Name-Brand Drug Makers Tactically Delay Generic Competition

On May 17, 2018, the FDA made public a list of companies that have been blocking access to the samples of their name-brand drugs. The FDA received more than 150 inquiries from prospective generic applicants indicating that they would like to develop a generic version of an FDA-approved drug, but are unable to obtain the necessary samples of the reference listed drug (RLD) – typically referred to as the name-brand drug – because the RLD is subject to limited distribution. To help address this issue and to provide transparency regarding these inquiries, the FDA posted a list identifying all drug products for which FDA has received an RLD access inquiry related to limited distribution of the marketed RLD, with details regarding the RLD sponsor, the drug product, and the number of inquiries the FDA received. The FDA will continue to update this list periodically.


The two biggest offenders on the list were Novartis Pharmaceuticals Corporation and Actelion Pharmaceuticals Ltd. Both companies were on the list for limiting distribution of four different drugs, respectively.


In passing the 1984 Hatch-Waxman Amendments to the Federal Food, Drug, & Cosmetic Act, Congress created a system that balances encouraging and rewarding medical innovation with facilitating robust and timely market competition. One of the primary ways that the FDA facilitates a competitive marketplace is through the efficient approval of generic drugs, which often cost less than name-brand drugs. In an effort to improve generic drug competition as a way to improve access and affordability, the FDA addressed tactics drug companies employ to forestall expected generic entry. As part of the FDA’s Drug Competition Action Plan (DCAP), the FDA committed to addressing and improving transparency about gaming tactics that delay the generic competition Congress intended.


One example of these gaming tactics is when potential generic applicants are prevented from obtaining samples of certain name-brand products necessary to support approval of a generic drug. Generic drug developers need the samples of the name-brand drug to develop their generic product and/or to conduct testing to show that their product is bioequivalent to the name-brand drug for FDA approval. A generic drug developer typically needs 1,500 to 5,000 units of the name-brand drug to perform the studies required for FDA approval. The inability of generic companies to purchase the samples they need slows down, or entirely impedes, the generic drug development process. These kinds of problems with generic access to necessary samples may occur when name-brand products are subject to limited distribution – whether the company has voluntarily adopted limitations on distribution, or the limitations have been imposed in connection with a Risk Evaluation and Mitigation Strategy (REMS), a program that FDA implements for certain drugs to help ensure that their benefits outweigh their risks. In some cases, name-brand drug sponsors may use these limited distribution arrangements as a basis for blocking potential generic applicants from accessing the samples they need. In other cases, name-brand drug sponsors have placed restrictions in their commercial contracts or agreements with prescription drug distributors, wholesalers, or specialty pharmacies to limit the ability of these intermediaries in the drug supply chain to sell samples to generic drug developers for testing.


Even in cases where the FDA confirms there is an existing REMS program that impacts distribution, generic drug developers should be able to secure samples of the product. To facilitate the transfer of samples in these cases, the FDA has a voluntary process through which generic companies can submit their bioequivalence testing protocols to the FDA, and the FDA evaluates these protocols to ensure that their plan for testing the product contains safety protections comparable to the name-brand product’s REMS program. If the generic drug developers’ plans include appropriate protections, then the generic drug developers can request that the FDA send a letter, called a Safety Determination Letter, to the name-brand drug sponsor stating that the REMS program does not mean the name-brand drug maker cannot sell their product to generic drug developers for comparative testing. To date, the FDA had issued 21 Safety Determination Letters in response to requests from generic drug companies.


See the FDA Announcement


See the FDA Reference Listed Drug Access Inquiries List


See also Medical Risk Law Report: Drugs, Dosage, and Damage: Physician Liability for Prescribing or Administering Medication