FDLI to Sponsor First Workshop on Hatch/Waxman Act

May, 1998

On Monday, November 23, 1998, FDLI will sponsor its first one-day workshop on the Drug Price Competition and Patent Term Restoration Act of 1984 (Hatch/Waxman Act). Entitled "Striking the Right Balance Between Innovation and Drug Price Competition: Understanding the Hatch/Waxman Act," FDLI will be marketing the conference with the approval of the Biotechnology/Chemistry Committee of the American Intellectual Property Law Association (AIPLA). The conference will be held in Washington D.C., at the Marriott Metro Center Hotel, and will feature a distinguished faculty, including speakers from the FDA and the Patent and Trademark Office (PTO).

The Hatch/Waxman Act was intended to strike an acceptable balance between providing appropriate incentives for research and development (R&D) based companies to develop innovative diagnostic and therapeutic products while encouraging generic pharmaceutical companies to market lower cost generic versions of pioneer products expeditiously.

To accomplish the first goal, the Act provides a complex mixture of patent and nonpatent related incentives to R&D based manufacturers in the form of patent term extensions and nonpatent marketing exclusivity. To accomplish the second goal, the Act established an elaborate set of procedures designed to ensure that generic versions of pioneer products reach the commercial market as soon as possible. Prompt commercialization is facilitated by permitting generic competitors to carry out premarket approval activities on patented products prior to patent expiration, and by establishing procedures to settle patent disputes over pioneer products within a time frame that ensures that the generic version can be commercialized as soon as possible after all valid patent or nonpatent exclusivity has been exhausted.

The FDA and the PTO each play important roles in administering the Hatch/Waxman Act. Both regulatory affairs professionals and patent attorneys need to understand the respective roles of these agencies, how they interact with each other, and the provisions of Hatch/Waxman, in order to form an effective team to achieve a common goal. In the case of an R&D based company, this goal will be to obtain and maintain maximum marketing exclusivity for a successful pioneer product for as long as possible. In the case of a generic company, the team's common goal will be to devise a strategy designed to obtain FDA approval of its application for a generic version of the successful pioneer product as soon as possible.

The workshop is designed to give participants a basic working knowledge about how the Hatch/Waxman Act works, how the agencies responsible for administering it and the courts have construed it, and the issues and choices companies must face as a consequence. The workshop's keynote speaker will address why economic incentives must always exist in order to encourage production of innovative products of all types. Another speaker will set the stage for passage of the Act. This will be followed by a brief primer session explaining the different types of patent and nonpatent exclusivity that are available in the United States.

Speakers from the FDA and the PTO will follow by addressing their respective roles in administering the Act. For the FDA, this will include a description of the marketing exclusivity provisions, including new marketing exclusivity for pediatric studies created by the Food and Drug Administration Modernization Act of 1997 (FDAMA). For the PTO, this will include, among other things, an explanation about which products qualify for patent term extensions and a description of PTO procedures for obtaining them. The PTO will also talk about those circumstances in which an applicant might not qualify for a patent extension.

Other speakers will address other pieces of the Hatch/Waxman mosaic, focusing on the complex procedures established by Congress that are designed to result in prompt approval of applications for approval of generic drugs, as well as the practical and legal aspects of issues, such as current FDA "Orange Book" practice; current interpretation of the "safe harbor" from infringement for products intended to receive FDA approval; and certain patent issues that may not be well appreciated by regulatory affairs professionals or patent attorneys, such as the importance of the "act of infringement" provision, the potential interrelationship and tension between proof of bioequivalence for abbreviated new drug application purposes, and infringement under the "Doctrine of Equivalents." Practical suggestions will be offered about drafting patents to address possible Hatch/Waxman Act issues.

After the basics of Hatch/Waxman have been explored, the audience will participate with a panel of experts in conducting a case study of a new drug. Expert regulatory affairs professionals and patent attorneys, together with workshop participants, will establish an optimal strategy: 1) for obtaining maximum marketing exclusivity for an R&D based company for a new product under Hatch/Waxman and 2) for obtaining FDA approval for a generic version of the pioneer product as soon as possible. This "study" is expected to demonstrate to participants that planning and implementation of an optimal strategy should not be postponed until just before the pioneer product patent expires. Experience has shown that prudent companies, whether generic or R&D based companies, incorporate planning of such a strategy as an integral part of the development process for a new or generic version of a drug, with implementation of their strategies beginning years before any relevant patents are due to expire.

The United States has had fourteen years of experience with the Hatch/Waxman Act. Appropriately, the workshop will close with a discussion by a panel of industry experts drawn from who will assess how the Act has performed since its passage in 1984.

With the permission of the Food and Drug Law Institute.