Orange Book Modernization Act: Congress Largely Codifies FDA’s Existing Orange Book Practices, But Also Brings PTAB Decisions Into the Fold

By Sara W. Koblitz & Kurt R. Karst

Those of you keeping up with the Orange Book know that FDA has been considering changes to patent listing requirements, many of which industry has been requesting for decades.  Now, Congress is trying to facilitate effective administration of the Orange Book.  On January 5, 2021, President Trump signed into the law the Orange Book Modernization Act, Pub. L. 116-290, which had been kicking around since March 2019.  Though the Act does revise the seminal Federal Food, Drug, and Cosmetic Act (FDC Act) drug provisions set forth in Section 505, there are few new concepts introduced.  Primarily, the Orange Book Modernization Act codifies existing FDA listing practices, most of which are described in 21 C.F.R. § 314.53.  Notwithstanding the lack of new policies, the Orange Book Modernization Act represents Congress’s interest and attention to Orange Book reform—something (as we mentioned in our June 2020 post) FDA essentially has been avoiding for the last 15 years.

In the House Report on the bill, written in May 2019, Congress explains its concerns over the patent listing process.  Despite patent listing regulations, Congress noted that “some branded drug manufacturers may choose not to submit every patent on a product to the FDA, and others are submitting patents potentially for the purpose of blocking generic competition.”  Further, stakeholders are concerned that “the patent information included in the Orange Book is not as accurate or up-to-date as it could be.”  To address such concerns, the Orange Book Modernization Act specifies the patent information that must be submitted and listed in the Orange Book, clarifies that canceled or invalid patents must be timely removed, directs FDA to solicit public comments on information listed in the Orange Book (which FDA already did) and issue a report to Congress, and instructs the Government Accountability Office (GAO) to study whether certain patents should be listed in the Orange Book at all.

The specific provisions of the Orange Book Modernization Act amend FDC Act § 505(b), (c), and (j).  The revisions to FDC Act § 505(b) are mainly administrative, revising the numbering and enumerating the elements that must be included in any 505(b)(1) submission.  It’s in this section that Congress codifies the limitations on patents listed in the Orange Book, stating that only drug substance, drug product, or method of use patents can be listed.  Of course, this has been FDA’s policy for years, but now it’s statutorily-mandated.  The most interesting revision to 505(b)(1) is the removal of sentence: “Upon approval of the application, the Secretary shall publish [patent] information submitted under the two preceding sentences.”  This sentence, albeit revised to conform with the amended statutory language, was originally included in the bill and is included in the 2019 House Report, but it does not appear in the final version.  While seemingly a minor blip, removal of this provision means that FDA no longer needs to publish patent information immediately on approval and can instead publish it 30 days after approval as set forth in 505(j)(7).  At first, this seems like an oversight, but because it was intentionally removed, it raises some questions about whether FDA will change its patent publishing practices.

The Act revises 505(c)(2) to conform to the changes in (b)(1), address timing for submission of patent information (again, codifying existing policy), and emphasizes that patent information not addressed in 505(b)(1) should not be submitted to the Agency.  The Act also revises 505(j)(7) to conform to the revisions in (b)(1), but, more importantly, adds authority for FDA to list exclusivities in the Orange Book (again, something FDA already does).  It also tries to better explain the requirements to delist patents that have been cancelled or invalidated by PTAB, requiring FDA to remove from the Orange Book such patent information, other than patents subject to challenges that may result in periods of 180-day exclusivity, within 14 days of notification.  However, the PTAB decisions on cancellation and invalidity remain limited to those decisions “from which no appeal has been taken or can be taken,” meaning that most IPR decisions still fall outside the scope of delisting requirements.

Finally, the Orange Book Modernization Act requires FDA to solicit comments on the types of information that should be included on or removed from the Orange Book and provide a summary to Congress of such comments and any responsive action.  The GAO also must investigate and commission a report on the listing of drug/device or device delivery system patents in the Orange Book, as well as the effects of such listing on market entry.  Congress required that the GAO Report include recommendations as to whether such device patent information should be included in the Orange Book and which patents should not be listed at all in order to reduce barriers to approval and market entry.  Presumably, these reports will be used to assess whether further revisions to the Orange Book listing process are necessary – and will perhaps provide long-awaited answers to the questions associated with listing device patents in the Orange Book.

Again, nothing in the Orange Book Modernization Act is revolutionary, but it does signal that FDA and Congress are on the same page with respect to the importance of maintaining accurate and up-to-date patent information, and that Congress is willing to fold PTAB/IPR decisions into Hatch-Waxman.  That could be important in the future if it becomes necessary to further incorporate PTAB/IPR decisions into Hatch-Waxman for purposes of 30-month stay termination or 180-day exclusivity forfeiture. In any case, the orderly administration of the Orange Book helps both innovators and generics attain certainty.  Further, that Congress passed this Act in the first place suggests that if FDA is not prepared to reform the Orange Book and industry listing practices, Congress may take the issue into its own hands.