The FDA’s bright line between orphan designation and exclusivity was erased, again, Monday for some drugs when the U.S. Court of Appeals for the District of Columbia denied the agency an en banc rehearing of Eagle Pharmaceuticals Inc. v. Alex Azar.

The denial left standing the March 13, 2020, split decision of a three-judge appellate panel in which the majority said the Orphan Drug Act (ODA) – prior to amendments made in 2017 – “unambiguously entitles a manufacturer to marketing exclusivity upon [orphan] designation and approval.”

Although the 2017 amendments made it clear that, going forward, the seven-year exclusivity can only be granted to novel drugs or a newer iteration of a drug that demonstrates clinical superiority to older versions approved for the same orphan use, the appellate court said the FDA must give Eagle’s cancer drug, Bendeka (bendamustine), the exclusivity it was entitled to when it was approved in December 2015.

The denial of a rehearing also could clear the way for summary judgment in United Therapeutics Corp. v. FDA, a similar suit that had been stayed pending the rehearing decision. It involved the denial of orphan exclusivity for Orenitram (treprostinil), an oral drug approved in 2013 to treat pulmonary arterial hypertension using the same active ingredient as the company’s Remodulin, an intravenous and subcutaneous formulation, and Tyvaso, an inhaled formulation. Remodulin and Tyvaso both had been granted orphan exclusivity, a total of 14 years, for the same indication.

Of course, the FDA could always try its chances with the Supreme Court.

The agency’s policy of distinguishing between the grant of orphan designation and orphan exclusivity actually crumbled under a separate 2014 district court ruling in Depomed Inc. v. FDA, but the agency chose to ignore the ramifications of that ruling, saying the court’s order to grant orphan exclusivity to Depomed’s Gralise (gabapentin) was limited to that case only.

Clarified in a final rule published in 2013, the FDA’s policy allowed the grant of orphan drug designation upon a “plausible hypothesis of superiority” to the drugs that came before it, but restricted the seven-year orphan exclusivity to those drugs that actually proved superiority in clinical development.

While superiority could be measured in terms of safety, efficacy or major contributions to patient care, such as a change that improved administration, the rule didn’t describe the type and amount of evidence necessary to demonstrate clinical superiority for orphan exclusivity. Instead, it laid out a case-by-case approach – in other words, “we’ll know it when we see it.”

The FDA reiterated that policy in a Federal Register notice in the wake of the Depomed decision, adding that it was considering guidance on the evidence needed to support superiority, but in the meantime, it would follow the case-by-case approach. That guidance has not been forthcoming.

In the case of Eagle’s Bendeka, which has the same active moiety as Teva Pharmaceutical Industries Ltd.’s Treanda but in a different formulation, the FDA accepted Eagle’s hypothesis for the drug’s clinical superiority to Treanda and designated it an orphan drug in 2014, the year before Treanda’s orphan exclusivity ended. After approving Bendeka, the FDA refused to grant it orphan exclusivity, saying it hadn’t demonstrated superiority.

According to the majority in the D.C. Circuit’s split decision, the plain language of the ODA at the time left “no room for the FDA to place additional requirements on a drug that has been designated and approved before granting its manufacturer the right to exclusivity.”

While the 2017 ODA amendments included in the FDA Reauthorization Act (FDARA) clear up the exclusivity issue somewhat, there’s still a question of definitions. FDARA defines a “clinically superior” orphan drug as one that “provides a significant therapeutic advantage over and above an already approved or licensed drug in terms of greater efficacy, greater safety or by providing a major contribution to patient care.” That leaves a lot of room for subjectivity.