Supreme Court Hears Oral Arguments on Affordable Care Act: Will Biosimilars Survive?

November 10, 2020

Today the Supreme Court heard arguments in Texas v. Azar that the Affordable Care Act (ACA)’s individual coverage mandate is unconstitutional.  According to the ruling in the underlying case, in the absence of the individual mandate, the rest of the ACA cannot stand.

While the consequences of striking down the ACA are vast, it also includes putting the future of biosimilars in jeopardy.  By way of background, the Biologics Price Competition and Innovation Act (BPCIA), was passed as part of the ACA to allow for abbreviated biologics license applications to be filed for complex products which are biosimilar to/interchangeable with FDA-licensed biologics.

If the Supreme Court strikes down most — or all — of the ACA, the regulatory pathway for biosimilars would essentially disappear overnight.  This would affect millions of patients who would no longer see more affordable biosimilar versions of high-cost biologic treatments reach the market.

Even if the entire ACA is stricken, there is some hope that Congress would revive the BPCIA as a standalone law.  Amicus briefs filed to the Court stressed that the BPCIA stands on its own and serves an important public purpose entirely separate from the insurance-related provisions of the ACA under attack.

Regardless, preliminary reports from the oral arguments suggest it is unlikely that the ACA will be struck in its entirety.  Because of the ongoing pandemic, oral arguments were conducted by telephone.  Comments from two conservative justices suggest that, at most, the problematic provision would be stricken. 

Judge Roberts stated “It’s hard for you to argue that Congress intended the entire act to fall when the same Congress didn't even try to repeal the rest of the act,’ and reiterated that is not the Court’s job.  Justice Kavanaugh said he considered it “a very straightforward case,” based on precedent holding that the Supreme Court will not strike down an entire law if only one part is found to be invalid, unless that was clearly Congress’s intent.  He added that "the proper remedy would be to sever the mandate and leave the rest of the act in place.”  These comments suggest little appetite for striking down the entire ACA.

The Court will issue its decision by next Spring.