Market Exclusivity and Changes in Competition and Prices Associated With the US Food and Drug Administration Unapproved Drug Initiative

Abstract

In 2006, the US Food and Drug Administration (FDA) launched the Unapproved Drug Initiative (UDI) to document supporting data for several thousand drugs that had remained on the US market continually since before the agency began reviewing safety and effectiveness in 1938. 1 As an incentive, the FDA offered market exclusivity to the first manufacturer to receive approval of a legacy drug.In the short term, these market exclusivity periods drove up drug prices, most notably for the antigout drug colchicine. 2,3 In November 2020, the FDA announced that the UDI program was ending, citing concerns that the program raised prices without generating new clinical data for most drugs. 4 To assess the long-term effects of the UDI, we evaluated market exclusivity characteristics under the UDI program and how competition and prices changed 5 years after drug approval.

Market dynamics of authorized generics in Medicaid from 2014 to 2020

“…Drugs without a brand name that were regulated via pathways other than ANDAs, including separate NDAs (e.g., generics predating the creation of the ANDA pathway by the Hatch-Waxman Act) and unapproved drugs, 18,19 were classified as "Other. "…”

The Vexing Voyage of Vasopressin

“…Par Pharmaceutical's 8-year control over the vasopressin market coincided with the COVID-19 crisis, when demand for vasopressin and other medications for patients with critical illness with COVID-19 spiked. 5 Vasopressin cost US hospitals nearly $600 million in 2020, 1 and rising prices caused some hospitals to implement barriers to patient access. Despite the sudden rise in cost, however, use of vasopressin to treat patients with critical illness continued to climb.…”

“…The UDI has decreased competition, increased prices, and led to shortages for numerous drugs that were approved under the program, including the antigout drug colchicine. 2,5 Among 21 UDI-approved drugs, 52% had $ 3 years of exclusivity, and prices typically remained elevated after 5 years. 5 The current structure of the UDI provides excessive rewards for minor manufacturer investments, generates unnecessary health care costs, and compromises access to needed medicines.…”

“…2,5 Among 21 UDI-approved drugs, 52% had $ 3 years of exclusivity, and prices typically remained elevated after 5 years. 5 The current structure of the UDI provides excessive rewards for minor manufacturer investments, generates unnecessary health care costs, and compromises access to needed medicines. Policymakers should mitigate these harms and devise alternative plans to handle remaining unapproved drugs.…”

Medicaid Spending on Drugs Marketed Without US Food and Drug Administration Approval in 2020

“…In 2006, the FDA launched the Unapproved Drugs Initiative (UDI) to provide incentives for manufacturers of unapproved drug products to voluntarily submit safety and effectiveness data in return for a period of market exclusivity . The UDI has been controversial because, in some cases, it was disruptive to competition, leading to higher prices and drug shortages . Citing these concerns, the Department of Health and Human Services (HHS) announced an end to the program in November 2020.…”