Exclusivity And FDA Barriers To
Market Entry In The US
Brian V. Slater, Esq.
Fitzpatrick, Cella, Harper & Scinto
Pharmaceutical Patent Life Cycles, London, UK
July 5, 2004
© 2004 Brian V. Slater
www.fitzpatrickcella.com
Non-patent Regulatory Exclusivities
• Regulatory “exclusivities” that may extend market
protection beyond the patent term:
– First ANDA patent challenger (180 days)
– New Chemical Entities (5 years)
– New Clinical Investigations (3 years)
– Orphan Drug (7 years)
– Pediatric (6 months)
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Hatch-Waxman Basics
• Drug Price Competition and Patent Term Restoration Act of
1984 (“Hatch-Waxman”):
– Patent term restoration (partial) to compensate
innovators for pre-market approval regulatory delay
– Process to approve duplicates of approved drugs that
rely on safety and efficacy studies by innovator
– Complex scheme of patent information and patent
certifications
– Regulatory exclusivities for new chemical entities, new
clinical investigations and first ANDA patent challenger
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Drug Application Types
• A New Drug Application (NDA) contains full reports
of safety and efficacy studies conducted by or for
applicant or as to which it has right of reference
• An Abbreviated New Drug Application (ANDA) is for
a generic duplicate of an approved NDA product:
– Borrows safety and efficacy studies from NDA
– Must have identical active ingredient, route of
administration, dosage form, strength, labeling
and intended use
– Must demonstrate bioequivalence
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Drug Application Types
• A “505(b)(2)” application is an NDA for a
modification to an approved drug (e.g., different
active ingredient, dosage form, strength, etc.)
– relies upon one or more studies not conducted
by or for applicant and for which applicant has
no right of reference (e.g., published studies or
FDA finding of safety/efficacy of approved drug)
– application must contain sufficient data to
support the safety/efficacy of the modification
• A Biologics License Application (“BLA”) is an
application to market a biological product (NB. some
biologics are approved by NDA route)
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Patent Information/Certification
• NDA applicant (including 505(b)(2)) must inform
FDA of patents covering drug or method of using
it
• Under 2003 FDA Final Regulations:
– Method patent must cover approved method
– Product-by-process patent should be listed
only where novel product
– Metabolite and intermediate patents should
not be listed
– Patent on different polymorphic form should
be listed where testing shows bioequivalence
• FDA publishes information in “Orange Book”
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Patent Information/Certification
• Generic applicant (either ANDA or 505(b)(2)) must
make one of the following certifications:
– (I) patent information on the listed drug not filed
– (II) patent has expired
– (III) the date on which such patent will expire
– (IV) patent is invalid, unenforceable or not
infringed
– (viii) method of use patent does not claim a use
for which applicant is seeking approval.
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Patent Information/Certification
• Para IV filer must notify NDA holder/patent owner and
provide detailed statement of basis for challenge
• Under Medicare Prescription Drug, Improvement, And
Modernization Act 2003 (for Para IV certifications on or
after Aug. 18, 2003), ANDA and 505(b)(2) applicants
must give notice
– within 20 days of confirmation of generic filing; and
– at same time as any amendment or supplement
regardless of whether already given notice of
another Para IV
• Filing generic application (ANDA or 505(b)(2)) with a
Para IV is an act of patent infringement
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Patent Information/Certification
• NDA holder/patent owner has 45 days from receipt
of Para IV notice to sue for infringement
• If timely suit is brought, 30-month stay of FDA
approval of generic application unless earlier court
decision of invalidity, non-infringement or
unenforceability
• Under Medicare Act (for patents listed on or after
Aug. 18, 2003), opportunity of one 30-month stay
per generic application, limited to patents listed
prior to generic application
– Generic applicant still has to send notice re
later listed patents but, if patent holder sues,
no extra 30 month stay
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First ANDA Patent Challenger Exclusivity
• Under Hatch-Waxman:
– First ANDA Para IV filer (not 505(b)(2))
obtains 180-day exclusivity against other
ANDA filers (not 505(b)(2)s)
– Exclusivity triggered by earlier of first
commercial marketing or “court decision”
• Several issues arising under Hatch-Waxman
have been addressed by the Medicare Act
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180-Day Exclusivity Eligibility
• Under Medicare Act, for ANDAs where no Para IV
was made before Dec. 8, 2003:
– an applicant that submits a “substantially
complete” ANDA for a drug
– that contains and “lawfully maintains” a Para IV
certification “for the drug”
– on the first day that any applicant does so
– is a “first applicant”
– and obtains 180-days exclusivity (unless
forfeited)
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180-Day Exclusivity Eligibility
• Two or more ANDA applicants first to file Para IV’s re
different patents:
– Pre-Medicare: FDA policy that each applicant
shares exclusivity and neither blocks the other
• FDA policy rejected in TorPharm v. FDA, 2004
U.S. Dist. LEXIS 524 (D.D.C. Jan. 2, 2004)
(appeal pending)
– Under Medicare: Exclusivity goes to first to file
Para IV with respect to any listed patent on day
one (need not file as to all listed patents)
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180-Day Exclusivity Eligibility
• Two or more ANDA applicants file Para IV’s on
same patents on same day:
– Pre-Medicare: Initially, FDA awarded
exclusivity to first to file that day
• Since Jul. 2003, FDA policy that each
applicant that files on day one shares
exclusivity (unclear if FDA had that
authority)
– Under Medicare: All “first applicants” on day
one share exclusivity and, presumably, are not
blocked by each other
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180-Day Exclusivity Trigger
• Under Hatch-Waxman, is exclusivity triggered by
district court or appellate decision?
– FDA policy since Mar. 2000, that exclusivity
triggered by district court decision
– Created quandary for ANDA applicants:
• launch at risk of appellate reversal and face
potential lost profits damages, or potentially
lose benefit of 180-day exclusivity
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180-Day Exclusivity Trigger
• Under Medicare:
– For ANDAs with no Para IV prior to Dec. 8, 2003:
• trigger is first commercial marketing of generic
drug or brand drug by any “first applicant”
• court decision is no longer a trigger but may be
a “forfeiture” event (see below)
– For ANDAs with a Para IV prior to Dec. 8, 2003:
• (assuming trigger has not already occurred)
trigger is commercial marketing or appellate
decision (not district court)
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180-Day Exclusivity Forfeiture
First applicant’s 180-day exclusivity forfeited by first
applicant’s:
1. Failure to market (see next slide)
2. Withdrawal of ANDA (either voluntarily or by FDA)
3. Amendment/withdrawal of qualifying Para IV as to all
patents
4. Failure to obtain tentative approval within 30 months
5. Agreement with another ANDA applicant, NDA
holder or patent owner adjudicated to violate
antitrust laws
6. Expiration of all the patents that are subject of
qualifying Para IV of first applicant
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180-Day Exclusivity Forfeiture
1. Failure to market: A first applicant forfeits exclusivity
by failing to market by the later of:
• 75 days after FDA approval of first applicant is made
effective or 30 months after ANDA filing, whichever is
earlier; or
• 75 days after one of following has occurred with
respect to each patent in first applicant’s Para IV (in
an infringement or d.j. action involving first applicant
or another applicant with tentative approval)
– court enters final decision from which no appeal
has been/can be taken, or signs a settlement order
or consent decree that enters final judgment, that
patent is invalid or not infringed
– NDA holder withdraws the patent information
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180-Day Exclusivity Forfeiture
• Only forfeiture by all “first applicants” means
subsequent applicants are not subject to exclusivity
• If all first applicants forfeit exclusivity, subsequent
applicant does not inherit 180-day exclusivity
• 180-day forfeiture provisions apply to ANDAs filed
for a drug as to which no Para IV was made before
Dec. 8, 2003, except that
– Exclusivity is forfeited where first applicant enters
agreement violating antitrust laws
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Generic Strategies re 180 days
• Declaratory judgment action by “subsequent” Para
IV applicant that is not sued against patent owner to
“burn off” first ANDA filer’s exclusivity. [See Teva Pharms.,
USA, Inc. v. U.S.F.D.A., 182 F.3d 1003 (D.C. Cir. 1999)]
– must demonstrate “case or controversy”, i.e., an
explicit threat or other action by patentee giving
rise to a “reasonable apprehension” of suit?
– BUT (i) Orange Book listing, (ii) prior history of
suing generics, and (iii) refusal to grant covenant
not to sue, do not demonstrate “reasonable
apprehension” [See Teva Pharms. USA, Inc. v. Pfizer Inc., 69
USPQ2d 1791 (D. Mass. 2003); Dr. Reddy’s Labs. v. Pfizer Inc., 2003 WL
21638254 (D.N.J. 7/28/03)]
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Generic Strategies re 180 days
• Under Medicare, ANDA applicant can still file
declaratory judgment action for invalidity/noninfringement (if no suit during 45 day period)
– “Case or controversy” must still be shown:
• “Courts shall, to the extent consistent with the
Constitution, have subject matter jurisdiction”
over such actions.” [35 U.S.C. § 271(e)(5)]
– Strategy less of an issue now because:
• For new Para IVs, trigger is now only
commercial marketing and forfeiture is based
on appellate decision
• For ANDAs with Para IV before Dec. 8, 2003,
trigger is now appellate (not district) decision
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Generic Strategies re 180 days
• Medicare also entitles generic to bring a
counterclaim in infringement suit to delist patents
from Orange Book
– Previously, generic had no private cause of
action against NDA holder [See Mylan
Pharmaceuticals, Inc. v. Thompson, 268 F.3d 1323, 1332 (Fed. Cir.
2001); see also Apotex v. Thompson, 349 F.3d 1335 (Fed. Cir.
2003)]
– First Para IV ANDA filer likely will not want to
do this because it would lose 180-days
exclusivity, but subsequent ANDA filer may.
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FTC Review Of Agreements
• Under Medicare, the following must be filed with
Assistant Attorney General and FTC:
– Agreements between ANDA Para IV filer and
brand name co. regarding (i) manufacture,
marketing or sale of brand name drug or generic
drug or (ii) 180-day exclusivity period
– Agreements between two ANDA Para IV filers
regarding 180-day exclusivity period
– Doesn’t apply to 505(b)(2) applicant
• Agreements must be filed by each party prior to first
commercial marketing of drug and within 10 business
days of execution
• Applies to agreements entered into on or after Jan.
8, 2004
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New Chemical Entity Exclusivity
• Eligibility: NDA (including 505(b)(2)) for a drug no
“active ingredient” (including ester or salt) of which
has been approved in any other NDA
• Period: 5 year exclusivity from NDA approval (4
years where Para IV is filed)
– Where Para IV is filed between 4th and 5th years,
and timely patent action is commenced, 30 month
statutory stay is extended so that 7½ years
elapses from NDA approval
• Bars: Submission of ANDA or 505(b)(2) (not full
NDA) for same drug for which exclusivity granted
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New Chemical Entity Exclusivity
• FDA regulation that active ingredient means “active
moiety”, which in turn is defined as:
– the molecule or ion, excluding those appended
portions of the molecule that cause the drug to be
an ester, salt (including a salt with hydrogen or
coordination bonds), or other noncovalent,
derivative (such as a complex, chelate, or
clathrate) of the molecule, responsible for the
physiological or pharmacological action of the
drug substance. [59 Fed. Reg. 50358 (Oct. 3, 1994)]
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New Clinical Investigations Exclusivity
• Eligibility: NDA (including 505(b)(2)) or supplemental
NDA that contains:
– reports of “new clinical investigations” (other than
bioavailability studies) that are
– “essential to the approval” and are
– “conducted or sponsored by the applicant”
• Period: 3-year period of exclusivity from approval of
NDA or supplemental NDA
• Bars: Approval of ANDA or 505(b)(2) application (not
NDA) for same conditions of approval of the drug for
which exclusivity was granted
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New Clinical Investigations Exclusivity
• “Clinical investigations” means in humans
• “New” means investigations that have not already
been relied upon by FDA to approve another product
• “Essential to approval” means there are no other
data available that could support approval
• “Conducted or sponsored by the applicant” means
either applicant was named sponsor of study or
provided 50% or more of the cost of conducting the
study
– purchase of non-exclusive rights in a study is
insufficient
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New Clinical Investigations Exclusivity
• Clinical investigations that DO qualify for exclusivity:
– New product (NP); new combination (NC); new
indication (I); new dosage form (NDF); new strength
(NS); new dosing schedule (D); new route of
administration (NR); new patient population (NPP);
and OTC switch (RTO)
• Investigations that DO NOT qualify for exclusivity:
– Labeling changes involving warning or risk
information
– Label comprehension studies in qualifying OTC
switch
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New Clinical Investigations Exclusivity
• Labeling exceptions:
– FDA will allow generic applicant to exclude from
label an indication that is subject to exclusivity or
patent [21 C.F.R. 314.94(a)(8)(iv) (1997)]
– Product still rated as therapeutically equivalent so
pharmacists may substitute for the exclusive uses
• Brand strategy: replace old labeling with labeling
containing only protected new indication to prevent
generic carve out
– 2001 FDA Draft Guidance: proposed allowing
generic applicant to copy withdrawn labeling
unless it was withdrawn for safety reasons
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Salts and Esters
• Salts/esters of previously approved acid/salt/ester
– Currently not considered “same” for ANDA filing
purposes, so have to file as 505(b)(2)
– No NCE exclusivity because same “active moiety”
• See also Pfizer v. Dr. Reddy’s, 359 F.3d 361
(Fed. Cir. 2004) (patent term extension
granted for different salt than previouslyapproved salt where same active moiety)
• But what if you can show salt/ester has
different pharmacological properties?
– 3-year NCI exclusivity (new ester or salt = NE)
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Polymorphs
• Polymorphic forms of previously-approved drugs, e.g.,
different crystalline form, different waters of hydration,
solvates and amorphous forms
– ANDA generally acceptable because considered
same active ingredient (provided it performs the
same)
• Under new Orange Book listing rules, if
patentee lists patent on the polymorph, aids
generic argument ANDA is proper on polymorph
– No NCE exclusivity because same “active moiety”
as previously approved drug
– 3-year NCI exclusivity?
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Enantiomers
• Enantiomers of previously-approved racemate:
– Not currently eligible for NCE exclusivity
• 1989 FDA proposed regulations saying no
NCE because racemate “contains” the
enantiomer
• 1994 FDA regulations took same position
despite one contrary comment
• 1997 FDA Request for Comments: should
enantiomers of previously-approved racemate
be eligible for NCE exclusivity?
• No FDA proposed rules promulgated yet
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Enantiomers
– Should FDA grant NCE exclusivity for enantiomer
of previously-approved racemate?
• What if one enantiomer is active and the other
is inactive?
• What if both enantiomers share activity but one
has an additional activity?
• What if both enantiomers are active but one is
less toxic?
– Eligible for 3 years NCI exclusivity (e.g., Nexium,
Lexapro)
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Orphan Drug Exclusivity
• Eligibility: First NDA or BLA approved for a “rare”
disease or condition, i.e., one that
– affects less than 200,000 persons in US, or
– affects more than 200,000 persons in US but
there is no “reasonable” expectation that
development costs for drug will be recovered
from US sales
• Period: 7 years from NDA or BLA approval
• Bars: Approval of another NDA, ANDA, 505(b)(2) or
BLA for same drug for same disease or condition
[See Sigma-Tau Pharms. v. Schwetz, 288 F.3d 141 (4th Cir. 2002) (ANDA not
barred where not labeled for Orphan indication)]
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Orphan Drug Exclusivity
• “Same drug” means:
– For small molecules, a drug that contains same
active moiety
– For large molecules, a drug that contains the
same principal molecular structural features
Unless
– Second drug can be shown to be “clinically
superior”
• Greater effectiveness
• Greater safety or
• Major contribution to patient care
– E.g., Berlex Labs. v. FDA, 942 F. Supp. 19
(D.D.C. 1996) ( Avonex “clinically superior” to
Betaseron, and not barred from approval,
because of lower incidence of skin reactions)
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Pediatric Exclusivity
• Eligibility: Timely submission of studies in pediatric
patients upon written request of FDA for drugs that
are approved or in approval process
– Studies need not be successful
• Period: 6 months at end of all other exclusivities
(NCE, NCI, OD, Orange Book listed patents)
• Bars: Same as underlying exclusivity (except
patents):
– Submission of ANDA or 505(b)(2) in case of NCE
– Approval of application in case of NCI and OD
• Sunset: October 1, 2007 [Best Pharmaceuticals for Children Act 2002]
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Pediatric Exclusivity and NCI
• Successful pediatric studies are eligible for 3-year NCI
exclusivity
– BUT, since 2002, ANDA applicant that carves the
indication out of its label is not subject to NCI
exclusivity
– Statute does not say 505(b)(2) can avoid NCI
exclusivity by carve out
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Pediatric Exclusivity and Patents
• Runs from expiration (including any extensions) of
each Orange Book listed patent
• Bars approval of ANDA or 505(b)(2) for 6 months
• Not a patent term extension so commercial activities
after patent expiration are not subject to damages or
injunction
• In case of Para II and Para III (patent expiration), any
exclusivity automatically begins at patent expiration
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Pediatric Exclusivity and Para IV’s
• In case of Para IV applicant statute says pediatric
exclusivity awarded if court determines patent is valid
and infringed
• Several questions arise in the case of a Para IV
applicant:
Q.Does pediatric exclusivity attach if patent expires
before patent litigation is resolved (assuming 30 month
stay did not expire before patent expiration)?
A. Yes. FDA will change generic applicant’s Para IV to a
Para II, so exclusivity attaches upon patent expiration.
[Ranbaxy v. USFDA, 30 F.Supp.2d 15 (D.C. 2004), aff’d 2004 WL 886333 (D.C.
Cir. 2004) (unpublished)]
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Pediatric Exclusivity and Para IV’s
Q.Does pediatric exclusivity attach if patent expires
before patent litigation is resolved (assuming 30
month stay does expire before patent expiration)?
A. Presumably, but not yet decided.
– FDA may delay generic application for up to 90
days while reviewing studies
– Once statutory 90 day review period has
passed, there is no barrier to generic approval.
– If patentee subsequently wins patent suit, ANDA
applicant can be enjoined, and (presumably)
injunction will cover pediatric term.
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Pediatric Exclusivity and Para IV’s
Q.Does pediatric exclusivity attach if patent holder
does not sue Para IV filer within statutory 45 days
but wins patent suit (i.e., no 30 month stay)?
A. Not yet decided but complaint has been filed in
Mylan v. Thompson (D.D.C.) by ANDA Para IV
applicant that was given “final” FDA approval
because it was sued after 45 days had expired,
and which subsequently lost patent suit.
• Applicant challenges award of pediatric
exclusivity and FDA’s changing of its Para IV
to a Para II certification.
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Pediatric Exclusivity and 180-day
Exclusivity
Q.Does pediatric exclusivity extend the 180-day first
ANDA patent challenger exclusivity?
A. Yes. Recent legislation provides that 180-day
exclusivity is extended so that it does not overlap
with pediatric exclusivity. [Best Pharmaceuticals for Children Act 2002]
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Second Pediatric Exclusivity
• Eligibility: Submission of supplemental application
– for a “new use”, i.e., one not included in labeling
of approved drug that
– qualifies for 3-year NCI exclusivity and
– contains studies in pediatric patients requested
by second FDA written request
• Period: 6 months added on to the end of 3-year NCI
exclusivity for the new use (does not extend other
exclusivities or patents)
• Bars: Approval of ANDA or 505(b)(2)
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505(b)(2) NDAs
• An end run around statutory “sameness” concept for
borrowing safety and efficacy?
– Citizen’s Petitions filed by Pfizer challenging
FDA’s use of 505(b)(2) NDAs:
• Only ANDAs should be allowed to borrow
innovator’s safety and efficacy data
• Dr. Reddy’s should not be allowed to file
505(b)(2) application for a different salt of
Norvasc and borrow Pfizer’s proprietary data
(Pfizer’s NDA contained data for both salts)
– Oct. 2003 FDA responded that it may reconsider
use of 505(b)(2) for different form of active, but
then approved Dr. Reddy’s salt variation anyway
– Pfizer sued FDA (before CAFC decision granting
Pfizer PTE for Dr. Reddy’s salt variation)
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“Follow-on” Biologics
• No abbreviated procedure for BLAs
• FDA Draft Guidance allows 505(b)(2) NDAs for
generic “biologics” that are regulated as drugs, e.g.,
human insulin, human growth hormone.
• BIO filed Citizen Petition in 2003 opposing use of
505(b)(2)s for follow-on biologics arguing it does not
allow applicant to borrow innovator’s proprietary data
• Oct. 2003 FDA responded by reaffirming its view of
505(b)(2) but deferring on scientific issues
associated with follow-on biologics
• FDA working on guidances on approval of follow-on
biologics (WSJ 2/18/04) . . .
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Thank You
BRIAN V. SLATER is a partner with Fitzpatrick, Cella, Harper & Scinto in New York, where he has
practiced since graduating from the University of Pennsylvania in 1990. Prior to that he obtained
his LL.B. from the University of Strathclyde in Scotland. He specializes in patent litigation, licensing
and counseling especially in the pharmaceutical and biotechnology fields. Mr. Slater has extensive
experience litigating patents against generic pharmaceutical companies under the Hatch-Waxman
Act. Among the clients Mr. Slater has represented in the pharmaceutical/biotech field are
Hoffmann-La Roche, GlaxoSmithKline, Novartis, G.D. Searle and Yamanouchi. Mr. Slater has
argued before the Court of Appeals for the Federal Circuit and numerous U.S. district courts, and is
a frequent author and speaker on intellectual property-related issues.
Fitzpatrick, Cella, Harper & Scinto
30 Rockefeller Plaza
New York, New York 10112
Tel: 212-218-2100
Fax: 212-218-2200
bslater@fchs.com
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