Bill To Stop Deals Delaying Generic Drugs Could Hurt Consumers
By Darrell A. Hughes, Of DOW JONES NEWSWIRES
WASHINGTON -(Dow Jones)- Pharmaceutical supporters and some lawmakers said a bill that would prevent brand-name drug companies from paying to delay the launch of generic drugs could thwart incentives to develop advanced medicine and reduce the amount of generic drugs offered.
At a Tuesday hearing, Rep. Joe Barton of Texas, the ranking Republican on the House Energy and Commerce Committee, said the legislation could further eliminate motivation for drug makers to settle drug-patent challenges, causing lengthy litigation that ultimately "erodes any benefit to the consumer."
Barton said consumers should have access to the "best drugs at the cheapest price" but added, "limiting the options of private litigants to settle out of court should be avoided, if at all possible, and the right to defend or challenge patents should be preserved."
A subcommittee for the Energy and Commerce Committee held the hearing Tuesday to discuss the merits of legislation introduced by Rep. Bobby Rush, D-Ill., that would stop pharmaceutical companies from paying to stop cheaper, generic drugs from hitting the market, which is referred to as "pay-for-delay." Sen. Herb Kohl, a Wisconsin Democrat, has proposed a similar bill barring the deals.
Diane Bieri of the Pharmaceutical Research and Manufacturers of America said such legislation could also negatively impact generics.
Limits on settlements will increase the possibility of a court ruling on infringement," she said. "An infringement ruling prevents a generic from making any sales until patent expiration and thus delays its ability to recoup its investment in developing the product."
Bieri said fewer generic drugs may be developed because of this.
The bill was introduced last week and has support from committee Chairman Henry Waxman, D-Calif., Rep. John Dingell, D-Mich, and Rep. Edward Markey, D- Mass., among others. Rush authored similar legislation in the previous Congress and said he and his supporters intend to have to the bill become law.
The Obama administration is also working to prevent such deals from taking place. The Federal Trade Commission supports the legislation, as it did when it was introduced in the previous Congress.
FTC Commissioner J. Thomas Rosch, in testimony, said federal courts have been too lenient with curtailing "pay-for-delay" agreements in drug patent settlements.
The disconnect between federal antitrust authorities, or the FTC, and federal courts have made it "increasingly difficult to bring antitrust cases to stop 'pay-for-delay' tactics, and such agreements have become common industry strategy," Rosch said.
Still, the FTC, attempting to crackdown on such deals, has filed six suits since 2001 to block deals involving payments by drug companies to generic makers, but it has encountered little success in the courts.
Whether or not the deals are illegal remain unknown because the Supreme Court hasn't ruled on the issue.
However, Rosch said Congress should not wait for the Supreme Court to revise " erroneous judicial decisions" that have allowed "pay-for-delay" deals. "There's no reason to think that the court will set things right anytime soon," he said.
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