Paragraph Four Explained

The Food and Drug Administration (FDA) oversees the drug approval process in the U.S.   When branded drug companies such as Pfizer or GlaxoSmithKline (also referred to as “manufacturers”), want to get a new drug approved, they must provide data to the FDA showing that the drug is both safe and effective.   The manufacturers provide the data in a New Drug Application (NDA) where they place all of the scientific and clinical data, usually from at least two well-controlled clinical studies.

If approved, the drug will have two forms of market protection.   The first comes in the form of “exclusivity” which is a creation of law.   Exclusivity enables the drug product to have exclusive, or monopoly, status in the market for a certain number of years (five years for a new chemical entity and other periods of time for different situations.) Exclusivity means that the FDA cannot legally approve a generic drug application for that product until the exclusivity period expires.

Exclusivity should not be confused with patent protection, which is the second form of market protection for a marketed branded drug. Included in the NDA is information regarding any patents on the drug product.   The manufacturer applies for these patents with the US Patent and Trademark Office which, of course, works independently from the FDA.   The FDA lists the patents in the Approved Drug Products with Therapeutic Equivalence Evaluations , also known as the Orange Book.

When a generic company wants to sell its generic version of a branded product, it usually does so through the Abbreviated New Drug Application (ANDA).   When it files an ANDA, it must show that it meets certain bioequivalence standards and must certify against any listed patents.   The generic approval process is discussed in more detail in the next section.

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