BPCIA’s Principal Authors Seek to Clarify Congressional Intent With Respect to 12-Year Exclusivity Period; PhRMA/BIO Request “Umbrella Exclusivity”

By Kurt R. Karst –    

In a letter recently submitted to FDA by the three principal authors of the Biologics Price Competition and Innovation Act of 2009 (“BPCIA”) – Representatives Anna Eshoo (D-CA), Jay Inslee (D-WA), and Joe Barton (R-TX) – the legislators take issue with FDA’s characterization of the 12-year exclusivity period provided by the law and seek to clarify Congressional intent on granting new 12-year exclusivity periods for “next generation” products.

The BPCIA amended the Public Health Service Act (“PHS Act”) to, among other things, create an approval pathway for biosimilar and interchangeable versions of reference products (so-called § 351(k) applications) and establish a 12-year exclusivity period for reference products.  Specifically, PHS Act § 351(k)(7) provides for a 12-year period of exclusivity from the date of first licensure of the reference product, during which approval of a § 351(k) application cannot be made effective.  PHS Act § 351(k)(7)(C) includes certain limits on obtaining 12-year exclusivity.  That provision states that the date of first licensure, and therefore the 12-year exclusivity period, does not apply to a license for or approval of:

(i) a supplement for the biological product that is the reference product; or

(ii) a subsequent application filed by the same sponsor or manufacturer of the biological product that is the reference product (or a licensor, predecessor in interest, or other related entity) for –

(I) a change (not including a modification to the structure of the biological product) that results in a new indication, route of administration, dosing schedule, dosage form, delivery system, delivery device, or strength; or

(II) a modification to the structure of the biological product that does not result in a change in safety, purity, or potency.

In October 2010, FDA issued a Federal Register notice announcing a two-day public hearing to obtain input on specific issues and challenges associated with the implementation of the BPCIA.  Among the myriad issues for which FDA sought public comment were two questions on exclusivity:

1. In light of the potential transfer of BLAs from one corporate entity to another and the complexities of corporate and business relationships, what factors should the agency consider in determining the types of related entities that may be ineligible for a period of 12-year exclusivity for a subsequent BLA?

2. What factors should the agency consider in determining whether a modification to the structure of the licensed reference biological product results in a change in safety, purity, or potency, such that a subsequent BLA may be eligible for a second 12-year period of marketing exclusivity?

The BPCIA’s principal authors, in their December 21, 2010 letter, felt compelled to address FDA’s characterization of the 12-year exclusivity period as a period of “marketing exclusivity” in the Agency’s meeting notice.  The BPCIA “does not provide ‘market exclusivity’ for innovator products,” according to the letter.  “Rather, it provides data exclusivity for 12 years from the date of FDA approval . . . .”  The letter goes on to note the “significant and critical differences between the two types of exclusivity.”  “Data exclusivity only prohibits the FDA from allowing another manufacturer to rely on the data of an innovator to support approval of another product.  Importantly, it does not prohibit or prevent another manufacturer from developing its own data to justify FDA approval of a similar of competitive product.” 

The second issue raised in the letter concerns so-called “evergreening.”  Evergreening, which is the practice of obtaining additional periods of exclusivity for product modifications, was hotly debated during consideration of what ultimately became the BPCIA.  One legislative proposal even included an express prohibition on evergreening, and the Obama Administration’s 2009 10-year budget proposal raised concern about the practice.  PHS Act § 351(k)(7)(C) is intended to prevent evergreening by excluding most product changes from qualifying for a new 12-year exclusivity period.  

According to the December 21st letter, the BPCIA “is clear that no product, under any circumstances, can be granted ‘bonus’ years of data exclusivity for mere improvements on a product.”  Nevertheless, the legislators “want to be clear that if a ‘next generation’ product is approved by the FDA as a new product (significant changes in safety, purity, or potency) then that new biologic will receive its own 12-year period of data exclusivity.”  “Any proposal to limit the definition of a ‘new’ product, and thus one which is entitled to its own period of data exclusivity has the potential to stifle innovation and negatively impact patient care,” according to the letter. 

The scope the 12-year exclusivity period provided by the BPCIA is also discussed in lengthy comments (here and here) submitted to FDA by the Pharmaceutical Research and Manufacturers of America (“PhRMA”) and the Biotechnology Industry Organization (“BIO”).  Both PhRMA and BIO request that FDA apply the concept of “umbrella exclusivity” to new BLAs and BLA supplements that do not independently qualify for the 12-year exclusivity period. 

Under FDA’s “umbrella policy” for drug products, any remaining 5-year New Chemical Entity (“NCE”) exclusivity period granted under the Hatch-Waxman Amendments for the original NDA NCE approval applies to subsequent applications (both new NDAs and NDA supplements) for drug products containing that NCE until the NCE term expires.  According to BIO:

[I]it is important for FDA to clarify that BLA supplements and full BLAs that may not themselves be eligible for 12 years of exclusivity because they seek certain non-qualifying changes to already-approved products will nevertheless benefit from any remaining exclusivity for the underlying, previously-approved biologic.

PhRMA contends that any decision by FDA apply the Agency’s “umbrella policy” to BPCIA exclusivity would mean that: “(1) a supplement or subsequent application that was not entitled to its own 12-year period would be protected for any remaining period of exclusivity applicable to the first licensed product to which it is related, and (2) an affiliate or related entity’s product that was not entitled to its own 12-year period would be protected for any remaining period of exclusivity applicable to the initial applicant’s product.”  “Any other approach,” according to PhRMA, “would be inconsistent with [FDA’s] longstanding approach to data exclusivity [and] would seriously undermine the value of exclusivity and incentives to innovate.”