Protecting Patent Exclusivity: House Passes Bill to Ensure that Drug Scheduling Does Not Adversely Effect Marketing of NCEs

March 17, 2015

By John A. Gilbert

On March 16th, the U.S. House of Representatives passed by voice vote H.R. 639, the Improving Regulatory Transparency for New Medical Therapies Act, which would amend the Federal Food, Drug & Cosmetic Act (FD&C Act) and the Controlled Substances Act (CSA) to expedite scheduling of new chemical entities (“NCE”).  As reported in related blog postings (here, here, and here), this legislation is intended to address issues where the marketing of certain drugs approved by the Food and Drug Administration (FDA) have been delayed while waiting for Drug Enforcement Administration (DEA) scheduling action.  

The final version of H.R. 639 that passed is significantly different than the version introduced on February 2, 2015.  The final version amends not only the CSA, but also the FD&C Act and patent term extension laws.  In doing so, this legislation more directly addresses the crux of the issue, ensuring that companies do not lose patent or non-patent exclusivity on newly approved drugs because of drug scheduling delays.  If enacted, the bill would presumably moot pending litigation Eisai initiated against FDA concerning the triggering of NCE exclusivity for a controlled substance (see our previous post here).

H.R. 639 amends the FD&C Act in cases where HHS has recommended scheduling under the CSA by timing the effective date of FDA approval, conditional approval or indexing, as appropriate, for a drug, biological product, or animal drug to the DEA’s issuing of the interim final rule scheduling the product.  The bill also amends the CSA to require DEA to issue an interim final rule controlling a drug no later than 90 days after either: (1) when DEA has received the HHS scientific and medical evaluation and recommendation (commonly known as the “Eight Factor Analysis”) or (2) DEA is notified by HHS of the approval of the drug, biological product or animal drug.  The bill requires DEA to make the interim final rule effective immediately without having to show good cause. 

H.R. 639 also amends the patent term extension statute (35 U.S.C. § 156) by defining the “covered date” for products recommended for scheduling as the later of either approval by FDA or the issuing of the interim final rule scheduling the drug by DEA.

Finally, H.R. 639 promotes research and development of NCE’s or any drug by expediting registration for manufacturers of clinical trial material.   Generally, neither the CSA nor DEA regulations place a deadline on DEA to decide on any application for a DEA registration (e.g., manufacturer, distributor, pharmacy, etc.).  However, in the case of a Schedule I or II drug, this legislation would require DEA to publish a notice of application for such a manufacturer registration within 90 days of receipt and then issue the registration or a show cause to deny the registration, within 90 days of the close of the comment period.  In the case of manufacturer registration for use of a Schedule III-V drug in a clinical trial, the DEA must grant the registration or issue a show cause denying the application within 180 days after receipt of such application.  It is worth noting that the difference in these approval procedures is because the CSA otherwise requires that applications for bulk manufacturers of a Schedule I or II controlled substances must be published in the Federal Register.