AbbVie 2012 Annual Report Download - page 10

integrated discovery and development project teams, which include chemists, biologists, physicians, and
pharmacologists who work on the same compounds as a team.
The research and development process generally begins with discovery research which focuses on
the identification of a molecule that has a desired effect against a given disease. If preclinical testing of
an identified compound proves successful, the compound moves into clinical development which
generally includes the following phases:
• Phase I—involves the first human tests in a small number of healthy volunteers or patients to
assess safety, tolerability and potential dosing.
• Phase II—tests the molecule’s efficacy against the disease in a relatively small group of patients.
• Phase III—tests a molecule that demonstrates favorable results in the earlier phases in a
significantly larger patient population to further demonstrate efficacy and safety based on
regulatory criteria.
The clinical trials from all of the development phases provide the data required to prepare and
submit a New Drug Application (NDA), a Biological License Application (BLA) or other submission
for regulatory approval to the U.S. Food and Drug Administration (FDA) or similar government
agencies outside the U.S. The specific requirements (e.g., scope of clinical trials) for obtaining
regulatory approval vary across different countries and geographic regions.
The research and development process from discovery through a new drug launch typically takes
8 - 12 years and can be even longer. There is a significant amount of uncertainty inherent in the
research and development of new pharmaceutical products and there is no guarantee when, or if, a
molecule will receive the regulatory approval required to launch a new drug or indication.
In addition to the development of new products and new formulations, research and development
projects also may include Phase IV trials, sometimes called post-marketing studies. For such projects,
clinical trials are designed and conducted to collect additional data regarding, among other parameters,
the benefits and risks of an approved drug.
AbbVie spent approximately $2.8 billion in 2012, $2.6 billion in 2011, and $2.5 billion in 2010 on
research to discover and develop new products, indications and processes and to improve existing
products and processes. These expenses consisted primarily of collaboration fees and expenses, salaries
and related expenses for personnel, license fees, consulting payments, contract research, manufacturing,
and the costs of laboratory equipment and facilities.
Intellectual Property Protection and Regulatory Exclusivity
Generally, upon approval, products in development may be entitled to exclusivity under applicable
intellectual property and regulatory regimes. AbbVie seeks patent protection, where available, in all
significant markets and/or countries for each product in development. In the United States, the
expiration date for patents filed on or after June 8, 1995 is 20 years after the filing date. Given that
patents relating to pharmaceutical products are often obtained early in the development process, and
given the amount of time needed to complete clinical trials and other development activities required
for regulatory approval, the length of time between product launch and patent expiration is significantly
less than 20 years. The Drug Price Competition and Patent Term Restoration Act of 1984 (commonly
known as the Hatch-Waxman Act) permits a patent holder to seek a patent extension, commonly called
a ‘‘patent term restoration,’’ for patents on products (or processes for making the product) regulated by
the Federal Food, Drug, and Cosmetic Act. The length of the patent extension is roughly based on
50 percent of the period of time from the filing of an Investigational New Drug Application for a
compound to the submission of the NDA for such compound, plus 100 percent of the time period from
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