Regulatory changes in Europe and the USA have made it much harder for pharmaceutical companies to adopt the strategy of rolling out additional indications for the brand-name drugs in order to fend off generic competition, according to a Datamonitor report.

Developing new uses for drug products has been almost universally employed by the drug industry as a way of boosting sales and extending the patent life of its products. Of the 50 top selling drug brands in 2004, 84% have had additional indications approved since their initial launch in the US, and a further 6% are known to have subsequent indications in development.

But use of this approach to extend the patented lifetime of drugs is under threat on both sides of the Atlantic, according to Datamonitor analyst Adele Schulz.

In Europe, while new pharmaceutical legislation gives companies an additional year’s market exclusivity for new indications filed during the first eight years on market, the regulations also include a provision for generics companies to exclude patented indications or dosage forms from their product information.

“This prevents pharmaceutical companies from employing the historically used strategy of filing for multiple new indications across different European markets as a means to delay the entry of generics,” said Schulz.

Meanwhile, in the USA, the Medicare Modernization Act (MMA) of 2003 removed the ability of companies to benefit from multiple 30-month stays of generic approval each time a generics company challenged a patent listed in the US Food and Drug Administration’s Orange book. Whereas patents filed for multiple indications had previously resulted in multiple 30-month delays of generic approval, MMA restricts each company to one 30-month stay, triggered when the originator companies sues a generics player for challenging any listed patent.

In addition, recent high-profile drug safety concerns - such as the withdrawal of Merck & Co’s painkiller Vioxx (rofecoxib) from the market after it was linked to heart attacks - are also threatening to reduce the potential for companies to profit from off-label use of their products in an expanded patient population, according to Datamonitor.

Stung by criticism over its safety record, the FDA has put in place a number of reforms and is expected to tighten up enforcement activities, reducing the potential for off-label promotion. Similar moves are under discussion in Europe, particularly with regard to the use of journal publications to influence doctor’s prescribing.

This could be significant as some of the most successful forays of products into new indications in recent years have been driven by off-label usage. For example, Genentech/Roche’s Rituxan (rituximab) is a blockbuster drug that only holds US approval for a niche oncology indication: much of its success is due to off-label use in a broader range of leukaemia patients. Likewise, Pfizer’s Neurontin (gabapentin) was initially approved for adjunct therapy in epilepsy, an indication which at one time made up just 5% of the blockbuster drug’s US prescriptions.

“Companies will have to weigh the increased scrutiny associated with off-label indication management strategies against potential reduced rewards of on-label strategies,” said Schulz.