In October, 2002, President Bush issued proposed revisions to the FDA regulations governing generic drug market entry. The proposed regulations ("The Availability Of The 30-Month Stay of FDA Approval Of Generic Drug Applications And Revised Orange Book Patent Listing Requirements") have elicited mixed responses from various pioneer and generic drug manufacturers, healthcare providers, and consumer groups. Some have criticized President Bush’s proposal as a half-measured attempt to close loopholes in the existing law. Others have questioned the timing of the proposed rules, as they were issued two weeks before the midterm elections. Nonetheless, many commentators have recognized the Bush proposal as an important first step in removing loopholes in the current law and encouraging increased competition among brand and generic drug manufacturers.
A Federal Trade Commission study published in July of 2002 identified several loopholes in the Hatch-Waxman Act and the FDA implementing regulations governing generic drug market entry. One potential loophole is the practice by some pioneer companies of obtaining multiple 30-month stays of generic drug approval. Under the current law, a pioneer company is required to provide patent information to the FDA for listing in an FDA publication commonly referred to as the "Orange Book. If a generic company intends to seek FDA approval before the expiration of a listed patent, it must make, as part of its generic drug application, a so-called "paragraph IV certification," asserting invalidity and/or noninfringement of the patent. The generic manufacturer is required to notify the pioneer company of any paragraph IV certification. If the pioneer company files a suit against the generic challenger within forth-five days, the FDA approval of the generic drug application is automatically stayed for thirty months, unless the suit is resolved in the generic manufacturer’s favor or the patent expires before the end of the stay. Additional 30-months stays may result if the pioneer company lists additional patents after the filing of the generic drug application. A generic manufacturer is likely to challenge a later-listed patent, and, in that event, a suit brought by the pioneer company based on the new challenge will automatically trigger a new 30-month stay that is independent of any previously granted 30-month stays. The FTC cites the practice of late-listing as a major reason for the long delays in the launch of some generic drugs. In one well-known example, five 30-month stays were awarded against the launch of a generic version of the anti-depressant, Paxil.
The Bush proposal contains three major revisions aimed at tightening patent listing requirements and reducing the number of 30-month stays available to pioneer companies. Under the Bush proposal, the FDA may grant only one automatic 30-month stay pending resolution of a patent challenge. Thus, no matter how many patents are listed in the Orange Book or when they are listed, only one 30-month stay can be granted per pioneer drug. If implemented, the Bush proposal could substantially shorten the time generic manufacturers have to wait before launching a generic drug. While there still is incentive under the proposed rules to list patents in order to trigger one 30-month stay, in a typical scenario late-listing (i.e., listing a patent after the filing of the generic application) will not be as useful a means to delay generic entry as under the current law. According to the FTC comments, the Bush proposal could "eliminate a substantial portion of the potential for unwarranted delay of FDA approval of generic drugs." The Bush proposal, however, does not go quite as far as the FTC had recommended. While both the FTC recommendations and the Bush proposal limit the number of 30-month stays to one per pioneer drug, the Bush proposal allows a late-listed patent to serve as a basis for a 30-month stay as long as no previous 30-month stay has been granted. The FTC recommendations, on the other hand, would not have allowed a 30-month stay based on a patent listed after the filing of a generic application.
Another measure in the Bush proposal is the clarification and tightening of patent listing requirements. The current FDA regulations do not provide objective standards for Orange Book listing. It is the FDA’s policy not to review substantively patents submitted for listing. Moreover, there is no practical mechanism for delisting improperly listed patents. The result is that some pioneer companies have successfully listed patents that bear a questionable relationship to an approved drug, but, nonetheless, serve as a basis for the 30-month stay. For example, some pioneer companies have listed patents that claim an intermediate to the approved drug (i.e., a precursor compound in the manufacturing process) or a metabolite of the approved drug (i.e., a compound that results from ingestion and metabolism of the approved drug). While generic manufacturers have challenged such listings as inappropriate, courts consistently have held that the existing law does not provide a cause of action for the delisting suits. The Bush proposal expressly excludes metabolite patents, drug intermediate patents, and drug-packaging patents from the Orange Book. In addition, drug substance, drug product, and method of use patents must claim an approved active ingredient, an approved product composition, or an FDA approved use in order to meet the proposed listing requirements. For example, a method of use patent claiming an indication not approved by the FDA would not be listable under the Bush proposal. The Bush proposal, however, does not fully adopt the FTC’s recommendations regarding patent listing. For example, the FTC recommended against the listing of certain product-by-process patents (i.e., patents claiming a product by the way it is produced) and patents that claim a different crystalline form of an approved drug. The Bush proposal would allow the listing of such patents.
The third significant aspect of the Bush proposal is the redesign of the Orange Book patent declaration procedure. Under the current FDA regulations, a pioneer company is required to make only a general statement, indicating that a patent covers the formulation, composition, and/or method of use of the pioneer drug. The proposed rule would require a multi-step declaration including detailed statements as to which claims cover which subject matter and how the claims relate to the pioneer drug.
The Bush proposal appears to be a step in the direction many had advocated, i.e., revising the current law to allow increased generic competition in the marketplace. The proposal is expected to be finalized this summer.
The content of this article does not constitute legal advice and should not be relied on in that way. Specific advice should be sought about your specific circumstances.
