Mircera: Bad for Patents, Good for Patients?

Anyone following the heated Amgen-Roche battle over Roche's Mircera might be interested in some court documents posted today--notably Roche's license agreement for a proposed launch of its drug in the US, and Amgen's counter-brief. (Hat-tip to our friends at Bear Stearns...er...JP Morgan...for this one.)

What, you say? Didn't Judge Young rule last October that Roche infringed Amgen's patents--the latest of several of EPO victories for Amgen over the decades?

Well, yes he did. But although Amgen won the patent battle, it hasn't yet won the public interest battle, apparently. The Judge basically isn't sure whether blocking Mircera from the US entirely, as Amgen is seeking via an injunction, would best serve American patients (and their government's wallets). So he left open the possibility, in a hearing two weeks ago, that Roche may launch the drug nevertheless.

There are conditions: Roche must pay Amgen a 22.5% royalty on US sales (as Roche had already said it was willing to do), it must price Mircera to the Medicare program with an average selling price the same or less than that of Epogen, it must provide evidence of clinical usage and the real world dosage of Mircera to allow a dose conversion factor to be calculated, and it must fund an independent monitor to account for royalty payments. Lastly, patients switched to the Roche drug must be allowed to access the product at the same price going forward regardless of the outcome of future legislation.

Fine, says Roche in its posting, we'll adhere to all that. And we think it's great that patients are offered choice, and a better treatment option--especially, it says, rubbing it in, "given the FDA’s recent re-examination of serious safety issues associated with Amgen’s ESA products." Amgen's behaved rottenly, the document continues (yes, we're paraphrasing somewhat), so any harm that may come to it following a potential modification of this injunction in Roche's favor should be ignored. Hail billions of dollars of savings to the U.S Treasury!

Amgen isn't used to this kind of post-victory set-back. And it could probably do without it, given everything else going on--not least ODAC's not-so-bad-but-not-great-either decisions on restricting ESA usage in chemotherapy-induced-anemia patients, etc. The Big Biotech comes back with just the points one would expect in a briefing support document (filed, with Roche's, ahead of a potential ruling early next month over whether Mircera will indeed be allowed this conditional entry).

Innovative drugs like ours have enhanced economic growth and reduced medical expenditures, Amgen says. Letting Roche in would create an unwelcome precedent, suggesting that even valid and infringed patents don't fully protect innovative drugs. Woe betide the end of private sector investment in drug R&D....etc.

Now, though we do hear that Amgen's IP-protection tactics have perhaps over-aggressively exploited quirks in IP law, and while we do feel, like Roche, that Amgen's monopoly has perhaps overstayed its welcome, the US biotech does have a couple of points here. If patents are judged to have been infringed, the infringer should be banned until the patents expire--that principle underpins the industry, right? And we also tend to agree with Amgen's point that "with all due respect, determining the appropriate amount Medicare should pay for biopharmaceutical products and medical treatments is not the province of this Court."

We're not lawyers and perhaps we missed the point. (Though if we may toot our own horns for a second, we predicted nearly two years ago that Roche would be willing--or required--to agree to cut prices as a condition for market.)

Still, the battle was over whether Roche infringed Amgen's patents. Turns out it did (whatever you think about how Amgen extended and protected those patents). Bringing issues of drug costs and patient choice into the court-room mix may be well-intentioned, but may also backfire big time if it dilutes the power of patents.