Updated trends in US brand-name and generic drug competition

Objective: To provide updated evidence on US trends in: market exclusivity periods (MEPs, time between brand-name drug launch and first generic competitors) for new molecular entities (NMEs); likelihood, timing and number of Hatch-Waxman Act Paragraph IV patent challenges; and generic drug penetration. Methods: This study used IMS Health National Sales Perspectives (TM) US data to calculate MEPs for the 288 NMEs experiencing initial generic entry between January 1995 and December 2014, the number of generic competitors for 12 months afterward (by level of annual sales prior to generic entry), and generic penetration rates. The likelihood, timing and number of Paragraph IV challengers were calculated using data from Abbreviated New Drug Approval (ANDA) letters, the FDA website, public information searches, and ParagraphFour.com. Results: For drugs experiencing initial generic entry in 2013-2014, the MEP was 12.5 years for drugs with sales greater than $250 million (in 2008 dollars) in the year prior to generic entry ($250 million+NMEs), 13.6 years overall. After generic entry, brands rapidly lost sales, with their average unit share being 7% at 1 year for $250 million+NMEs, 12% overall. Ninety-four percent of $250 million+NMEs experiencing initial generic entry in 2013-2014 had faced at least one Paragraph IV challenge, an average of 5.2 years after brand launch (76% and 5.9 years for all NMEs). NMEs faced an average of 5.1 and 6.2 Paragraph IV challenges per NME, for all and $250 million+NMEs, respectively. Limitations: Analyses, including Paragraph IV calculations, were restricted to NMEs where generic entry had occurred. Conclusion: The average 2013-2014 MEP of 12.5 years for $250 million+NMEs, 13.6 overall remains consistent with prior research. MEPs are lower, and Paragraph IV challenges are more frequent and occur earlier for $250 million+drugs. Generic share erosion is also greater, and continues to intensify for both NME types.