All states have “automatic substitution” laws that require prescriptions to be filled using generics where available (unless otherwise ordered by the physician), and those substitutions are based on the TE codes.
In July 2022, FDA published guidance to industry regarding its therapeutic equivalence evaluations, including the assignment of therapeutic equivalence (TE) codes. This guidance applies only to certain drug products approved under Section 505 of the Federal Food, Drug and Cosmetic (FD&C) Act for therapeutic equivalence―i.e., stand-alone, new drug applications (NDAs); 505(b)(2) applications; and abbreviated new drug applications (ANDAs). As defined in 21 CFR 314.3(b), therapeutic equivalents are:
[A]pproved drug products that FDA has determined are pharmaceutical equivalents for which bioequivalence has been demonstrated, and that can be executed to have the same clinical effect and safety profile when administered to patients under the conditions specified in the labeling.
In short, the guidance clarifies that FDA lists its TE code evaluations for multisource prescription drug products to serve as public information and advice to state health agencies, prescribers and pharmacists to promote public education in the area of drug product selection and to foster containment of healthcare costs. All states have “automatic substitution” laws that require prescriptions to be filled using generics where available (unless otherwise ordered by the physician), and those substitutions are based on the TE codes.
Specifically, therapeutic equivalence evaluations are a scientific judgment based upon evidence, while generic substitution may involve social economic policy administered by the states, e.g., reducing the cost of drugs to consumers. The scientific and regulatory foundation for the evaluation of the therapeutic equivalence of prescription drug products involves pharmaceutical equivalence, bioequivalence and same clinical effect and safety profile for the conditions of use specified in the labeling. See 21 CFR 314.3(b). This evaluation is product-specific. FDA believes products classified as therapeutically equivalent can be substituted with the full expectation that the substituted product will produce the same clinical effect and safety profile as the prescribed product when administered to patients under the conditions specified in the labeling.
In most cases, a stand-alone NDA drug product would not be therapeutically equivalent because stand-alone NDAs are generally designated as reference-listed drugs upon which prospective generic drug applicants can rely in developing their ANDA drug products. For 505(b)(2) applications, a person seeking to have a therapeutic equivalence rating may petition the FDA through the citizen petition procedure. See 21 CFR 10.25(a), 10.30.
ANDAs generally must contain information to show that the proposed generic product (1) is the same as the reference listed drug (RLD) with respect to the active ingredient(s), conditions of use, route of administration, dosage form, strength and labeling, and (2) is bioequivalent to the RLD. Consequently, when FDA approves a drug product under an ANDA, it is therapeutically equivalent to its RLD―with the exception of a petitioned ANDA because the requirements for ANDA approval include the data and information that establish therapeutic equivalence.
FDA lists its therapeutic equivalence evaluations in the Orange Book using a system of multiletter codes assigned to multisource drug products. In short, the coding system is designed to allow users to determine quickly whether the agency has evaluated a particular approved drug product as therapeutically equivalent to another approved pharmaceutically equivalent drug product. The first letter of the code indicates whether the agency has determined that a particular approved drug product is therapeutically equivalent to another drug product, while additional specific letters provide further information based on FDA’s evaluations.
Therapeutically equivalent approved drug products are assigned “A” as the first letter of their TE code. For such drug products, the second letter in the code identifies either:
(1) actual or potential bioequivalence problems have been resolved with adequate evidence, or (2) there are no known or suspected bioequivalence problems.
Drug products are assigned a “B” as the first letter of their TE code if, at the time, actual or potential bioequivalence problems have not been resolved with adequate evidence of bioequivalence. For such drug products, the second letter in the TE code either identifies the dosage form or provides further general information regarding why the product is not considered as therapeutically equivalent.
In some instances, a number is added to certain codes to make a three-character code. These generally are assigned only in situations in which more than one RLD of the same strength has been designated under the same product heading. Lastly, FDA may revise its therapeutic equivalence evaluation for a particular drug product if, based on data or information FDA receives or becomes aware of, FDA determines that such a revision is warranted.
Overall, while the guidance is an explanation of a preexisting system, a firm understanding of the TE code system can be used as a critical tool in future product development.
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