Authors: Rachel Moodie and Bernard Chao
Abstract: Drug prices in the United States are higher than in other countries. Generic drugs offer one path to lower these prices. The Biologics Price Competition and Innovation Act (‘BPCIA’) was passed in 2010 to promote the entry of biosimilars, generic versions of a new class of biologic drugs. These drugs have proven to be effective at treating a variety of illnesses including various autoimmune diseases and cancers. But to date, few biosimilars have entered the U.S. market. Patent thickets covering biologic drugs may be one cause.
Our study seeks to test this hypothesis by comparing patent assertions against the same biosimilar drugs in the United States, United Kingdom and Canada. We found that that on average nine to twelves times more patents were asserted against biosimilars in the United States than in Canada and the UK. We also observe that biosimilars enter the Canadian and UK markets more quickly following regulatory approval than they do in the United States. Of course, later market entry may be the consequence of a working patent system. Patent laws are designed to give pharmaceutical companies market exclusivity for a limited period. Consequently, we drilled down on one patent portfolio to look at what the patents cover. Our study found that AbbVie’s Humira biologic drug is covered by roughly 73 mostly duplicative patents, but its EU patent portfolio is dramatically smaller and comprised of only eight non-duplicative patents. This duplication of non-patentably distinct claims is entirely permissible under the US patent system, while patent rules in other countries restrict this practice.
The BPCIA is designed to allow branded drug companies to maintain market exclusivity when their drugs are covered by high quality patents (i.e. patents covering significant advances). But the use of patent thickets in the United States allows branded drug companies to delay biosimilar entry by relying on the high cost of challenging many duplicative patents instead of the quality of their underlying patents. Accordingly, we suggest several policy interventions that may thin biological drug patent thickets.
Keywords: Patent, thickets, biologics, drugs, biosimilars, Canada, United Kingdom
Citation: Moodie, Rachel and Chao, Bernard H., Biological Patent Thickets and Delayed Access to Biosimilars, An American Problem (January 21, 2022). Available at SSRN: https://ssrn.com/abstract=4014760 or http://dx.doi.org/10.2139/ssrn.4014760
