In a rousing session at the AAM’s GRx-Biosims conference, Kurt Karst, J.D., Director, Hyman, Phelps & McNamara, Brian McCormick, J.D., M.H.S., Vice President and Chief Regulatory Counsel, Teva Pharmaceuticals, and Chad Landmon, J.D., Partner, Axinn, Veltrop & Harkrider LLP gave a presentation entitled 180-Day Exclusivity: What Is Past Is Prologue or, as they like to call it, the chipping away of 180-day exclusivity.
In these times of depressed generic prices and resultant sagging profits, the 180-day exclusivity provision of the Act awards entrants for being first-to-file, and gaining approval under certain circumstances can be the one and only thing that provides generic companies a sufficient incentive for challenging innovator patents. The Supreme Court has said “vast majority of potential profits for a generic drug manufacturer materialize during the 180-day exclusivity period.” No secret there!
The three attorneys provided a historical walk through the evolution of the 180-day exclusivity provisions describing how the allure of potential initial profits that the exclusivity can provide has ebbed and flowed over time by outlining the impact of the following:
- 21 C.F.R. § 314.107(c)(1) & FDAs “Successful Defense” Requirement
- Court Invalidation of the Requirement
- FDA’s Guidance Amendments in Response to Court Decisions
- Courts Refine the Type of Court Decisions that Trigger Exclusivity
- FDAs Handling of Multiple First Applicants
- Transfer and Waiver of 180 Day Exclusivity
- “Deemed” First Commercial Marketing
- 30 Month Forfeiture: No But-For Causation
- MMA Forfeiture Provisions – Failure to Market
In the beginning (not the creation of the world, but the start of Hatch-Waxman), to gain the coveted 180-day exclusivity, not only did a firm have to be first-to-file, but, in order cross the finish line to receive benefit, they must also have successfully defended their claim on non-infringement or have the patent declared invalid or unenforceable. That provision limited the availability of claiming exclusivity to few applicants and it also was struck down in the case known as Mova Pharm. Corp. v. Shalala, 955 F. Supp. 128 (D.D.C. 1997), aff’d 140 F.3d 1060 (D.C. Cir. 1998) concerning Glynase/glyburide. The District Court held that “it is plain and unambiguous” that the statute “does not include a ‘successful defense’ requirement which was later affirmed by the Federal Appeals Court. This was the first break in the FDA position as the Court basically said that while FDA can interpret the statute, they can’t rewrite it, and I believe the first time that FDA’s interpretation of the Hatch-Waxman Act was struck down. (Note there were others along the way to today but, given the complexity of the Act, the Agency has won most battles.) In my view, the striking down of the successful requirement opened the door for more sponsors to enjoy the benefits of 180-day exclusivity.
Unfortunately, looking at the other issues above in detail would take days to fully explain, but take my word that each and every other point above has somehow or another diminished the value of 180-day exclusivity. Even the change of the meaning of “first-to-file” from the very first application walking in the door, that ultimately led to sponsors camping out at the steps of the FDA building so they could be first in line, to the anyone submitting their application on the first day that an application with PIV certification challenging a listed patent could be filed, would be considered first-to-file. While this provision opened up the door for more applicants for potential eligibility, at the same time it also diminished the value of 180-day exclusivity because, if you have multiple applicants approved during the 180-day exclusivity period, that would mean that multiple applicants would be competing for a piece of the 180-day pie.
The trio of experts then launched into the current pending legislative initiatives that could likely further diminish the value of the 180-day exclusivity, for instance, the so-called Blocking Act as it has evolved over time (and which, I believe, is a piece of legislation looking for a problem to fix as it, in part, addresses an issue that seldom happens).
Anyway – this was a great session and I wish I had more time to explain the other legislative issues the presenters discussed in detail, but I have to get back to the next session. For those of us that remain steadfast Hatch-Waxman nerds, be sure to continue to follow the yellow brick road and I hope you don’t hit a roadblock!
