The FDA has recently thrown its hat into the debate between brand and generic drug manufacturers about the proper way to compete. Generics often accuse brands of improperly trying to extend their monopolies over patented medications by using FDA regulations and, in particular, citizen petitions to allegedly foreclose competition. The FDA has issued an updated guidance on citizen petitions now including factors that the FDA will consider in determining whether a citizen petition is submitted for the primary purpose of delaying approval of a generic drug. More broadly, all health care companies should be aware of the antitrust and IP interplay and execute a legal and policy strategy that is in line with the current developments, for which the below is one example.
On October 2, 2018, FDA Commissioner Scott Gottlieb, M.D. issued a statement with release of a draft updated guidance on citizen petitions, explaining that one area of his focus “has been shutting down practices used by branded firms to ‘game’ the system and take advantage of certain rules, or exploit loopholes to delay generic approval — thereby extending a drug’s monopoly beyond what Congress intended.”1 Commissioner Gottlieb stated that one anticompetitive practice involves citizen petitions under Section 505(q)2 and consequently, the FDA has issued a revised draft guidance on citizen petitions, which describes some factors the FDA will consider in determining whether a petition is submitted with the primary purpose of delaying the approval of a generic drug application.
While approval of a generic drug is pending, a citizen petition may be filed with the FDA to request that the FDA take, or refrain from taking, administrative action. Because citizen petitions can delay a generic drug’s approval, there has been concern that they are open to abuse by brand companies attempting to prolong their monopoly in the market.3
The FDA may not delay approval of a 505(b)(2) or ANDA application based on a citizen petition unless the FDA determines, upon reviewing the petition, that a delay is necessary to protect the public health. However, under Section 505(q)(1)(E), if the FDA determines that a petition was submitted with the primary purpose of delaying approval of such application and the petition does not on its face raise valid scientific or regulatory issues, the FDA may deny the petition at any point based on such determination. Section 505(q)(1)(E) further provides that the FDA may issue guidance to describe the factors that will be used to determine whether a petition has been submitted with the primary purpose of delaying approval of an application.
In October 2018, the FDA issued a revised draft guidance4, which updates a November 2014 guidance by describing some of the considerations that the FDA will use in determining whether a petition is submitted with the primary purpose of delaying the approval of a 505(b)(2) or ANDA application:
- where the petitioner has taken an unreasonable length of time to submit the petition;
- where the petitioner has submitted multiple petitions raising issues that reasonably could have been known to the petitioner at the time of submission of an earlier petition;
- where the petition is submitted close in time to expiration of a blocking patent or exclusivity;
- where the petition lacks data or information in support of the scientific positions in the petition;
- where the petition raises the same or substantially similar issues as in a prior petition to which the FDA has substantively responded;
- where the petition concerns standards for approval of a drug product for which the FDA has provided the opportunity for public comment and the petitioner has not provided comment;
- where the petition requests that other applicants meet standards for testing, data, or labeling that are more onerous than the standards applicable to the listed product or petitioner’s version of the same product; and
- other relevant considerations, including the history of the petitioner with the FDA (whether the petitioner has submitted other petitions that the FDA has determined were for the primary purpose of delay).
The updated guidance further provides that if the FDA determines that a petition has been submitted with the primary purpose of delaying an application, the FDA intends to refer the matter to the FTC.
There have been some antitrust actions based on filing sham citizen petitions5, including In re Flonase Antitrust Litigation, Civil Action No. 08-3301 (Eastern District of Pennsylvania), which resulted in a settlement in November 2012 under which GlaxoSmith Kline agreed to pay $35 million to indirect purchasers of a generic version of Flonase, fluticasone propionate. The new FDA action of referring to the FTC citizen petitions that have been filed for delay may deter such sham petitions. However, if a product of a generic company is the subject of a citizen petition, the generic company should seek legal advice to evaluate, among other matters, whether an antitrust claim may be available.