FTC Challenge to Pharma's Improper FDA Orange Book Patent Listings Poised to Open the Door to Cheaper Weight-Loss Drugs

GLP-1 inhibitor drugs for weight-loss are in the news at the moment, but they're not fundamentally new. The drugs have been around for Type 2 diabetes (they are not FDA-approved for the treatment of autoimmune Type 1 diabetes) since 2005, when Amylin Pharmaceuticals partnered with Eli Lilly & Company to sell a medicine branded as Byetta (exenatide). The original medicines remain efficacious, yet have lost patent exclusivity, hence the companies made improvements which qualify the newest drugs for new patent protections. While both the old and new drugs remain effective, prices on the newest products put them out-of-reach for many, and some insurance company payers are reluctant to cover them due to the cost.  

On April 30, 2024, the U.S. Federal Trade Commission (FTC), in its role of protecting competition, challenged more than 300 improper drug patent listings in the FDA Orange Book (see the FTC press release at https://www.ftc.gov/news-events/news/press-releases/2024/04/ftc-expands-patent-listing-challenges-targeting-more-300-junk-listings-diabetes-weight-loss-asthma for more). Among them were 36 Novo Nordisk patent listings; the company had listed a number of patents, and by listing them, asserted them to be for its GLP-1 inhibitor drugs. But most of the patents which FTC challenged were for the company's pen injector devices, and only patents on drugs or biologics (not medical devices) are permitted in the FDA Orange Book. 

For patients seeking less costly weight-loss medicines, the April 2024 FTC Orange Book patent challenges may be welcome news. The Orange Book patent listing challenge from the FTC is likely to enable less costly biosimilars of weight-loss and Type 2 diabetes drugs to come to market quite soon, with a number now pending formal FDA approval decisions.

Novo Nordisk introduced a GLP-1 inhibitor drug known generically as liraglutide (branded as Victoza) in 2010. In 2014, Novo Nordisk applied for (and the FDA approved) a "label extension" on liraglutide for the indication of obesity without Type 2 diabetes. Novo Nordisk branded the weight-loss version of the drug Saxenda.  FDA approval decisions on biosimilars of liraglutide from Teva Pharmaceuticals, Amphastar Pharmaceuticals, Inc., Biocon Biologics, Lannett Company, Inc. and Sandoz are expected in 2024. All except Teva also happen to have insulin biosimilars now pending approval decisions.

Drug companies were attempting to delay biosimilar versions of their older, patent-expired medicines by improperly and unlawfully listing patents on medical devices (such as injector pens) in the FDA's Orange Book regulatory database. As noted, only drugs or biologic medicines are permitted in the FDA Orange Book, while patents on medical devices are not. Unfortunately, with the improper FDA Orange Book patent listings, the companies could potentially have received an additional 30 months (two and a half years) of keeping less-costly biosimilars off-market, which is an unfair method of competition. 

That was until the FTC stepped in. 

In the FTC's letter to Novo Nordisk (see the FTC letter at https://www.ftc.gov/system/files/ftc_gov/pdf/novo-nordisk-ozempic-saxenda-victoza-_4302024.pdf for reference) about the company's improper Orange Book patent listings related to the company's Victoza, Saxenda and Ozempic products (most of the improper listings had been improperly identified as "Drug Products" [designated as "DP"], yet were for pen injector devices), the FTC stated: 

"...we have availed ourselves of the FDA's regulatory process and submitted patent listing dispute communications to the FDA regarding the listings identified in a table outlined in its letter."

FTC has already had success challenging similar improperly listed Orange Book patents. For example, in November 2023, the FTC successfully challenged 100 other improper Orange Book patent listings, including improper patent listings for both asthma inhalers and epinephrine pen injector devices (best known by the brand name EpiPen); neither of which are drugs or biologics, and the 2023 FTC notice of its challenge on those improper Orange Book patent listings can be seen at https://www.ftc.gov/news-events/news/press-releases/2023/11/ftc-challenges-more-100-patents-improperly-listed-fdas-orange-book. The FTC move helped bring prices on those particular medicines down by enabling more competition to come to market. 

In the April 2024 FTC complaint on improperly listed Orange Book patents related to Novo Nordisk's GLP-1 inhibitors, we know that Novo Nordisk's Patent 7762994 was for a pen needle mounting system and methods for mounting a needle assembly on a needle mount, while Novo Nordisk's Patent RE46363 is for a dial-down mechanism for an injection pen device. Those are just two examples; there were 34 others cited in the FTC's letter. 

The FTC letter to Novo Nordisk about its improper FDA Orange Book patent listings for its GLP-1 inhibitor products closed by saying: 

 "We have opted to use the FDA's regulatory dispute process to address the improper listings, but we retain the right to take any further action the public interest may require, which may include investigating this conduct as an unfair method of competition under Section 5 of the FTC Act, 15 U.S.C. § 45, and as described in the Policy Statement (see the revised FTC Policy Statement at https://www.ftc.gov/system/files/ftc_gov/pdf/p239900orangebookpolicystatement092023.pdf for more)." 

As noted, Teva Pharmaceuticals, Amphastar Pharmaceuticals, Biocon, Lannett Company and Sandoz are publicly-held (or formerly publicly held, in the case of the Lannett Company) firms which have Biologics License Applications (BLA's) for biosimilar versions of liraglutide (fka Novo Nordisk Victoza/Saxenda) pending FDA approval decisions in 2024. The companies' SEC filings (or previous SEC filings) revealed the GLP-1's in their drug development pipelines. We also know that Lannett Company has already licensed a supply agreement with Ypsomed AG for its UnoPen pen injector device.

In April 2024, in the first Sandoz annual investor presentation since having been spun-off as an independent company from Novartis in 2023, Sandoz revealed to investors that management anticipates that its biosimilar of liraglutide (and potentially other GLP-1's, such as Lilly's Trulicity [dulaglutide]) have potential to generate 69% of that company's forecast new drug sales by year 2029 and beyond. 

Whether Pharmacy Benefit Managers (PBMs) which receive cash rebates (suitably described as legally-exempted rebate kickbacks) for inappropriate "formulary exclusions" of less costly biosimilar GLP-1 drugs remains unaddressed. 

However, since 2022, the FTC has also been studying PBM business practices (see https://www.ftc.gov/news-events/news/press-releases/2022/06/ftc-launches-inquiry-prescription-drug-middlemen-industry for more) via a comprehensive 6(b) study (FTC Matter No. P221200) which has yet to be published. FTC Chair stated at the March 2, 2024 "White House Roundtable on PBMs" that the largest PBMs had "not fully complied" with FTC orders to turn over documents and data. It further added: "FTC orders are not suggestions, and we won't hesitate to use the full extent of our legal authorities to mandate [PBM] compliance." 

Still, as we have seen with both authorized generic and genuine biosimilar insulin varieties, the pharmaceutical industry practice has (thus far) been to sell two identical versions of the exact same medicines, including both a costly but heavily-rebated branded product targeting the PBM rebate-contracting sales model, and a less costly unbranded version aimed at cash-payers. We shall see what happens when biosimilar GLP-1's hit the market, but we know they are coming. The advent of successful startups such as Mark Cuban Cost Plus Drug Company, PBC would seem to suggest that we may soon see cheaper GLP-1 weight-loss drugs coming to market soon.

Author P.S., May 9, 2024: I subsequently, formally "published" this article on LinkedIn (the article link can be found at https://www.linkedin.com/pulse/ftc-challenge-pharmas-improper-fda-orange-book-patent-scott-strumello-h6ede/ for reference) which is where my official article publication can be found, but my blog is where the original thoughts can be seen.