Drug Companies, Bipartisan Group Of Senators Lobby To Fend Off Competition From Generic Drugs

Before the Affordable Care Act was signed into law, there existed no expedited pathway for approving generic versions of brand name biologic drugs — a new class of ‘wonder drugs’ that contain living organisms and could one day help treat everything from cancer to Parkinson’s disease. A provision in the health law tries to strike a compromise that would lower costs while giving brand-name manufacturers the patent protection they need to continue researching and developing new medicines. Under the law, generics can enter the market “after a brand-name biologic enjoys exclusivity for 12 years,” but now, biologics manufacturers and a bipartisan group of Senators — Orrin Hatch (R-UT) and Kay Hagan (D-NC) — are urging the Food and Drug Administration (FDA) to grant companies “an additional 12 years of exclusivity if manufacturers alter an existing product to improve safety or potency.” The Wall Street Journal has more:

Proponents of generics say they fear brand-name companies may continually tweak their products to get 12 more years of protection. Companies often try such “evergreening” with chemical drugs, putting out extended-release or extra-strength versions to stay ahead of generic competition. […]

The Hatch-Hagan letter calls on the FDA to interpret the law’s reference to “exclusivity” as “data exclusivity.” Under that interpretation, generics companies might be barred for 12 years from citing the brand-name maker’s data, effectively delaying any application for a copycat version, said lawyers for the generics industry.

“It appears that the brand biologics interests are attempting to parse the meaning of exclusivity to pervert the stated intent of the statute,” said Robert Billings, interim director of the Generic Pharmaceutical Association. The brand-name makers said they are clarifying the law.

Progressives like Firedoglake’s Jane Hamsher raised this concern during the health reform debate, arguing that an earlier version of the bill included an “evergreening” clause that “grants drug companies a continued monopoly if they make slight changes to the drug (like creating a once-a-day dose where the original product was three times per day), they will never become generics.” In fact, a Federal Trade Commission report released last year found that “the 12- to 14-year regulatory exclusivity period is too long to promote innovation by these firms, particularly since they likely will retain substantial market share after FOB [generic drugs’] entry” and recommended against establishing an exclusivity period. Brand name drugs are “expected to respond and offer competitive discounts to maintain market share and are likely to retain 70 to 90 percent of their market share and will continue to reap substantial profits, even after FOB entry,” the report concluded.


Sen. Sherrod Brown (D-OH) is preparing to send a letter to the FDA laying out his opposition to extending the exclusivity period and gave this statement to the Wonk Room: “As it stands, brand-name pharmaceutical companies will enjoy a 12-year monopoly on life-saving drugs that treat cancer, Multiple Sclerosis, and rheumatoid arthritis before generic alternatives can be sold at affordable prices. But that isn’t enough for them. Now, brand-name pharmaceutical companies are seeking to further delay the development of affordable generic alternatives. To be clear: these biologic drugs are expensive and they are often developed with taxpayer-funded support. By preventing generic competition, American patients suffer and our federal health programs incur additional costs at a time of record deficits.”

The biologics issue was largely overshadowed by the more emotional public option debate, but as Brown suggests, the FDA’s decision could keep life-saving drugs out of reach for thousands of chronically ill patients. During House Energy and Commerce Committee’s mark-up of the health care bill, Rep. Henry Waxman (D-CA) “had pushed to shield biologics for no more than five years — the same amount of time that traditional pharmaceuticals get under the Hatch-Waxman law,” but Rep. Anna Eshoo (D-CA)’s 12-year shield prevailed. President Obama had originally suggested a 7-year exclusivity provision as a possible compromise, before increasing that number to 10, and eventually signing a law with a 12-year exclusivity window.