Data exclusivity is separate and independent from other forms of IP – it is not the same as trade secret or a patent. It is the term used in the U.S. to refer to the intellectual property right reference stipulated in Article 39.3 of the Agreement on Trade-Related Intellectual Property Rights (TRIPs).
Article 39.3: “Members, when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products which utilize new chemical entities, the submission of undisclosed test or other data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use. In addition, Members shall protect such data against disclosure, except where necessary to protect the public, or unless steps are taken to ensure that the data are protected against unfair commercial use.”
Data exclusivity is a practice whereby drug regulatory authorities, for a certain period of time, do not allow the clinical test data submitted by an originator as part of the requirements to prove safety and efficacy of a new drug to be used to register therapeutically equivalent generic version of the drug.
Data exclusivity is crucial because marketing approval for new medicines requires considerable time and costs for pharmaceutical companies to conduct chemical, pharmacological, toxicological, and clinical research and testing. In addition, protection of the costly test data is legally required (TRIPs) and economically necessary (for maintaining incentives).