Waxman/Hatch Reinterpretation Underpins Change In 30-Month Stay Policy

FDA's proposal to allow only one 30-month stay of approval for ANDAs hinges on a reinterpretation of Waxman/Hatch language declaring that patent holders must be notified if a generic application is amended to "include" a Paragraph IV certification.

FDA has historically interpreted the act to require a separate notification each time an ANDA applicant certifies to a newly listed patent. Each certification triggers a new 30-month stay of approval period.

However, under the Oct. 24 proposed rule, FDA is taking the position that, if an ANDA already includes a Paragraph IV certification, "any ANDA amendment containing a paragraph IV certification does not amend the ANDA to 'include' a Paragraph IV certification because the ANDA already contained a Paragraph IV certification."

Hence, subsequent Paragraph IV certifications will not "trigger the notice requirement" and "only one 30-month stay in the ANDA's approval date is possible."

"To put it another way," the proposed rule states, "if the ANDA applicant is not obliged to submit the notice to the patent owner and NDA holder, then the pre-requisites to trigger the 30-month stay in an ANDA's approval date are not met, so the 30-month stay would not be available."

The reinterpretation of the 30-month stay is the most significant departure from FDA's current Waxman/Hatch procedures included in the proposed rule. As such, it is also likely to be one of the first elements challenged in court once the proposed rule takes effect.

FDA is also proposing clarifications to the types of patents that can be listed in the "Orange Book." However, the agency is not altering its position that its role in patent listings is "ministerial," so those changes may have a less direct impact on the generic drug approval process (see ¹ ).

The proposed rule outlines the reasons for the change in the 30-month stay procedures, noting that the issue was highlighted by the Federal Trade Commission in a recent report on brand/generic competition (² (Also see "Paxil Late-Listed Patents Are Questionable For Orange Book Listing – FTC" - Pink Sheet, 5 Aug, 2002.), p. 8).

FDA begins by noting that its current interpretation allowing multiple 30-month stays has held up in court. The issue was litigated as one element of a patent dispute between Andrx and Biovail over Tiazac (³ (Also see "ANDA Amendments Should Trigger New Paragraph IV Certifications – Biovail" - Pink Sheet, 14 Jan, 2002.), p. 7).

However, the agency acknowledges the concerns raised by FTC. "The total number of stays in ANDA approvals is higher," the rule notes, "and we agree with FTC that the number of stays appears to be increasing over time."

"Consequently, we examined [Waxman/Hatch] to assess whether requiring successive 30-month stays was the only reasonable interpretation of the act. We determined that another reasonable interpretation existed," FDA said.

FDA maintains that the new policy "would not adversely affect a patent owner's ability to protect its patent rights," because "the patent owner and the NDA holders would always receive notice and would always have the opportunity to protect the patented invention."

With respect to "later-filed" patents, "the patent owner and NDA holder still have patent infringement and judicial remedies available to them even without receiving another notice," the rule notes.

The agency also cites the legislative history of the Waxman/Hatch Act to support its new interpretation.

An early version of Waxman/Hatch failed to pass the House in 1982, despite overwhelming support in the Senate, the rule notes. FDA quotes then Rep. Al Gore (D-Tenn.) voicing concerns that patent terms could be extended unreasonably through "pyramiding" or "evergreening" strategies.

In 1984, the House and Senate agreed to the notification provision, and "the only relevant report language states that notice is required...when an ANDA 'is subsequently amended so as to bring it within this notice requirement,'" the rule says.

If the ANDA applicant had already come under the requirement with an initial Paragraph IV certification at the time of filing, the applicant would be "already within the notice requirement," FDA notes.