United States: FDA's Final Guidance On Determination Of Five-Year NCE Exclusivity For Certain Fixed-Combination Drug Products Under Federal FDCA

The U.S. Food and Drug Administration (FDA) recently published its final Guidance for Industry detailing circumstances under which a fixed-combination drug product (FCD) may be entitled to five-year new chemical entity (NCE) exclusivity.

As discussed in our Alert on February 26, 2014, New Drug Application (NDA) sponsors potentially can garner two exclusivity periods under the Hatch-Waxman Amendments to the Federal Food, Drug, and Cosmetic Act (FDCA). These exclusivity periods provide NDA sponsors a "grace period" from Abbreviated New Drug Application (ANDA) and 505(b)(2) competition. Of particular interest to the drug industry is the "eligibility clause" of section 505(j)(5)(F)(ii) of the FDCA that allows a five-year NCE exclusivity for a drug product where no active ingredient previously has been approved in any other NDA application.

Historically, FDA awarded five-year NCE exclusivity only to those FCDs that contained no previously approved active moieties. As defined in 21 CFR 314.108, FDA considers an "active moiety" to be "the molecule or ion, excluding those appended portions of the molecule that cause the drug to be an ester, salt ... , or other noncovalent derivative ... of the molecule, responsible for the physiological or pharmacological action of the drug substance." This decision stemmed from an early FDA interpretation of the term "drug" to mean "drug product" in the context of the exclusivity provisions.

In response to the increasing use of FCDs in many therapeutic areas, FDA this year reviewed its criteria for awarding five-year NCE exclusivity for FCDs and, in February, issued a draft guidance on FCD exclusivity. In the final Guidance, FDA recognized that fixed combinations "play an important role in optimizing adherence to dosing regimens and improving patient outcomes." Standing by its position in the February 2014 draft Guidance, FDA said it would interpret the term "drug" to mean "drug substance or active ingredient" rather than "drug product" in deciding eligibility for NCE exclusivity for FCDs. FDA abandoned its prior view that all active ingredients in the FCD had to be new active moieties by its interpretation of "drug" in this final Guidance, which focuses on each drug substance in the FCD. Therefore, a fixed combination "that contains a drug substance with a single, new active moiety would be eligible for [five]-year NCE exclusivity, even if the fixed-combination also contained a drug substance with a previously approved active moiety."

The final Guidance is not without points that may generate contention. For example, FDA retained its prior stance that the final Guidance's policies on exclusivity are prospective only and apply only to FCDs approved as of the date of this Guidance, thereby precluding FCDs approved before the publication of this final Guidance. Thus, NDA holders who have had FCDs that now would meet the new NCE exclusivity criteria may challenge FDA's refusal to retroactively apply this reinterpretation.

Also, clarification is not provided regarding the "publication date," as that date either can be considered the date the final Guidance was published on the FDA website (October 10, 2014), or the date the final Guidance was announced in the Federal Register (October 16, 2014). This may be particularly significant for Eisai Inc.'s AKYNZEO® (netupitant/palonosetron) capsules and Gilead's HARVONI® (ledipasvir/sofosbuvir), two NDAs for FCDs approved on the date of publication on the FDA website.

These changes appear to create a route for more FCDs to meet the requirements for NCE status and, thus, be allowed a five-year NCE exclusivity. According to the FDA, allowing greater access to five-year NCE exclusivity would "further incentivize the development of these important products."

For generic firms, the final Guidance indicates that more FCDs may obtain five year NCE exclusivity. It also appears that ANDA applicants will not even be able to submit an ANDA for a FCD enjoying NCE exclusivity until the five-year period expires, unless the ANDA was filed at the NCE-1 date with Paragraph IV certification. The ANDA applicant can challenge a patent listed in FDA's Orange Book as covering the FCD, in which case, the ANDA can be submitted after the expiration of four years of the NCE for the FCD. Under FDA's prior view of looking at both ingredients for deciding on NCE exclusivity, many FCDs were awarded only three-year exclusivity under Hatch-Waxman. Under three-year exclusivity, unlike NCE exclusivity, an ANDA can be filed at any time during the exclusivity period. Thus, the new policy will likely delay the ANDA process for many FCDs where such a delay would not have existed previously.

If you have any questions about this Alert, please contact Frederick (Rick) R. Ball, Carolyn A. Alenci, any member of the Pharmaceutical, Medical Device, Pharmacy and Food industry group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.

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