Magazine article Drug Topics

The Exclusivity Merry-Go-Round Continues to Whirl

Magazine article Drug Topics

The Exclusivity Merry-Go-Round Continues to Whirl

Article excerpt

Americans are beginning to ask whether the rules are fair. Brand-name drug companies seem to ride the exclusivity carousel continuously, grabbing gold rings at every turn. Generic pharmaceutical companies stand on the sidelines waiting for their turn, while consumers pay top dollar for branded prescription drugs.

And now, some observers are asking if the Waxman-Hatch Act, designed in 1984 to create a sensible balance between innovator and generic companies, has spun crazily out of control.

The issue has spiraled to the top of the agenda in the 107th Congress, gaining momentum with the Democratic takeover of the Senate. Waxman-Hatch deserves a hard look, according to Nancy Chockley, president, National Institute for Health Care Management. She noted, however, that present regulations are "so valuable to the drug industry, it will be very hard to make changes."

180-day exclusivity

During the past 17 years, the Waxman-Hatch Act has successfully encouraged the marketing of thousands of lower-cost generic drugs. Some 43% of US. prescriptions are now filled with generic drugs, according to Congressional Budget Office reports, and that number is expected to increase by 13% annually. However, the act's provisions are complicated, and interpretations vary depending on point of view.

The brand-name companies use the complex rulings to delay generic competition to "blockbuster" drugs, placing the Food & Drug Administration in the role of "enforcer." Dealing with patent issues takes time and resources that would be better used for review of drug applications, according to FDA officials, and some have questioned whether the Waxman-Hatch Act is still necessary.

In testimony before the U.S. Senate Committee on the Judiciary, Gary Buehler, R.Ph., acting director of the Office of Generic Drugs, said the FDA does not undertake independent reviews of patents submitted by NDA sponsors, nor does it assess whether a patent infringement could reasonably be made. "The FDA has no expertise or resources with which to resolve complex questions of patent coverage, and thus the agency's role in the patent-listing process is ministerial," he said.

In May, Sens. John McCain (R, Ariz.) and Charles Schumer (D, N.Y.) joined forces with a broad coalition of consumers, insurers, employers, and unions to plug the loopholes in the Waxman-Hatch Act. They claim that their bill, known as the Greater Access to Affordable Pharmaceuticals (GAAP) Act, will restore "the intent of our patent laws." If passed, they estimate it will save consumers $71 billion in 10 years.

The GAAP bill would make several changes designed to streamline Waxman-Hatch. It would:

*Eliminate the automatic 30-- month stay granted innovative manufacturers who file suit against a generic company's patent challenge

*Give generic drugmakers the ability to seek a declaratory judgment on any patent listed in the Orange Book

*Provide for "rolling exclusivity," granting the 180-day period to the next-filed generic applicant if the first applicant fails to get a drug to market

*Require that citizen petitions be warranted by existing law, not filed for anticompetitive purposes

*Incorporate standards of bioequivalence into statute to reduce frivolous legal challenges

*Propose a five-year study by the Federal Trade Commission to determine the effectiveness of these measures

A similar bill, the Greater Access to Affordable Pharmaceuticals Act, was introduced in the House by Reps. Sherrod Brown (D, Ohio), Jo Ann Amerson (R, Mo.), and Frank Pallone Jr. (D, N.J.). Rep. Pallone also introduced the Access to Generic Drugs Act to prohibit innovator companies from convincing state legislatures to place unnecessary restrictions on generic drugs. If all states had these restrictions, generic manufacturers would have to comply with 50 different sets of state laws before marketing their drug to consumers. …

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