Trends In Proposed Laws Aimed At Drug Patents
By Sona De
Recent proposed bills have targeted patents on branded drugs that may be asserted against potential generic or biosimilar manufacturers. The stated motive behind this trend is to make the lower-priced substitutes available to the public sooner. Advocates for such change have been fueled by data suggesting that multiple patents on branded drugs are responsible for extending their market exclusivity. That data has not only been criticized for overstating the extent of this patent protection, but has since been contradicted by competing data jointly reported by the FDA and the U.S. Patent and Trademark Office (“Patent Office”).
This article (i) describes the current system for resolving patent issues between branded manufacturers and potential generics or biosimilars, (ii) summarizes two proposed bills and how they could change that system, (iii) compares the competing data on branded drug patents, and (iv) discusses what can be done going forward.
The Current System
A drug patent, like all patents, typically expires 20 years after its priority application is filed. Some of this time is consumed while the Patent Office reviews the patent application to decide whether to grant the patent. But unlike many other products, a drug must also be approved by the FDA before it can be marketed. Because the process for obtaining FDA approval of a new branded drug can take several years, issued patents on branded drugs may lose years of patent protection during that time before the drug can be sold.
There are already laws in place for potential manufacturers of generic or biosimilar versions of branded drugs to enter the U.S. market in less time and at less expense. Generics or biosimilars can seek FDA approval by relying in part on the branded manufacturer’s data and studies. The Hatch-Waxman Act (“Hatch-Waxman”) created this abbreviated FDA approval pathway for generic versions of small molecule drugs in 1984. The Biologics Price Competition and Innovation Act (“BPCIA”) created a similar pathway for biosimilar versions of biologic drugs in 2010.
These laws also created a way for a branded manufacturer and the generic or biosimilar, as the case may be, to resolve patent disputes in a streamlined fashion. Once the generic or biosimilar files its abbreviated application with the FDA, it can notify the branded manufacturer so they can litigate the patent issues while the FDA reviews the application. If the branded manufacturer wins, the generic or biosimilar must wait for the winning patent(s) to expire before it can launch. If the generic or biosimilar wins, it can launch then. If the case settles, it is often with an agreed-upon launch date before the asserted patents expire.
Despite having this system in place for decades, some have argued for change. A common refrain among them is that greater access to lower cost generics and biosimilars is needed, and that branded manufacturers should not have extended patent protection against those substitutes. Proponents of the current system emphasize that patents are necessary to advance medicine because they motivate branded manufacturers to undertake the risks and significant expense of research and development.
Proposed Bills
Proposed bills could impact Hatch-Waxman and BPCIA patent litigation as we know it.
In September 2023, the Medication Affordability and Patent Integrity Act was introduced in both the U.S. Senate and the House of Representatives (S 2780 and HR 5429). According to the sponsors, branded manufacturers can get multiple patents by using partial information for an initial patent while saving other information for later filed patents to get later expiration dates. This legislation purports to avoid that by requiring branded manufacturers to make coordinated disclosures before the Patent Office and the FDA. That would impose new compliance burdens on branded manufacturers and generate more paperwork for these agencies. It would affect patent litigation by creating a new “failure to comply” defense by a generic or biosimilar that the courts would be left to decide. This legislation has not yet passed in either the Senate or the House.
In July 2024, the Senate passed the Affordable Prescriptions for Patients Act (S 150). It seeks to limit the number of patents that a branded biologic manufacturer can assert against a biosimilar in BPCIA litigation. It proposes that only 20 of those patents can have filing dates four or more years after the branded drug was FDA approved or that cover a manufacturing process that the branded manufacturer does not itself use. Its practical effects are difficult to predict given that this bill also has proposed exceptions to the limit. It has been sent to the House, but not yet taken up there.
The Underlying Data
An oft-cited source of data that purports to show there is extensive patent coverage for top grossing branded drugs is the advocacy group known as Initiative for Medicines, Access & Knowledge (“I-MAK”). I-MAK issued a 2018 report on the 12 best selling drugs in 2017. It claims to have found that, on average, over 100 patent applications are filed per branded drug, resulting in nearly 40 years of market exclusivity.
I-MAK’s data and methodology have faced criticism from various commentators. In the wake of that response, Senator Thom Tillis of North Carolina wrote to the FDA and the Patent Office in January 2022 expressing concerns about the data itself and that it has spurred a false narrative that patents are misused to delay generics. He asked these agencies to conduct an independent assessment. They did. In June 2024, the FDA and the Patent Office jointly published a report of their own that studied 25 FDA-approved new drug applications representing top branded small molecule drugs in 2017. In contrast to I-MAK, the FDA-Patent Office study found that for the drugs with generic versions, market exclusivity before generic launch ranged from about three to 16 years.
Four drugs are common to both I-MAK’s and the FDA-Patent Office lists. We use one of those four, Revlimid, to illustrate how these reports arrived at such different results.
The reported number of issued patents on Revlimid differed over three-fold. I-MAK reported 96 patents on Revlimid, compared to 27 patents identified in the FDA-Patent Office report for the same drug. The FDA-Patent Office based its count on the Orange Book, which lists patents the branded manufacturer identified as covering Revlimid. I-MAK does not disclose exactly how it determined which other patents cover Revlimid, but does state that its methodology went beyond the Orange Book. I-MAK’s rationale for doing so is that the Orange Book does not list certain types of patents, such as those on intermediate compounds used to make the end drug product. The FDA-Patent Office report recognized such additional patents may exist, but explained that only Orange Book-listed patents can affect FDA approval of generics. In terms of unlisted patents, the FDA-Patent Office report pointed out that while they must be evaluated for risk, that is true of patents in any other competitive industry.
The reported years of market exclusivity for Revlimid also differed in magnitude between I-MAK and the FDA-Patent Office report. I-MAK reported 40 years of exclusivity compared to the 16 years reported by the FDA-Patent Office. The FDA-Patent Office report counted from the date Revlimid was FDA approved for sale until the first generic copy of Revlimid launched. I-MAK counted from the earliest patent application filed on Revlimid through the last possible expiration date of any pending patent application. The FDA-Patent Office report explained its study did not include pending applications because they are not a meaningful metric. That is because pending applications may never issue and do not protect market share; only issued patents can do that.
What to Expect Next
Proposed bills that are not signed into law by President Biden before the current U.S. Congress ends in January 2025 will expire. The fact that the two bills discussed here have yet to pass both chambers of Congress means they are unlikely to meet that deadline. The bipartisan support for these bills, however, may motivate sponsors to reintroduce them with the next U.S. Congress. Although some of the original sponsors lost their seats in the recent election, they were replaced by other members of their respective party.
With the likely delay of action on the proposed bills, there is time for lawmakers to carefully investigate all available facts, as well as the real-world implications of the proposed changes. Interested stakeholders can urge their Congressional representatives to consider and understand the differences between competing data to make informed decisions. Pharmaceutical companies should monitor further developments to be ready for any changes.
About The Author:
Sona De is a litigation partner in Sidley Austin’s New York office. Neven Abdo, law clerk, assisted in the preparation of this article.