In 2008, the First Appellate District of California jolted the drug and medical device defense bar when the Conte court, in essence, imposed a new duty on brand-name manufacturers for alleged injuries sustained by consumers of its competitors' products. Conte v. Wyeth, Inc., 85 Cal.Rptr.3d 299 (Cal. App. 1st Dist. 2008). In December 2010, the concern of a possible extension of Conte presented itself when the U.S. Supreme Court granted certiorari in Pliva, Inc., et al. v. Gladys Mensing, a case that may have the unintended impact of expanding Conte to other jurisdictions. While Conte and Mensing dealt with traditional pharmaceutical products, the industry's rapid advancement into biopharmaceuticals means practitioners must be prepared for Conte and Mensing to spill over into the emerging legal field of follow-on biologic products.
On February 18, 2011, FDA Commissioner Margaret Hamburg promised that new rules for follow-on biologics would be forthcoming "very soon." The factors upon which the Conte court relied are the same issues FDA is currently deliberating. Follow-on biologics certainly are not the same as generics, but the different legal framework and regulatory system for their development and approval are about to change.
This article explains the scientific, legal, and regulatory differences governing pharmaceuticals (brand and generic) verses biopharmaceuticals (reference products and follow-on biologics), along with legal arguments and suggestions for new FDA rules that will help protect biopharmaceutical innovators from liability arising from the use of a competitor's follow-on biologic product.
Conte and Mensing
Drug and medical device defense practitioners are well aware of the Conte holding that a brand-name manufacturer may be liable for common law fraud and negligent misrepresentation when a plaintiff's ingestion was limited to the generic version of the brand-name drug. The factors that influenced the Conte court include the common and permissible practice of pharmacies automatically substituting a generic drug for the brand-name product unless the prescriber indicates otherwise. The court also emphasized that labeling was the same between the generic and brand-name products and that the two products must be, by law, biologically equivalent. Rejecting arguments from products liability cases and, instead, applying elements and novel cases concerning common law misrepresentation, the court held that it was foreseeable for the prescribing physician to rely on the brand-name manufacturer's product information even though the patient may ultimately ingest the generic equivalent. Conte, 85 Cal.Rptr.3d at 313.
With limited exception, courts across the country have rejected the rationale of Conte. While we remain cautiously optimistic that Conte will continue to be an outlier, cause for concern increased last December when the U.S. Supreme Court disregarded the advice of the Solicitor General (advice the Court, itself, invited) and granted certiorari in Mensing. The issue in Mensing is whether claims against generic manufacturers are preempted by the Drug Price Competition and Patent Term Restoration Act of 1984 (also referred to as the "Hatch-Waxman Amendments").
The similarities between Conte and Mensing are limited to the ingested product and the alleged injury. The legal arguments, the parties on appeal, and the causes of action all differ. Nevertheless, a ruling in favor of the generic manufacturers in Mensing might have negative implications on brand-name manufacturers, resulting in the proliferation of Conte to other jurisdictions. Courts that tend to sympathize with injured plaintiffs will search hard to find a remedy. Without a generic manufacturer in the case, that remedy may unjustly lie with the brand-name manufacturer – even in instances when the brand-name product was never ingested by the plaintiff.
Application to Biopharmaceutical Products
In addition to the outcome of Mensing, practitioners should be knowledgeable and prepared for possible Conte-like arguments in the emerging legal field of follow-on biologics. Last year's Patient Protection and Affordable Care Act created an abbreviated approval pathway for biological products that are demonstrated to be "highly similar" ("biosimilar") to or "interchangeable" ("interchangeables") with an FDA-approved biological product. The statutory provisions are also referred to as the Biologics Price Competition and Innovation Act of 2009 ("BPCI Act"). The general goal of the BPCI Act is similar to that of the Hatch-Waxman Amendments – to provide a process for the approval, marketing, and post-marketing surveillance of less expensive versions of the reference product. However, the similarity between biopharmaceutical products and traditional pharmaceutical products ends there.
Traditional pharmaceutical products are small-molecule, chemically-based drugs consisting of a well-defined, and comparatively easily replicated, chemical structure. In contrast, biopharmaceuticals (or "biologics") are complex, large-molecular products that are manufactured through the use of living organisms such as plant or animal cells. They generally involve protein-based medicines and are extremely difficult to duplicate. While more complex than traditional pharmaceuticals, biologics themselves range from extremely complex and very difficult to manufacture (e.g., monoclonal antibodies) to relatively uncomplicated and less-elaborate biologics (e.g., human growth hormones). Further, given their complexities, it is challenging, if not altogether impossible, to analyze the efficacy and safety of the majority of biologics absent clinical trials.
Follow-on biologics is a term used to describe new versions of biologics following expiry of the innovator's patent. Follow-on biologics, however, are not generic drugs. Whereas traditional pharmaceutical products are relatively easily replicated by use of the known active ingredient (the drug) and miscellaneous inactive ingredients (e.g., binders, coatings, fillers, flavours, etc.), the majority of follow-on biologics are difficult to make and require a significant amount of resources, expertise and capabilities not previously associated with many manufacturers of generic pharmaceuticals. Consequently, and for a variety of additional reasons, use of the term "biogeneric" to describe follow-on biologics is misplaced.
One key distinction between follow-on biologics and generics is the different legal framework and regulatory scheme for development and approval. Traditional pharmaceuticals are approved under the Federal Food, Drug, and Cosmetic Act ("FDCA"). Conversely, the Public Health Service Act governs approval of biopharmaceutical products. FDCA provides a detailed framework for the approval of generic drugs. However, there is currently no formal pathway or framework for the approval of follow-on biologics. While FDA has previously approved some follow-on biologics, it has done so through either the Abbreviated New Drug Application process (21 C.F.R. 314.92) or through the Section 505(b)(2) process (21 C.F.R. 414.54). Neither of these processes sufficiently address the unique issues that exist when discussing biopharmaceutical products.
FDA's Forthcoming Regulations for Follow-On Biologics
Since the passage of the BPCI Act, FDA has conducted extensive research and held public hearings to formulate regulatory guidelines for an approval process so that the proposed follow-on biologic is demonstrated to be biosimilar or interchangeable with an FDA-approved biologic product. As noted above, FDA Commissioner Hamburg stated that rules governing an approval process for follow-on biologics would be announced "very soon." When the White House released its budget for fiscal year 2012 on February 14, 2011, it increased FDA funding by 33 percent and $124 million is dedicated to the Protecting Patients Initiative which includes, among other things, the development of a pathway for approving follow-on biologics.
The forthcoming FDA rules are expected to address critical issues that will impact biopharmaceutical companies globally, including liability exposure for manufacturers of follow-on biologics and their reference products. The rules are likely to contain guidelines addressing the type and amount of clinical trial data necessary to establish biosimilarity; the necessary heightened showing for an interchangeable which, pursuant to the BPCI Act, is defined to mean that the product "may be substituted for the reference product without the intervention of the health care providers who prescribed the reference product" (BPCI Act, Title VII, Sec. 7002 (b), redefining 42 U.S.C. § 262(i)(3)); the length and scope of the exclusivity period in which data pertaining to the innovator is protected; the use of a distinct and nonproprietary name for a follow-on biologic so that it is easily distinguishable from the innovator so as to better facilitate pharmacovigilance; and labeling issues.
The need for clinical trials is one area where the regulatory approval process for follow-on biologics will differ significantly from the approval process for generic drugs. It is generally uncontested that the approval process for follow-on biologics will necessarily involve clinical trials. This is due to the difficulty in analyzing biopharmaceutical products in a laboratory as well as the fact that follow-on biologic manufacturers will not have access to the living organism used to create the reference product. Further, unlike generic drugs, follow-on biologics are not the same as their reference product. Slight variations in the manufacturing process or in the cell line may result in significant safety and efficacy differences. These factors render it impossible for a follow-on biologic manufacturer to demonstrate that its product is highly similar to or interchangeable with its innovator absent clinical trials.
By comparison, traditional generic drugs have no requirement for clinical trials. Under the Hatch-Waxman Amendments, a generic drug manufacturer need only show that its drug is the "bioequivalent" of the brand-name product. By contrast, a traditional pharmaceutical innovator must undergo extensive, rigorous, and costly animal and human clinical studies to demonstrate efficacy and safety. Generic drug manufacturers need not undergo these same time-consuming and expensive procedures. There is no requirement to show that the generic drug is safe or effective. Rather, in order to receive FDA approval for a generic drug, its manufacturer simply needs to demonstrate that the drug has the same bioequivalence as the reference product.
Why is labeling important?
As noted above, FDA's rules establishing a pathway for approval of follow-on biologics will include regulations that govern labeling. As noted by the court in Conte and as provided in numerous decisions concerning "generic preemption," the labeling for a generic pharmaceutical product must be the same as the labeling of the reference product. (See, e.g., Conte,85 Cal.Rptr.3d at 307;Mensing v. Wyeth, Inc., 588 F.3d 603 (8th Cir. Minn. 2009), cert. granted, 79 U.S.L.W. 3358 (U.S. Dec. 10, 2010) (Nos. 09-993 and 09-1039); Demahy v. Activis, Inc., 593 F.3d 428 (5th Cir. La. 2010) 79 U.S.L.W. 3358 (U.S. Dec. 10, 2010) (No. 09-1501); and Gaeta v. Perrigo Pharmaceuticals Company, et al., 2011 U.S. App. LEXIS 1382 (9th Cir. Cal. Jan 24, 2011). This was one of the key factors for the Conte court when it ruled that a brand-name manufacturer may be liable for misrepresentations made in its labeling even though a patient ingests the generic equivalent. Conte, 85 Cal.Rptr.3d at 313-14. Given this backdrop, different labeling standards for follow-on biologics will be a critical issue in the protection of our innovator biologic clients from liability arising out of use of the competitor's follow-on biologic product.
Since biosimilars are not the same as their biologic reference product it follows that the labeling for a biosimilar should be uniquely tailored for each biosimilar and with limited, if any, reliance on the biologic's label. This is most obvious for biosimilars that fail to obtain FDA approval for any indication for which the innovator is approved. However, the scope of the uniquely tailored label must extend to all portions of the label including product quality, efficacy, and safety.
The presenters at FDA's public hearings that commented on labeling issues provided a consistent message underscoring the need for the patient and health provider to know the information for the specific product the patient is ingesting. Moreover, the BPCI Act creates two separate "tiers" for follow-on biologics: one for biosimilars (products that are demonstrated to be "highly similar" to the biologic reference product); the other meeting the heightened standard of being "interchangeable" with the biologic reference product. A product that satisfies the higher standard of "interchangeability" will need to demonstrate that it "can be expected to produce the same clinical result as the reference product in any given patient." BPCI Act, Title VII, Sec. 7002 (a) redefining 42 U.S.C. § 262 (a)(1)(A)(k)(4)(A)(ii). Additionally, it must be established that, for a "product that is administered more than once to a patient, the risk in terms of safety or diminished efficacy of alternating or switching between" the interchangeable product and the reference product "is not greater than the risk of using the reference product without" switching. BPCI Act, Title VII, Sec. 7002 (a) redefining 42 U.S.C. § 262 (a)(1)(A) (k)(4)(B). FDA will need to provide clearer guidance on the circumstances in which it would be appropriate for a follow-on biologic to be designated as an interchangeable particularly since pharmacies will have the ability to switch a patient from the innovator's product to the interchangeable product without consulting with the prescriber. Testimony during FDA's public hearings provided little guidance on this issue except to demonstrate that technology may not currently exist to satisfy this heightened standard.
The labeling may vary depending on whether the follow-on biologic is approved as being a biosimilar or an interchangeable. That said, in neither event should the follow-on biologic have labeling that can be confused with the innovator's labeling. To emphasize the importance for consumers to be able to clearly distinguish between the follow-on biologic and its reference product, FDA is considering whether to require a follow-on biologic to have its own, distinct nonproprietary name. This would prevent inadvertent product switching by pharmacies and would allow for a more efficient manner of tracking adverse events and other post-marketing surveillance. It was made clear to FDA that current regulations for naming and labeling generic pharmaceutical products were not designed to address follow-on biologics. While biopharmaceutical innovators may have different opinions than follow-on biologic manufacturers on these issues, patient rights organizations appear to favor different labeling so that all interested parties (pharmacies, health care providers, patients, and pharmacovigilance departments) can differentiate between the follow-on biologic and its reference product to best serve patients.
The factors, upon which the Conte court relied, albeit involving traditional pharmaceutical products, are the same issues FDA is currently deliberating and will be the subject of either FDA's rules or its subsequent regulations. The theme of Conte is whether it was foreseeable to the reference drug manufacturer that the prescriber would rely on its labeling even if the patient ultimately ingested the generic equivalent. Conte, 85 Cal.Rptr.3d at 313. The court was influenced by the similarities between the brand-name and generic drug in both their chemical structure as well as their labeling. Id. . It also noted that it was routine for pharmacies to switch a patient from the brand-name product to the generic product. Id. FDA must have a clear understanding that a "one-size fits all" approach to biopharmaceutical products is neither feasible nor safe. FDA's final regulations should (1) require follow-on biologics to have different, nonproprietary names that distinguish them from their reference product; (2) call for follow-on biologic labeling to be uniquely tailored and product-specific to highlight individual characteristics concerning product quality, efficacy, and safety; and (3) develop a stringent protocol for the determination of when a follow-on biologic is "interchangeable" with the reference product so that pharmacy switching does not become commonplace. Absent these positions by FDA, practitioners should prepare to defend against Conte-type claims to limit liability for innovator manufacturers of biopharmaceutical products.
Dominic Campodonico is a Partner in the San Francisco office of Gordon & Rees LLP. He is a member of the Drug & Medical Device and Life Sciences Practices with more than 12 years of experience serving as local, regional and national litigation coordinating counsel and settlement counsel in mass tort litigation for pharmaceutical and medical device manufacturers. Mr. Campodonico's firm management responsibilities include serving as the current Chair of both the Diversity Committee and the Pro Bono Committee in the San Francisco office. He can be reached at email@example.com and 415-875-3118.