The U.S. Supreme Court on Monday has come out with a crucial decision cutting the time it will take for copycat versions of biologic drugs to be available in the market that could be worth billions of dollars in sales for drug companies.
Voting 9-0, the justices overturned a lower court’s decision that previously prevented Swiss pharmaceutical company Novartis AG (NOVN.S) from selling its copycat version of California-based Amgen Inc’s (AMGN.O) Neupogen until six months after the U.S. Food and Drug Administration approved it.
The High Court’s ruling has major implications for the pharmaceutical industry because it will set how long brand-name makers of biologic drugs can keep near-copies known as biosimilars, off the market. Even the six months period in contention can result to hundreds of millions of dollars in sales.
Biosimilars are expected by health insurers to be far cheaper than original brands, like generics, saving consumers billions of dollars per year. Novartis has also issued a statement saying that the highest court’s decision “will help expedite patient access to life-enhancing treatments.”
Amgen on the other hand, through its spokesperson Kelley Davenport, expressed disappointment with the decision but said it “will continue to seek to enforce our intellectual property against those parties that infringe upon our rights.”
The warring companies’ contention involved a section of the 2010 Affordable Care Act, otherwise known as Obamacare, that paved the way for an expedited path for regulatory approval of biosimilars while trying to respect the patient rights of brand-name manufacturers.
Novartis claimed in the 2015 ruling by the U.S. Court of Appeals for the Federal Circuit in Washington gave Amgen an extra six months of exclusivity on top of the 12 years already provided under the law.
The high costs of drugs are of utmost importance to patients and policymakers. President Donald Trump has consistently criticized the pharmaceutical industry over pricing practices, and vowed to encourage competition and bring down the drug costs.
Biologics are different from traditional drugs in the sense that they are made from living cells and cannot be copied the exactly to produce generic versions. They are used for treatment in a range of conditions, including Crohn’s disease, ulcerative colitis, rheumatoid arthritis, plaque psoriasis, breast cancer and diabetes. They also cost at least 15 % less than branded ones.
The Trump administration supported Novartis’ arguments in the case.