The Patent Use Code Conundrum — or Why FDA Can't Read (Patents)

This article appeared in Pharmaceutical Compliance Monitor, October 17, 2014 and is reproduced with permission.

When Hatch-Waxman was adopted 30 years ago, Congress wanted to ensure that generic manufacturers could enter the market with low cost drugs just as soon as the initial protections on the brand drug had expired. Specifically, Congress was concerned about "evergreening," whereby new, protected indications might be added to the brand label to thwart generic entry and extend the life of the drug monopoly. Congress said there was no reason why a generic drug could not be approved for older, unprotected uses at the same time the brand was being sold for newer uses protected by patent or exclusivity.

Thus, Hatch-Waxman allows an ANDA applicant who does not intend to market its drug for a protected use, to "carve out" of its label (which otherwise must be identical to the brand) all information associated with that protected use. As long as the now "skinny labeled" generic was no less safe or effective as the brand for all the remaining uses, it would receive an AB-rating as a therapeutic equivalent (TE) to the brand drug for the labeled uses. The obvious restriction was that the skinny labeled generic could not be marketed or advertised for the protected use carved out of its label and now considered an "off-label" use of the generic drug. Congress left to the FDA the task of determining what language on the brand label was or was not covered by the protected use.

For uses protected by three-year exclusivity (awarded for new uses based on clinical studies), the FDA's carve out analysis is relatively straightforward because it is the sole arbiter of the language to be added to the brand label based on the clinical studies; thus, it knows exactly what language needs to be carved out by a skinny labeled generic. For uses protected by patent, however, the FDA's carve out analysis is much more difficult because it refuses (or, as the FDA contends, is not specifically authorized) to develop any requisite patent expertise. Therefore, to make the patent carve out calculus easier the FDA requires NDA holders to submit for Orange Book listing, a short statement describing the approved use claimed by the patent, known as the patent "use code." The FDA then can rely on the use codes to determine what language a skinny labeled generic must remove from its label in order to be approved. When the patent use code and brand label language are literally the same, the carve out analysis is easy; but when the use code and label language are not identical, which is more often the case with therapeutic use patents, the carve out analysis is much harder because the FDA does not read or construe patent claims. This can lead to a legal conundrum whereby a skinny labeled generic goes to market with an FDA approved drug label that, in fact, induces infringement of a brand patent listed in the Orange Book. And because courts are loathe to enjoin the sale of low cost generic drugs once on the market, brand drugs protected by use patents are in a potentially precarious position.

Please read "The Patent Use Code Conundrum - or Why FDA Can't Read (Patents)" for the rest of this article. If you have any questions about this article or would like to discuss this topic further, please contact the author, Terry G. Mahn.