The third certification, i.e., that the generic company will not market the product until the patents have expired, directly addresses the issues raised in Roche v. Bolar. That is, under paragraph 3, a generic company can prepare the necessary ANDA data, file the ANDA with the FDA, and be prepared to go to market the day after the patent expires, all the while being shielded from a patent infringement suit. However, filing an ANDA with a paragraph 3 certification does not assure the generic company that other generic companies will not also seek and be approved to sell generic versions of the same drug. It is the fourth certification, known as a paragraph 4 certifi­cation, where the bulk of the Hatch-Waxman Act takes effect. We focus primarily on two important provisions of the act – the 180-day exclusivi­ty provision and the 30-month stay provision.

In order to begin the approval process, the generic company not only must file the ANDA and the appropriate paragraph 4 certification with the FDA (i.e., any patents in question are invalid or not infringed), but it must also notify the patent owner (listed in the Orange Book) of its ANDA filing. The act includes a reward for the generic company that is the first to file an ANDA with a paragraph 4 certification: that company isentitled to a 180-day period of marketing exclusivity for the drug in question. During this 180-day period, the FDA is prohibited from approving any other ANDA for the same drug. The 180-day exclusivity,which can be and usually is of great financial importance, begins when the generic prod­uct goes on sale or on the datea court declares the patent(s) inquestion invalid or not infringed, which ever occurs first.

The downside of being the first generic company to file an ANDA with a paragraph 4 certification is that in all but the rarest of cases, the generic company will be sued for patent infringement. In fact, the filing of a paragraph 4 certification is itself considered to be an act of patent infringe the patent owner files such a patent infringement suit (which must occur within 45 days of the patent owner’s receipt of the ANDA), the filing of suit automatically postpones the FDA’s ability to approve the ANDA for 30 months. This 30-month stay is intended to give the patent owner time to assert its patent rights before the generic product is approved for sale. The act does not provide for any expedited schedule for the underlying patent infringement lawsuit, and thus once filed, the suit proceeds like any other patent infringement suit.

Biopharmaceuticals and the Hatch-Waxman Act

The Hatch-Waxman Act waspassed in 1984, and has greatly reduced the time it takes for generics to reach the market, thus increasing the consuming public’s access to less expen­sive drug products. For example,it has been reported that since the enactment of the act, over 10,000 generic drugs have entered the market, and generics now account for closeto 50 % of prescriptions filled.Before the act, it took three to five years for generics to enter the market after the patent on the drug expired. Today, the generic drug can and often does enter the market on the day the patent expires. Before the act, only 35 % of the best selling drugs had generic competition. Today, almost all of the best selling drugs have generic counterparts.

The problem for generic companies is that at present, the Hatch-Waxman Act does not apply to the vast majority of biopharmaceuticals. In the past, some natural source proteins (insulin, for example) have been regulated as drugs, and other natural source proteins (such as blood fac­tors) have been regulated as biological products. The FDA approves new drugs under mechanisms found in section 505 of the Federal Food, Drugand Cosmetic (FD&C) Act andapproves most biological prod­ucts under section 351 of the Public Health Service (PHS) Act. Hatch-Waxman, and its ANDA process, is available only to those drugs approved under the FD&C Act, not those products approved under the PHS Act (e.g., biopharmaceuticals).ⁱⁱ

Thus, at present there is no statutory authority for expedit­ed approval of biogenerics. Given the economics involved,this is likely to change. In fact,Senator Orin Hatch (co-author of the Hatch-Waxman Act) raised the issue as recently as June, 2004 in a statement before the U.S. Senate Committee on the Judiciary that was conducting hearings on “The Law of Off-Patent Biopharmaceuticals.”Specifically, as Senator Hatch explained, the hearing was designed to “explore some of the key issues concerning the legality, feasibility and advisability of creating a new, abbreviated regulatory pathway at the Food and Drug Administration for the review and approval of off-patent biological products.”ⁱⁱⁱ As a first step in exploring thepossibility of the establishmentof guidelines, the FDA recently scheduled a public workshop on follow-on biologics for September 14 and 15, 2004. The workshop will focus on comments on issues of manu­facturing, characterization, immunogenicity, preclinical and clinical studies, potency and surrogates for efficacy andsafety, as well as terminology for follow-on biologics.

As noted by Senator Hatch, akey issue for FDA approval of a biogeneric is the establish­ment of bio equivalence to the innovator drug. The FDArequires that the active ingredi­ent of a generic drug be absorbed into the body and metabolized in approximatelythe same amount over approxi­mately the same period as the active ingredient of the innovator drug. For small molecule drugs this process isfairly straightforward and the FDA has established specific guidelines with regard to which tests should be per-formed, such as dissolution testing and blood-level testing.

Biopharmaceuticals, on the other hand, are proteins and,as such, are much more diffi­cult to characterize. Proteins are much more than just an amino sequence. Conformational changes can affect protein function and activity, as will post-translational modifications such as glycosy­lation. Most biopharmaceuticals are produced in living cells, which adds to the complexity of the resulting protein product. If a generic company were to produce an innovator protein using a different cell system, would the resulting protein be the same as the innovator pro­tein? The innovator companies argue that they would not be equivalent, because the generic companies would not have access to proprietary good manufacture practice (GMP) and good laboratory practice (GLP) protocols developed by the innovator companies. The generic companies argue that they would employ the same scientificprinciples and commitment to quality and safety that the innovator com­panies do in order to produce abioequivalent biopharmaceutical.

The FDA has not remained silent on the issue of “sameness” with regard to biopharmaceuti­cals, although it has yet to issuespecific guidelines on bioequiv­alence, per se. In November 2003, comparability guidelines were issued by the FDA “to provide principles for assessingthe comparability of biotechno­logical/biological products before and after changes are made in the manufacturing process for the drug substance or drug product.”^iv The scopeof the guidelines includes proteins and polypeptides produced from recombinant or non-recombinant cell-culture expression systems. The guide-lines further suggest specific tests and analytical procedures that can be used to assess the comparability of the two products.

Conclusion

No one questions the inher­ent difficulties in proving bioe­quivalence for biogenerics. Nonetheless, given the benefits the Hatch-Waxman Act pro­vides to the consuming public, with respect to generic phar­maceuticals, it is very likely that a statutory scheme that is analogous to Hatch-Waxman that permits early and less expensive entry of bio generics to the market will be devel­oped and implemented. Both brand name biopharmaceutical companies and biogeneric com­panies will need to pay close attention to these matters so they can tailor the procure­ment and enforcement of their intellectual property accordingly.

i

Rouhi, MA. Generics Next Wave: Biopharmaceuticals.

Chemical & Engineering News

23 September 2002, 80(38): 61-65.

ii It should be noted that not all biologics however fall under the PHS Act. Indeed, the ANDA process has been used for biologics. See e.g., Serono Laboratories, Inc. v. Shalala, 158 F.3d 1313 (1989). As set forth in Serono, in 1990 Lederle Parenterals, Inc. filed an ANDA for menotropin, a biological product that is extracted from the urine of post-menopausal women, and contains two active ingredi­ents: follicle-stimulating hor­mone (FSH) and luteinizing hormone (LH). In the review of the ANDA application the FDA evaluated the bioequiva­lence of the generic product to the innovator product. The FDA ultimately found the two products bioequivalent. Therefore, it seems obvious that the FDA has the expertise and sophistication to make these types of determinations and it is just a matter of time, and possibly new legislation, before they will be performingthese evaluations on other bio­generics.

iii June 23, 2004 Statement of Chairman Orin Hatch before the United States Senate Committee on the Judiciary, Hearing on The Law of Off-Patent Biopharmaceuticals.

iv “ICH Q5E: Comparability of Biotechnological/BiologicalProducts Subject to Changes inTheir Manufacturing Process” suit (which must occur within 45 days of the patent owner’s receipt of the ANDA), the filing of suit automatically postpones the FDA’s ability to approve the ANDA for 30 months. This 30-month stay is intended to give the patent owner time to assert its patent rights before the generic product is approved for sale. The act does not provide for any expedited schedule for the underlying patent infringement lawsuit, and thus once filed, the suit proceeds like any other patent infringement suit.

Biopharmaceuticals and the Hatch-Waxman Act

The Hatch-Waxman Act waspassed in 1984, and has greatly reduced the time it takes for generics to reach the market, thus increasing the consuming public’s access to less expen­sive drug products. For example,it has been reported that since the enactment of the act, over 10,000 generic drugs have entered the market, and generics now account for closeto 50 % of prescriptions filled.Before the act, it took three to five years for generics to enter the market after the patent on the drug expired. Today, the generic drug can and often does enter the market on the day the patent expires. Before the act, only 35 % of the best selling drugs had generic competition. Today, almost all of the best selling drugs have generic counterparts.

The problem for generic companies is that at present, the Hatch-Waxman Act does not apply to the vast majority of biopharmaceuticals. In the past, some natural source proteins (insulin, for example) have been regulated as drugs, and other natural source proteins (such as blood fac­tors) have been regulated as biological products. The FDA approves new drugs under mechanisms found in section 505 of the Federal Food, Drugand Cosmetic (FD&C) Act andapproves most biological prod­ucts under section 351 of the Public Health Service (PHS) Act. Hatch-Waxman, and its ANDA process, is available only to those drugs approved under the FD&C Act, not those products approved under the PHS Act (e.g., biopharmaceuticals).ⁱⁱ

Thus, at present there is no statutory authority for expedit­ed approval of biogenerics. Given the economics involved,this is likely to change. In fact,Senator Orin Hatch (co-author of the Hatch-Waxman Act) raised the issue as recently as June, 2004 in a statement before the U.S. Senate Committee on the Judiciary that was conducting hearings on “The Law of Off-Patent Biopharmaceuticals.”Specifically, as Senator Hatch explained, the hearing was designed to “explore some of the key issues concerning the legality, feasibility and advisability of creating a new, abbreviated regulatory pathway at the Food and Drug Administration for the review and approval of off-patent biological products.”ⁱⁱⁱ As a first step in exploring thepossibility of the establishmentof guidelines, the FDA recently scheduled a public workshop on follow-on biologics for September 14 and 15, 2004. The workshop will focus on comments on issues of manu­facturing, characterization, immunogenicity, preclinical and clinical studies, potency and surrogates for efficacy andsafety, as well as terminology for follow-on biologics.

As noted by Senator Hatch, akey issue for FDA approval of a biogeneric is the establish­ment of bio equivalence to the innovator drug. The FDArequires that the active ingredi­ent of a generic drug be absorbed into the body and metabolized in approximatelythe same amount over approxi­mately the same period as the active ingredient of the innovator drug. For small molecule drugs this process isfairly straightforward and the FDA has established specific guidelines with regard to which tests should be per-formed, such as dissolution testing and blood-level testing.

Biopharmaceuticals, on the other hand, are proteins and,as such, are much more diffi­cult to characterize. Proteins are much more than just an amino sequence. Conformational changes can affect protein function and activity, as will post-translational modifications such as glycosy­lation. Most biopharmaceuticals are produced in living cells, which adds to the complexity of the resulting protein product. If a generic company were to produce an innovator protein using a different cell system, would the resulting protein be the same as the innovator pro­tein? The innovator companies argue that they would not be equivalent, because the generic companies would not have access to proprietary good manufacture practice (GMP) and good laboratory practice (GLP) protocols developed by the innovator companies. The generic companies argue that they would employ the same scientificprinciples and commitment to quality and safety that the innovator com­panies do in order to produce abioequivalent biopharmaceutical.

The FDA has not remained silent on the issue of “sameness” with regard to biopharmaceuti­cals, although it has yet to issuespecific guidelines on bioequiv­alence, per se. In November 2003, comparability guidelines were issued by the FDA “to provide principles for assessingthe comparability of biotechno­logical/biological products before and after changes are made in the manufacturing process for the drug substance or drug product.”^iv The scopeof the guidelines includes proteins and polypeptides produced from recombinant or non-recombinant cell-culture expression systems. The guide-lines further suggest specific tests and analytical procedures that can be used to assess the comparability of the two products.

Conclusion

No one questions the inher­ent difficulties in proving bioe­quivalence for biogenerics. Nonetheless, given the benefits the Hatch-Waxman Act pro­vides to the consuming public, with respect to generic phar­maceuticals, it is very likely that a statutory scheme that is analogous to Hatch-Waxman that permits early and less expensive entry of bio generics to the market will be devel­oped and implemented. Both brand name biopharmaceutical companies and biogeneric com­panies will need to pay close attention to these matters so they can tailor the procure­ment and enforcement of their intellectual property accordingly.

i

Rouhi, MA. Generics Next Wave: Biopharmaceuticals.

Chemical & Engineering News

23 September 2002, 80(38): 61-65.

ii It should be noted that not all biologics however fall under the PHS Act. Indeed, the ANDA process has been used for biologics. See e.g., Serono Laboratories, Inc. v. Shalala, 158 F.3d 1313 (1989). As set forth in Serono, in 1990 Lederle Parenterals, Inc. filed an ANDA for menotropin, a biological product that is extracted from the urine of post-menopausal women, and contains two active ingredi­ents: follicle-stimulating hor­mone (FSH) and luteinizing hormone (LH). In the review of the ANDA application the FDA evaluated the bioequiva­lence of the generic product to the innovator product. The FDA ultimately found the two products bioequivalent. Therefore, it seems obvious that the FDA has the expertise and sophistication to make these types of determinations and it is just a matter of time, and possibly new legislation, before they will be performingthese evaluations on other bio­generics.

iii June 23, 2004 Statement of Chairman Orin Hatch before the United States Senate Committee on the Judiciary, Hearing on The Law of Off-Patent Biopharmaceuticals.

iv “ICH Q5E: Comparability of Biotechnological/BiologicalProducts Subject to Changes inTheir Manufacturing Process”November 2002, www.fda.gov

Conclusion

No one questions the inher­ent difficulties in proving bioe­quivalence for biogenerics. Nonetheless, given the benefits the Hatch-Waxman Act pro­vides to the consuming public, with respect to generic phar­maceuticals, it is very likely that a statutory scheme that is analogous to Hatch-Waxman that permits early and less expensive entry of bio generics to the market will be devel­oped and implemented. Both brand name biopharmaceutical companies and biogeneric com­panies will need to pay close attention to these matters so they can tailor the procure­ment and enforcement of their intellectual property accordingly.

i

Rouhi, MA. Generics Next Wave: Biopharmaceuticals.

Chemical & Engineering News

23 September 2002, 80(38): 61-65.

ii It should be noted that not all biologics however fall under the PHS Act. Indeed, the ANDA process has been used for biologics. See e.g., Serono Laboratories, Inc. v. Shalala, 158 F.3d 1313 (1989). As set forth in Serono, in 1990 Lederle Parenterals, Inc. filed an ANDA for menotropin, a biological product that is extracted from the urine of post-menopausal women, and contains two active ingredi­ents: follicle-stimulating hor­mone (FSH) and luteinizing hormone (LH). In the review of the ANDA application the FDA evaluated the bioequiva­lence of the generic product to the innovator product. The FDA ultimately found the two products bioequivalent. Therefore, it seems obvious that the FDA has the expertise and sophistication to make these types of determinations and it is just a matter of time, and possibly new legislation, before they will be performingthese evaluations on other bio­generics.

iii June 23, 2004 Statement of Chairman Orin Hatch before the United States Senate Committee on the Judiciary, Hearing on The Law of Off-Patent Biopharmaceuticals.

iv “ICH Q5E: Comparability of Biotechnological/BiologicalProducts Subject to Changes inTheir Manufacturing Process”November 2002, www.fda.gov