Data exclusivity (DE)—the right of inventors to prevent unauthorized disclosure of essential competitive information submitted for market authorization—is facing a strong new wave of opposition. Root causes behind the assault include the growing commercial tension between brands and generics, continued concerns about access barriers in the fight to treat the global pandemic of neglected diseases, and a newly assertive industrial policy among key emerging market countries seeking to exploit gaps in multilateral standards for DE, as evidenced in the 1994 WTO Agreement on Trade Related Intellectual Property Rights (TRIPS). At the same time, patent expiries, longer development times, and slower payer uptake of new medicines make preservation of the innovators data assets more important than ever.
Hence the key question for all Big Pharma today: How do we build a constructive case against the criticism and maintain the relevance of DE as an essential driver of new drug innovation? Most of the criticism of DE comes at a time when governments are experiencing the disconnect between a demographic of soaring healthcare costs, and a fiscal and debt crisis that makes them unable to provide patient access to the latest medicines. Since healthcare costs are projected to skyrocket by more than 70 percent over the next 10 years, there is fear that the period of data exclusivity—which varies among countries—will have a negative impact on health budgets by preventing patient access to innovative life-saving medicines or vaccines that can treat multiple chronic conditions or prevent and cure emerging diseases.
The supplemental value of DE. Some critics of DE argue that DE is unnecessary due to the protection provided by a patent: it's a superfluous "double dip." Of course, patents are the most visible and perhaps most important form of intellectual property, but their application is far from universal when viewed in a global context. Historically the scope of patent protection has been quite varied—in some countries there is sometimes no patent protection at all, due to local patent eligibility criteria that exclude specific sectors like pharmaceuticals; some countries have only recently enacted patent protection for pharmaceuticals, which "grandfathers" many compounds out of the framework for coverage. As a result, in these countries, DE may be the only realistic method of protecting drugs.
Likewise, for smaller- or medium-sized companies, the high unpredictability of legal interpretations of today's patent laws makes it confusing or costly to build a strong bulwark of patent protection, in which case the more straightforward application of DE can provide the protection necessary for the investment into R&D. Further, DE can act as a back-up system for R&D, should a patent on an innovative breakthrough medicine be challenged and invalidated; or to recoup the investment cost in product liability suits, which are costly to defend and often based on unanticipated adverse side effects.