White Paper

Why More Drugs Than Ever Are Approved Through 505(b)(2)

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Discovering and developing safe and effective new medicines is a long, difficult, and expensive process. Typically, a new drug application (NDA) approved by the Food and Drug Administration (FDA) under the standard 505(b)(1) regulatory path has taken as much as 15 years and a nine-figure investment to work its way through the system. However, drugs approved under 505(b)(2), which can rely in part on data from existing reference drugs, can be developed and achieve FDA approval in as little as 30 months with only a fraction of the number of required clinical trials and at a much lower cost.

Additionally, unlike generic drugs approved under Section 505(j) where exclusivity can be held for only 180 days, the 505(b)(2) applicant may qualify for three, five, or even seven years of market exclusivity, depending on the extent of the change to the previously approved drug and the type of clinical data included in the NDA.

Granted, 505(b)(2) is not right for every situation. A breakthrough compound with a broad demographic application and a novel therapeutic mechanism may have fabulous market potential, but it will have to take the long way around to be approved. However, there are a wide range of drug candidates with good market possibilities that have an opportunity for rapid approval under 505(b)(2). For drugs that represent a limited change from a previously approved drug, utilizing data from studies in the public domain greatly shortens the development timeline.

Opportunities include:

  • New indications
  • Changes in dosage form, strength, formulation, dosing regimen, or route of administration
  • New combination products
  • New molecular entities (new active ingredients)
  • Prodrugs of approved drugs

When you compare the return on investment, the best bottom-line strategy for many pharmaceutical, biotech, and generic companies is to seek opportunities in niche markets in order to make new use of compounds already available.

Knowing which products are viable and have adequate long term market potential is a common development challenge and a good reason to select a contract research organization with experience in 505(b)(2).


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