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Blog & Resources Camargo Blog December 10th, 2014

Therapeutic Equivalence Ratings Under 505(b)(2)

The FDA listing of therapeutic equivalence (TE) ratings can be a murky area for products approved under 505(b)(2) applications. The concept of TE ratings emerged from FDA regulations for generics and revolve around the announcement that the FDA would publish a current listing of all of its approved drugs together with TE ratings. This was designed to assist state governments and others in determining suitable generic versions of brand name drugs to include in their pharmaceutical formularies. The FDA began publishing the Approved Drug Products with Therapeutic Equivalence Evaluations, commonly called the “Orange Book” in 1980 to meet this need. Drugs found to meet FDA standards of therapeutic equivalence are given a TE rating of “A” while those for which the data is vague or for which there are outstanding questions are given a “B” rating. The FDA based its ratings on information derived from the approval process but did not set out standards for how ratings were determined because it considered the listing to be a non-regulatory function.

When the Hatch-Waxman Amendments created the 505(b)(2) pathway in 1984, standards for the establishment of TE ratings were not included in the regulation. However, although 505(j) (ANDA) approvals of generic versions of brand name drugs center around demonstration of “sameness” of the new drug without generation of new preclinical and clinical data on safety and efficacy, 505(b)(2) applications can be very different. Products approved under 505(b)(2) may be formulated differently, may be used at different dosages or may be used in a different indication, for example. New data must be generated to show safety and efficacy with regard to the different characteristics of the new drug from the reference drug. However, these drugs are listed alongside the reference product and assigned TE ratings the same way that generics are — herein lies the murkiness.

The case of AbbVie, Inc.’s (formerly Abbott Laboratory) testosterone replacement gel, Androgel, provides an example of the types of issues that can emerge with TE ratings of 505(b)(2) products compared to standard generic (505(j), ANDA) products. In 2011, Abbott Labs filed a Citizen Petition to the FDA asking that the agency not assign TE ratings to products that referenced Androgel until rules were set out that defined how TE ratings would be assigned to 505(b)(2) products and how interested parties could comment on or challenge the ratings. Abbott also argued against the FDA’s claim that the listings were non-regulatory in nature by saying that the ratings were being used for purposes that are “binding” rather than simply advisory. The company pointed out that TE listings are used to establish state pharmacy practice statutes that control which drug products pharmacists may dispense, they directly affect insurance reimbursement schemes, and they are relied upon in Medicare Part B and other federal laws.

The AbbVie, Inc. petition emerged from reports in 2009 to the FDA on adverse events associated with transference of topical testosterone products to people who could be harmed by the product. These included pregnant or breastfeeding women, women who could become pregnant, unborn fetuses and infant children. The FDA responded by requiring boxed warnings of these problems in product literature and by requiring that future follow-on products that contained changes in formulation that might affect transference include skin-transfer, hand-washing and showering studies. They also required that these reformulated drugs be approved as part of a 505(b)(2) application not a 505(j).

In 2013, Auxilium Pharmaceuticals also filed a citizen petition on the same topic with regard to Upsher-Smith Laboratories’ testosterone gel product that referenced its product Testim. Both AbbVie and Auxilium argued that differences in formulation that required the 505(b)(2) approval pathway could result in differences in transference of the product and that “sameness” of the new products in terms of safety and effectiveness had to be established in order to give the new products an “A” TE rating.

Unfortunately for AbbVie and Auxilium, the FDA did not agree. In July 2014, the agency rejected both requests citing the non-regulatory nature of TE ratings and arguing that although others may be using the Orange Book information for “binding” rule-making or reimbursement schemes, these are not administered by the FDA and not relevant to the rule.

This case brings up important questions for companies that are bringing products to market through the 505(b)(2) approval process. It is possible that AbbVie Inc. and Auxilium and others will continue to pursue this question through the courts and ask that the FDA develop standards by which therapeutic equivalence for these products is defined? Camargo’s team will stay updated with the latest information and provide insight to our clients developing new drugs through the 505(b)(2) pathway.



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