli- therefore to a clinician,” he explained. sentations; the amount of bond the court gible to trigger a 30-month stay under The generics firms’ failure to present should require the plaintiff to post; and the Hatch-Waxman Act and because any evidence from a pharmacologist “whether any discovery disputes remain pediatric exclusivity on the ‘229 patent POSA was crucial, Stark felt. “This alone, I ripe and require judicial attention.” protected Novartis from any potentially think, is likely a sufficient basis to find de- infringing competition until August of fendants are not likely to prevail on their FURTHER GILENYA 0.5MG PATENT 2019,” he commented. invalidity challenges at trial.” RUNS UNTIL 2026 The judge pointed out that he had not Nevertheless, the judge addressed The ’405 patent is listed against one-a- been asked to stay court proceedings each of the invalidity arguments in turn. day Gilenya 0.5mg capsules in the Orange during an inter partes review in which the On anticipation by the one-page, 600- Book patent register maintained by the US Patent and Trademark Office in July word Kappos 2006 abstract, he agreed US Food and Drug Administration, as are last year rejected attacks on the ‘405 dos- with Novartis that “defendants are unlikely the ‘229 molecule patent and US patent age-regimen patent by Apotex, Argen- to persuade the court at trial that Kappos 8,324,283, for which a pediatric extension tum, Sun Pharma and Teva. Appeals have 2006 discloses the ‘405 claim limitations of ends on 29 September 2026. The ‘283 pat- been lodged against the ruling by the treatment and no loading dose.” At the ab- ent claims solid pharmaceutical composi- USPTO’s Patent Trial and Appeal Board. stract’s publication date, the 0.5mg dose of tions of sphingosine-1-phosphate recep- Suggesting that the generics firms fingolimod had never been used on a hu- tor agonists with a sugar alcohol. may have been able to force the issue of man multiple sclerosis treatment, so it was A pediatric 0.25mg strength of Gilenya is the ‘405 patent’s validity via declaratory not known to be an effective treatment. covered by the ‘229 molecule patent that action, Stark rejected suggestions that The POSA would have read it as “some- was late last year upheld by the US Court of Novartis believed the patent to be valid thing other than a method of treatment.” Appeals. Also listed against this version in because it was preparing for potential “Kappos 2006 also does not exclude an im- the Orange Book is US formulation patent generic competition. mediately preceding loading dose, which is 9,592,208 that expires on 30 September With infringement of the ‘405 patent not an express limitation of the asserted claims 2032 after a six-month pediatric extension. contested during the preliminary injunc- of the ‘405 patent,” Stark highlighted. Novartis – which reported US Gilenya tion motion, Stark found that “Novartis sales down by 6% to $392m in the first has met its burden to demonstrate a likeli- PHARMACOLOGIST WOULD HAVE quarter of this year – based its full-year hood of success on the merits” regarding UNDERSTOOD INVENTION 2019 forecast of mid-single-digit con- the three invalidity challenges brought by Turning to the second invalidity defense, stant-currency sales growth by its Inno- the generics defendants: anticipation by written description, Stark said it was “un- vative Medicines division on no generic the Kappos 2006 prior-art abstract; lack of likely defendants will persuade me that a rivals to Gilenya entering the US market adequate written description; and lack of pharmacologist would fail to understand at-risk during 2019. enablement or utility. what the inventors invented and what the “Having considered the evidence and inventors were disclosing.” Pointing out Published online 27 June 2019

genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 11 BIOSIMILARS

Henlius Has First ‘China-Developed’ Biosimilar Accepted For EMA Review PENELOPE MACRAE

arking a major first step toward the opening of glob- ilars and innovative biologics to treat tumors and autoimmune al markets for made-in-China biosimilars, Shanghai diseases. Henlius also has its adalimumab biosimilar HLX03 un- M Henlius Biotech has announced that the European der NPMA review along with HLX02. Medicines Agency has accepted for review an application for marketing its HLX02 trastuzumab biosimilar version of Roche’s CHINA SEEKING TO ACCELERATE GENERIC AND breast-cancer drug Herceptin. BIOSIMILAR APPROVALS TO LOWER HEALTH COSTS It is the first time the EMA has accepted a marketing autho- The Chinese government is seeking to accelerate approvals of rization application for a “China-developed” biosimilar. The significantly cheaper generic and biosimilar drugs to tame bur- EMA’s decision “shows that our clinical, medical, regulatory geoning healthcare costs in the country, which was the second- affairs and quality system capabilities have been internation- largest pharmaceutical market globally by spending in 2017 ally recognized,” said Henlius’ president and chief executive, and the second biggest biological market by sales revenue. Scott Liu. ‘China-developed’ biosimilars now have “entered the According to the NMPA, China has the most biosimilars in de- global stage,” he said. velopment with some 200 biosimilar clinical trial applications In 2015, China drew up national guidelines for developing and approved so far. Other biosimilars accepted for review by the evaluating biosimilars that broadly follow the same principles NMPA include Guangzhou-based Bio-Thera Solutions’ BAT1406, used by the US Food and Drug Administration and the EMA. a biosimilar to AbbVie’s rheumatoid arthritis drug Humira (adali- “We plan to work closely with EMA on this HLX02 MAA mumab). Suzhou-based Innovent Biologics has pending review and hope to benefit HER2+ cancer patients globally with its two biosimilars IBI303 (adalimumab) and cancer treatment IBI- high-quality and affordability,” added Liu, who co-founded 305 (bevacizumab). Henlius in 2010. Henlius has stayed abreast of the global regulatory curve with Just a couple of months before the EMA accepted Henlius’ an eye on expanding overseas. It started following EU standards biosimilar MAA, China’s National Medical Products Administra- from the start, giving the company a potentially easier entry into tion (NMPA) said it was reviewing HLX02’s new drug applica- European markets. Unlike some of its South Korean and Indian tion (NDA) for sale domestically. peers, it early on decided to leave the US market alone, deterred by US legislation aimed at protecting originator patents. Liu said CHINA-DEVELOPED BIOSIMILARS HAVE better opportunities exist elsewhere, especially in emerging ‘ENTERED THE GLOBAL PHASE’: HENLIUS markets. “Henlius plans to further expand our footprints to more Shanghai-headquartered Henlius, which is developing both bio- countries around the world leveraging the company’s advan- similars and innovative biologics and is backed by Chinese con- glomerate Fosun International, is at the forefront of biosimilar development in China. “The acceptance of HLX02 MAA “The acceptance of HLX02 MAA review [also] marks a key mile- review [also] marks a key milestone stone for collaboration between Henlius and its partner Accord,” said the company. Henlius signed licensing and supply agree- for collaboration between Henlius ments with Intas subsidiary Accord Healthcare in June 2018, assigning the company commercial rights to HLX02 in the UK, and its partner Accord” France, Germany and Italy in Europe, 17 countries in the Middle East and North Africa and various countries in the Common- tage of global integrated innovation,” Liu said. wealth of Independent States. The trastuzumab Phase I study successfully demonstrated Four months ago, the NPMA approved the company’s HLX01, the equivalence in pharmacokinetics and safety profiles be- China’s first biosimilar – a version of another Roche’s MabThera tween HLX02 and the reference drug sourced from both EU drug (rituximab), which treats lymphoma. Henlius’ rituximab and China. The Phase III study aimed for head-to-head similar- was developed in accord with international standards and now ity evaluation in efficacy, safety and immunogenicity profiles has been “successfully launched” in China, the company said. between HLX02 and reference trastuzumab sourced from the HLX02 is intended to be indicated for human epidermal European Union in 649 previously untreated patients with growth factor receptor 2-positive (HER2+) early-stage breast HER2+ metastatic breast cancer in mainland China, Ukraine, cancer, HER2+ metastatic breast cancer, and untreated HER2+ Poland and the Philippines. metastatic gastric and gastroesophageal junction (GEJ) cancer. If approved, HLX02 would join a growing number of biosim- Henlius, which has R&D centers in Taipei and California, said it ilars referencing Herceptin. The European regulator has previ- was continuing efforts to expand its product pipeline of biosim- ously granted authorizations for five trastuzumab biosimilars

12 | Generics Bulletin | 5 July 2019 © Informa UK Ltd 2019 BIOSIMILARS / MANUFACTURING

– Amgen’s Kanjinti, Celltrion’s Herzuma, Mylan’s Ogivri, Sam- sung Bioepis’ Ontruzant and Pfizer’s Trazimera. API Manufacturing

PRESTIGE ANNOUNCES POSITIVE DATA Meanwhile, Singapore’s Prestige Biopharma has announced Must Be High On positive results from a randomized, double-blind, parallel group, equivalence, multi-centre Phase III trial of its own HD201 trastu- Europe’s Agenda zumab biosimilar candidate that it just filed with the EMA. A US submission is slated for later this year. AIDAN FRY [email protected] “These top-line results demonstrate HD201’s exceptional similarity to Herceptin in terms of clinical response and pharmaco- olicymakers in Europe, kinetics, in addition to a comparable safety profile to the range including the incom- previously observed in other trastuzumab biosimilar clinical tri- Ping European Com- als,” the firm stated. mission and Parliament, “The results demonstrate that HD201 is the most equivalent should consider ways biosimilar of Herceptin,” said Prestige’s CEO, Lisa Park. The ‘Troika’ to strengthen the conti- study had “broken many records – fastest recruitment, lowest nent’s security of supply screening failure and drop-out, most exceptional similarity, and for medicines by promoting the fastest dossier generation and filing,” she said. “We are pleased domestic production of raw ma- to advance HD201 a step closer to commercialization to benefit terials, leading industry figures believe. the patients with an affordable high-quality trastuzumab”. Responding to a question posed by Generics Bulletin during Prestige – which intends to supply global markets from its fa- a CEO panel to conclude the joint annual conference of Medi- cility located in Osong, South Korea – also has its HD204 beva- cines for Europe and the International Generic and Biosimilar cizumab biosimilar in Phase III clinical trials, while its PBP1502 Medicines Association, Polpharma’s CEO, Markus Sieger, ar- adalimumab candidate is at the Phase I stage. gued that vertical integration for active pharmaceutical ingredients was “extremely important for certain categories.” Published online 25 June 2019 Referencing the impurity issues around valsartan, Sieger pointed out that Krka’s vertical integration had left the Slovenian producer essentially alone in the market against the originator. “It goes further to a bigger question in Europe, where the is- Do you know we have the following sue is what form of API industry do we need?” Sieger insisted. Antibiotics available? Europe’s raw materials production had been “reduced to an ab- solute minimum”, leading local industry, not least through Medi- cines for Europe, to consider what can be done to strengthen raw-materials capacity. Pointing to European industry’s dependence on APIs from China Penicillin-V and India, Sieger questioned “is this healthy in the longer term?” Dicloxacillin “There is a question of availability, as 400 factories have been Film coated tablets Hard capsules closed in China over the past few months,” he stated, highlight- 250mg & 500mg 660mg, 800mg, 1000mg ing the local drive to improve ecological standards.

EUROPEAN INDUSTRY DEPENDS ON ASIAN INTERMEDIATES Reflecting on API integration, Fresenius Kabi’s Marc-Alexander Mahl – who has just completed a two-year term as president of How best to treat an infection? Medicines for Europe, having handed over to Teva’s Christoph Stoller and taken on the role of secretary – pointed out that These dossiers are ready-to-ﬁt in your Portfolio! even companies that produced APIs in Europe could still be Treatment with solid dose forms is effective dependent on intermediates from China. “If you look at certain and less painful than injectables. oncology agents or anti-infectives, Europe is 100% dependent on one or two plants in Asia,” he remarked. “When we speak about a strategic route for Europe to become less dependent on complete supplies and imports, we not only need to invest, we also need to talk to policymakers and governments about how to deal with API facilities. Let’s For more details contact [email protected] face it, nobody wants to have an API facility around the cor- Check our Website www.neogen.be ner, despite modern manufacturing standards enabling you to more or less completely to contain waste going through the

genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 13 MANUFACTURING

chimney,” Fresenius’ Mahl continued. challenges come,” she asserted. “To become less dependent, we need “For some substances,” she elucidated, governments which will help us to relo- “we have only one or two API producers, cate intermediates and API factories in and we need to better understand the as- Europe,” he concluded. sociated risks.” As an example, she cited “Data for the UK considerable shortages of life-saving an- EUROPEAN MANUFACTURING BASE show that 40% of tibiotics in Switzerland, which suggested OF ‘CRITICAL IMPORTANCE’ that, while price was a factor, it was not Representing the Polish government, Jan shortages come down the only issue affecting anti-infective Filip Staniłko – director of the depart- supply levels. ment of innovation within the Ministry of to problems with “We need to be much more aware, and Enterprise and Technology – argued that work with governments to understand it was “bad for the planet” to be moving the API supply” where risks are high,” Guntern concluded. goods made through energy-intensive – Warwick Smith CEO panel moderator Warwick Smith, processes around the world. “From this who is director-general of the British Ge- perspective, you might decide it is of neric Manufacturers Association and the critical importance to have some capac- British Biosimilars Association, echoed ity for API and intermediates manufactur- the need for several API suppliers for ing here in Europe,” he believed. But such each substance so as to be able “to fill the strategic considerations would require gaps”. “Data for the UK show that 40% of an integrated industrial policy at pan- shortages come down to problems with European level. “The question is,” he put ply point of view, it is interesting to ask the API supply,” he highlighted. to the audience, “do you share this goal the provider of the drug where the API Carsten Brockmeyer, CEO of biosimi- with the innovator industry?” was manufactured,” he insisted. Such lars developer Formycon, pointed out From patients’ point of view, he ac- policies, he felt, were “completely con- that many of the key patent expiries over knowledged that drug costs could rise if sistent” with the European Union’s Trans- the next decade would be for biologic production switched from Asia to Europe, parency Directive. drugs. No single company could offer all not least because of stricter regulations in the technologies and expression systems Europe. “But that is the cost of safety, both SINGLE API SUPPLIERS required, so partnering would be crucial. of the drug itself and of security of sup- BRING SUPPLY RISKS Controlling the manufacturing chain ply,” he argued. Head of Sandoz’ European cluster, Rebec- would be vital not only in maximizing Medicines reimbursement could, ca Guntern, believed the issue was not so gross margins, he said, but also in ensur- Staniłko suggested, reflect in part the much one of vertical integration as en- ing timely market entry. scope of production activities that took suring alternative sources of API supply place in Europe. “From a security of sup- were available. “That is where most of the Published online 24 June 2019

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14 | Generics Bulletin | 5 July 2019 © Informa UK Ltd 2019 BUSINESS STRATEGY

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genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 15 REGULATION

UK Government Plans Express Freight For Medicines

AIDAN FRY [email protected]

K medicines suppliers will soon learn in writing details of “an U express freight contingency arrangement to support continuity of supply of medicines and medical products” that the country’s Department of Health and Social Care is starting to prepare ahead of the UK’s planned Brexit withdrawal from the European Union. Medicines suppliers should also expect “in the coming days” to be asked for information at product level of their own preparato- ry measures, including the stock levels they expect to hold as of 31 October and their plans to re-route supply lines away from the heavily used crossing between south-east Calais, Dunkirk and Coquelles in France Drawing on industry feedback since plans England and continental Europe. and the ports of Dover and Folkstone in were put in place for Brexit at the end of The plans have met with at best a guard- the UK, as well as “extra warehouse space, March, Oldfield says the Department is aimed welcome from the UK’s pharmaceuticals stockpiling, buffer stocks, clarifying regu- ing to give medicines suppliers “greater flex- and life sciences sector, with the BioIndus- latory requirements, supporting traders ibility in terms of the balance between their try Association bemoaning the additional to have all necessary paperwork in place stockpiling and re-routing plans to ensure a burden the government’s plans would im- at the border, and strengthening the pro- continuity of supply of their products.” pose on companies. cesses used to deal with shortages to en- A written statement on EU exit pre- sure that patients have uninterrupted ac- SIX-WEEK STOCKPILING paredness released on 26 June by Cabinet cess to medicines and medical products IS RECOMMENDED Office minister David Lidington describes if the UK leaves the EU without a deal.” Preparedness plans should, he recom- the initiative as “an urgent contingency The statement stresses that the UK mends, contain a mix of secured freight measure for products requiring urgent government “will only pay for capacity as capacity away from the short straits, stock- delivery, within a 24-48-hour timeframe, and when it is needed and used.” piling at a recommended minimum of if the UK leaves the EU without a deal.” At six weeks’ stock above operational buffer present, the UK is scheduled to cease be- THREE-QUARTERS OF UK MEDICINES stocks, and assurances on the readiness of ing an EU member on 31 October this year, COME THROUGH EU the company’s logistics and supply chains and no withdrawal deal has yet been ap- In an accompanying letter, the Depart- to meet new customs and border require- proved by the UK parliament. ment’s chief commercial officer, Steve ments for both import and export. Oldfield, recognizes that “around three- Where stockpiling is not viable for prod- MEDICINES AMONG PRIORITIES quarters of medicines, and over half of ucts with short shelf lives, the Depart- IN NO-DEAL BREXIT the clinical consumables, that the UK uses ment is asking for alternative air-freight “Guaranteeing the supply of critical ‘cat- come from, or via, the EU” and that “the plans. The letter pledges to keep industry egory 1’ goods, including medicines, medi- vast majority” of these are reliant on the updated on how it can access additional cal products, veterinary medicines and short-straits crossings. warehousing that the Department has chemicals remains an essential element of the government’s no deal contingency “The predicted flow rate across the short straits planning,” the statement insists. “The government is therefore undertaking steps has improved slightly” – Steve Oldfield to secure freight capacity for suppliers of these goods in a no-deal scenario.” While “the predicted flow rate across the contracted for ambient, refrigerated and According to Lidington, the express short straits has improved slightly” since controlled-drug storage. freight contingency arrangement cover- the original Brexit date of 29 March this If companies suspect a risk of drug ing all of the UK forms part of the Depart- year, Oldfield warns of “significant disrup- shortages, they should continue to use ment’s “multi-layered approach”, which tions” for six months after a no-deal exit, existing reporting arrangements, includ- includes re-routing medical supplies “with the most severe period being the ing the Department’s National Supply and from the short-strait crossings between first three months.” Disruption Response (NSDR) unit. Oldfield

16 | Generics Bulletin | 5 July 2019 © Informa UK Ltd 2019 REGULATION

also notes that legislation is in place to allow ministers to issue serious shortage AAM Maintains Pressure On protocols that will permit pharmacists to substitute medicines without prior autho- rization from the prescriber. USTR To Shield Pharmaceuticals The Department – which plans to engage separately with certain groups of From China Tariffs medicines suppliers, including parallel importers, specials producers and “UK DAVID WALLACE [email protected] manufacturers of products where raw materials may come from/via the EU and inished pharmaceutical products European Economic Area” – is commenc- and active pharmaceutical ingredi- ing a procurement exercise for ‘express F ents must continue to be excluded freight services’ for small consignments from tariffs on Chinese imports into the on a 24-hour basis and for two-to-four- US, the country’s Association for Acces- day delivery of pallets. It is also starting sible Medicines has urged the US Trade to procure ‘roll-on roll-off’ freight capacity Representative, Robert Lighthizer. for both medicines and medical products. As part of a USTR request for formal In general, the UK’s Department for feedback on proposed tariffs on Chi- Transport is putting in place a “freight ca- nese imports, the AAM says it “strongly pacity framework agreement” aimed at giv- supports the office of the USTR’s deci- ing government departments the ability to sion to continue excluding pharma- secure freight capacity for critical supply ceuticals and certain pharmaceutical chains as and when needed. “This frame- inputs from the expanded list of Chi- “Fortunately, finished work does not commit the government nese exports that will face tariffs when drugs and API to purchasing or reserving any freight ca- imported into the US.” pacity, but it does provide a flexible list of Noting that it had last year warned were removed from operators and options for the provision that tariffs on Chinese imports then be- of the capacity that can be drawn upon if ing mooted by the USTR could push up [the list] and they needed,” Lidington explained. prices as well as manufacturing costs for generics and biosimilars, the AAM says have not been ADDITIONAL BORDER this would have caused “disproportion- proposed as part PAPERWORK REQUIRED ate economic harm to US interests, in- Responding to the statement, Steve bates, cluding the interests of consumers, by of the current list CEO of the UK’s BioIndustry Association significantly increasing the cost of ge- commented: “Our sector has already en- neric prescription drugs.” of goods” dured considerable disruption, duplica- “Fortunately, finished drugs and API tion and uncertainty, and invested signifi- were removed from [the list] and they cant time, effort and resource with little have not been proposed as part of the current list of goods,” the AAM points out. The government support. There is now an ad- organization had specifically lobbied the USTR on this point just over a year ago. ditional requirement around border pa- “AAM appreciates that the [Trump] administration continues to recognize the poten- perwork which brings additional burden, tial harmful impact that an increased tariff would have on efforts to reduce drug prices especially for smaller companies, as much in the US,” the off-patent association states. of this work is contracted out.” “The imposition of tariffs on generic drugs, biosimilars or their ingredients would Acknowledging that the government have a perverse effect on healthcare spending in the US,” it maintains, as well as increas- had listed to industry about the need for ing the risk of shortages. extra freight capacity, Bates encouraged “Analysts have recognized that if a 25% tariff is imposed, it would likely have a BIA members to engage with the govern- greater impact on generic producers than their brand name counterparts, because ment’s plans, but stressed that “a no-deal, manufacturing represents a much greater proportion of generic producers’ costs,” disorderly Brexit must be avoided.” the AAM says. Similar sentiments were voiced by UK “AAM recognizes that the administration is balancing a number of important interests branded medicines body the ABPI, which as it continues to press China to address the concerning acts and practices identified,” welcomed the steps taken to secure the association concludes. “AAM appreciates the continued recognition an additional freight capacity, but said it was awaiting duty on finished drugs and API would harm access to safe, effective and affordable ge- further details. neric and biosimilar medicines.”

Published online 28 June 2019 Published online 26 June 2019

genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 17 BUSINESS STRATEGY FY2019 GDUFA ANDA Holder Fees Increased by 17% …. What Increase Will FY2020 Bring????

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The ANDA Holder Program fee schedule for Fiscal Year 2019 was published by FDA in August 2018, and the fees increased by 17% from the previous year. Fees were as follows:

Tier ANDAS Owned Fee Small 1-5 $186,217 Medium 6-19 $744,867 Large 20 or more $1,862,167

This is a significant expense for many firms. Those with a modest number of ANDAs will again be paying substantial fees for products they may not even currently market or are identified as Discontinued in the Orange Book. For a small- or medium-tier company this can be a dramatic hurdle simply to retain the assets they worked so hard to own. Discontinued ANDAs are still considered approved ANDAs for user fee purposes unless the approval is withdrawn. And once withdrawn, ANDAs become virtually impossible to reactivate. Your asset may be gone forever. Further, no one yet knows what will happen to the ANDAs identified asnot “ marketed” from last year’s one-time marketing status report as submitted to the FDA.

A PROVEN Solution Now in its third year, ANDA Repository, LLC. offers significant user-fee relief and a solution for companies with discontinued ANDAs or drug products not currently marketed. Like with a parking lot, car owners need space for their cars, whether in use or not. At ANDA Repository, in exchange for the space to park (and a fee), car owners transfers title of the cars to the parking lot owner. The former car owners can, with appropriate notice, resume ownership when they choose to use the car again. Since the parking lot owner has enough cars, this venture benefits for all the parties involved, and the cars remain safe and secure. In the example above, the car owner is an ANDA owner, and the parking lot owner is ANDA Repository, LLC. which charges ANDA owners an annual fee significantly less than the GDUFA II ANDA Holder Program Fee the FDA charges small- or medium-sized firms. There is NO need to pay excessive fees or be forced to withdraw your valued assets due to short-term market conditions, capacity constraints, API supplier issues, etc!

And check with us before WITHDRAWING your ANDAs…we may be interested in purchasing them!

The FY2020 GDUFA Generic Drug Applicant Program Fee is due October 1, 2019, so please act now!

Phone: +1-570-261-1901 Email: [email protected] 18 | Generics Bulletin | 5 July 2019 © Informa UK Ltd 2019 BIOSIMILARS FY2019 GDUFA ANDA Holder Fees Increased by 17% …. What Increase Will FY2020 Bring???? Coherus Chief: FTC Must Probe

We offer relief to ANDA Holders, especially small and medium Originators’ Anti-Competitive Tactics firms, through a PROVEN GDUFA II Program Fee approach AIDAN FRY [email protected] action in a bid to boost uptake of its In- The ANDA Holder Program fee schedule for Fiscal Year 2019 was published by FDA in August 2018, flectra infliximab biosimilar of Remicade. and the fees increased by 17% from the previous year. Fees were as follows: “If policymakers want to reduce drug prices and maintain “Johnson & Johnson is happy to collect patient access, it is time to end the manipulative practices that its artificially inflated prices, and the -in take choice away from physicians and patients” – Denny Lanfear surer and pharmacy benefit manager are happy to pocket ‘savings’ they have ne- Tier ANDAS Owned Fee gotiated,” he alleges. “Meanwhile, com- Small 1-5 $186,217 petition and choice wither, and the rest of us get stuck with the bill.” Medium 6-19 $744,867 Such originator tactics and strategies Large 20 or more $1,862,167 have not gone unnoticed. Former Food and Drug Administration commissioner Scott Gottlieb accused Amgen of “using This is a significant expense for many firms. Those with a modest number of ANDAs will again be paying their market power to thwart an avenue to competition,” he notes, while Health and substantial fees for products they may not even currently market or are identified as Discontinued in the iologics originators are using “a prices and maintain patient access,” he Human Services secretary Alex Azar has Orange Book. For a small- or medium-tier company this can be a dramatic hurdle simply to retain the assets combination of coercive, anti-com- states, “it is time to end the manipulative described rebates for original biologics as they worked so hard to own. B petitive tactics to box out biosimi- practices that take choice away from phy- “perverse incentives” to protect brands and lars”, an approach that merits investiga- sicians and patients.” push costs onto patients and taxpayers. Discontinued ANDAs are still considered approved ANDAs for user fee purposes unless the approval is tion by the Federal Trade Commission, At the start of this year, Coherus in- withdrawn. And once withdrawn, ANDAs become virtually impossible to reactivate. Your asset may be Coherus BioSciences’’ president, CEO and troduced its Udenyca pegfilgrastim bio- FTC MUST ACT TO ADDRESS chairman Denny Lanfear argues in an similar at a 33% discount to its reference EXCLUSIONARY CONTRACTS gone forever. Further, no one yet knows what will happen to the ANDAs identified asnot “ marketed” from opinion piece published this week in the brand, Amgen’s Neulasta. With “strong Lanfear acknowledges that both Con- last year’s one-time marketing status report as submitted to the FDA. Wall Street Journal. acceptance by oncologists and their pa- gress and the FDA have already done Arguing that branded biologics firms tients”, sales of the neutropenia treatment their part by creating the BPCIA and were being allowed to maintain their mo- reached $37.1m in the first quarter of regulatory pathway for approving bio- A PROVEN Solution nopolies almost a decade after the 2010 2019, generating a gross margin of 94.0%. similars and addressing patent issues. Now in its third year, ANDA Repository, LLC. offers significant user-fee relief and a solution for companies Biologics Price Competition and Innova- “The problem,” he insists, “is backroom, tion Act had created a US pathway for AMGEN’S PBM DEAL PREFERS bundled-rebate contracts between big with discontinued ANDAs or drug products not currently marketed. Like with a parking lot, car owners biosimilars, former Amgen executive Lan- BRAND TO BIOSIMILAR pharma, major insurers and pharmacy need space for their cars, whether in use or not. At ANDA Repository, in exchange for the space to park fear insists that US authorities must act to However, Lanfear highlights, Amgen re- benefit managers.” (and a fee), car owners transfers title of the cars to the parking lot owner. The former car owners can, with address “rapidly escalating, unsustainable acted to this competition cutting into its Nevertheless, he argues that “Washing- drug costs”, especially for biologics. own profits by striking a deal with Unit- ton has the opportunity – and obligation appropriate notice, resume ownership when they choose to use the car again. Since the parking lot owner In 2017, the biosimilars developer’s chief edHealth Group and its OptumRx phar- – to ensure that biosimilars are allowed to has enough cars, this venture benefits for all the parties involved, and the cars remain safe and secure. points out, biologic medicines accounted macy benefit manager to prefer Neulasta do the job they were intended to do: pro- for just 2% of US prescriptions, but 37% of over biosimilars with lower list prices. vide a check on big pharma’s big prices.” In the example above, the car owner is an ANDA owner, and the parking lot owner is ANDA Repository, LLC. Americans’ drugs spending. “In the absence “That’s great for Amgen, OptumRx and Referencing a recent call by non-profit which charges ANDA owners an annual fee significantly less than the GDUFA II ANDA Holder Program of direct competition, prices on products UnitedHealth Group, but terrible for pa- advocacy group Patients for Affordable Fee the FDA charges small- or medium-sized firms. There is NO need to pay excessive fees or be forced such as Enbrel (etanercept), launched in the tients, healthcare providers and the tax- Drugs Now for the FTC to investigate co- 1990s at about $10,000 a year, were raised payers who fund Medicare,” he claims. ercive bundled-rebate contracts, Lanfear to withdraw your valued assets due to short-term market conditions, capacity constraints, API supplier aggressively – and with impunity – to more According to the Coherus chief, Am- maintains that “the FTC has every reason issues, etc! than $60,000 a year,” he observes. “Patients gen’s tactics on Neulasta are “adapted to investigate.” are now paying up to 20% of these drugs’ from the playbook Johnson & Johnson “Patients need access to products they list prices as co-payments.” used to block biosimilar competition to can afford, and these secret contracts And check with us before WITHDRAWING your ANDAs…we may be interested in purchasing them! Contrasting the US rises with the sav- its Remicade therapy.” By providing insur- keep prices high and prevent doctors ings for healthcare systems in Europe en- ers with “back-end rebates” on a basket from maximizing patient benefit,” he gendered by rapid adoption of biosimi- of products, the originator has, he says, concludes in urging Washington to allow The FY2020 GDUFA Generic Drug Applicant Program Fee lars, Lanfear maintains: “Given the choice, effectively blocked physician and patient biosimilars suppliers to compete. physicians and patients choose value.” access to less-expensive options. This is due October 1, 2019, so please act now! “If policymakers want to reduce drug prompted Pfizer in 2017 to launch a legal Published online 27 June 2019

Phone: +1-570-261-1901 Email: [email protected] genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 19 INTELLECTUAL PROPERTY

Mayne Cannot Revive US Antifungals Patent

AIDAN FRY [email protected]

ayne Pharma has failed to convince the US Court of tion to include MCI. Such amendments, the court said, could Appeals for the Federal Circuit that its US antifungals be made without altering the petition’s filing date. M formulation patent 6,881,745 was wrongly found to be “There was no evidence suggesting MSD intended to conceal unpatentable by the US Patent and Trademark Office. The ‘745 MCI’s identity,” the appeals panel stated. “In fact, Mayne was aware patent was set to expire on 22 December next year. of MCI because MCI was a named defendant in parallel district court Merck Sharp & Dohme had successfully argued before the litigation and, had MSD named MCI as a real party in interest in its USPTO’s Patent Trial and Appeal Board that the ‘745 patent, original petition, Mayne would be in the same position it is in now.” which claims pharmaceutical compositions of azole antifungal The Australian firm had sued both MSD and MCI in a Delaware drugs that are practically insoluble in aqueous media, was antici- district court for alleged infringing the ‘745 patent through the US pated and obvious in light of prior-art references. firm’s Noxafil (posaconazole) antifungal brand. That litigation was But on appeal, Mayne argued that the PTAB had erred because stayed in 2017 pending the outcome of the inter partes review. Merck was time-barred from bringing an inter partes review of Mayne was similarly unsuccessful in arguing for a narrower the patent. The US originator should, it asserted, have identified claim construction that might render the disputed claims patent- parent group Merck & Co (MCI) as “a real party of interest”, but able. The term ‘pharmaceutical composition’ was not limited to failed to do so within the statutory one-year bar. non-toxic compositions, the Federal Circuit ruled. The court also agreed with MSD that “the broadest reasonable interpretation of PETITIONS CAN BE AMENDED WITH SAME FILING DATE the claims is not limited to humans.” Thus, the claims at issue were But having heard the USPTO’s intervention in support of MSD, both anticipated as obvious in light of prior-art references. the Federal Circuit found that the PTAB had “committed no re- versible error” in allowing MSD to amend its inter partes peti- Published online 24 June 2019

PRICING Spain’s Aeseg Warns Against Tender Proposals DAVID WALLACE [email protected]

ntroducing widespread regional or national tenders in Spain would increase the risk of shortages and put patient access at I risk, according to local off-patent industry association Aeseg. The industry body was responding to recommendations set out by Spain’s Independent Authority for Fiscal Responsibility, AIReF, suggesting a national tender system for medicines dis- pensed through pharmacies. “Any measure based on exclusive supply, by one or a limited number of companies, that prevents the free participation of all available firms, will hinder the regular supply of drugs and will pose a risk to the regular supply of medicines for the patient,” Aeseg stated. Pointing out that retail tenders were still a rarity in Europe, with the exception of Germany and the Netherlands – which the association said had healthcare systems that were “not comparable” to those of their European neighbors – Aeseg said that other price differential with other European countries and the economic countries that had introduced tenders had seen these mecha- unfeasibility of marketing certain presentations”. Such situations nisms withdrawn due to the shortages they had engendered. would only be exacerbated by national tenders, Aeseg warned. With the exception of Andalusia, none of Spain’s regional autono- Noting that AIReF’s recommendations to Spain’s government mous communities had prioritised the application of tendering sys- were only advisory in nature, Aeseg said it expected both cen- tems, Aeseg noted, with almost half of the drugs currently subject tral and regional administrations to carry out a “thorough evalu- to Spanish shortages being those covered by the Andalusia tenders. ation” of the proposals “and assess in detail” potential negative In 2018, the association said, 1,332 shortages had been report- effects on all healthcare stakeholders and impact on patients. ed in Spain. This was 44% more than in 2018 “and 42% of them were caused by unforeseen shortages of certain products due to a Published online 25 June 2019

US Court Sticks To Status Quo On Rotigotine Patch AIDAN FRY [email protected]

eva’s attempt to overturn a US patent protecting a transdermal T patch formulation of the rotigotine Parkinson’s disease treatment until March 2021 has been thwarted by the US Court of Appeals for the Federal Circuit. “There is not enough But the court confirmed the invalidity of indication from the a polymorph patent that could have protected UCB Pharma’s Neupro extended- patent specification, release patches well into the next decade. In November 2017, a Delaware district claims, or the record court had found that generic rotigotine evidence of the patches developed by Teva’s Actavis and an equivalent, and also should not force Watson affiliates infringed US patent inventor’s knowledge inventors to delay filing for a patent on 6,884,434 under the doctrine of equiva- what they have invented while testing all lents. The ‘434 patent, which claims a here to conclude that known possible equivalents for fear of be- transdermal therapeutic system compris- ing unable to assert infringement under ing free-base rotigotine without water in UCB surrendered the doctrine of equivalents in the future.” a matrix based on an acrylate-based or polyisobutylene as a On vitiation that would render a claim silicone-based polymer adhesive system, limitation inconsequential or ineffective, expires on 30 March 2021. possible equivalent” the Federal Circuit disagreed with Teva At the same time, the Delaware court that “finding polyisobutylene to be an upheld the validity of the ‘434 patent – Court of Appeals equivalent gives the element ‘an acry- against Teva’s obviousness and antici- late-based or silicone-based polymer ad- pation challenges. But it invalidated US hesive system’ such broad play that the rotigotine polymorph patent 8,232,414 – element would disappear entirely.” Nor, which was filed in 2008, but is not listed the court found, did UCB’s infringement against Neupro in the Orange Book main- chosen to draft narrow patent claims that theory ‘ensnare’ the prior art, because tained by the Food and Drug Administra- would be improperly expanded in scope Teva had offered “no examples of prior tion – on the basis that its claimed inven- via the doctrine of equivalents, the Feder- art that would be ensnared by the addition was known and used by others in the al Circuit noted that the generics firm was tion of polyisobutylene to the claim.” US before the date of invention. not arguing that “the ‘434 patent’s specifi- Addressing the validity of the ‘434 patent, cation relies on any unique characteristics the Court of Appeals noted that Teva was APPEAL CENTRED ON FORMS of acrylate or silicone-based polymer ad- alleging anticipation in light of the Cygnus OF ADHESIVES hesive systems that would not be present prior-art patent application covering a ma- On appeal, the infringement issue centred in a polyisobutylene-based system.” trix formulation of rotigotine hydrochloride on Teva’s use of a polyisobutylene adhesive, “There is not enough indication from salt, as well as obviousness on the basis of rather than the acrylate- or silicone-based the patent specification, claims, or the various references including Cygnus. adhesives described in the ‘434 patent. record evidence of the inventor’s knowl- The appeals panel agreed with the dis- edge here to conclude that UCB sur- ANTICIPATION ARGUMENT trict court that UCB was not barred from rendered polyisobutylene as a possible FATALLY FLAWED asserting the doctrine of equivalents. equivalent,” the court declared. On anticipation, the appeals panel iden- UCB had not, the Court of Appeals tified “a fatal flaw” in Teva’s attempt to found, surrendered polyisobutylene as an SYSTEM SHOULD NOT INCENTIVIZE show that Cygnus taught a patch con- equivalent in prosecuting the ‘434 patent CLAIMING EQUIVALENTS taining at least some rotigotine in a free before the US Patent and Trademark Of- “As a policy matter,” the appeals panel base form. “There is nothing in Cygnus fice. “A restriction requirement does not added, “the patent system should not in- that teaches a water-free patch with roti- necessarily invoke prosecution history es- centivize inventors to claim equivalents gotine in free base form,” it pointed out, toppel,” it stated. that they had not invented or tested, just adding that other prior-art references cit- Turning to Teva’s argument that UCB had because they know of the possibility of ed by Teva did not fill this gap. And there

genericsbulletin.pharmaintelligence.informa.com 5 July 2019 | Generics Bulletin | 21 INTELLECTUAL PROPERTY / LEGAL ISSUES

was a “lack of reasonable expectation of success” that would have encouraged a Oklahoma Judge Okays $85m Teva skilled person to combine other prior art cited by the generic applicant. UCB had cross appealed, asking the Opioid Out-of-Court Settlement Federal Circuit to reverse the district PENELOPE MACRAE court’s finding that the ‘414 polymorph Form II patent was invalid due to prior leveland County District Judge Thad Balkman signed off on the $85m settlement public use. But the originator’s arguments between Oklahoma state and Teva Pharmaceutical Industries Ltd after receiving were in vain. C assurances the funds will go only to government efforts to combat the opioid addiction epidemic. But the deal resolved only one lawsuit stemming from the opioid PATIENT USED POLYMORPH crisis, and debt-laden Teva and other drug firms still face an avalanche of more cases. PATCHES BEFORE PRIORITY The settlement, in which Teva made no admission of wrongdoing, stipulates the com- “The district court reasonably found that pany cannot promote its opioids in any way in Oklahoma until 2027. The agreement was a patient in the US used Neupro patches struck following a mediation session before a retired state Supreme Court judge last week. that contained Form II rotigotine before 28 November 2007 – the ‘414 patent’s TEVA WILL ASSIST LEGAL INVESTIGATIONS filing date – and that therefore the ‘414 Teva has also agreed to help law enforcement investigations involving opioids, accord- patent claims were invalid,” the appeals ing to state attorney general Mike Hunter, who has aggressively pursued opioid-makers panel stated. for their alleged role in creating the biggest public health drug crisis in US history. The Court of Appeals explained that Hunter said the money from the Teva settlement will be placed in the state’s “opioid a female patient who had responded lawsuit settlement fund” and be utilised “only be for the abatement of the nuisance well to Neupro samples had in Novem- related to the opioid crisis.” State lawmakers will decide on “specific appropriations,” he ber 2007 purchased patches from a lot said. State lawyers will get $12.75m in fees from the settlement, 15% of the total. later discovered to have contained Form Balkman had put the deal concluded II rotigotine. While the patient did not between Teva and the state in May on hold report an adverse event resulting from earlier this month after Oklahoma state The money from using the patches containing the poly- leaders expressed concern the agreement morph crystals until 30 November 2007 failed to satisfy new state legislation stipu- the Teva settlement – two days after the ‘414 patent’s priority lating opioid settlement funds must go date – she had already been using the into the state treasury. Balkman had sought will be placed in the Neupro patches for a week at that point. clarity on who would control the money. Oklahoma has proposed a 30-year opi- state’s “opioid lawsuit ACTAVIS SUED OVER oid epidemic abatement program costing settlement fund” 2030 NEUPRO PATENT a projected $17.5bn and the Teva agree- While the Court of Appeals’ decision likely ment calls for the money to be put toward holds off generic rivals to Neupro patch- that plan. “The resources and terms of the agreement will help abate the ongoing crisis es until March 2021, UCB is attempting to the state is facing,” Republican attorney general Hunter said in a news release following a throw up further barriers to competition hearing on 24 June in Norman, Oklahoma. for its Parkinson’s disease brand, which The settlement would also “help prevent doctors and Oklahomans from being misled registered 5% sales growth to €101m by marketing materials and provides law enforcement with another investigative tool ($115m) in the US last year. to help us shut down pill mills and illicit enterprises,” he said. In March this year, the Belgian originator sued Teva’s Actavis in Delaware OKLAHOMA DEAL DOES NOT FREE TEVA FROM OTHER CASES for alleged infringement of US patent Balkman, a former Republican state legislator, made clear the settlement does not free 10,130,589, which is listed in the FDA’s Or- Teva from any separate claims that might be brought by individual cities or counties. ange Book with an expiry date of 22 De- Teva has said it remains “prepared to vigorously defend claims against the company, in- cember 2030. The ‘589 patent is entitled cluding the upcoming federal court trial in Cleveland, Ohio – slated for October – where ‘Polyvinylpyrrolidone for the stabilization the majority of the cases are pending.” of a solid dispersion of the non-crystalline Teva’s chief executive Kåre Schultz said in May that the company, whose net debt form of rotigotine.’ According to UCB’s totaled $26.7bn as of 31 March, does not “have that much money. I think they will have suit, Actavis’ paragraph IV patent-chal- to find someone else if they want big settlements. It won’t be with us.” lenge notice letter “did not contest its in- The Israeli group’s share price has fallen by nearly 30% in 2019 and is down by nearly fringement of the ‘589 patent”, but rather 90% from a 2015 peak. Teva, which makes generic opioid painkillers, swung to a first- asserted that the patent was invalid. quarter loss of $105m from a net profit of $1bn in the same year-earlier period.

Published online 25 June 2019 Published online 28 June 2019

S ER AL LES HO W

Don’tall let over them you. step

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