Well, freedom from generic competition for a while at least. Generally, most companies’ business plans specify some means to keep the competition at bay until the product can make a profit – when revenues start to exceed investments.

There are two ways for 505(b)(2) applications to obtain a market free from a duplicate: patent protection and exclusivity.

Patent Protection

Patent protection stems from being able to obtain a patent from the U.S. Patent and Trademark Office. The patent could cover the indication, formulation, or synthesis and could potentially block the approval of a generic version.

Exclusivity

Exclusivity is granted by the FDA under 21 CFR 314.108.  The periods of exclusivity are:

• Three years: clinical studies essential for approval conducted by the applicant
• Five years: NCE — old drugs never approved under an NDA
• Seven years: orphan drug
• Six months added on to existing exclusivity or patent life: pediatric studies

I’m going to focus on exclusivity. Let’s start with the fact that if your drug product does not require a clinical study for approval you obtain no exclusivity for your drug product. Unless you have a good patent, no exclusivity means that a generic can be approved as soon as it can be made, is shown to be bioequivalent, and winds it way through the Office of Generic Drugs. You’ll likely get at least 2 years on the market without generic competition.

What does “clinical study” mean in this context, though? Recall that all drug products approved in the US must meet the same standards — the NDA standard, containing all studies to show safety and efficacy. Applications differ on where the information comes from — ANDAs get their information from the reference listed drug (RLD) as long as there is no difference from the RLD. 505(b)(2)s get their information from an RLD plus information to show that differences do not affect safety and efficacy. This information comes from either the public domain or studies conducted by the applicant. These studies can include nonclinical (non-human) or clinical studies.

For purposes of exclusivity, Phase 1 and Phase 2a studies usually do not count as clinical studies, as they are usually conducted in a healthy population. Thus, Phase 2b and Phase 3 studies count as clinical studies for the purposes of determining exclusivity. There is a certain risk here, because the FDA does not make the determination of whether a clinical study was required for approval until the time of approval.