As you can imagine, you can't have 2 apps with exactly the same name in the App Store. So grabbing an app name is like grabbing a good domain name. First come first serve. For domain names you probably know that some people registered desirable domains, with no intention to actually use them, only to resell them to the highest bidder. Apple learned something from that, and they try to prevent namejacking. So once you create an app in iTunes Connect, occupying a name, you have a 120 days grace period to submit your app for review. If you fail to do so, the app will be automatically removed from the system and you'll lose the right to use that name ever again under your account.
When that happens you'll get an email from Apple saying that:
You did not upload a binary for your app, ***, during the 120-day grace period. As a result, the app has been deleted from iTunes Connect.
This app cannot be restored, nor can you use the App Name or SKU for any other app under your account in the future.
The same happens when you explicitly delete an app from your account, either before your grace period expires, or if the app is already live.
Deleting it will permanently remove it from iTunes Connect, along with any associated In-App Purchases. The App Name and SKU will not be reusable, even once the app is deleted.
There are a a few ways to mitigate the risk of losing your app name:
1. Once you grabbed a name, submit the app, any app, perhaps with limited functionality, or even unrelated functionality. Something that Apple would accept in their store. Example apps would be a native wrapper for a web site, PDF publication or a simple app perhaps built off some sample code available from either Apple or 3rd parties. For a competent developer 120 days should be enough to build a version 1.0 of most apps.
2. If you're approaching the end of the grace period, you could try to open a new account, maybe under a different name, of a relative or associate, and move the name to the new account to get a new extension. You'd have to relinquish it from your current account, before it can be registered to the new one.
3. Register the domain matching the app name. That may deter people form trying to use it.
4. Register the name as a trademark. That may give you a legal recourse in claiming ownership with Apple or infringers.
If it comes to worse, and you lose your name, you can still publish your app using variations of that name.