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Market Exclusivity

Market Exclusivity in the Pharmaceutical Industry

Successful commercialization of pharmaceutical and biotechnology products depends on maximizing the time available for product sales before generic products enter the market. Patent protection and FDA regulation interact to provide several market exclusivity provisions that enhance the life cycle of the products. The market protection opportunities that have the greatest impact on the life cycle of the product include patents, data exclusivity, patent term restoration, patent litigation procedural protections (frequently described as Hatch-Waxman protections), pediatric exclusivity, and Orphan Drug exclusivity. A thorough understanding of these provisions and their interactions can lead to strategies to maximize market exclusivity and, thereby maximize products sales, royalties, and other compensation.

Strategic Patent Prosecution

As in other industries, the value of the issued patent depends on the strategies pursued during patent prosecution. For pharmaceutical products, strategic considerations in patent prosecution include a focus on whether the types of claims being pursued would result in an issued patent that is “listable” in the Orange Book, frequent review and update of pending patent claims to correspond to changes in product development, a consideration of the types of product characteristics which, if patented, would create regulatory hurdles for would-be competitors, and creating protection against pathways for non-identical – yet, competitive – variations on your product.

Orange Book Listings

Listed patents provide the only opportunity to benefit from procedural Hatch-Waxman protections, such as patent certifications, notification regarding alleged non-infringement or invalidity, and the 30-month stay of approval. Strategic Orange Book considerations include careful evaluation of close questions regarding which patents/claim types can be listed in light of the approved product or method of use and coordination on the timing of patent prosecution so that an issued patent can be listed at a time to maximize market protection for the product.

Patent Term Restoration

Extension of the term of a patent that covers the product or an approved method of using the product provides more time for product commercialization before generic competition enters the market. Strategic issues include deciding which of the eligible patents will be restored—particularly, in circumstances where one of several eligible patents might provide benefits to future products.

Coordination of Regulatory Exclusivities

Companies often contemplate that new indications, dosage forms, and formulations will proceed to market as soon as possible. In some circumstances, however, the life cycle for the active pharmaceutical ingredient can be extended by strategic sequencing of new product development to take maximum advantage of the available regulatory exclusivities, such as: (1) five-year and three-year data exclusivity (and the associated timing of generic applications), (2) pediatric exclusivity (including whether pediatric studies will also be eligible for 3-year exclusivity), and (3) Orphan Drug exclusivity (including whether pediatric indications will be eligible for Orphan Drug exclusivity).


Developing an effective strategy to maximize market protection for pharmaceutical and biotechnology products requires a thorough understanding of the intersection of patent protection and FDA regulation. For assistance in evaluating market protection opportunities and strategies to maximize protections, please contact us at 202.589.1780.