Patents and ‘FDA exclusivity’ both offer right to exclude others from respectively using your patented and FDA-approved drug formulation, but they differ in many ways.
Importantly, USPTO provides exclusivity for a patented drug for 20 years from the date of filing of a patent application. On the other hand, FDA exclusivity grants owners of an FDA-approved drug the exclusive marketing rights, and bars the approval of ANDAs (Abbreviated New Drug Applications, required for generic bio-equivalents) and NDAs (New Drug Applications) for a period, depending on the category of drug. This period of exclusivity promotes new drug innovation by restricting genetic drug competition.
The patent term and FDA exclusivity can run concurrently or they can expire at different times. Additionally, some drugs have both patent protection and FDA exclusivity, while others have just one, or neither. Patents and FDA exclusivities are recorded in the FDA’s Orange Book.
There are five types of FDA exclusivity:
Orphan Drug Exclusivity
Drugs which are approved to treat disorders which affect fewer than 200,000 people in the United States qualify for Orphan Drug Exclusivity, as described in the Orphan Drug Act of 1983. Orphan Drug Exclusivity can also be applied to drugs which treat diseases affecting more than 200,000 Americans if the drug developer can show that there is otherwise no hope of recovering development costs. Orphan Drug Exclusivity has an effective period of 7 years.
New Chemical Exclusivity
Drugs which feature an active moiety—the effective part of a drug molecule, minus nonfunctional structures—that has never before been approved by the FDA qualify for New Chemical Exclusivity. NCE has an effective period of 5 years.
Pediatric Exclusivity
Pediatric Exclusivity extended a drug’s period of exclusivity (or period of patent protection) in cases where the applicant has conducted pediatric studies on the drug. This extension is 180 days (six months) in length.
Generating Antibiotic Incentives Now (GAIN) Exclusivity
In 2012, Congress passed the Generating Antibiotic Incentives Now Act, better known as the GAIN Act. This piece of legislation was designed to coax pharmaceutical companies into conducting more research to discover new antibiotics to combat dangerous antibiotic-resistant bacterial infections, such as MRSA. Under the GAIN Act, “qualified infectious disease products” (QIPDs) will receive an additional five year period of market exclusivity.
Patent Challenge Exclusivity
Patent Challenge Exclusivity applies strictly to ANDAs only, and lasts for a period of 180 days (six months).
“Other” Exclusivity
Other Exclusivity applies to drugs whose applications contain reports of original clinical investigations paid for or conducted by the applicant. Essentially, Other Exclusivity is meant to help drug companies recoup the cost of conducting research. The effective period of Other Exclusivity is 3 years.