A New Chemical Entity (NCE) is a drug that does not contain any active moiety that has been approved by the United States Food and Drug Administration (USFDA) with any other application. The manufacturers of an innovator drug generally develop a NCE during the early development stage of the product cycle. The NCE, then, undergoes various clinical trials in order to transform into a drug product.

In 2015, the FDA published a draft guidance stating that if an NCE is approved for a drug product under 505(b), no other manufacturer can apply for a product with the same active moiety for a period of five year from the date of approval of the original drug product. Although, the agency has also included an “Umbrella Policy” under the guidance which allows the products developed simultaneously with the same active moiety to share the exclusivity of the product for five-year.  The FDA provides exclusivity to an NCE, which gives the license holders an edge in the market. The exclusivity of five-year, given by the FDA, is applicable to each drug substance present in the product. NCE exclusivity can be obtained by submitting either a 505(b)(1) or 505(b)(2) application.

FDA has taken measurable steps to ensure that the NCEs are monitored time-to-time and do not overlap with any other active moiety. To know more about NCE and similar related components and their regulations, reach out to us at sales@freyrsolutions.com