First to File and Beyond: Paragraph IV Business Strategies

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1 First to File and Beyond: Paragraph IV Business Strategies THOMSON REUTERS INTELLECTUAL PROPERTY & SCIENCE GENERICS & API INTELLIGENCE Benjamin Burck Research Analyst and Project Manager Generics & API Intelligence

2 Generics & API Intelligence at Thomson Reuters 20 years of expertise in global generics Unique research that tracks global generic API development and manufacturing activities Intelligence appears in Newport Premium database for: Strategy, Planning and Product Targeting Business Development & Licensing Competitive & Business Intelligence API Sourcing Patents & Intellectual Property Supports Life Sciences consulting projects Serves 300 customers operating in 43 countries Team based in Portland, Maine 2

3 Agenda Hatch-Waxman Basics Paragraph IV Strategies Market Realities Anticipating Competitors Examples 3

4 Orange Book Patent Listing 21 USC 355(b)(1) The applicant shall file with the application (NDA) the patent number and the expiration date of any patent which claims the drug for which the applicant submitted the application or which claims a method of using such drug and with respect to which a claim of patent infringement could reasonably be asserted if a person not licensed by the owner engaged in the manufacture, use, or sale of the drug. 4

5 Orange Book Patent Listing Patents that must be listed Active ingredient (drug substance) Formulation or composition (drug product) Method of approved use Patents that may not be listed Processes Packaging Intermediates 5

6 ANDA Patent Certification 21 USC 355(j)(2)(A)(vii) [An ANDA shall contain] a certification, in the opinion of the applicant and to the best of his knowledge, with respect to each patent which claims the listed drug or which claims a use for such listed drug for which the applicant is seeking approval (I) that such patent information has not been filed, (II) that such patent has expired, (III) of the date on which such patent will expire, or (IV) that such patent is invalid or will not be infringed by the manufacture, use, or sale of the new drug for which the application is submitted 6

7 Incentives and Protections 180-day market exclusivity First applicant to submit a substantially complete ANDA (first-to-file) May be shared by multiple applicants Subject to forfeiture 30-month stay of FDA approval If patent owner or NDA holder sues the ANDA applicant for patent infringement within 45 days of receiving notice of the Paragraph IV certification Runs from date of notification or expiration of NCE exclusivity May be lengthened or shortened by the court 7

8 ANDA Submission New Chemical Entity (NCE) Exclusivity Five year data exclusivity from the date of first NDA approval for products containing chemical entities never previously approved by FDA ANDAs with Paragraph IV certification may be submitted four years after regulatory approval (NCE -1), but may not receive approval until the expiration of the exclusivity period Other Exclusivities ANDAs may be submitted at any time, with or without Paragraph IV certification ANDAs may not receive approval until the expiration of the exclusivity period 8

9 Lawsuits such as these are an ordinary and expected part of the process of obtaining approval to commercialize a generic drug product in the United States. 9

10 First-Time Generic Approvals Source: Newport Premium 10

11 Possible Generic Paragraph IV Strategies Targets Everything Blockbusters Niche Products Formulation Therapeutic Class Limited API Limited Sales Market Position First filer Subsequent filer Limited competition Highly competitive market Line Extension 11

12 Generic Strategies We plan to continue to expand our Global Division through targeted ANDAs and a first-to-file and firstto-market strategy. Our products and product candidates are generally difficult to formulate and manufacture, providing certain barriers to entry for potential competitors. (Impax Laboratories, Form 10-K) The Niche Generics program is targeted on developing those generic drug products that are: Difficult to develop for technical reasons, especially injectable and ophthalmic dosage forms No or very limited API source (InnoPharma, Company Website) We believe that we can maximize the profitability of our generic product opportunities by continuing our proven track record of bringing to market high quality products that are difficult to formulate or manufacture, or for which the API is difficult to obtain. (Mylan, Form 10-K) The strategy in the Rx Pharmaceuticals segment is to be the first to market with those new products that are exposed to less competition because they have more difficult to develop formulations and cost much more to complete. (Perrigo, Form 10-K) We constantly seek to expand our range of generic products, with an emphasis on high-value products, including those with high barriers to entry. (Teva, Form 20-F) Our strategy in the U.S. is to develop generic pharmaceuticals that are difficult to formulate or manufacture or will complement or broaden our existing product lines. (Watson, Form 10-K) Differentiation is one of the rudiments that success thrives on and the company strategically selects difficult to develop, high technology products and niche markets to get ANDA approvals. (Wockhardt, Annual Report 2011) 12

13 Paragraph IV Reality Any product may be a generic target More companies are pursuing a Paragraph IV strategy Challenges to complex products are increasing Competition and specialization in the generic industry has led to products with $20 million or less in sales being considered opportunities Products may be targeted even before NDA approval 13

14 Gralise (gabapentin) First FDA Approval January 28, 2011 U.S. Product Launch October 10, 2011 First ANDA Submission October 31, 2011 NDA Holder Depomed US Sales (October December 2011) $ 0.5M Orange Book Patents Patent No Expiration Known ANDA Filers 6,340,475 September 19, ,488,962 June 20, ,635,280 September 19, ,723,340 October 25, ,731,989 October 25, ,438,927 February 26, 2024 Actavis, Incepta, Watson (Source: Depomed ) Source: Newport Premium 14

15 First Paragraph IV Patent Certifications Posted by FDA Source: Newport Premium 15

16 Corporate Groups Associated with Paragraph IV Patent Certifications Source: Newport Premium 16

17 Top Paragraph IV Filers by Group Source: Newport Premium 17

18 Market Reality Price erodes with each generic entrant Price erosion continues as the generic market matures Aggressive individual players can greatly affect the price for all First filer s market share advantage persists after additional generic entry Authorized generics are to be expected 18

19 Known ANDA Filers per Challenged Product Source: Newport Premium 19

20 First Filers Settlement leverage Limited competition at launch Higher initial price First Mover market share Marketing message 20

21 NCE-1 Opportunities Source: Newport Premium 21

22 2008 NCE -1 Products Trade Name Active Ingredient Dose Form # of Known P IV ANDAs Sensipar cinacalcet hydrochloride Tablet 1 Enablex darifenacin hydrobromide Extended-release tablet 3 Lovaza omega-3 acid ethyl esters Capsule 3 Cymbalta duloxetine hydrochloride Delayed-release capsule 9 Tarceva erlotinib hydrochloride Tablet 2 Lunesta eszopiclone Tablet 10 Fosrenol lanthanum carbonate hydrate Chewable tablet 4 Alimta pemetrexed disodium Injectable 4 Lyrica pregabalin Capsule 10 Source: Newport Premium 22

23 Subsequent Filers Travel a worn path Lower litigation costs Known legal arguments Settlement precedent More informed decisions Authorized generic deal? 23

24 Lunesta (eszopiclone) First FDA Approval December 15, 2004 NCE Exclusivity December 15, 2009 First ANDA Submission December 15, 2008 NDA Holder Sepracor (now Sunovion) US Sales (12 months ending September 30, 2011) $ 774.5M Orange Book Patents Patent No Expiration Known ANDA Filers 6,319,926 January 16, ,381,724 January 16, ,864,257 August 30, ,444,673 February 14, 2014 Generic Launch per Settlement November 30, 2013 (Source: IMS Health) Dr. Reddy's, Glenmark, Lupin, Mylan, Orchid, Roxane, Sun, Teva, Watson, Wockhardt Source: Newport Premium 24

25 Lunesta (eszopiclone): Mylan Paragraph IV Notification March 10, 2009 (Alphapharm) DMF Manufacturer Submission Date Matrix Laboratories March 25, 2008 Related Patents Primary Patent Patent Type Priority Date WO Process June 21, 2005 WO Formulation April 26, 2006 WO Process April 12, 2007 Newport First Associated Date June 21, 2005 Source: Newport Premium 25

26 Lunesta (eszopiclone): Teva Paragraph IV Notification February 9, 2009 DMF Manufacturer Submission Date TAPI Puerto Rico November 14, 2008 Related Patents Primary Patent Patent Type Priority Date WO Product (derivative) March 23, 2006 WO Process April 20, 2006 WO Process April 20, 2006 WO Process June 26, 2006 WO Formulation June 25, 2007 Newport First Associated Date March 23, 2006 Source: Newport Premium 26

27 Lunesta (eszopiclone): Some Others Involved Dr. Reddy s Laboratories Patent September 5, 2005 API Commercially Available in Newport March 9, 2007 DMF Submitted September 13, 2008 Farmak Patent (Czech Republic) August 11, 2000 API Commercially Available in Newport January 18, 2006 DMF Submitted March 7, 2008 Glenmark Patent January 17, 2006 Unconfirmed API Activity in Newport January 30, 2006 DMF Submitted August 4, 2008 Sun Pharmaceutical Industries API Commercially Available in Newport September 5, 2008 DMF Submitted November 29, 2008 Other Market Launches February 28, 2007 (India) Source: Newport Premium 27

28 Bystolic (nebivolol HCl) First FDA Approval December 17, 2007 NCE Exclusivity December 17, 2012 First ANDA Submission December 19, 2011 NDA Holder Forest Laboratories US Sales (12 months ending September 30, 2011) $ 341.1M Orange Book Patents Patent No Expiration Known ANDA Filers 5,759,580 June 2, ,545,040 December 17, 2021 (Source: IMS Health) Alkem, Amerigen, Glenmark, Hetero, Indchemie, Torrent, and Watson Source: Newport Premium 28

29 180-Day Exclusivity Forfeiture Generic exclusivity is forfeited for failure to market upon the later of: The earlier of: 75 days after approval of the first applicant s ANDA 30 months after the date of ANDA submission 75 days after any of the following with respect to any applicant with tentative approval: Court decision that the patent is invalid or not infringed (no further appeal) Settlement order or consent decree with judgment of invalidity or noninfringement Patent listing is withdrawn 29

30 Integrilin (eptifibatide) First FDA Approval December 15, 2004 First ANDA Submission September 30, 2008 NDA Holder ANDA Filer Schering (Merck) Teva Orange Book Patents Patent No Expiration 5,686,570 November 11, ,747,447 May 5, ,756,451 November 11, ,807,825 September 15, ,5968,902 June 2, 2015 Generic Launch per Settlement June 2, 2015 Source: Newport Premium 30

31 Kaletra (lopinavir/ritonavir) First FDA Approval October 28, 2005 First ANDA Submission December 23, 2008 NDA Holder ANDA Filer Abbott Mylan Orange Book Patents Patent No Expiration (including PED exclusivity) 5,541,206 Jan 30, ,648,497 Jan 15, ,886,036 May 19, ,914,332 Jun 13, ,037,157 Dec 26, ,284,767 Aug 15, ,703,403 Dec 26, ,148,359 Jan 19, ,364,752 May 10, ,025,899 Mar 26, 2028 Case status Stayed until July 1, 2014 Source: Newport Premium 31

32 Thank You! Benjamin Burck Research Analyst and Project Manager Thomson Reuters x35 thomsonreuters.com 32