No Evergreening

Generics makers, not surprisingly, blasted the 12 years' exclusivity offered in the Senate compromise as "unprecedented and unwarranted." Kathleen Jaeger, president of the Generic Pharmaceutical Association (GPhA), sought clearer limits on products eligible for exclusivity and language to prevent "evergreening" patent monopolies through minor product changes.

In finalizing the bill, Sen. Edward Kennedy (D-MA), chairman of the Senate Health, Education, Labor and Pensions (HELP) Committee, clarified that a reference product can have only one 12-year exclusivity period. Such exclusivity starts the day FDA approves the new therapy for market, and innovators can't add more years by developing new formulations or dosage forms, adding new indications, or conducting pediatric studies. The exclusivity applies only to a biotech product that is comparable to a "new chemical entity" for drugs, not to a slightly different version of an existing treatment.

One reason for agreeing to 12 years' exclusivity, said Clinton, is that many biotech therapies have been on the market long enough to be eligible immediately for follow-on competition. Amgen's anemia treatment Epogen (epoetin alfa), for example, was approved in the United States in 1989, and other biologics have or will soon exceed the exclusivity period.

Twelve years is probably "the best deal the industry is going to get," comments former FDA official Scott Gottlieb. "This is a genuine compromise."

Interchangeability Possible

Despite protests from generics makers, much of the Senate package meets their demands. The legislation provides a pathway for developing interchangeable FOBs that can be substituted for an innovator product. And follow-on sponsors would get a one-year data-exclusivity award as an incentive to take that route. To gain approval of an FOB that pharmacists can substitute for the original product without the prescriber's OK, the follow-on maker will have to conduct clinical trials to demonstrate that the new product can be used without any noticeable differences, a requirement that addresses legitimate safety concerns.

The Senate plan also permits generics makers to file an application for a biosimilar four years after the start of the innovator's exclusivity period as one way to resolve some patent issues early on. When FDA accepts the FOB application, that triggers a multi-step process for exchanging confidential information between the follow-on firm and the innovator on manufacturing process and product characteristics and patents likely to be affected. Innovators are concerned that the follow-on firm eventually will determine which patents can be litigated, making it harder to defend patent rights.

Biotech companies still can enforce patents awarded after the filing of a follow-on application, but that involves additional procedures for dealing with later patent litigation. Whether all these provisions will reduce litigation in an equitable manner remains to be seen.

Flexibility for FDA

The main testing and regulatory provisions of the FOB legislation reflect further trade-offs for innovators and generics firms. The agreement calls for at least one or more clinical studies to assess the immunogenicity of a follow-on, but it gives FDA leeway to waive that requirement.

FDA may develop guidance for testing and developing FOBs, but generics firms don't have to wait for published guidance to move forward with testing and applications. Such guidance could indicate that existing science does not support follow-ons for a certain product class, but FDA could revise such a finding later on.

Follow-on applicants initially will pay user fees on applications, while FDA assesses the cost of running the program as the basis for adjusting the fee structure later. Also, the FDA review division that approved the innovator will assess any follow-ons—not FDA's Office of Generic Drugs. This could encourage FDA reviewers to compare proprietary brand data when evaluating an FOB, something that innovators strongly oppose.