Thanks Dylan for the input. As far as I can tell, both your suggestion would have unreasonable drawbacks though. Your first one would imply that after making a selection, you end up with all text selected, you have to unselect first in order to continue typing, if you don't want to overwrite the existing value.
The second one would completely break "continue typing", since we can't replicate keyboard input while the menu has focus. If screenreaders would do a good job with the focus on the menu, this might indeed be a solution for the long term. I think the only way to pursue this is to build a prototype that shows if this can work and how much effort it would be.
All that said, the original issue is actually a duplicated value. In the given example, it doesn't really make sense. The description talks about "when autocomplete results are abbreviated and multiple duplicate values exist." - an actual example of that might be useful to see if there's a way to address this that avoids putting the same value into the input twice.