Rep. Henry Waxman (D-Calif.) is developing generic drug reform legislation that would eliminate the 30-month stay of approvals on ANDAs subject to patent litigation.

"There is no longer a justification for any 30-month stay," Waxman told the Generic Pharmaceutical Association's annual meeting in Rio Grande, Puerto Rico on Jan. 28. In 2002, Waxman co-sponsored the House version of Senate-passed reform legislation (S 812, McCain/Schumer), which would have allowed a single 30-month stay.

"On further reflection, I would favor simplifying that bill" to eliminate the stay altogether, Waxman told GPhA.

"The reason we had a 30-month stay in the 1984 [Waxman/Hatch] legislation is that we were told that the generic industry is a fly-by-night industry," and a brand company would never be able to collect damages after a generic launch, Waxman said. "No one can make that argument today," he declared.

"And secondly, and most importantly, it was in doubt that [brand firms] could get a court action that would stop the generics from going forward and violating the patent."

"Well, for almost all patent infringement cases, the courts will give immediate action to stop the infringement from taking place. So, the original purposes are gone for any 30-month stay, and getting rid of it altogether would remove many of the confusing aspects of the Senate-passed bill," he said.

The Pharmaceutical Research & Manufacturers of America and Sen. Orrin Hatch (R-Utah) argue that the 30-month stay was a trade-off for the Bolar Amendment, which allows generic companies to conduct research on products prior to patent expiration (¹ Also see "Waxman/Hatch Reform Should Await Pending Supreme Court Decision – Hatch" - Pink Sheet, 22 April, 2002., p. 12).

Eliminating the 30-month stay removes the need for "deadlines for the enforcement of patents." The "cutoffs" in S 812 "caused discomfort for many members and have given PhRMA a basis to argue that the bill interferes with patent rights," Waxman said.

Waxman noted that the cutoffs were designed to achieve an "important goal": giving generic manufacturers "certainty, before marketing, about whether they will be sued for patent infringement."

"Without this certainty, some manufacturers might decide not to go to market for fear of being liable for treble damages in a late-filed infringement action," he noted.

"We can accomplish the same goal" by "clarifying that generic manufacturers can go to court to seek declaratory judgments of non-infringements before they go to market."

While the right to seek declaratory judgments "has always existed," the proposal would "make sure that such a suit could be brought early enough to resolve patent disputes before marketing," Waxman said.

"It is easier to defend against the argument that authorizing declaratory judgments creates too many lawsuits than against the argument that limiting enforcement of patents interferes with patent rights," Waxman said.

While eliminating the 30-month stay could be seen as a more radical suggestion than allowing only one, Waxman is positioning the proposal as a way to accomplish the same goal (allowing generic launch after the expiration of legitimate patents) through a more elegant mechanism.

FDA is working on a proposed rule that would permit only one stay, but GPhA and the Federal Trade Commission have argued the agency's legal rationale for an administrative cap is flawed (² [A#00650010022], p. 23). FTC supports a single 30-month stay.

Waxman is also considering two provisions that were not in the Senate bill. One section would prevent companies which obtain three-year Waxman/Hatch exclusivity for new labeling to block generics, expanding on the Glucophage provision related to pediatric labeling enacted in 2001 (³ Also see "Glucophage Generics Coming Soon, Bristol Says; Exclusivity Bill Clears Senate" - Pink Sheet, 17 December, 2001., p. 20).

The other provision Waxman is considering would require brand and generic companies to notify FTC when they enter into agreements that have the potential to delay generic launches. The provision is similar to a bill that passed the Senate in 2002 (⁴ Also see "Generic Drug Reforms: FTC Notification Bill Appears Ready To Move In 2003" - Pink Sheet, 25 November, 2002., p. 10).

Waxman’s Generic Reform: No 30-Month Stay, Early Declaratory Judgments

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