10/21/2015

The Trans-Pacific Partnership Treaty Will Provide a Minimum of Five Years of Data Exclusivity for Biologic Drugs

3 min

On October 5, 2015, the United States and 11 Asia-Pacific and Latin American countries reached agreement on the Trans-Pacific Partnership (TPP). The TPP is a comprehensive multilateral free trade agreement that has been negotiated for the last eight years. It is predicted to impact one-third of world trade.

A key sticking point in the negotiations had been the period of data exclusivity that each member state should afford to innovator biologic drugs. The U.S. pressed for its domestic protection of 12 years, which the U.S. argued is necessary to incentivize innovation, whereas other states, including Australia, pushed for a maximum of 5 years to match their domestic protection, which they argued facilitates patient access to cheaper biosimilar drugs. The agreed text now provides a minimum of 5 years’ data exclusivity, plus an additional 3 years of “comparable” protection. This is a significant compromise for Brunei, which currently provides no period of data exclusivity, and Chile, Peru and Mexico, whose legislation does not specifically grant data exclusivity to biologics.

The text of the treaty must now be presented to the United States Congress, and to the national legislatures of Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, and must be ratified by these bodies before it becomes effective. Additional countries that have been reported as expressing interest in joining the TPP include Columbia, Indonesia, Philippines, South Korea, Taiwan and Thailand.

Data exclusivity is the period of time during which a regulatory agency cannot use efficacy and safety data submitted by the manufacturer of an innovator biologic to approve the registration of a follow-on biosimilar drug. Innovators maintain that a reasonable period of data exclusivity is essential for the development of biologics because these drugs are more complex, expensive and time-consuming to develop than traditional small-molecule drugs.

Hundreds of biologics are currently on the market, and are used to treat cancer, rheumatoid arthritis, multiple sclerosis, Alzheimer’s disease, Crohn’s disease, and psoriasis, among others. Biologics generally include any therapy derived from a biological source, including viruses, vaccines, blood components or derivatives, and antibodies, and are among the fastest growing class of therapeutic compounds.

Each country has independent regulatory regimes and requirements for the approval of follow-on biologics, otherwise known as biosimilars. In the U.S., a “biosimilar” must be “highly similar” to an FDA-approved innovator biologic, and among other things, must have “no clinically meaningful differences [compared to the innovator biologic] … in terms of safety, purity, and potency.” 42 U.S.C. § 262(i)(2). Sandoz’s filgrastim (Filgrastim-sndz), is currently the only biosimilar on the market in the U.S., although a number of biologics license applications are pending before the FDA. At least eight biosimilars are currently on the market in Australia, three in Canada, seven in Japan, and four in New Zealand.

The biologics and biosimilars markets are expected to expand significantly over the next decade and beyond. The data exclusivity period established by the TPP will play an important role in shaping these markets, particularly in member states that currently lack equivalent protection or whose legislation does not specifically reference biologics.