In 1984, the Hatch-Waxman Drug Price Competition and
Patent Restoration Act was passed. This was an
important development that changed forever the economics of the
pharmaceutical industry.
NEJM has a nice, short, open-access
href="http://content.nejm.org/cgi/content/full/357/20/1993">article
on the history and consequences of the Act.
The author, Richard
G. Frank, Ph.D., points out some interesting facts:
- Today, generic drugs account for 63% of all U.S.
prescriptions for drugs - Between 2007 and 2010, roughly 110 drugs will
lose their patent protection - The first firm that files an Abbreviated New
Drug Application is granted a 180-day period of exclusive marketing
among generic products. - If a patent-infringement action is initiated by
a brand-name manufacturer within 45 days of the noninfringement claim,
the FDA cannot approve a generic product for 30 months or until the
litigation is resolved.
Now, the average drug is covered by 10 separate patents. As
you can imagine, this has resulted in an avalanche of litigation,
whenever a widely-used drug nears the end of its patent life.
The whole thing is messy and difficult to understand, unless you follow
the field closely. It is nice to have someone summarize the
situation in one article.