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Executive Summary

The Senate-passed version of the ANDA-patent bill, by prohibiting submission of ANDAs during the first five years of marketing after a pioneer NDA is approved, effectively prevents patent challenges throughout the same period. Because the legislation (S 2926) provides that patent challenges can be initiated at the time of the filing of an ANDA with FDA, the five-year moratorium against ANDAs not only establishes a minimum period of exclusivity but also assures the pioneer mfr. freedom from patent litigation for five years. Senate sponsor Hatch (R-Utah) helped conduct three days of negotiations that resulted in the final bill passed by the Senate Aug. 10 ("The Pink Sheet" Aug. 13, p. 11). One of the negotiated changes was the provision for the ANDA moratorium, and the language prohibiting submission -- as opposed to approval -- was a key to the agreement. The provision is one of several that are likely candidates for debate when the bill is considered in the House. Rep. Waxman (D-Calif.) has indicated he will re-examine the five-year provision's language when his version (HR 3605) of the legislation is brought to the House floor, probably soon after Congress reconvenes from the Republican Convention recess. Sen. Metzenbaum (D-Ohio), who cast the lone vote against S 2926, told the Senate he was "concerned" that the bill prevents patent challenges. "The language of the five-year exclusive marketing provision," Metzenbaum said, "may also in some way detour or detract from the right of generic drug mfrs., and perhaps others as well, to challenge the patent during that period." Enactment Expected, Though Bill's Route Through House Depends On Amendments The Ohio Democrat had blocked Senate consideration of S 2926 for two days while he scrutinized its language. Metzenbaum noted that part of the reason he consented to letting the bill proceed to the Senate floor was that he "received an iron-clad assurance from" House sponsor Waxman (D-Calif.) that "if this [prohibition against ANDA submissions and patent challenges] is a problem, he will see to it that it is taken care of in the House." Metzenbaum further complained that the ANDA moratorium as drafted would result in a minimum exclusivity period of more than five years. "If you read [the language] closely enough, you will learn it really is not five years; it is closer to six years because of the date and the manner in which it is written," the senator said. The additional year or two of exclusivity presumably would occur during FDA review of the ANDA after the prohibition against submission expires. The fact that several provisions of the Senate-passed compromise are said to cause some concern and may lead to House debate is not expected to threaten the bill's chances for passage. Amendments to S 2926 will cause a House-Senate conference on the bill, but no congressman is reported to be so strongly opposed to any provision as to seek a change that would disrupt the compromise. One amendment that could be added in the House is unrelated: Rep. Derrick's (D-S.C.) textiles bill. Before S 2926 passed the Senate, Thurmond reportedly agreed not to burden S 2926 with his version of a textiles bill. Rep. Kastenmeier (D-Wis.) is also known to be concerned by the ANDA moratorium and a similar three-year provision for non-new chemical entities. During House Judiciary Cmte. mark-up, Courts Subcmte. Chairman Kastenmeier persuaded the cmte. to delete from the House bill (HR 3605) a provision for a four-year exclusivity period for non-patentable new chemical entities. He argued that such a provision would establish a second class of patents. However, the Hatch bill expands the House-deleted provision three ways: by expanding the exclusivity period to five years, by deleting the restriction to non-patentable products by granting exclusivity regardless of patent status, and by providing an additional three-year exclusivity period for products which are not new chemical entities. Reportedly, Kastenmeier is not concerned by a separate provision for two years of ANDA protection for non-new chemical entities approved during the bill's "transition period" (Jan. 1, 1982-enactment). In an Aug. 10 letter to Metzenbaum, who was still holding up S 2926 in the Senate, Kastenmeier said he was "opposed to a 'second-class patent' of this kind" provided in the Hatch bill. By appearing "to give FDA authority to exclude others from competition," the congressman explained, the five-year "proposal goes beyond unpatentable substances which are off patent. This provision is just as objectionable as the original four-year rule." In addition, he continued, "the three-year provision would expand the original four-year rule by including certain relatively minor modifications in a drug which may not be patentable inventions." Finally, Kastenmeier said he suspects that passage of such a bill could encourage other industries to ask Congress for special monopoly rights in the future. "I am suspicious about the unwarranted expansion of proprietors' rights," the congressman wrote. "While these accommodations may be seen by some as necessary to achieve enactment of the larger bill, I am wary about the future of this approach." Another Senate provision which reportedly may face opposition in the House is Sen. Thurmond's (R-S.C.) amendment to extend until 1992 the patents of glyburide (Hoechst-Roussel's DiaBeta & Upjohn's Micronase) and glipizide (Pfizer's Glucotrol). The oral hypoglycemic new chemical entities were approved during the legislation's transition period, which provides 10 years' freedom from ANDA competition for new drug compounds. However, supporters of the amendment argue that even if the products enjoy protection from ANDA competition, the products' patents, which expire within the next two years, should be extended to prevent competition via full NDAs. One addition to the Hatch bill that poses no controversy is the "separability clause," which provides that if any part of the legislation is found unconstitutional, the rest of the law will be unaffected. Although such provisions are commonly included in new legislation, the clause clearly is included in S 2926 to protect against court challenges to the constitutionality of the Bolar provision.

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