Legislation to create a regulatory pathway for follow-on biologics is currently being considered by the United States Congress. A critical issue in this respect is the period of data exclusivity for innovator companies before a follow-on competitor can rely in part on data obtained for an original biologic for an abbreviated approval. Given the nature of patents on biologics, the period of data exclusivity is anticipated to have a key role in determining how quickly follow-on competitors emerge, and consequently also on the time available for originator companies to recoup their investment. With this issue in mind, this article discusses factors influencing return on investment on biologic research and development. A break-even analysis for a representative portfolio of biologics provides support for a substantial data exclusivity period.
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This research was supported in part by grants from the Pharmaceutical Research and Manufacturers of America, and the Duke University Program in Pharmaceuticals and Health Economics. The design, analysis and composition of the manuscript were conducted independently by me, and I am responsible for any errors. Early versions of this paper were presented at various forums, including the National Academy of Sciences Committee on Science Technology and Law, the Congressional Budget Office, the American Enterprise Institute, the Duke Clinical Research Institute, and the National Consumers League. I wish to thank G. Long and D. Ridley in particular for helpful comments.
H.G. is Director of the Program in Pharmaceuticals and Health Economics, which receives funding support from foundations, health-sector companies and government agencies.
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Grabowski, H. Follow-on biologics: data exclusivity and the balance between innovation and competition. Nat Rev Drug Discov 7, 479–488 (2008). https://doi.org/10.1038/nrd2532
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