The District Court for the District of Delaware recently rejected Novartis’s effort to block MSN Pharmaceuticals from launching a generic version of Entresto® (sacubitril/valsartan), its top-selling heart failure medication. The decision, issued on July 11, 2025, potentially clears the path for generic entry before expiration of U.S. Patent No. 11,096,918 (“the ’918 patent”) on November 9, 2026. However, on July 15, 2025, the Court of Appeals for the Federal Circuit issued a temporary injunction blocking MSN’s launch and ordered expedited briefing on whether the circuit court should issue an injunction pending appeal.

While not specific to biosimilars, this case highlights the importance of data reliability in patent litigation and raises interesting issues involving a plaintiff’s discovery obligations in a multi-defendant litigation.

Background

Novartis’s Entresto®, approved by the FDA in 2015, combines valsartan, an angiotensin receptor blocker, and sacubitril, a neutral endopeptidase inhibitor. On October 24, 2022, Novartis filed C.A. No. 22-1395 against MSN, alleging infringement of the ’918 patent, which claims an amorphous solid form of a compound comprising sacubitril, valsartan, and sodium cations (“amorphous TVS”). The only independent claim of the ’918 patent recites:

1. An amorphous solid form of a compound comprising anionic (S)-N-valeryl-N-{[2’-(1H-tetrazole-5-yl)-biphenyl-4-yl]-methyl}-valine [valsartan], anionic (2R,4S)-5-biphenyl-4-yl-4-(3-carboxy-propionylamino)-2-methyl-pentanoic acid ethyl ester [sacubitril], and sodium cations in a 1:1:3 molar ratio.

Following a bench trial in December 2024, Judge Andrews found that Novartis has not proven that MSN infringes the ’918 patent.[1] Prior to the trial, the court construed the term “amorphous solid form of a compound” in the ’918 patent to mean “a solid form of a compound in which the amorphous form of the compound predominates. An amorphous solid form is mutually exclusive from a crystalline solid form, but not necessarily mutually exclusive from a partially crystalline solid form.”[2] At trial, the question of infringement revolved around whether Novartis could prove that MSN’s generic product is predominantly amorphous TVS (an amorphous complex with chemical interactions among the compounds) rather than a physical mixture of amorphous valsartan and amorphous sacubitril sodium with no significant chemical interactions among the compounds.[3]

The Court’s Decision

To demonstrate that MSN infringes the ’918 patent, Novartis compared a Raman spectrum from MSN’s abbreviated new drug application (ANDA) to a reference Raman spectrum. Raman spectroscopy is a method that produces a unique spectrum for different compounds or mixtures of compounds. Specifically of interest here, Raman spectroscopy is capable of differentiating a physical mixture of two compounds (in which no interaction occurs between the compounds) versus an amorphous complex (e.g., amorphous TVS).

Novartis’s expert made a “mathematically-created” reference spectrum for an amorphous physical mixture (which is different from the claimed “amorphous TVS” complex) by adding together the Raman spectra of separate amorphous valsartan disodium and amorphous sacubitril sodium samples.  The district court found this spectrum reliable.[4]  Novartis’s expert also created a “glassy solid” sample, which Novartis argued was amorphous TVS, to compare with MSN’s ANDA spectrum. The district court found the Raman spectrum collected for this glassy solid was not reliable, and thus Novartis failed to show by a preponderance of the evidence that the resulting reference Raman spectrum corresponds to amorphous TVS.[5] Specifically, the court found the Raman spectrum for Novartis’s glassy solid sample was suspiciously similar to the spectrum for the physical mixture; the differences in the spectra appeared to be only a systematic shift of all peaks, rather than different peaks as would be expected for different samples.

Novartis argued that the Raman spectrum of the glassy solid “is different from the Raman spectrum of a[] physical mixture”, pointing to peak shifts when comparing the glassy solid spectrum to the mathematically-created spectrum of a physical mixture of sacubitril and valsartan.[6] Novartis further argued that the peak shifts indicate that the glassy solid sample is amorphous TVS.

MSN disagreed, pointing out that the entire Raman spectrum for the glassy solid “is shifted…to the right of the Raman spectrum of the physical mixture”.[7] MSN’s expert testified that “the type of systematic shift observed…is simply impossible”,[8] thus casting doubt on the reliability of the glassy solid Raman spectrum.

Further compounding this issue, the court took an adverse inference against Novartis for failing to produce the glassy solid sample during discovery. Novartis argued, in part, that an adverse inference is not applicable because MSN did not request production of the sample. However, Noratech was MSN’s co-defendant at the time of discovery and did request production of the sample. The court found that this “discovery [was] common to both Defendants,” that MSN and Noratech shared an expert witness for this issue, and that “MSN wished to test [Novartis’s] glassy solid, the material against which its ANDA was compared.”[9] The court found Novartis had the sample, knew it fell within the scope of requested discovery, and did not provide it. Thus, the court assumed that, “had Novartis produced the glassy solid sample to Defendants, it would have been unfavorable to Novartis’ case.”[10]

Novartis presented additional evidence to demonstrate that the glassy solid was amorphous TVS. However, because Novartis used Raman spectra to show infringement by MSN’s ANDA, the additional evidence was not directly considered when determining infringement. In the end, the “unreliability of Novartis’ reference Raman spectrum” lead the court “to conclude that Novartis did not meet its burden to show MSN’s ANDA infringes by a preponderance of evidence.”[11]

Implications

As a result of the decision, Novartis is denied injunctive relief based on the ’918 patent, and MSN’s generic version of Entresto® could soon receive final FDA approval.[12] MSN has previously indicated that it is poised to launch its product as soon as it is approved.[13] However, Novartis has appealed the District Court’s decision, and the Federal Circuit has issued a temporary stay preventing launch of the generic. Both Novartis and MSN have until July 21 to file briefs, at which time the Federal Circuit will determine whether a lengthier pause is warranted.

Disclaimer: The information contained in this posting does not, and is not intended to, constitute legal advice or express any opinion to be relied upon legally, for investment purposes or otherwise. If you would like to obtain legal advice relating to the subject matter addressed in this posting, please consult with us or your attorney. The information in this post is also based upon publicly available information, presents opinions, and does not represent in any way whatsoever the opinions or official positions of the entities or individuals referenced herein.

[1] In re Entresto (Sacubitril/Valsartan) Pat. Litig., No. 22-cv-1395-RGA, 2025 WL 1911823 (D. Del. July 11, 2025).

[2] Id. at *2.

[3] See id. at *3.

[4] Id. at *3.

[5] Id. at *4.

[6] Id. at *8.

[7] Id. at *10.

[8] Id. at *13.

[9] Id. at *21.

[10] Id. at *22.

[11] Id. at *22.

[12] The district court previously issued an order under 35 U.S.C. § 271(e)(4)(A) resetting the date of approval of MSN’s ANDA to July 16, 2025, after the expiration of the pediatric exclusivity period for U.S. Patent No. 8,101,659.   See MSN’s Emergency Motion to Stay, Novartis Pharms. Corp. v. MSN Pharms. Inc., No. 19-cv-2053, Dkt. 511 (D. Del., filed April 2, 2025).

[13] See id. at 3.

With healthcare costs rising and biologics driving a large portion of drug spend, the next wave of biosimilar launches promises to reshape the U.S. pharmaceutical market in profound ways, including reduced prices for close analogs of existing reference blockbuster branded products. This post provides a roadmap into this evolution, focusing on potential biosimilar approvals and launches through 2029 in view of a changing regulatory scheme, as well as the cost implications of the changing landscape.

Primer – What are Biosimilars?

Biosimilars are biologic therapeutic products that are highly similar to an already approved (so-called “reference”) biologic, with no clinically meaningful differences with regards to safety, purity, and potency. In the United States, biosimilars are approved under the Public Health Service (PHS) Act via the abbreviated 351(k) Biologics License Application (BLA) pathway. Under this framework, the review standard focuses on a “totality of evidence” model, allowing extrapolation of indications if similarity is established. Importantly, biosimilars may also seek “interchangeable” designation, which (until recently) required additional switching studies to support automatic substitution at the pharmacy level. However, as of June 2024, the FDA issued draft guidance eliminating the need for switching studies, permitting interchangeability designations based on comparative analytical and clinical data alone, aligning the U.S. more closely with European Medicines Agency (EMA) and World Health Organization (WHO) frameworks.

2025 Off to a Fast Start: 12 Biosimilar Approvals and Counting

Within the first half of 2025, the FDA had already approved twelve biosimilars across immunology, oncology, and endocrinology. The approved biosimilars reference Stelara (ustekinumab), Prolia/Xgeva (denosumab), Actemra (tocilizumab), and Xolair (omalizumab), among others.[1]

As of 2025, the following biosimilars have been approved:[2]

Biosimilar NameApproval DateReference ProductMore Information
Kirsty (insulin aspart-xjhz)Jul-25Novolog (insulin aspart)Kirsty Information
Starjemza (ustekinumab-hmny)May-25Stelara (ustekinumab)Starjemza Information
Jobevne (bevacizumab-nwgd)Apr-25Avastin (bevacizumab)Jobevne Information
Bomyntra (denosumab-bnht)Mar-25Xgeva (denosumab)Bomyntra Information
Conexxence (denosumab-bnht)Mar-25Prolia (denosumab)Conexxence Information
Omlyclo (omalizumab-igec)Mar-25Xolair (omalizumab)Omlyclo Information
Osenvelt (denosumab-bmwo)Feb-25Prolia (denosumab)Osenvelt Information
Stoboclo (denosumab-bmwo)Feb-25Prolia (denosumab)Stoboclo Information
Merilog (insulin aspart-szjj)Feb-25Novolog (insulin aspart)Merilog Information
Ospomyv (denosumab-dssb)Feb-25Prolia (denosumab)Ospomyv Information
Xbryk (denosumab-dssb)Feb-25Xgeva (denosumab)Xbryk Information
Avtozma (tocilizumab-anoh)Jan-25Actemra (tocilizumab)Avtozma Information

What stands out is the pace: these approvals occurred faster than during prior years, suggesting regulators and developers alike are adapting to biosimilar pathways with more confidence and coordination.

A Turning Point in FDA Interchangeability Policy

As noted above, perhaps the most consequential change to the field is regulatory: in June 2024, the FDA issued draft guidance eliminating the requirement for switching studies in order to obtain interchangeability designation.[3] Manufacturers can now rely on comparative analytical and clinical data instead of conducting costly and time-consuming trials.[4] The removal of switching studies is predicted to cut biosimilar development costs from $100-$300 million to $75-250 million and timelines from 7-8 years down to 6.5-7.5 years, with further reductions to $50-75 million and 5-6 years if Phase 3 studies are also eliminated.[5]

This change is already affecting how biosimilar developers approach product development. For example, Formycon,[6] Sandoz,[7] and Bio-Thera[8] all cancelled or modified Phase 3 trials for their Keytruda (pembrolizumab) biosimilars, aiming instead for FDA submission based on Phase 1 data and analytics. This could signal an accelerated path to market for other oncology biosimilars in development and a major reduction in overall biosimilar development costs.

Pipeline Highlights by Therapeutic Class

During the next half-decade, a significant number of biosimilars are expected to enter the market across a myriad of therapeutic classes. Some of the most prominent candidates in development include:

Immunology

  • Simponi (golimumab) biosimilars from Bio-Thera (BAT2506)[9] and Alvotech/Teva (AVT05) are progressing, with launches expected in 2025-2027.[10]
  • Entyvio (vedolizumab) biosimilars from Polpharma and Alvotech are in Phase 3, with expected launches around 2028-2032, pending IV and SC formulation development.[11]
  • Cosentyx (secukinumab) biosimilars are in Phase 3 trials by Celltrion (CT-P55) and Bio-Thera (BAT2306), with exclusivity set to expire in 2029.[12]

Oncology

  • Pembrolizumab (Keytruda) biosimilars are being pursued by at least seven developers, including Samsung Bioepis, Sandoz, Celltrion, Bio-Thera, and Amgen.[13] Launches could begin around 2028-2029, but may accelerate due to the regulatory flexibility described herein.
  • Other oncology biosimilars in active development include agents referencing Opdivo (nivolumab), Herceptin (trastuzumab), and Perjeta (pertuzumab).[14]

Endocrinology & Pulmonology

  • A biosimilar for Trulicity (dulaglutide) from Boan Biotech, already approved in China, is in early development, with exclusivity set to expire in late 2027.[15]
  • Nucala (mepolizumab) biosimilars are entering early-phase trials, targeting a post-2027 window.[16]

Ophthalmology

  • Ongoing development of additional biosimilars for Eylea (aflibercept) and Lucentis (ranibizumab).[17]

Cost Implications and Market Forces

In spring 2025, though approximately 73 biosimilars have been approved, only 48 have launched.[18] That means 34% of approvals remain uncommercialized (often due to market barriers such as patent disputes or pricing challenges), a key reminder that FDA approval does not guarantee immediate or near-term market entry. Q1 2025 alone saw 10 new biosimilar approvals, including multiple entrants for Stelara, Prolia/Xgeva, and Actemra, and 7 biosimilar launches, including Wezlana (Amgen), Selarsdi (Alvotech/Teva), and Steqeyma (Celltrion) for Stelara.[19]

Image source: BiologicsHQ. “SB Biosimilar Market Report Q2 2025.” BiologicsHQ, Apr. 2025, biologicshq.com/wp-content/uploads/2025/04/SB-Biosimilar-Market-Report-Q2-2025.pdf.

Biosimilar competition is driving significant price reductions in 2025. Oncology biosimilars, such as trastuzumab, bevacizumab, and rituximab, show average sales price (ASP) discounts of 50-70%.[20] Denosumab biosimilars launched with wholesale acquisition cost (WAC) discounts exceeding 80% versus Prolia and Xgeva, while tocilizumab biosimilars vary, with Tofidence priced 0.3% below the reference ASP and Tyenne 29% lower.[21] In immunology, infliximab and adalimumab biosimilars offer WAC reductions of 20–60%, with unbranded variants leading the trend. Pegfilgrastim’s ASP dropped 95% since biosimilar entry, and rituximab and trastuzumab fell 33% and 24%, respectively.[22] These trends signal deeper savings as more biosimilars enter pharmacy-benefit areas like endocrinology and ophthalmology.

Bottom Line: A Market About to Tip

Between newly approved agents, relaxed FDA requirements, and a maturing biosimilar developer ecosystem, the U.S. pipeline for 2025-2029 is poised to deliver wider biosimilar adoption, faster launches, and lower prices. Key therapeutic areas to watch include immunology, oncology, and endocrinology, with Cosentyx, Entyvio, Keytruda, and Trulicity representing pivotal inflection points in the next phase of biosimilar growth.

Disclaimer: The information contained in this posting does not, and is not intended to, constitute legal advice or express any opinion to be relied upon legally, for investment purposes or otherwise. If you would like to obtain legal advice relating to the subject matter addressed in this posting, please consult with us or your attorney. The information in this post is also based upon publicly available information, presents opinions, and does not represent in any way whatsoever the opinions or official positions of the entities or individuals referenced herein.

[1] IPD Analytics. “Biosimilar Pipeline 2H 2025.” IPD Analytics, July 2025, www.ipdanalytics.com/sample-reports-1/biosimilar-pipeline-2h-2025.

[2] FDA Biosimilar Product Information – Approved Biosimilar Products. Accessed July 15, 2025, https://www.fda.gov/drugs/biosimilars/biosimilar-product-information.

[3] U.S. Food and Drug Administration. “FDA Updates Guidance on Interchangeability.” FDA.gov, 20 June 2024, www.fda.gov/drugs/drug-safety-and-availability/fda-updates-guidance-interchangeability.

[4] IPD Analytics. “Biosimilar Pipeline 2H 2025.” IPD Analytics, July 2025, www.ipdanalytics.com/sample-reports-1/biosimilar-pipeline-2h-2025.

[5] Id.

[6] Pearce IP. “Formycon to Terminate Ph 3 Trial and Pursue US-Approval of Pembrolizumab Biosimilar Based on Ph 1/Analytical Data.” Pearce IP, 17 Feb. 2025, www.pearceip.law/2025/02/17/formycon-to-terminate-ph-3-trial-and-pursue-us-approval-of-pembrolizumab-biosimilar-based-on-ph-1-analytical-data/.

[7] Pearce IP. “Sandoz to ‘Minimise’ Phase 3 Biosimilar Pembrolizumab Trial Due to Regulatory Streamlining.” Pearce IP, 30 Apr. 2025, www.pearceip.law/2025/04/30/sandoz-to-minimise-phase-3-biosimilar-pembrolizumab-trial-due-to-regulatory-streamlining/.

[8] Bio-Thera Solutions. “Bio-Thera Solutions Initiates Integrated Phase I/Phase III Clinical Trial for BAT3306, a Proposed Biosimilar of Keytruda® (Pembrolizumab).” PR Newswire, 25 July 2024, www.prnewswire.com/news-releases/bio-thera-solutions-initiates-integrated-phase-i–phase-iii-clinical-trial-for-bat3306-a-proposed-biosimilar-of-keytruda-pembrolizumab-302206502.html.

[9] Bio-Thera Solutions. “Bio-Thera Solutions Announces Exclusive Commercialization and License Agreement with Intas Pharmaceuticals for BAT2506, a Proposed Biosimilar Referencing Simponi® (Golimumab), in the United States of America.” Bio-Thera Solutions, 10 Feb. 2025, www.bio-thera.com/plus/view.php?aid=1130.

[10] Alvotech and Teva Pharmaceuticals. “Alvotech and Teva Announce Filing Acceptance of U.S. Biologics License Applications for AVT05, a Proposed Biosimilar to Simponi® and Simponi Aria® (Golimumab).” Alvotech, 27 Jan. 2025, investors.alvotech.com/news-releases/news-release-details/alvotech-and-teva-announce-filing-acceptance-us-biologic/

[11] IPD Analytics. “Biosimilar Pipeline 2H 2025.” IPD Analytics, July 2025, www.ipdanalytics.com/sample-reports-1/biosimilar-pipeline-2h-2025.

[12] Id.

[13] Id.

[14] Id.

[15] Boan Biotech. “Boan’s Dulaglutide Cleared by FDA for Clinical Trials.” Boan Biotech, 5 Aug. 2024, www.boan-bio.com/en/phone/info.php?id=317.

[16] IPD Analytics. “Biosimilar Pipeline 2H 2025.” IPD Analytics, July 2025, www.ipdanalytics.com/sample-reports-1/biosimilar-pipeline-2h-2025.

[17] Id.; Biosimilars for both products are already on the market.

[18] BiologicsHQ. “SB Biosimilar Market Report Q2 2025.” BiologicsHQ, Apr. 2025, biologicshq.com/wp-content/uploads/2025/04/SB-Biosimilar-Market-Report-Q2-2025.pdf.

[19] Id.

[20] Id.

[21] Id.

[22] IPD Analytics. “Biosimilar Pipeline 2H 2025.” IPD Analytics, July 2025, www.ipdanalytics.com/sample-reports-1/biosimilar-pipeline-2h-2025.

In a precedential ruling, the U.S. Court of Appeals for the Federal Circuit in Jazz Pharma. v. Avadel CNS Pharma., 2025 WL 1298920, — F.4th — (Fed. Cir. May 6, 2025), addressed the scope of the 35 U.S.C. § 271(e)(1) “safe harbor” provisions for certain clinical trials and regulatory filings. Although the case arose under the Hatch-Waxman Act, the same safe harbor provision applies to biologics.[1]

Background

Jazz Pharmaceuticals markets XYREM and XYWAV (sodium oxybate) for narcolepsy and related conditions. Avadel CNS Pharmaceuticals developed LUMRYZ, a competing sodium oxybate product approved under the FDA’s 505(b)(2) pathway.

The dispute centers on Jazz’s U.S. Patent No. 11,147,782, which cover sustained-release formulations. Notably, while this patent was held to cover LUMRYZ, it does not cover either XYREM or XYWAV, and is thus not listed in the FDA’s listing of “Approved Drug Products with Therapeutic Equivalence Evaluations” (a.k.a., “Orange Book”).[2] 

Avadel stipulated that LUMRYZ would infringe claim 24 of the ’782 patent if it were not found invalid. After a jury found that claim 24 was not invalid, the U.S. District Court for the District of Delaware issued an injunction that barred Avadel from engaging in certain clinical trials and regulatory activities for LUMRYZ, specifically: (1) offering open-label extensions to clinical trial participants, (2) applying for FDA approval and marketing LUMRYZ for new indications, including idiopathic hypersomnia (an indication for which Avadel had begun clinical trials), and (3) initiating new clinical trials or studies after the effective date of the injunction.[3]

Avadel appealed, arguing that the injunction was overly broad, particularly in restricting activities protected under the “safe harbor” provision of 35 U.S.C. § 271(e)(1). This provision shields certain activities related to regulatory approval from patent infringement liability by providing that:

It shall not be an act of infringement to make, use, offer to sell, or sell within the United States or import into the United States a patented invention (other than [certain animal drugs and veterinary biological products]) solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs or veterinary biological products.

35 U.S.C. § 271(e)(1).

The Federal Circuit reversed in part and remanded in part, holding that injunction prohibiting new clinical trials and open-label extensions was “overbroad as a matter of law.”[4] The court emphasized that the safe harbor applies broadly to “all uses of patented inventions that are reasonably related to the development and submission of any information under the FDCA,” even if the commercial product has been held to infringe a valid patent.[5] At the same time, the court underscored the fact-specific nature of the safe harbor inquiry, pointing out that Jazz may in the future bring patent infringement claims based on specific clinical trial-related activities that it believes fall outside of the § 271(e)(1) safe harbor.[6]

Key points from the ruling include:

  • Future Clinical Trials: The Federal Circuit reversed the injunction’s prohibition on initiation of new clinical trials, holding that “the plain language and purposes” of § 271(e)(1) exempts from infringement such clinical trial activities.[7] The court noted that in enacting the Hatch-Waxman Act’s safe harbor provision, Congress expressed its intent that “experimentation with a patented drug, when the purpose is to prepare for commercial activity which will begin after a valid patent expires, is not a patent infringement.”[8]  
  • Safe Harbor as an Affirmative Defense: The Federal Circuit rejected Jazz’s argument that Avadel had waived the protection of the safe harbor by not pleading it as an affirmative defense. The court found that the “forward-looking injunction” against future clinical trial activities turned entirely on a question of law and was facially in violation of § 271(e)(3), which expressly prohibits injunctions against activity that falls within the safe harbor.[9] Because Avadel had not been accused of specific infringing acts involving its future clinical trials, it would be premature to require it to plead (much less develop facts to support) a safe-harbor defense. The court noted, however, that Jazz could in the future challenge specific activities by Avadel that it believes fall outside of the safe harbor, and that it then would be “incumbent upon Avadel to plead its entitlement to safe-harbor protection” as an affirmative defense.[10]
  • Open Label Extensions: An open label extension (“OLE”) “allows clinical trial participants to receive a trial drug past the formal completion of the trial, both to gather additional safety data for submission to the FDA and to maintain continuity of patient treatment.”[11] Although the parties presented extensive arguments on appeal about whether Avadel’s use of OLEs was protected by the safe harbor, the Federal Circuit noted those issues had not been decided by the district court and reversed the injunction prohibiting Avadel from offering OLEs. The court held that specific OLE activity must first be accused of infringement and held outside the protection of § 271(e)(1) before an injunction may issue.  “Only if and when that activity is adjudicated to fall outside the protection of the safe harbor, and only if and when the district court finds the eBay factors to favor an injunction, may it be permanently enjoined.”[12]
  • Applying for FDA Approval for New Indications: The court vacated and remanded the portion of the injunction barring Avadel from seeking FDA approval for new indications. The court noted that merely filing an application seeking FDA approval is not an infringing act under § 271(a)-(c). While an injunction may extend to certain non-infringing acts, it may do so only if the injunction is “necessary” to prevent future infringement.[13] While the Federal Circuit noted several reasons that enjoining the filing of an FDA application does not seem necessary to prevent actual infringement, it remanded to the district court for further consideration.[14]
  • Can there be an act of infringement under § 271(e)(2)(A) without an Orange Book listing? The court identified an apparent issue of first impression as to whether Avadel’s submission of a 505(b)(2) application for a new indication would be a technical act of infringement under § 271(e)(2)(A) even though the asserted patent is not listed in the Orange Book.[15] The appeals court noted that if such a submission is an infringing act under § 271(e)(2)(A), then the district court’s injunction against seeking approval for new indications exceeds the scope of its statutory powers under § 271(e)(4). However, the court remanded to the district court to decide this issue in the first instance. 

The Federal Circuit’s decision reinforces the balance struck by Congress between patent protection and fostering generic or follow-on drug development. It underscores that clinical and regulatory activities, even for infringing products, are protected if they are solely for uses reasonably related to development and submission of information under the FDCA.

Disclaimer: The information contained in this posting does not, and is not intended to, constitute legal advice or express any opinion to be relied upon legally, for investment purposes or otherwise. If you would like to obtain legal advice relating to the subject matter addressed in this posting, please consult with us or your attorney. The information in this post is also based upon publicly available information, presents opinions, and does not represent in any way whatsoever the opinions or official positions of the entities or individuals referenced herein.

[1] See, e.g., Amgen Inc. v. Hospira, Inc., 944 F.3d 1327 (Fed. Cir. 2019).

[2] Jazz Pharma. v. Avadel CNS Pharma., 2025 WL 1298920, at *2 (Fed. Cir. May 6, 2025). Notably, the district court did not enjoin Avadel from making, using, or selling LUMRYZ for its FDA-approved indication (treatment of narcolepsy). The district court found the potential harms to the public from such an injunction outweighed any irreparable harm to Jazz. Id. at *3, n. 5.  Jazz did not appeal that issue.

[3] Id. at *4.

[4] Id. at *5; see id. at *7.

[5] Id. at *5 (quoting Merck KGaA v. Integra Lifesciences I, Ltd., 545 U.S. 193, 202 (2005)). The “FDCA” is the Federal, Food, Drug and Cosmetics Act, codified in Title 21, Chapter 9 of the United States Code. 

[6] See id. at *7 (finding “no support in the record to sustain a determination one way or the other on whether the safe-harbor provision applies to those [future] activities” not yet accused of infringement).

[7] Id. at *5.

[8] Id. at *5 (quoting H.R. Rep. No. 98-857, pt. 1, at 45-46 (1984), as reprinted in 1984 U.S.C.C.A.N. 2647).

[9] Id. at *6.

[10] Id. at *7.

[11] Id. at *3 (quoting J.A. 7511-12).

[12] Id. at *7.

[13] Id. at *10.

[14] See id. at *11. The Federal Circuit instructed the district court to first consider whether its injunction against filing a 505(b)(2) application for new indications would be prohibited by § 271(e)(4).

[15] Id. at *9-*10.  This issue does not apply to biosimilars.  Under the BPCIA, the technical act of infringement involved in filing an application for FDA approval refers to those patents identified in the lists provided under 42 U.S.C. § 262(l)(3) or (l)(7).

  • FDA approves Omylco® (omalizumab), first biosimilar of Xolair®.
  • After Q1, FDA and EMA on track for a record number of biosimilar authorizations in 2025.

Biosimilars, once a niche segment in the pharmaceutical industry, are now making a significant impact on global healthcare. These products are highly similar to an already-approved reference product, offering a more affordable treatment option without compromising on safety or efficacy. As biosimilars gain traction worldwide, regulatory bodies like the European Medicines Agency (EMA) and the U.S. Food and Drug Administration (FDA) play a critical role in shaping their market introduction. While both agencies share similar goals of ensuring patient safety and promoting access to high-quality therapeutics, their regulatory pathways and approval trends show notable differences.

One such difference is that the EMA has historically been quicker than the FDA in approving biosimilars. Since 2005, the biosimilar regulatory framework in Europe has been implemented through the Committee for Medicinal Products for Human Use (CHMP) under the EMA. The CHMP provides initial assessments for marketing authorization of new medicines that are ultimately approved centrally by the EMA. Since Sandoz’s somatotropin biosimilar, Omnitrope®, was first authorized on April 12, 2006, an additional 124 applications have been approved in Europe. Sixteen of the authorizations have been withdrawn post-approval (Table 1). On average, the EMA takes about 1-2 years from submission of a biosimilar application to approval.

In contrast, the FDA’s biosimilar approval process has been relatively slow, with initial approval times averaging 3-4 years for the first generation of biosimilars. This delay in approval is partly due to the FDA’s more rigorous evaluation of biosimilars and the additional data required to achieve interchangeability designation. Additionally, the U.S. did not implement a regulatory framework for biosimilar evaluation until after enactment of the Biologics Price Competition and Innovation Act (BPCIA) of 2009. As the EMA had already approved over a dozen biosimilars by this time, Europe had a significant head start on both the number of approved biosimilars and the regulatory process for approving more. Sandoz’s filgrastim biosimilar, Zarxio®, received the first U.S. approval in 2015, whereas nine filgrastim biosimilars have been approved in Europe dating back to multiple authorizations in 2008. Despite the FDA’s relatively slower biosimilar approval pace, the U.S. biosimilar market has managed to grow continuously over the past decade. Subsequent to Zarxio®’s approval, 73 other biosimilar drugs have gained U.S. approval to date including 17 interchangeable products (Table 2).

As illustrated in the following graph, while the EU’s significant head start and higher approval rate led to an imbalance in the number of biosimilar drugs available in the respective markets, the FDA has increased the rate of approval in recent years. In 2024 alone, the FDA approved 19 biosimilars, the most approvals in a single year by either regulatory body to date.

In the first four months of 2025, Europe and the U.S. are nearly equivalent in the number of biosimilar approvals, having authorized 12 and 10 biosimilars, respectively. Of note, these approval numbers include both 60 mg pre-filled syringe (Connexance, Stoboclo, and Ospomyv/Obodence; referencing Prolia®) and 120 mg vial (Bomyntra, Osenvelt, and Xbryk; referencing Xgeva®) forms of denosumab. Should the high rate of approvals be maintained throughout the year, both the EMA and FDA are on track to surpass the record 19 approvals seen in 2024. Notably, the EMA has also issued favorable opinions for the approval of Jubereq and Osvyrti (denosumab) and Quyvolma (ustekinumab), though final marketing authorization is still pending. In the U.S., the FDA recently approved Omylco® (omalizumab), the first biosimilar of Xolair®, which also achieved interchangeability designation with the reference product.

Looking forward, there are currently 36 biosimilar applications under review by the EMA for marketing authorization (Table 3).  As an increasing number of patents expire on blockbuster biologic drugs, the number of abbreviated biologics license applications is also increasing. Biosimilars for more than 31 different original biologics are currently navigating biosimilar pathways or are in late stage development in the U.S. (Table 4).  

Table 1. European Medicines Agency List of Approved Biosimilar Drugs.

Table 2. U.S. Food and Drug Administration List of Approved Biosimilar Drugs.

Table 3. European Medicines Agency List of Biosimilars Under Evaluation for Marketing Approval (Source: EMA list of applications for new human medicines compiled on April 8, 2025, and published on April 16, 2025).

Table 4. Biologics having already expired or nearing primary patent expiry in the U.S. and biologics that have biosimilars in the regulatory pipeline. 

*Expiration dates are estimated and subject to change, for example, if pending patent term extension applications are granted.

Disclaimer: The information contained in this posting does not, and is not intended to, constitute legal advice or express any opinion to be relied upon legally, for investment purposes or otherwise. If you would like to obtain legal advice relating to the subject matter addressed in this posting, please consult with us or your attorney. The information in this post is also based upon publicly available information, presents opinions, and does not represent in any way whatsoever the opinions or official positions of the entities or individuals referenced herein.

Summary of the Budapest Treaty for Biological Deposits

The Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure is an international agreement to establish a uniform system for depositing microorganisms and other biological material to meet patent disclosure requirements. The agreement was first ratified in 1977, and was later modified in 1980. In other words, this is an international agreement regarding biotech patent law that predates PCR (invented 1983), Western blotting (invented 1981), massively parallel signature sequencing (MPSS, invented 1992), and a host of other molecular biological techniques that are the commonplace workhorses of biotech today.

The treaty was intended to address the challenge—as it existed at the time—of adequately describing transgenic organisms in patent applications, back in the day when it was impractical or even impossible to describe a transgenic organism in precise terms that would enable others to replicate the organism and practice the invention. The treaty allows applicants to deposit biological material with a recognized institution instead of providing a detailed description, so as to ensure accessibility to others in the art for purposes of satisfying patent law enablement requirements. The treaty provides for:

  1. International Depositary Authorities (IDAs), i.e., cell banks, tissue banks, and seed banks designated by treaty signatory governments to store biological material. IDAs are required under the treaty to meet standards for secure storage, impartiality, and accessibility;
  2. Single Deposit Recognition, i.e., a standard whereby a deposit made with any IDA is recognized by all contracting states for patent purposes, eliminating the need for multiple deposits in different countries; and
  3. Requirements, specifying timing and quantities by which the material must be deposited, the terms on which deposited material is available to interested parties, and the terms under which applicants must replace or replenish a deposit with the same material if a deposit becomes non-viable or depleted.

Those requirements—especially the requirements to make available and to replenish—can be noisome to businesses. For example, although some depository institutions have a box on their depository paperwork that the depositor can check requesting that the IDA notify the depositor every time that a withdrawal is made, there is no mechanism to enforce this notice provision, and no easy way for the depositor to know that it has been violated until after the harm (i.e., the unreported dissemination of the depositor’s patented materials) has already occurred. Moreover, the need to replenish the supply as (often unauthorized) withdrawals deplete the deposited supply can be a costly and time-consuming nuisance for the depositor. However, if a patent is granted on the basis of a Budapest treaty declaration having been given to the patent office, then failure to comply with these requirements could later prejudice the validity of the patent. 37 C.F.R. § 1.805.

Tips

For these reasons, many patent applicants prefer not to give a Budapest treaty declaration during patent prosecution. To avoid the need for a Budapest Treaty deposit during patent prosecution, consider the following three tips:

  1. Provide a Comprehensive Written Description: The Budapest treaty was negotiated back in a time when it was difficult or even impossible to know the genetic sequences of the organism or germ plasm being deposited. Today, however, whole genome sequencing often can be done fairly inexpensively. If the material for which patent protection is being sought (e.g., seeds, bacteria, plasmids) can be fully described (e.g., through genetic sequences, chemical composition, etc.) then this information can be included in the application in lieu of a deposit.
  2. Distribute the Materials Yourself: The logic behind the Budapest treaty is that sometimes one needs access to a particular biological material (e.g., a transgenic bacterium) to practice the claimed invention. But the IDAs are not the only plausible source of the material. If the material is accessible to the public through a known commercial vendor, this is also the sort of availability that can enable practice of the invention.
  3. Demonstrate That the Materials Are Already Available to the Public Elsewhere: It is commonplace in the “materials & methods” sections of scientific publications to see a line to the effect of “E. coli strain DX5K9 was a kind gift of _____ of ____ University….” If one can point to scientific publications showing that the material for use in the invention to be patented is already in circulation among scientists in the relevant field, this is also the sort of availability that can enable practice of the invention.

These strategies depend on the invention’s specifics and jurisdiction requirements. Consulting a patent attorney is advisable to assess whether a deposit can be avoided while meeting disclosure obligations.

Disclaimer: The information contained in this posting does not, and is not intended to, constitute legal advice or express any opinion to be relied upon legally or otherwise. If you would like to obtain legal advice relating to the subject matter addressed in this posting, please consult with us or your attorney. The information in this post is also based upon publicly available information, presents opinions, and does not represent in any way whatsoever the opinions or official positions of the entities or individuals referenced herein.

On March 13, 2025, the U.S. Court of Appeals for the Federal Circuit affirmed a five-year patent term extension (“PTE”) for Merck’s sugammadex patent, holding that the district court had correctly calculated PTE based on the issue date of the original patent rather than the issue date of the reissued patent.[1]

Background

The case originated as a series of Hatch-Waxman litigations related to Merck’s Bridion®, a drug with the active ingredient sugammadex which is administered as an intravenous injection to reverse neuromuscular blockade, a form of paralysis induced by rocuronium bromide and vecuronium bromide in certain types of surgery.[2]

Merck originally obtained U.S. Patent No. 6,670,340 (“the ’340 patent”), which is directed to a class of 6-mercapto-cyclodextrin derivatives and issued on December 30, 2003, and applied to the Food and Drug Administration (“FDA”) for approval of a species within that class, sugammadex, shortly after on April 13, 2004.[3] Years later, while regulatory review was ongoing, Merck filed a reissue application for the ’340 patent that included both the original claims and narrower claims specifically directed to sugammadex, which was granted and issued as U.S. Patent No. RE44,733 (“the RE’733 patent”) on January 28, 2014.[4] The FDA approved sugammadex on December 15, 2015.

On February 10, 2016, Merck filed a PTE application for the RE’733 patent seeking PTE under 35 U.S.C. § 156 based on the original ’340 patent’s issue date (capped at five years under § 156(g)(6)(A)).[5] On February 4, 2020, the U.S. Patent and Trademark Office (“PTO”) granted a five-year PTE based on the ’340 patent’s issue date, extending the RE’733 patent’s expiration date from January 27, 2021, to January 27, 2026.[6]

In early 2020, Merck filed Hatch-Waxman lawsuits in the U.S. District Court for the District of New Jersey against several companies (collectively, “Aurobindo”) that had filed Abbreviated New Drug Applications (“ANDAs”) for generic versions of Bridion® and which had submitted Paragraph IV certifications as to the RE’733 patent.[7] The cases were consolidated.

At trial, Aurobindo argued that based on the plain text of § 156(c), which provides that the length of patent term extension is “the time equal to the regulatory review period… occur[ring] after the date the patent is issued,” the PTO should have calculated the RE’733 patent’s PTE based on the reissued patent’s issue date, rather than the original patent’s issue date.[8] Thus, the RE’733 patent was entitled not to a five-year PTE, but only to a 686-day PTE based on the period of regulatory review that had taken place after the RE’733 patent’s January 28, 2014 issue date, corresponding to an expiration date of December 14, 2022.[9]  Thus, Aurobindo sought to reduce the granted PTE by 1,140 days.

The district court rejected Aurobindo’s construction, and concluded that, when calculating PTE for a reissued patent, the PTO is statutorily required to base its calculation on the original patent’s issue date rather than the reissue patent’s issue date.[10] It thus held that the RE’733 patent was entitled to its full five-year PTE.[11]

Aurobindo appealed the decision. Notably, the PTO filed an amicus brief in support of Merck and took part in the oral argument on February 4, 2025.

The Federal Circuit’s Affirmance

On appeal, the Federal Circuit affirmed the district court’s holding, explaining that

[I]n the context of reissued patents, the reference to “the patent” in subsection 156(c) is to the original patent. Here, the ’340 patent included claims directed to the active ingredient for a drug product . . . . Under these circumstances, the RE’733 patent was entitled to a five-year PTE based on the ’340 patent’s issue date, since regulatory review effectively prevented the patent owner from enforcing the patent during that period.[12]

Central to the Federal Circuit’s decision was the statutory interpretation of 35 U.S.C. § 156(c). In this respect, the Federal Circuit found that “the language of subsection 156(c) standing alone is ambiguous.”[13] Looking to the statutory text and the broader context of the statute, the Federal Circuit explained that Congressional intent made clear the purpose of this section of the Hatch-Waxman Act: “to compensate the pharmaceutical companies for the effective truncation of their patent terms while waiting for regulatory approval of new drug applications.”[14] It emphasized that “[t]he statute contemplates a patentee receiving time lost in its patent term by reason of FDA delay, and the statute should be liberally interpreted to achieve this end,” and observed that Aurobindo’s construction of the statute, which would “den[y] Merck compensation for all but a small period of the delay,” was at odds with the purpose of the statute.[15]

The Federal Circuit thus concluded that “[a] reissued patent is entitled to PTE based on the original patent’s issue date where, as here, the original patent included the same claims directed to a drug product subject to FDA review.”[16] It added as a final note that the PTO’s revised Manual of Patent Examining Procedure, which instructs patent examiners to calculate the amount of PTE to which reissued patents are entitled based on the original patent’s issue date so long as both patents claimed or claim the approved product, “substantially tracks with our analysis as applied in this case.”[17]

Implications for PTE Based on Regulatory Review Period

In light of the Federal Circuit’s holding, the status quo with respect to how the USPTO calculates PTE based on the FDA’s regulatory review period remains unchanged. As the PTO suggested during oral argument, calculating PTE based on reissue date rather than the original patent’s issue date could lead to gamesmanship to maximize PTE by “either not filing the reissue or, at the [PTO], taking certain steps to delay your reissue application, until you get PTE on the original patent.” However, the affirmance avoids the need for such measures—patent owners can continue to file reissue patents without opening themselves up to the possibility of cutting off PTE (provided that both the reissued and original patents include the same claims directed to the approved drug product).

[1] Merck Sharp & Dohme B.V. v. Aurobindo Pharma USA, Inc., No. 23-2254 (Fed. Cir. Mar. 13, 2025) (available at https://www.cafc.uscourts.gov/opinions-orders/23-2254.OPINION.3-13-2025_2481365.pdf).

[2] Id. at 5-6.

[3] Id. at 5.

[4] Id. at 6.

[5] Id. at 6-7; 35 U.S.C. §§ 156(c), 156(g).

[6] Merck at 7.

[7] Id. at 7-8.

[8] Id. at 8.

[9] Id.

[10] Id. at 8-9.

[11] Id. at 9.

[12] Id. at 4.

[13] Id. at 10.

[14] Id. at 10-12.

[15] Id. at 13.

[16] Id. at 14-15.

[17] Id. at 16-17.

In our previous articles, we reported that the Federal Circuit affirmed the district court’s decision on December 20, 2024 ordering Teva Pharmaceuticals (“Teva”) to delist certain patents related to Teva’s ProAir® HFA metered-dose inhaler from the FDA’s Orange Book, and that the Federal Circuit subsequently stayed that delisting order on January 22, 2025 following a request from Teva for an en banc rehearing. On March 3, 2025, the U.S. Court of Appeals for the Federal Circuit denied Teva’s request for en banc rehearing.

With the denial of this petition, Teva is required to follow the district court’s delisting order and remove its inhaler patents — including U.S. Patent Nos. 8,132,712; 9,463,289; 9,808,587; 10,561,808; and 11,395,889 — from the Orange Book. It remains to be seen if Teva will now seek Supreme Court review.

The case is Teva Branded Pharmaceutical Products R&D Inc. v. Amneal Pharmaceuticals of New York LLC, case number 24-1936, in the United States Court of Appeals for the Federal Circuit. We will continue to monitor further developments in this case and provide insight and updates as they become available.

The U.S. stands at a crossroads in light of rising drug prices and it is unclear what the future will hold in answer to the rising drug costs. Biologic medicines have rapidly expanded available treatment options and accounted for approximately half of U.S. healthcare medicine spending in the past few years. While biosimilars have offered patients competing products at a fraction of the cost, the fledgling industry has been stymied by uncertainty.  Referred to as the “biosimilar void,” the future of the biosimilar market hangs in the balance, awaiting action to solve the unanswered questions circling the sustainability of biosimilar competition. In a February 2025 report, “Assessing the Biosimilar Void in the U.S.”1, the IQVIA Institute for Human Data Science outlines challenges faced by the biosimilars market as well as potential solutions to help promote healthy competition, reduce healthcare costs, and improve patient access.

Biosimilar Future Market Opportunities

Over the next decade (2025-2034), IQVIA reports that 118 biologics are subject to lose patent protection, thus presenting a $234 billion opportunity for biosimilar competition. Of these biologics, 22 are forecasted to exceed $2.5 billion in sales pre-expiry. The high-sales biologics facing expiry range from applications in immunology (11), oncology (6), neurology (2), hematology (1), diabetes (1), and cardiovascular diseases (1). Namely, the first PD-1 inhibitors (pembrolizumab, durvalumab, and nivolumab) are set to expire before 2034. However, with this loss of exclusivity, only 12 of these biologics have biosimilar versions in development. The author notes that this is not surprising when considering that only 14 out of 62 biologics that lost patent protection as of 2024 have biosimilar versions on the market. This gap in development leaves an opportunity to reduce costs and increase patient access to therapies, but that opportunity is hindered by difficult challenges.

Challenges to Biosimilar Development

The IQVIA report acknowledges that, to date, biosimilar development predominantly targets high-sales biologics, e.g., in oncology and immunology while leaving behind potential biosimilar competitors for lower lifetime sales medicines which make up almost $9 billion in branded sales. The remaining pre-expiry high-sales biologics without biosimilar development make up another $156 billion in potential earnings. The hesitation to tap into this untapped market largely stems from uncertainty in development costs (and subsequently the ability to recoup), regulatory hurdles, market unpredictability with shifting treatment paradigms, and market acceptance. Because biosimilar competitors mainly focus on biologics with greater than $1 billion in sales, the ability to recoup development costs with sales is likely the driving force behind the lack of biosimilar development. Even so, with such a vast number of high-sales biologics without biosimilar development, there are indications that sales potential is not the only factor stifling growth. 

Regulatory requirements create a tricky double bind beyond the typical burdens imparted by the approval process in cost and time. As of 2009, after the enactment of the Biologics Price Competition and Innovation Act (BPCIA), in order for biosimilars to demonstrate interchangeability it is required that there be “no clinically meaningful differences…in terms of safety, purity, and potency2” between the biologic and the biosimilar competitor, which tends to necessitate large and costly clinical trials. This creates additional hurdles during the regulatory process with the U.S. Food and Drug Administration (FDA). On the other hand, a lower interchangeability designation or non-interchangeability designation could feed into already present concerns and negative perceptions among patients and physicians about biosimilars as a whole. Market acceptance is already a barrier that biosimilar developers encounter even after the safety and efficacy has been proven, as biosimilar uptake post-market entry is modest at best3 . In a 2019 survey, 84% of physicians disapproved of nonmedical switching to biosimilars4 .

The report estimates that biosimilar development costs can reach upwards of $100 million. Thus, it is no surprise that developers are hesitant to commit resources in light of the uncertainties and challenges in this space. A clear example of this is complex biologics, e.g., antibody-drug conjugates, bispecific antibodies, and cell and gene therapies. Complex biologics introduce even steeper manufacturing and testing difficulties. As a result, there are currently no biosimilars in development targeting competition of the 16 complex biologics that will lose patent protection in the next decade. Further, competition for these complex biologics can come in other forms such as, for example, antibody-drug conjugates with the same antibody component but with different cytotoxic agents which can be categorized as a new product. As such, drug developers can market variants of branded biologics as a new product albeit at higher prices than biosimilar versions.

The authors mark payor behavior as also playing a significant role in biosimilar uptake. The payors, i.e., insurance companies, government health programs, Health Maintenance Organizations (HMOs), and Preferred Provider Organizations (PPOs), are responsible for negotiating drug reimbursement, which influences availability to patients. They are currently incentivized by higher rebates that tend to follow from originator biologic medicines which typically have higher listed prices than their biosimilar competitors. As in the case of pharmacy-dispensed medicines, which are controlled largely by pharmacy benefit managers (PBMs) who determine whether originator biologics or their biosimilar counterparts are listed on formularies, prices at the consumer level are highly variable. Similarly, the market size of biosimilars could be significantly impacted by the adoption of the Inflation Reduction Act (IRA). The IRA allows for Medicare to negotiate Maximum Fair Prices (MFPs) directly for high-spending drugs, which undermines one of the core benefits of biosimilars – the financially attractive price gap between biosimilars and their reference biologics. Of the 10 approved drugs currently listed for MFPs, 3 are biologics and none are biosimilars. Selectively narrowing the price gap between biosimilars and their reference biologics via price controls can be viewed as potentially dissuading developers further from investing.

Outlook

IQVIA estimates that avoiding the biosimilar void and achieving a fully competitive biosimilar market could bring to patients and the healthcare system approximately $189 billion in savings over the next decade. The author warns, however, that “[p]rogress toward a more sustainable biosimilar market requires re-assessment of current U.S. regulatory frameworks and market dynamics to facilitate access to biosimilars across all areas where biologic medicines exist and limit the magnitude of a biosimilar void.”

The impending expiration of patents for numerous biologics presents a significant opportunity for biosimilar manufacturers to enter the market. However, the complexity of the patent landscape necessitates a comprehensive strategy to navigate potential challenges effectively. A critical first step involves conducting thorough freedom-to-operate analyses to identify and assess existing patents that could impede biosimilar development. This process includes evaluating patent thickets—dense clusters of overlapping patents—that originator companies often establish to extend market exclusivity. By meticulously analyzing these thickets, biosimilar companies can develop strategies to challenge weak or non-essential patents, thereby facilitating earlier market entry. Additionally, engaging in the patent dance, a structured information exchange under the Biologics Price Competition and Innovation Act (BPCIA), allows for the early resolution of patent disputes, potentially expediting product launch. Furthermore, biosimilar companies should consider pursuing their own patent protections for unique manufacturing processes or formulations to strengthen their market position. By implementing these multifaceted patent strategies, biosimilar manufacturers can effectively capitalize on the upcoming wave of biologic patent expirations and enhance their competitiveness in the marketplace.

Disclaimer: The information contained in this posting does not, and is not intended to, constitute legal advice or express any opinion to be relied upon legally, for investment purposes or otherwise. If you would like to obtain legal advice relating to the subject matter addressed in this posting, please consult with us or your attorney. The information in this post is also based upon publicly available information, presents opinions, and does not represent in any way whatsoever the opinions or official positions of the entities or individuals referenced herein.

  1. https://www.iqvia.com/insights/the-iqvia-institute/reports-and-publications/reports/assessing-the-biosimilar-void-in-the-us ↩︎
  2. Implementation of the Biologics Price Competition and Innovation Act of 2009 | FDA ↩︎
  3. Gibofsky A, Evans C, Strand V. Provider and patient knowledge gaps on biosimilars: insights from surveys. Am J Manag Care. 2022 Nov;28(12 Suppl):S227-S233. Available from: https://www.ajmc.com/view/biosimilarssuppl-insightssurveys ↩︎
  4. Teeple A, Ellis LA, Huff L, et al. Physician attitudes about nonmedical switching to biosimilars: results from an online physician survey in the United States. Curr Med Res Opin. 2019;35(4):611-617. doi:10.1080/03007995.2019.1571296 ↩︎

Introduction

On January 6, 2025, the FDA released draft guidance on using artificial intelligence (AI) in regulatory decision-making for drugs and biological products.  The draft guidance – the first of its kind from the agency – aims to enhance the efficacy and accuracy of the drug approval process, ensuring that applications incorporating AI meet rigorous standards for safety and effectiveness. Public comments on the new guidance can be submitted through April 7, 2025.

The draft guidance provides recommendations for establishing and maintaining trust in AI systems used across the drug product lifecycle, focusing on safety, effectiveness, and quality.  In preparing the document, FDA considered input from the community, including feedback from “a number of interested parties including sponsors, manufacturers, technology developers and suppliers, and academics” and input provided at an FDA sponsored expert workshop convened by the Duke Margolis Institute for Health Policy in Dec. 2022. [1]

Key Highlights from the Guidance

While the FDA proposed guidance is procedural in nature, it is not without intrigue, as the abutment of artificial intelligence with biopharmaceuticals is not only a long time coming, but also a nexus with the potential to usher in landmark changes.  Thus, the FDA’s guidance – while tentative at this stage – will undoubtedly be closely scrutinized as AI-based data production is further integrated into the biopharma regulatory framework. 

The FDA’s guidance applies specifically to AI models used to produce data supporting regulatory decisions on drug safety, effectiveness, and quality.[2]  The guidance does not address the use of AI models (1) in drug discovery or (2) when used for operational efficiencies (e.g., internal workflows, resource allocation, drafting/writing a regulatory submission) that do not impact patient safety, drug quality, or the reliability of results from a nonclinical or clinical study.  Id.  Notably, the FDA encourages sponsors to engage with FDA early if they are uncertain about whether or not their use of AI is within the scope of this guidance.  Id.

A critical aspect of the guidance is its seven-step risk-based credibility assessment framework, designed to evaluate AI systems based on their context of use (COU) and the level of regulatory impact they have:

  1. Define the question of interest that will be addressed by the AI model;
  2. Define the COU for the AI model;
  3. Assess the AI model risk;
  4. Develop a plan to establish the credibility of AI model output within the COU;
  5. Execute the plan;
  6. Document the results of the credibility assessment plan and discuss deviations from the plan; and
  7. Determine the adequacy of the AI model for the COU.

Id. at pages 5-6.  In summary, the framework thus instructs (a) defining the question of interest and the context of use; (b) assessing AI model risk by considering the model’s influence and potential consequences of errors; (c) developing and executing a credibility plan tailored to the model’s risk level; and (d) documenting and evaluating results, allowing for iterative adjustments based on those results.

Lifecycle Management and Ongoing Challenges

A key focus of the guidance is AI model lifecycle maintenance, particularly addressing challenges like data drift — where an AI model’s performance degrades over time due to differences in new input data.  The FDA recommends continuous monitoring and updating of AI models to ensure they remain effective and reliable throughout their lifecycle.  The guidance also addresses broader AI-related concerns:

  • Dataset quality and integrity: AI models require high-quality, representative data to produce reliable outcomes.
  • Algorithmic bias: The FDA acknowledges the risk of bias in AI-generated results and stresses the importance of bias mitigation strategies.
  • Transparency and explainability: Regulatory decisions must be interpretable, necessitating AI models that provide clear, understandable justifications for their outputs.

Potential Questions and Issues to Address

While the draft guidance is a strong signal in the FDA’s efforts to integrate technological change in biopharmaceutical regulation, these efforts do not come without strain.  For example, it remains to be seen how stakeholders will consistently apply the guidance’s model risk matrix across diverse use cases, considering the relatively scant amount of guidance at present, as well as the numerous (and rapidly increasing) means by which AI can be leveraged in a scientific setting.  While the FDA guidance does not – and perhaps cannot – attempt to cover all implementations of AI, the speed at which technology processes, and at which the FDA responds, will need to be monitored closely, as several open questions remain:

  • Consistency in AI risk assessment: How will different stakeholders interpret and apply the AI risk matrix across diverse regulatory scenarios?
  • Regulation of self-evolving AI models: The FDA highlights concerns about AI systems that adapt over time, but the extent of post-approval oversight is still unclear.
  • Impact on smaller companies: Meeting the documentation and validation requirements could pose challenges for startups and smaller biopharma companies with limited regulatory experience.

Industry Engagement and Next Steps

The FDA is positioning this guidance as the beginning of an ongoing conversation, strongly encouraging sponsors to engage early to discuss AI model risk and credibility assessment plans. The agency outlined various engagement options for discussing AI in development programs, including INTERACT meetings for CBER and CDER products, as well as Pre-IND meetings.  Depending on the AI model’s intended use, sponsors and stakeholders can also explore other options, such as:

  • INTERACT meetings (for early-stage regulatory discussions)
  • Pre-IND meetings (for investigational new drug applications)
  • Digital Health Technologies Program (for AI and digital tool integration)
  • Complex Innovative Trial Design (CID) Program (for AI-driven trial methodologies)
  • Emerging Drug Safety Technology Program (EDSTP) (for post-market AI surveillance)

Id. at 17-20.

Conclusion

Publishing the guidance is the beginning, not the end, of the process, which FDA acknowledges will require a dialogue.  The FDA “strongly encourages” early engagement between sponsors and the agency to discuss the use of AI models in drug and biologic products, emphasizing the importance of expectation setting for credibility assessments and addressing potential challenges.

While the FDA will consider public feedback on whether its risk-based framework meets industry expectations (and whether current engagement opportunities are sufficient), this newly published guidance is a clear reflection of the FDA’s commitment to incorporating AI into regulatory processes while upholding safety and reliability standards.

[1] “Considerations for the Use of Artificial Intelligence to Support Regulatory Decision-Making for Drug and Biological Products.” Federal Register, vol. 90, no. 4, 7 Jan. 2025, pp. 851-855. U.S. Government Publishing Office, https://www.federalregister.gov/documents/2025/01/07/2024-31542/considerations-for-the-use-of-artificial-intelligence-to-support-regulatory-decision-making-for-drug.

[2] “Considerations for the Use of Artificial Intelligence to Support Regulatory Decision-Making for Drug and Biological Products.” U.S. Food and Drug Administration, Jan. 2025, https://www.fda.gov/media/184830/download at page 3.

On January 29, 2025, the Federal Circuit issued paired decisions addressing Samsung Bioepis’s (“SB”) and Formycon AG’s (“Formycon”) appeals of preliminary injunctions entered in ongoing aflibercept biosimilar litigations with Regeneron Pharmaceuticals, Inc. (“Regeneron”).[1] The Federal Circuit affirmed the district court’s exercise of personal jurisdiction over both defendants as well as the entries of preliminary injunctions against both companies’ aflibercept biosimilar products. With respect to personal jurisdiction, the Federal Circuit has taken a broad view of Acorda,[2] signaling that foreign companies that file an ANDA or aBLA in the U.S. can expect to be subject to personal jurisdiction in any given forum state unless they specifically carve out the forum state from their distribution networks for their drug products.

Formycon and SB are both foreign companies that filed aBLAs seeking FDA approval of aflibercept biosimilars in the United States. Both companies served on Regeneron a Notice of Commercial Marketing pursuant to 42 U.S.C. 262(l)(8)(A), which the Federal Circuit found “expressly communicated an intent to begin marketing of [the biosimilars] upon FDA approval.”[3] Both companies stated that they would not engage in any sales of their aflibercept biosimilar products, but instead have contracted (or will contract) with distributors who will make sales in the United States.[4]

In Acorda, the Federal Circuit addressed the question of whether a Hatch-Waxman defendant’s conduct satisfied the minimum contacts requirement for specific personal jurisdiction in the context of an infringement suit brought under 35 U.S.C. § 271(e)(2). The Court concluded that Mylan’s ANDA filings and its distribution channels were sufficient to establish personal jurisdiction in the forum state of Delaware. In particular, the Court found the ANDA filing “realistically establish[es] a plan to market.”[5] They also stated that, while Mylan’s conduct indicated that it planned to make direct sales of its generic product into the forum state, “even if Mylan does not sell its drugs directly into Delaware, it has a network of independent wholesalers and distributors with which it contracts to market the drugs in Delaware. Such directing of sales into Delaware is sufficient for minimum contacts.”[6] However, the facts in Acorda included additional evidence showing Mylan’s intent to market a generic drug product in the forum state, including Mylan having registered to do business in Delaware, appointed an agent to accept service of process there, and registered with the Delaware Board of Pharmacy as a licensed “Pharmacy-Wholesale” and a “Distributor/Manufacturer CSR.”[7] Thus, SB and Formycon argued that Acorda did not hold that filing an ANDA or aBLA seeking approval to market a product throughout the United States, or contracting with distributors to sell throughout the United States, necessarily evidenced the intent to market the generic or biosimilar drug product in each individual state sufficient to establish personal jurisdiction in any given state.

In the Samsung Bioepis opinion, the Court explained that, like in Acorda, each foreign defendant had engaged in conduct indicating an intent to distribute its drug product nationwide in the U.S. (including in the forum state of West Virginia) by filing an aBLA with the FDA, serving a Notice of Commercial Marketing expressing an intent to begin marketing upon FDA approval, and engaging with partner companies to commercialize and distribute its drug product without excluding any individual U.S. states from the distribution agreement. Although both defendants asserted that they would not be responsible for any decision-making regarding U.S. commercialization because the distribution, marketing, or sales of their respective drug products would be handled solely by non-party partner companies, the Court rejected that argument, pointing out that it had already rejected a similar argument in Acorda “[c]onsistent with the practical focus of the constitutional standard.”[8]

Additionally, the Court was unpersuaded that, as the defendants contended, Regeneron needed to show affirmative evidence that they were expressly targeting West Virginia as a market. Instead, the Court determined that there was “simply no good reason, under the constitutional standard, for demanding such singling-out evidence as a substitute for persuasive evidence of nationwide targeting without a carveout.”[9] In this regard, the Court suggested that, while each defendant’s aBLA does not identify any parts of the U.S. as places where it does not intend to market and distribute the approved product, it could have excluded the forum state as a target for commercialization by, for example, selecting distributors that only reached a limited region of the U.S. (and not the forum state).

As a final note, during oral argument, Judge Moore had alluded to a possible application of Fed. R. Civ. P. 4(k)(2), which provides that a court may exercise personal jurisdiction over a defendant who is not subject to jurisdiction in any state’s courts. In response, Formycon’s counsel asserted that Rule 4(k)(2) did not apply based on Formycon’s voluntary waiver of personal jurisdiction in the state of Washington. Ultimately, having found SB’s and Formycon’s conduct sufficient to meet the minimum-contacts requirement, the Court declined in its opinion to further address whether any alternative means of establishing specific personal jurisdiction, such as Rule 4(k)(2), would have applied here.

[1] Regeneron Pharms, Inc. v. Mylan Pharms Inc., No. 24-2009 et al.; Regeneron Pharms, Inc. v. Mylan Pharms Inc., No. 24-1965 et al. The Court issued a precedential opinion in the SB case, authored by Judge Taranto, and a per curiam opinion addressing additional arguments specific to Formycon’s case.

[2] Acorda Therapeutics Inc. v. Mylan Pharms. Inc., 817 F.3d 755 (Fed. Cir. 2016).

[3] No. 24-1965 at 13; see also No. 24-2009 at 7-8.

[4] No. 24-1965 at 7, 15; see also No. 24-2009 at 7-8.

[5] Acorda, 817 F.3d. at 761.

[6] Id. at 763.

[7] Id.

[8] No. 24-1965 at 15.

[9] Id.