FDA Patents

FDA patents are granted by the United States Patent and Trademark Office at any time during the drug's development. New pharmaceutical products are governed in the United States by U.S. Food and Drug Administration law and U.S. patent law

Pros Associated with FDA Patents

  • While the FDA may be criticized for being too strict in approving drugs when safety issues are involved, the agency can adjust the rules if it deems a change is necessary. 
  • If a company's new drug is approved and granted exclusivity, this can help promote and balance marketing between a new drug entering the market and its generic competition. 
  • Getting an FDA patent is a necessity for companies with products to market, as it is illegal to sell drugs that do not have the FDA's stamp of approval. 

Cons Associated with FDA Patents

  • Three reasons drug development fails are the approval process the drug must pass, the length of time it takes to get through the approval process, which can be 10 years or more, and development costs that are in the billions of dollars. 
  • Additional reasons for drug failure include extensive and complex drug trials, post-approval trials by the FDA, determining and analyzing side effects caused by the drug, and the research involved in how the drug is to be administered. 
  • FDA patents are not necessarily easy to have approved due to changing regulations. 
  • Even when a company is confident all the necessary data is compiled for the FDA, the agency can require more information or that more studies be conducted. 
  • Competitors and newcomers to the drug market may be discouraged and not participate in new drug development due to the high cost involved and risk in creating a product that may never be approved.

FAQs

Q. Is every drug submitted to the Food and Drug Administration approved?

A. No. Getting FDA approval is difficult. It is estimated the approval ratio is around 5,000 and 10,000 to 1. For example, only 22 medicines were approved to be sold in 2016. In 2015, only 45 medicines were FDA approved. 

Q. What are the primary costs when dealing with FDA patents?

A. Several cost factors include legal costs/fees, R&D (research and development), and funding that may be not available for an indefinite period. 

Q. What is patent exclusivity?

A. When exclusivity is granted by the FDA once a drug is approved, it provides exclusive marketing rights for that drug. Exclusivity is granted to new drug applications (NDA) as a statutory provision if statutory requirements [21 C.F.R.314.108] are met. 

Q. How long is an FDA patent exclusivity?

A. Exclusivity is granted by the FDA based on the type of drug being manufactured. Patents have an estimated 20-year time span. Orphan drugs are provided seven years for exclusivity, and new chemical entities are provided with five years. Some types of statutory criteria may also receive exclusivity for up to three years or more. 

Q. What is the difference between a patent and exclusivity?

A. A patent can expire before FDA approval. It can be issued after the FDA has approved the drug or anytime during the development state. Exclusivity is only granted upon approval of the drug by the FDA. 

Q. Are exclusivity rights necessary?

A. For successful drugs, exclusivity rights promote profits. Without this, a company could sustain a substantial loss in revenue. 

Q. What types of exclusivity rights are available?

A. There are five types: Orphan Drug Exclusivity (ODE), New Chemical Exclusivity (NCE), "Other" Exclusivity, Pediatric Exclusivity (PED), and Abbreviated New Drug Applications (ANDA). Exclusivity rights for the ODE run for seven years, five years for NCE, and three years for Other. An additional six months are added to an existing patent for PED, and 180-day exclusivity is given for ANDA drugs. 

Q. What is a compulsory license?

A. Used in countries other than the United States, a compulsory license allows a company to produce and market drugs locally. These drugs have not yet reached the point where they will be competing with generics. 

Q. What is the Orange Book?

A. The Approved Drug Products with Therapeutic Equivalence Evaluations is referred to as The Orange Book. It is a requirement of the Drug Price and Competition ACT that the FDA provides this information.  

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