Difference between NCE (5 year) exclusivity and 3 year exclusivity
When a new chemical entity (NCE) is first approved as a drug under a New Drug Application (NDA), the sponsor is entitled to a five year exclusivity period that bars the submission of any generic drug application for a product that contains that NCE. There are two types of generic drug applications: Abbreviated New Drug Applications (ANDA); and the so-called 505(b)(2) NDA. With both types of applications, approval of the competing product relies upon FDA’s prior approval of a drug containing the NCE as being safe and effective. An exception allows filing of a generic application as early as four years after NCE approval if the competitor challenges the validity or applicability of a patent on the NCE. However, under the complex rules governing generic drug patent challenges, and in light of the two or more year FDA review time for ANDAs, final generic approval is usually not possible for at least seven years post-NCE approval, or longer.
Another regulatory exclusivity applies when a sponsor obtains FDA approval of certain changes to an already approved drug, eg, a new indication, a new dosing regimen, a new patient population, a switch to over-the-counter marketing status, or other labelling changes. If new clinical studies, conducted or sponsored by the applicant, are deemed by FDA to be essential to the approval of the change, the sponsor is awarded a three-year exclusivity period for the approved change. But, unlike the five year NCE exclusivity, the three year exclusivity only bars FDA approval of an ANDA or 505(b)(2) NDA for the same change, and once the three year exclusivity period expires, pending generic applications for the change may be approved immediately. Moreover, in many instances, a generic version can still be approved using the old labelling – ie, by carving out the exclusive labelling language – before the three year exclusivity expires. Given the liberal generic substitution rules in most states, this exclusivity is often considered to be of limited value. Thus, sophisticated companies and their FDA counsel have pursued regulatory strategies that can enhance the power of the three year exclusivity to prevent or delay FDA approval of generic versions that use the old, unprotected labelling. These strategies have been vigorously opposed by generic manufacturers and patients groups, and have a mixed record of success.
Well, here is a silly question. If no decision is ever made, then when can a challenge start ? Since we still have no decision, why are companies not challenging right now ? No decision means no exclusivity. Therefore, according to all who say NCE is the most important thing in the whole wide world, drug companies should be filing for generics in droves.