The Hatch-Waxman Act of 1984, often referred to simply as the Hatch-Waxman Act, is a United States law designed to balance the interests of pharmaceutical patent holders, generic drug manufacturers, and the public. It establishes crucial guidelines for regulating drug patents and the processes involved in challenging them, allowing generic drugs to enter the market without infringing on existing pharmaceutical patents. The Hatch-Waxman Act Litigaion was responsible for the dramatic increase in generic drug availability over the last few decades. It is incredibly imperative to understand the implications of the Hatch-Waxman litigation, as it affects a variety of stakeholders in the pharmaceutical market.
Establishes Guidelines for Patent Challenges
The Hatch-Waxman Act established procedures for generic drug manufacturers to challenge existing pharmaceutical patents by filing three types of patent challenges: Paragraph IV certifications, inter partes review proceedings, and their counterpart Post review proceedings. A Paragraph IV certification is when a generic drug manufacturer files a certificate asserting that the patent is invalid, unenforceable, or will not be infringed by their proposed generic drug. An inter partes review, on the other hand, is an administrative proceeding before the US Patent and Trial Appeal Board to determine whether a patent is valid. Finally, Post review proceedings are judicial proceedings before the federal district courts to determine whether a patent is invalid.
Increases Accessibility to Generic Drugs
The Hatch-Waxman Act has dramatically increased the availability of generic drugs over the last few decades. The Hatch-Waxman Act litigation has done this by providing a mechanism by which generic drug manufacturers can enter the market without infringing on existing pharmaceutical patents. This has led to lower prices and increased accessibility of generic drugs, benefiting consumers and public health in general.
Establishes 30-Month Stay
The Hatch-Waxman Act also established a 30-month stay designed to incentivize generic drug manufacturers to file patent challenges. This stay allows generic drug manufacturers who file patent challenges to obtain market exclusivity for their proposed generic drug for 30 months, regardless of the outcome of the patent challenge. This incentive encourages generic drug manufacturers to file challenges, allowing for increased competition in the pharmaceutical market.
Establishes First-to-File Rules
The Hatch-Waxman Act also established the “first-to-file” rules, which state that the first generic drug manufacturer to file a patent challenge will have the exclusive right to approve their generic drug, regardless of other generic drug manufacturers who may have filed patent challenges that the FDA did not accept. This rule encourages generic drug companies to file challenges and has helped spur competition in the pharmaceutical market.
Promotes New Drug Development
The Hatch-Waxman Act promotes new drug development by allowing for patent extensions for up to five years for certain drugs. This gives pharmaceutical companies more time and incentive to develop new drugs, as they are guaranteed a period of exclusivity where their existing patent will not be challenged. This, in turn, allows for innovation and the development of new drugs to meet the needs of consumers.
Creates Fairness in the Pharmaceutical Market
The Hatch-Waxman Act aims to create fairness in the pharmaceutical market by allowing generic drug manufacturers an opportunity to enter the market without infringing on existing patents. This helps to prevent monopolization of the pharmaceutical market and enables all players to have a fair degree of competition.
Establishes Procedures for Compulsory Licensing
The Hatch-Waxman Act litigation established procedures for a practice known as “compulsory licensing.” This allows generic drug manufacturers to obtain the right to use a patented drug without the patentholder’s permission in certain circumstances. This creates more pathways for new generic drugs to enter the market, which helps to make drugs more affordable and accessible to the public.
Strengthens Drug Patent Protection
The Hatch-Waxman Act strengthened drug patent protection by giving patent holders exclusive rights to manufacture and distribute their products for a limited period. This prevents generics from entering the market before the end of the patent term, which helps to ensure that the original patent holder reaps the full benefit of their innovation.
Encourages Collaboration and Intellectual Property Licenses
Finally, the Hatch-Waxman Act litigation encourages collaboration and the development of intellectual property licenses between generic drug manufacturers and patent holders. These licenses allow generic manufacturers to produce generic drugs while permitting the patent holder to receive appropriate compensation. This helps foster partnerships between patent holders and generic manufacturers, leading to further innovation in the pharmaceutical market.