Distribution of biosimilar pharmaceuticals through third parties is not enough to avoid personal jurisdiction

In Regeneron Pharms., Inc. v. Mylan Pharms. Inc., the Federal Circuit recently held that biosimilar pharmaceutical companies that filed abbreviated Biologics License Applications (aBLAs) and planned to make a single sale to a third-party marketer were subject to personal jurisdiction in West Virginia, even though the third-party marketers would distribute the product.

Background

Samsung Biopis and Formycon AG filed abbreviated aBLAs with the Food and Drug Administration (FDA) to market biosimilars to Regeneron’s EYELEA®. Samsung Biopis and Formycon AG planned to only make a single sale of the biosimilar to a third party. This sale would not occur in West Virginia. The third party would then market the product as determined by the contracts between it and Samsung Biopis and Formycon AG. As statutorily required, Samsung Biopis and Formycon AG had sent Notices of Commercial Marketing to Regeneron. In late 2023, Regeneron sued Samsung Biopis and Formycon AG in West Virginia and the district court entered an injunctive order.

The law pre-Regeneron: Acorda’s minimum contacts by ANDA

Almost ten years ago, the Federal Circuit answered a similar question in Acorda Therapeutics, Inc. v. Mylan Pharms., Inc. In that decision, the Federal Circuit held that Abbreviated New Drug Application (ANDA) filings are closely tied in purpose and planned effect to future marketing and sales, and that those activities created an Article III case or controversy because the future marketing would constitute an infringing act. The Federal Circuit also held that the ANDA filing and subsequent plan to market the product in Delaware created sufficient minimum contacts with the state and established personal jurisdiction.

Despite not directly marketing in West Virginia, the biosimilar companies still had sufficient minimum contacts

In the Regeneron case, Samsung Biopis and Formycon did not directly market in the forum state (West Virginia), in contrast to the facts in Acorda. Instead, Samsung Biopis and Formycon AG received aBLA authorization and planned to make a single sale to a third-party marketer outside West Virginia. Nonetheless, following the reasoning in Acorda, the Federal Circuit held that there were minimum contacts in West Virginia due to Samsung Biopis and Formycon AG’s aBLA applications, their Notices of Commercial Marketing, their establishment of distribution channels, and their failure to deny allegations of future sales in West Virginia through third parties.

The Federal Circuit recognized an aBLA as legally indistinct from the ANDA application at issue in Acorda. Both are filed under 35 USCS § 271(e)(2) and demonstrate a clear intent to market the product. The Notices of Commercial Marketing also provided evidence of clear intent to market the product, further tying the aBLA to future marketing.

Even though Samsung Biopis and Formycon AG would not market the biosimilars themselves, they were not removed from the process. For Samsung Biopsis, which had secured a third-party marketer, the Federal Circuit highlighted the “elaborate distribution agreement” and how “[it] retains significant … involvement in … commercialization activities through various contractually established mechanisms.” The Court held that there was no distinction between Samsung Biopis and Formycon AG distributing biosimilars themselves versus directing a third party to do so.

The Court concluded that the Samsung Biopis and Formycon AG had sufficient contacts with West Virginia and did not require affirmative evidence of intent to sell in the state because Samsung Biopis and Formycon AG had planned nationwide marketing and made no explicit carve-out for West Virginia.

Establishing personal jurisdiction for 271(e)(2) applicants: Takeaways

Personal jurisdiction may be established against a biosimilar pharmaceutical company if:

• The biosimilar company filed a 271(e)(2) application


• It has a clear plan of marketing the drug associated with the 271(e)(2) application – either by itself or through a third-party distribution agreement, and


• The infringing product will be sold nationwide without a specific carve-out for the forum state.

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