Effective patent life

For new drug products with little or no effective patent life, generic firms are prohibited from filing an abbreviated new drug application within the first 5 years of the product life. Most European countries prohibit such filing within the first 10 years of market life. 

Nevertheless, rapid progress through Phase 111 development will allow a longer effective patent life, which will increase the commercial return on a new medicine. In recent years, this factor alone has been a major driver for large pharmaceutical companies to project manage their product portfolios more efficiently. 

While the average effective patent life for new drugs was about 12 years, there was also considerable heterogeneity in the effective patent life across NCEs. Figure 8.2 shows the frequency distribution for the 62 NCEs approved over the last three years of our sample (1993-1995). The mode of the... 

Grabowski, Henry, and John Vernon. 2000. Effective Patent Life in Pharmaceuticals. International Journal of Technology Management 19(l-2) 98-120. 

AVERAGE EFFECTIVE PATENT LIFE (from NDA approval date)... 

The Erosion of Effective Patent Life - an International Comparison. 

In the pharmaceutical industry, the term of patent life is a very important factor. Because patents are filed very early in the life cycle of a new pharmaceutical product and much premarketing testing is needed before the health authorities will permit public sale of a product, a large portion of patent life is lost. Often, the term effective patent life for pharmaceutical products is used. Studies by the Pharmaceutical Research and Manufacturers of America have shown that effective patent life for pharmaceutical products averaged 15 years in the early 1960s and declined to... 

The average effective patent life for prescription medicines tmder the Hatch-Waxman Act is 11-12 years, compared with an average of 18.5 years for other products. 

The effective patent life is the elapsed time between FDA approval for marketing of a new drug and expiration of the last patent or market exclusivity provision that effectively protects the original compound from generic competition. Two new Federal laws passed in the 1980s, the... 

Drug Price Competition and Patent Term Restoration Act of 1984 (Public Law 98-417) and the Orphan Drug Act of 1983 (Public Law 97-414), increased the effective patent life for new compounds. 

Figure 1-6 shows recent trends in the average effective patent life for NCEs. As expected, after declining steadily throughout the 1970s and early 1980s, effective patent life rebounded somewhat in the years since 1984. 

The end of the effective patent life does not always mark the end of exclusive marketing for the NCE. Some compounds may not have generic competitors for several years after the patent expires, either because of delays in FDA approval of generic versions or because the total market for the drug is too small to induce generic manufacturers to enter the market. Occasionally a process patent issued after the original patents will protect a product for some time. 

Figure 1-6-Effective Patent Life for Drugs Approved, 1968-89...

To test this hypothesis, OTA obtained data on hospital and community pharmacy sales of all 1984-88 NCEs 2 calendar years after the calendar year of FDA approval (201). Table 4-2 shows the relationship between sales and effective patent life for NCEs by sales volume in the second year... 

The term effective patent life may be a misnomer, since it refers to all kinds of market exclusivities. In this report it is used merely to indicate how long after entry to the market the compound in its original dosage form is formally protected from generic competition. 

Table 4-2—Mean and Median Effective Patent Life as a Function 01 Sales for New Chemical Entities Approved 1985-89...

The estimated regression model is = 3684.589+. 000004S, where Pj is effective patent life for drug i expressed in days and St is sales for drug i expressed in dollars, The estimated coefficient on sales has a t-statistie of 2.0 with 67 degrees of freedom which is significant at the 5-percent level in a two-tailed test. The proportion of variation in effective patent life explained by this model (R2) is. 05. 

For NCEs approved in the 1981-83 period, OTA assumed that the average effective patent life is 9 years. As figure 4-3 shows, the simple average effective patent life for drugs approved in... 

The additional years of effective patent life obtained from new dosage forms were not reflected in OTA s estimate of effective patent life. That estimate is based on the effective patent life for the original compound. 

Effective patent life In this report, the length of time during which a new chemical entity is formally protected from generic competition by patent or other statutory market exclusivity provision. 

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