Five (5) & Ten (10) Year Data Exclusivity for New Drugs – When To File Generic Drug Applications

Brand pharma companies invest valuable resources, time, and money in moving drugs from development to FDA approval. The new drug approval may also enjoy some type of FDA exclusivity. Typically, FDA exclusivity falls into two types: (1) data exclusivity; and (2) approval/market exclusivity, both of which are known in the industry but not defined expressly in the FDA laws. “Data exclusivity” means the actual data in the approved drug application is protected and cannot be referred to by later applicants in later applications. In practice, this means that if data exclusivity exists, then later applicants that need to refer to the protected drug application (either a 505(b)(2) application or an ANDA) cannot even file their competitive applications until the data exclusivity expires. Because the competitive application cannot even be filed yet, the review of that application cannot begin. On the other hand, “approval or market exclusivity” permits a competitive application to be filed and put into the typical review queue, but FDA cannot approve it until the market exclusivity expires. Having data exclusivity provides certainty for brand companies because they know the earliest date that a possible generic company could file the abbreviated new drug application (ANDA), and provides certainty for the generic company because it knows the earliest possible filing date. 

The data exclusivity period is 5 years from the NDA approval date (except for GAIN Act antibiotics described below). For certain DEA controlled/scheduled drugs, the 5 years data exclusivity period doesn’t start until that product is later DEA scheduled. In these rare circumstances, the 5-year period does not coincide with the NDA approval date. Once the product is approved, the FDA will update the Orange Book to reflect the NDA approval date. The 5-year data exclusivity period is identified as a NCE (New Chemical Entity) in the Orange Book. It will show the 5-year date. 

Generic companies rely on the accuracy of the Orange Book dates because it determines when the ANDA can be filed. One would think that because the data exclusivity period is 5 years, then an ANDA cannot be filed until the 5-year date. That is normally true, except in one important circumstance. If an ANDA is filed with at least one so-called Paragraph IV certification to at least one Orange Book patent, then the ANDA can be filed at the 4-year date instead of the 5 year date. The 5-Year date is often known as the NCE date, and then the 4-Year date is often known as the NCE-1 (NCE minus 1) date. In the example above, the NCE 5 year date is 02 Nov. 2023 so an ANDA can first be filed by 02 Nov. 2022 (so long as there is at least one Paragraph IV certification to at least one OB patent). 

When a generic applicant is first to file the ANDA with at least one Paragraph IV certification to at least one Orange Book patent, that ANDA sponsor may be considered a so-called First Applicant (often called a First Filer). And being a First Filer or First Applicant, the ANDA may be entitled to the 180-Day Exclusivity. For more information about the Paragraph IV certification and 180-Day Exclusivity, the author refers you to his book, Generic Pharmaceutical Patent and FDA Law (2022 Ed.) Available HERE  ( Accordingly, ANDA sponsors know and hence try to file the ANDA on the NCE-1 date. Historically and before there were dozens of ANDA companies, it was common that only one ANDA filer would file on the NCE-1 date. That would mean the sole 180-Day Exclusivity belonged to that one ANDA filer. Nowadays, however, one often sees many dozen ANDA filers filing all on the same NCE-1 date, which means all a First Applicant and all presumptively share the 180-Day Exclusivity. 

NCE Status for New Drugs – Situations

FDA will grant NCE status essentially when the API has never been FDA approved. Most NCE exclusivity grants are when the API is newly approved in single API form (e.g, a monotherapy dosage form). But FDA will also grant NCE status if the approved drug product is a combination of 2 API’s and one of the API’s is new and the other is old. See e.g., Xigduo XR NDA 20-5649 (for the new dapagliflozin combined with the old metformin). Alternatively, if both API’s in the combination are new. See e.g., Mavyret NDA 20-9394 (for new glecaprevir and new pibrentasvir). 

Finally, with respect to the certain antibiotics, Congress passed the GAIN Act to add another 5 years of NCE exclusivity to certain GAIN-qualified antibiotics. This means that for those qualifying drug products, the NCE exclusivity is 10 years long (instead of 5 years) and ANDA’s can be first filed at Year 9 (instead of Year 4). 

Challenging the NCE Exclusivity Determination

To file an ANDA before the NCE-1 date, Sandoz Inc. tried a novel approach. See Sandoz Inc. v. Becerra, 2022 WL 2904262 (22 July 2022, DC DC). Briefly, Arava® was FDA approved in 1998 and contained as its active ingredient leflunomide. During the Arava® NDA approval process, it was known that leflunomide metabolized into teriflunomide, which was the real therapeutic molecule. Further, leflunomide degraded into teriflunomide as an impurity. Aubagio® was later FDA approved on 12 Sept. 2012 and contained teriflunomide as the active ingredient. Accordingly, FDA granted NCE 5-Year Exclusivity to Aubagio®, which was set to expire on 12 Sept. 2017. This meant the NCE-1 first filing date was 12 Sept. 2016 for all ANDA filers. Sandoz, however, wrote to the FDA on 31 Aug. 2016 (just a few weeks before the NCE-1 date) challenging Aubagio’s NCE exclusivity on the grounds that when FDA approved Arava® (for leflunomide) in 1998, it was also effectively approving teriflunomide in 1998. And thus, Aubagio was not entitled to “new” chemical entity (NCE) status because terflunomide was old, not new. To secure a potential ANDA first-to-file filing date, Sandoz filed its ANDA #1 on 07 Sept. 2016 (before the 12 Sept. NCE-1 date). Sandoz also filed ANDA #2 on 12 Sept., the NCE-1 date as a back-up. So, if Sandoz succeeded in convincing FDA that teriflunomide was not entitled to NCE status, then its ANDA #1 filed on 07 Sept. 2016 would the first and only ANDA filed on that date, and would be first-to-file, and presumptively entitled to the 180-Day Exclusivity. On the NCE-1 filing date, there were 21 other ANDA’s filed on that date, thus all sharing any potential 180-Day Exclusivity. 

The DC federal court ruled against Sandoz. The Court ruled that FDA’s approval of leflunomide was not an approval of every impurity contained in that drug product formulation. The Court reiterated that the active ingredient approved was leflunomide, not teriflunomide as another active ingredient, as if in combination. The Court also stated that if FDA was approving every chemical in the Arava® drug product (or at least the active ingredient and degradants thereof), then the ANDA filer would need to copy the active and each degradant for it have the same active ingredient. Further, the Court stated that it would be an administrative nightmare for FDA to now track every active ingredient and degradant thereof to determine if a later degradant was now seeking NCE status in a later filed NDA. Finally, there was no evidence that during the leflunomide NDA approval process, that the brand company intended to get teriflunomide approved also, to tout its therapeutic effect as the therapeutic metabolite, etc. In short, the Court held that the NDA approval of leflunomide was just that: the approval of leflunomide itself and what mattered was the ex-vivo molecule approved (here leflunomide) and not the active metabolite (here teriflunomide). 

Historically, Section 355(j)(5)(F)(ii) had the statutory language of “active ingredient” in the 5-year exclusivity provision. Many brand companies and FDA tussled over the meaning of active ingredient (brand companies favored a broader definition of active ingredient) versus whether “active ingredient” really meant an “active moiety” (favored by the FDA). Sometimes courts upheld FDA’s view that active moiety and active ingredient overlapped one-to-one. Other times courts rejected FDA’s views. The regulation 21 C.F.R. §314.108 defines a new chemical entity: “means a drug that contains no active moiety that has been approved by FDA in any other NDA submitted under section 505(b) of the Federal Food, Drug, and Cosmetic Act.” Challenges to FDA’s NCE decision (either granting or denying NCE status) usually occur in realm of pro-drugs or other minor changes to a previously approved drug. FDA took the position that NCE exclusivity would not be granted for minor changes to a chemical structure of an active ingredient if the minor changed molecule didn’t have therapeutic effect. See e.g., Actavis Elizabeth vs. FDA (DC Circuit docket 10-5066, Nov. 9, 2010)(relating to Vyvanse pro-drug) and Otsuka Pharma vs. FDA, 869 F.3d 987 (DC Circ. 2017)(relating to aripiprazole).

Congressional Change to the NCE Statute

In April 2021, President Biden signed Senate S. 415 (117th Cong.), which formally amended the statute to now explicitly recite the active moiety definition. See here (emphasis added):

(ii) If an application submitted under subsection (b) for a drug, no active moiety (as defined by the Secretary in section 314.3 of title 21, Code of Federal Regulations (or any successor regulations)) of which has been approved in any other application under subsection (b), is approved after September 24, 1984, no application may be submitted under this subsection which refers to the drug for which the subsection (b) application was submitted before the expiration of five years from the date of the approval of the application under subsection (b), except that such an application may be submitted under this subsection after the expiration of four years from the date of the approval of the subsection (b) application if it contains a certification of patent invalidity or noninfringement described in subclause (IV) of paragraph (2)(A)(vii). 

The revised statute now adopts a C.F.R. regulation as the definition of an active moiety and now prohibits the possibility that new salt forms or ester prodrugs would qualify for NCE exclusivity. For new NCE status, substantial changes to the chemical need to be made. 

NCE Exclusivity With No Patents in the Orange Book

There is a unique situation that rarely happens, but when it does, it can play havoc on ANDA filing strategies. This situation exists when approaching the Year 4 NCE-1 date there are no patents in the Orange Book. Under the Hatch Waxman Act, data exclusivity protects the NDA product until Year 5, unless an ANDA is filed with at least one Paragraph IV certification to at least one Orange Book listed patent, for which the ANDA can be filed at NCE-1 (Year 4). Now, under this unique situation suppose the NCE-1 date comes and passes, with no Orange Book listed patent. Typically, the ANDA can then only be filed at Year 5. But also suppose that a patent is newly issued and lists into the Orange Book after NCE-1 but before NCE. What then? Now that a patent is in the Orange Book it becomes Paragraph IV’able (I know this is not a real word), and thus an ANDA sponsor can file the ANDA with the Paragraph IV certification at any point after the patent is listed. And if only one ANDA sponsor files with the Paragraph IV certification, then that one sponsor can claim the first to file (First Applicant) status and potentially claim the 180-Day Exclusivity. 

And in this situation, a prudent ANDA filer may have the ANDA ready to file by the NCE-1 date, even though by timeline planning, the ANDA is not to be filed until the NCE date. And the prudent ANDA filer will be watching patent issuances to determine if a patent is potentially listable. To this end, there is also the “every day for 30 days” strategy in play. When a patent issues (on a Tuesday), the patentee has 30 days to list the patent into the Orange Book. Now the ANDA filer may spot the patent issuance, but does not know when the patent will list into the Orange Book. And until the patent is actually listed into the Orange Book, the ANDA containing the Paragraph IV certification cannot be filed (because of the NCE exclusivity) and any premature filing would be rejected. As such, the ANDA filer may file the ANDA (with the Paragraph IV certification) every day for 30 days. Suppose the patentee waits until Day 16 to list the patent into the Orange Book. Then the ANDA filer will file the ANDA on Day 1, it will get rejected as being too early, will file again on Day 2 and will be rejected for being too early, etc. Eventually on Day 16, the FDA will receive the ANDA but this time accept it for filing because the patent now is listed. The ANDA filer will have 15 previous refusals to receive but the Day 16 one will be effective. At this point, the ANDA filer will have an effective Paragraph IV certification and be first to file to claim the 180-Day exclusivity. 

Practical Considerations

The Orange Book will tell the public the NCE date. Because of the peculiarity of DEA scheduled drugs, one cannot assume the NCE date is exactly 5-years after NDA approval as the DEA scheduling date may change that to later. Deciding whether to file the ANDA at NCE-1 will mean starting development of the ANDA product much earlier in time, often before it is known with certainty whether the branded drug is successful enough to warrant development. Further, it can be prudent in the right circumstance to challenge the grant of an NCE exclusivity, just like Sandoz did. And finally, when in the circumstance of the no OB listed patents at NCE-1, prudence dictates that the ANDA sponsor monitor patent issuances and be ready to file the ANDA at NCE-1. 

How we can help you?

We help clients in patent & FDA litigation, appeals, patent and FDA counseling, opinions of counsel, and PTAB proceedings. We help clients model FDA exclusivities, map them onto patent exclusivities, and help strategize marketing. We can help confirm any exclusivities you have or challenge them when they block you. We have routinely confronted the FDA to unblock obstacles to drug approvals. When your current firm needs help or the client needs a change of counsel, we can help. 

About Upadhye Tang LLP 

Upadhye Tang LLP is an IP and FDA boutique firm concentrating on the pharmaceutical, life sciences, and medical device spaces. We help clients with navigating the legal landscape by helping on counseling and litigation. Clients call us to help move drug and device approvals along and to represent them in IP and commercial litigation. Call Shashank Upadhye, 312-327-3326, or by email:, for more information. Read more about our firm at

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