FDA-USPTO Collaboration Offers Insight on the Future of Generics

Andrew Thompson

Associate Editor

Loyola University Chicago School of Law, JD 2023

Following the Biden Administration’s release of the Comprehensive Plan for Addressing High Drug prices in September 2021, the Food and Drug Administration (FDA) responded by opening communication with the United States Patent and Trademark Office (USPTO). On September 10, 2021, the FDA sent a letter to the Under Secretary of Commerce for Intellectual Property and Director of the USPTO seeking to further develop the FDA-USPTO relationship. The letters point out that while “bringing more drug competition to the market and addressing the high cost of medicines by improving access to affordable medications is a top priority” for HHS and FDA, the FDA is constrained by its inability to regulate the price of drugs it approves. While the FDA’s 505(b)(2) hybrid NDA and 505(j) ANDA pathway decrease the cost and time to market entry for generics, the FDA’s authority is concentrated in the pre-market review stage, with post-market authority focused on actions such as product seizure of adulterated or misbranded articles, phase-4 confirmatory trials, and other actions intended to assess the safety and efficacy of drugs.

Market delay by bad faith use of patent certifications

The FDA flags a growing issue in the generic space – a drug sponsor’s bad faith use of 505(b)(2) provisions to delay market entry of generics. Under the 505(b)(2) requirements, the sponsor of a generic drug product must include information in their applications about patents for which a claim of patent infringement could reasonably be asserted. In practice, this means any patents that claim the drug product or drug product’s active ingredient(s) must be listed in the application with the sponsor making a certification with respect to the patent and their generic drug product.

The four types of patent certifications a sponsor may make are: a paragraph I certification holding out that the patent has not been filed; a paragraph II certification stating the relevant patent has expired; a paragraph III certification that the patent will expire on a certain date; and a paragraph IV certification claiming the patent is invalid, unenforceable, or will not be infringed upon by the drug for which FDA approval is sought. Notice of paragraph IV certifications by the sponsor must be provided by the manufacturer or sponsor holding the patent at issue so that the sponsor may initiate patent litigation within 45 days of notification if the patent holder believes the certification is incorrect. Once litigation is initiated, the sponsor receives a 30 month stay of approval per FDCA 505(c)(3)(C) or 505(j)(5)(B), meaning the FDA will not approve the generic drug product application for 30 months. This provision can force litigation and may be misused by sponsors who contest the paragraph IV certification in bad faith to trigger the 30-month stay. The FDA and scholars are concerned that these provisions, which were intended to allow for fair resolution of intellectual property disputes, are now being used to slow generic competitors and disrupt an already lengthy regulatory process.

FDA action

On December 14, 2021, the FDA published its response to a citizen petition seeking to block approval of Eagle Pharmaceuticals’ ANDA application. FDA denied the petition and stated in part B of their response that “the petition appears to have been submitted for the primary purpose of delay and fails to raise valid scientific or regulatory issues.” FDA’s explicit recognition of bad faith challenges to generic sponsors’ applications and FDA’s denial of a sham petition suggest the FDA will operate with a focus on preventing patent holders from subverting a statutory mechanism for notice and hearings on patent disputes.


FDA’s key concerns

The FDA’s letter to the USPTO offers a series of interlinked concerns held by the FDA on the misuse of patent law aspects of the drug approval process. The FDA notes some companies file “continuation” patents which allow the filer to obtain follow-on patents that make reference to an earlier patent to create a thicket of patents that cannot be penetrated by generic manufacturers without triggering costly patent litigation. Similarly, the FDA is concerned about patent evergreening, the practice of renewing patents based on minor changes, and product-hopping, the practice of submitting new applications for a modified drug product to obtain a patent for the modification and thereby delay generic entry. FDA-USPTO collaboration could bolster the FDA’s ability to respond to anti-competitive behavior by clarifying under what criteria the FDA may reject a sponsor’s challenge to paragraph IV certification(s), offering a framework for inter-agency review of challenged patents to ensure patents are reviewed using the same or similar approaches, and by improving the timeliness of inter-agency communications to speed the conclusion of sponsor challenges to paragraph IV certifications.