Generic-drug companies are increasingly viewing the development of controlled-release formulations as a way of obtaining a competitive edge, according to a report published by Espicom Business Intelligence in August 2009. Interest in these formulations is partly inspired by the number of controlled-release drugs that will soon lose patent protection.

The report, "Emerging Opportunities in Controlled-Release Generic Drugs", says that several factors make developing controlled-release drugs an attractive strategy for generics companies. Technical hurdles make these formulations difficult to develop, and the companies that create and market them have fewer competitors and can charge higher prices than those charged for instant-release formulations. The controlled-release drugs examined in the report had combined sales of more than $15 billion in 2008.

Companies are beginning to consider controlled-release delivery early in the product life cycle, rather than developing it as a product’s patent expiration nears, according to the report. Some companies are marketing immediate- and controlled-release versions of new drugs simultaneously.

Although many controlled-release formulations are protected by patents, US companies frequently file Paragraph IV certifications under the Hatch–Waxman Act, and the patents’ validity is often the subject of litigation. Litigation sometimes yields agreements between generic-drug companies and innovators that allow the limited introduction of a generic drug before the reference product’s patent expires. The agreements can benefit innovator companies by limiting generic competition and revenue loss. The agreements can provide generic-drug companies with early market entry and a period of reduced competition.

Wyeth’s (NJ, USA) popular Effexor XR (venlafaxine) has been the subject of much recent patent litigation. The company initiated several lawsuits after various firms filed abbreviated new drug applications (ANDAs) with the FDA for generic versions of Effexor XR. Cases against Sandoz (Germany), Mylan (PA, USA), Wockhardt (India), Biovail (Canada), Torrent (Ahmedabad, India), and Apotex (Canada) remained outstanding as of July 2009. Impax (CA, USA) and Mylan received tentative approval for their ANDAs for generic, controlled-release venlafaxine capsules.

The FDA approved Osmotica’s (NC, USA) new drug application for a controlled-release venlafaxine tablet. Wyeth filed a patent-infringement lawsuit against the company and ultimately granted Osmotica a license to manufacture the drug in exchange for a royalty on sales. Wyeth also settled litigation against Impax, Lupin (India), Anchen Pharmaceuticals (CA, USA), and Teva Pharmaceutical Industries (Israel).