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Blog & Resources Camargo Blog December 18th, 2014

The Potential Unveiling or Unraveling of Dormant Therapies—15-Year Data Exclusivity for Drugs for Unmet Needs

Last week the “Dormant Therapies Act” (DTA), a companion piece to the Modernizing our Drug & Diagnostics Evaluation and Regulatory Network Cures Act (also known as the MODDERN Cures Act of 2013), was introduced in the U.S. Senate. The Act would provide a drug maker with an unprecedented 15 years of data exclusivity for a drug product that meets an “unmet medical need”. An unmet medical need is a condition whose treatment or diagnosis is not addressed adequately by available therapy (see, e.g., FDA Guidance for Industry: Expedited Programs for Serious Conditions – Drugs and Biologics May 2014). Data exclusivity refers to the amount of time during which a generic or 505(b)(2) drug product manufacturer or developer maker would be prevented from using the data generated by a brand-name drug maker to then obtain regulatory approval and sell its own similar drug. Currently, drug makers can receive up to 5 years of data exclusivity for a new prescription medicine and 12 years for a biologic. This new designation – Dormant Therapy Designation – modeled off of FDA’s other existing designation programs, including breakthrough therapy designation, orphan drug designation and fast-track designation will only be given to new drugs (either a different active moiety or a biological product that is not highly similar to an approved biologic). The Sponsor will have to specifically request the designation from the FDA and will need to waive all patent rights to the drug.

U.S. Senator Orrin Hatch (R-Utah) sees this bill removing the “ticking patent clock” conundrum that forces drug makers to prioritize research based on the quickest to market and to the most profitable opportunities. It has been estimated that the total research and development and FDA approval process time for a new drug is between 10 and 15 years (see 2013 Innovation in the Biopharmaceutical Pipeline). Typically, patents last for only 20 years with much of that time is consumed during the lengthy research and development process. It is hoped that the DTA will create a time-certain protection to bring new and essential products to market for the patients who need them. Despite $80 billion spent annually on research and development, many diseases and conditions lack effective treatments. Senator Hatch indicated there are millions of patients struggling with conditions such as Alpha-1, ALS, Alzheimer’s, epilepsy, lupus, mesothelioma, and multiple sclerosis. For many individuals with a long-term disease or disability, no treatments are available leading to a high cost of care. For instance, the direct costs to all payers of caring for those with Alzheimer’s disease, including out-of-pocket costs to patients and their families, is estimated to increase five-fold, from $172 billion in 2010 to $1.1 trillion in 2050, unless new treatments are found that delay its onset or slow its progression (See, 2012 Alzheimer’s Disease Facts and Figures). At a June 2014 second hearing on the 21st Century Cures Initiative, a panel before the House Energy and Commerce Committee’s Subcommittee on Health cited that only 500 of 7,000 known diseases have effective treatments, and legislators are interested in closing this “innovation gap.”

A number of potential medicines in development would provide new clinical options for patients with diseases for which no new therapies have been approved for many years. An analysis of 15 selected diseases with no approvals in the past 10 years identified over 400 projects in development (See, 2013 Innovation in the Biopharmaceutical Pipeline – Table 7; pg 18)

Unveiling this bill is much easier than obtaining the approval, however. This isn’t a new concept – as this bill closely resembles the MODDERN Cures Act of 2013. This legislation supported by 94 co-sponsors has not made any progress towards approval. Ed Silverman from The Wall Street/Journal Pharmalot Blog indicated a key criticism of both bills is the potential to slow the introduction of lower-cost generic versions of many drugs, leading to higher prices as a result of extending data exclusivity.

The existing FDA definition of “unmet medical need”, which many consider vague, could lead to many products being eligible for dormant exclusivity. Columbia University Law School professor C. Scott Hemphill at a congressional hearing last year stated “the standard is extremely elastic, sweeping in drugs that offer a wide range of improved outcomes, different side effects, or even increased “compliance or convenience”.

As the term “unmet medical need” is often used in the industry, particularly in the 505(b)(2) setting, to secure a “niche” in the marketplace – this recent activity may lead to the FDA providing more scrutiny surrounding the application of the term.

This post developed by Camargo’s Stacey Ayres, PhD. and Bill Stoltman, J.D.



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