Written by: Susan M. Janicki, Ph.D. & Agnes Juang, Ph.D.

The Federal Trade Commission (FTC) issued a policy statement[1] on September 14, 2023, stating that “[b]rand drug manufacturers may be harming generic competition through the improper listing of patents in the Food and Drug Administration’s (“FDA”) Approved Drug Products with Therapeutic Equivalence Evaluations, known as the ‘Orange Book.’” The FTC’s stated goal was to notify market participants of the FTC’s intent to scrutinize improper Orange Book listings to determine whether they constitute unfair methods of competition in violation of Section 5 of the Federal Trade Commission Act. On November 7, 2023, the FTC followed through on its warning by sending notice letters to more than 10 companies challenging the Orange Book listing of more than 100 patents covering products including specific asthma and other inhaler devices, Restasis multidose bottles, and epinephrine autoinjectors.[2]

Under the Hatch-Waxman Act, which was passed in 1984 to encourage generic drug development, a branded drug manufacturer seeking FDA approval of its New Drug Application (NDA) must list the patent it considers to cover its drug product in the Orange Book “to put potential generic manufacturers on notice that the brand considers the patent to cover its drug.”[3] NDA holders are supposed to only list patents that claim the drug (the active pharmaceutical ingredient) or a method of using the drug that is the subject of the pending or approved NDA.[4] They are responsible for ensuring that their patents are properly listed, and the person who submits the patent information is required to attest under penalty of perjury that the submission complies with the regulations.[5]

When a drug company seeks to market a generic version of a brand drug, it must submit an abbreviated new drug application (ANDA) or 505(b)(2) application. If the brand drug has unexpired patents listed in the Orange Book, the generic drug manufacturer must provide a “certification” that they will not market prior to patent expiration[6] or that each of the patents is either (1) invalid or (2) will not be infringed[7]. The latter type of certification generally triggers an immediate right for the brand company to sue for infringement, which if done timely, generally results in an automatic, 30-month stay of any approval of the generic company’s ANDA or 505(b)(2) application by the FDA regardless of whether a court ultimately finds the patent at issue valid or infringed by the competing product.[8]

The purpose of Orange Book listings, as envisioned by the Hatch Waxman Act, is to identify and potentially resolve patent litigation while ANDA and 505(b)(2) applications are still under review by the FDA. However, the FTC is concerned that brand manufacturers are listing patents in the Orange Book that do not meet the statutory requirements in order to initiate an infringement suit and block FDA approval of a competing drug for 30 months. In its September 14, 2023, policy statement, the FTC warned that NDA holders must ensure that submitted patent information and currently listed patents comply with all statutory requirements and that failure to immediately remove improperly listed patents from the Orange Book may result in legal liability under the FTC Act.

Under FDA regulations, any interested person can dispute the accuracy or relevance of patent information published in the Orange Book, which will result in the FDA sending the statement of dispute to the NDA holder. The NDA holder then has 30 days to withdraw or amend the listings or certify under penalty of perjury that the listings comply with applicable statutory and regulatory requirements. In its November 7^th Notice Letters, the FTC utilized the FDA’s regulatory dispute process to challenge the Orange Book listing of the patents at issue as improperly or inaccurately listed.[9] However, the FTC stated that it retained the right to take further action, including investigating conduct as an unfair method of competition under Section 5 of the FTC Act, 15 U.S.C. § 45.

Editor: Brenden S. Gingrich, Ph.D.

[1] https://www.ftc.gov/system/files/ftc_gov/pdf/p239900orangebookpolicystatement092023.pdf

[2] https://www.ftc.gov/legal-library/browse/warning-letters/81927

[3] In re Restasis (Cyclosporine Ophthalmic Emulsion) Antitrust Litig., 333 F. Supp. 3d 135, 149 (E.D.N.Y. 2018).

[4] U.S.C. § 355(b)(1)(A)(viii). See also 21 U.S.C. §§ 355(c)(2), 21 C.F.R. § 314.53 (submission of patent information). Only the patent information submitted under section §355(c)(2) is listed in the Orange Book. A patent that is identified as claiming a method of using such drug shall be filed pursuant to section §355(c)(2) for listing in the Orange Book only if the patent claims a method of use approved in the application.

[5] 21 C.F.R. § 314.53, and subsection (c)(2)(ii)(R).

[6] 21 U.S.C. at § 355(j)(2)(A)(vii)(III).

[7] 21 U.S.C. at § 355(j)(2)(A)(vii)(IV).

[8] 21 U.S.C. § 355(j)(5)(B)(iii).

[9] https://www.ftc.gov/news-events/news/press-releases/2023/11/ftc-challenges-more-100-patents-improperly-listed-fdas-orange-book