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From Health Law Daily, October 5, 2015

FDA correctly denied lost exclusivity for 2 scheduled drugs

By Harold M. Bishop, J.D.

The FDA’s policy that the five-year marketing exclusivity period for a new drug begins when the FDA issues its letter approving the drug, even if the drug’s manufacturer must await the Drug Enforcement Administration’s (DEA) controlled substance scheduling determination, is reasonable and entitled to deference, according to a District of Columbia district court (Eisai, Inc. v. FDA, September 30, 2015, Moss, R.).

Background. Eisai, Inc. (Eisai), the manufacturer of two prescription drugs that required approximately one year to complete the DEA controlled substance scheduling process, lost approximately one year of the five-year marketing exclusivity provided by the Hatch-Waxman Amendments (P.L. 98-417) to the federal Food, Drug & Cosmetic Act (FDC Act) (21 U.S.C. §355(c)(3)(E)(ii)) on each drug.

The first drug, Belviq®, is a weight-loss drug that allegedly took 14 years and over $300 million to develop. The FDA issued an approval letter for Belviq on June 27, 2012. The FDA submitted a scheduling recommendation to the DEA on June 25, 2012, and the DEA issued its final scheduling order on May 8, 2013. The second drug, Fycompa®, an epilepsy drug, was approved by FDA letter on October 22, 2012. On January 28, 2013, the FDA recommended that the DEA schedule Fycompa. The DEA issued its final scheduling order on January 2, 2014.

Eisai asked the FDA via citizen petition to adjust the approval dates for Belviq and Fycompa to align with the DEA scheduling. When the FDA refused to do so, Eisai filed suit seeking a declaration that the FDA’s determination of the exclusivity periods for its drugs violated the Administrative Procedure Act (APA), 5 U.S.C. §706(2), and an order requiring the FDA to recognize those periods as beginning on the date when the company was actually permitted to bring the drug to market. The parties filed cross motions for summary judgment.

Marketing exclusivity and the DEA scheduling process. The FDA regulations implementing the marketing exclusivity provision of the Hatch-Waxman Amendments bar manufacturers from applying for approval of generic drugs for “a period of five years from the date of approval of the first approved new drug application” (21 C.F.R. sec. 314.108(b)(2)). The date of approval is further defined as the date of the approval letter from the FDA (21 C.F.R. sec. 314.108(a)).

When the FDA determines that a drug in the approval process has a potential for abuse, it must forward that information to the DEA. If the FDA’s scientific and medical evaluation of the drug and its recommendation to the DEA indicate that the drug should be scheduled, the DEA must initiate scheduling proceedings.

While neither the FDC Act nor FDA regulations specifically prohibit a manufacturer from marketing an approved drug before it is scheduled by the DEA, the FDA requires new drug applicants to agree not to market drugs that the FDA has proposed for scheduling until the DEA makes a final scheduling decision.

Approval exception sought. The district court first addressed Eisai’s argument that, despite the FDA’s approval date regulation, it should prevail because the FDA’s approval letters required it to make labeling revisions for both drugs, including statements detailing the scheduling of the drugs by the DEA. These revisions, according to Eisai, created an exception to the FDA’s approval regulation and entitled it to a later approval date for its drugs. The court disagreed, finding that the label change to reflect DEA scheduling is often as simple as adding a small logo to the label. This act, according to the court, is a simple and non-discretionary edit that the FDA treats as ministerial not worthy of further agency review. Thus, the FDA approval letters were the final FDA approval necessary for market entry, pending the DEA scheduling determinations.

Razadyne ER® and prior FDA practice. Eisai also asserted that the FDA acted in an arbitrary and capricious manner in violation of the APA when it adjusted the approval date of Johnson & Johnson’s (J&J) dementia drug Razadyne ER®, which was approved in 2004 but delayed by efforts to get an acceptable and non-conflicting trade name, but failed to likewise adjust the approval dates for Eisai’s two drugs. The court found that the Razadyne approval letter required J&J to submit the new trade name for “review prior to implementation.” The Razadyne letter, therefore, expressly required approval of the subsequent submission, while the Eisai letters did not expressly require any further agency review. The court also noted that Razadyne was not waiting for DEA scheduling as was the case with Eisai’s drugs. Finally, the court took note of the fact that of the 11 FDA drugs approved since 2005 that were subject to DEA scheduling determinations, none had the beginning of their exclusivity period delayed until after the drug had been scheduled.

Summary judgment was granted to the FDA.

The case is No. 14-cv-1346 (RDM).

Attorneys: James Robert Johnson (Hogan Lovells U.S. LLP) for Eisai Inc. Sang H. Lee, Department of Justice, for U.S. Food and Drug Administration, Margaret A. Hamburg, U.S. Department of Health and Human Services, and Sylvia M. Burwell.

Companies: Eisai Inc.; Johnson & Johnson; U.S. Food and Drug Administration; U.S. Department of Health and Human Services

MainStory: TopStory FDCActNews ControlledNews DrugBiologicNews GenericDrugNews PrescriptionDrugNews SafetyNews DistrictofColumbiaNews

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