This is not a new revision, but the final guidance from 2019. The FDA document, finalized in May 2019 (document number FDA-2017-D-5974), is intended to assist in selecting the appropriate application pathway, either ANDA [under section 505(j) of the Federal Food, Drug, and Cosmetic Act] or 505(b)(2) NDA. It does not impose new legal obligations or represent an action approving a specific drug; therefore, it should be distinguished from regulatory events involving clinical stages, approval dates, or advisory committee (AdComm) votes.

ANDA focuses on reproducibility and bioequivalence. An ANDA is an approval pathway for a product that is, in principle, identical to the Reference Listed Drug (RLD) in terms of active ingredient, indication, route of administration, dosage form, strength, and labeling, and demonstrates bioequivalence. If new clinical trials are needed to establish safety and efficacy, 505(b)(2) may be more appropriate. If the differences are limited, a Suitability Petition can be used. Therefore, the design of the dosage form, strength, and route of administration in the early stages of development determines not only the application type but also the clinical and Chemistry, Manufacturing, and Controls (CMC) costs.

505(b)(2) is a hybrid pathway tailored to the scope of modification. 505(b)(2) is used when developing a new dosage form, route of administration, strength, indication, or combination product, while referencing data from a drug for which the FDA has already established safety and efficacy. The scope of the required bridging clinical and non-clinical data is determined by the differences in the product, and not all candidates will be able to skip Phase 3 clinical trials or automatically obtain exclusivity. Approved products may receive a 3-year new clinical investigation exclusivity or a 5-year new chemical entity exclusivity upon meeting the requirements, but patents and exclusivity are separate regulatory assets.

Practical standards that differentiate patient access and competitive intensity. Generic drugs account for more than 90% of prescriptions in the United States and less than 13% of prescription drug costs, saving more than $3 trillion in the last 10 years. Of the 773 ANDAs approved by the FDA in 2023, the first 40 generic drugs generated $2.37 billion in savings within 12 months of launch. For example, Latuda (lurasidone hydrochloride), a dopamine D2 and serotonin 5-HT2A receptor antagonist, saw its price drop from $43 to about $1 after generic entry, demonstrating that the choice of pathway and the number of competitors influence market value.