Definition
NCE (New Chemical Entity) Exclusivity is a 5-year period of market protection granted by FDA for drugs containing an active moiety that has never been approved before. During this period, FDA cannot approve generic or 505(b)(2) applications that reference the NCE drug.
How NCE Exclusivity Works
NCE exclusivity begins on the date of NDA approval and runs for 5 years. It blocks FDA from approving competing applications but doesn’t prevent their submission.
Key Features
- 5 years from first approval date
- Applies to new active moieties only
- Blocks ANDA and 505(b)(2) approval
- Doesn’t block submission after year 4 (with Paragraph IV)
- Independent of patent protection
NCE Exclusivity Timeline
| Year | Activity |
|---|---|
| Year 0 | NDA approved; NCE exclusivity begins |
| Year 4 | Paragraph IV ANDAs may be submitted |
| Year 5 | NCE exclusivity expires; generics can be approved |
NCE vs Other Exclusivity
| Exclusivity Type | Duration | Trigger |
|---|---|---|
| NCE | 5 years | New active ingredient |
| Orphan Drug | 7 years | Rare disease indication |
| Clinical Data | 3 years | New clinical studies |
| Pediatric | +6 months | Pediatric studies |
Why BD Teams Track NCE Exclusivity
For business development professionals, NCE exclusivity defines competitive timeline:
- Deal Implication: NCE status significantly impacts valuation by ensuring 5-year protected market
- Due Diligence Focus: Verify NCE determination and calculate exclusivity expiry dates
- Opportunity Signal: Assets approaching NCE expiry may seek lifecycle management partners