We are separating the article on the possibility of generic biologic drug legislation from the articles on patents and drugs, since up to now, this area is a separate and distinct one.

(11/3/09)- The proposed health-care bill that will be brought before the House shortly includes a provision creating a way for the Food and Drug Administration to approve generic versions of biologic drugs.

The proposed bill gives brand-name drug companies sales exclusivity for 12 years, and allows them to extend that time frame, with minor changes to their formulas.

(8/5/09)- You may ask why does a drug's market exclusivity period matter at all, since drugs are covered under patent protection for a period of 20 years. The problem arises because the FDA usually does not approve a drug for sale and usage until several years after the patent has been granted.

How big will the savings be, if generic copies can be made of patented biologic drugs. Biologic copies of generic drugs are called "biosimilar", not biologic generics because it is difficult, if not impossible to make an exact copy of a biologic drug. Remember that biologic drugs are made from live cells, and that means it is virtually impossible for a similar version thereof to be exactly the same.

Because even small changes might affect a drug's safety or interaction, biosimilar drugs would have to undergo their own expensive testing, and not be able to rely on the tests as is done on "small molecule pills". Since this can be a very costly process, it is estimated that a biosimilar drug could be sold at only about a 25% discount to the patented version of the drug.

In Europe, which has approved biosimilar versions of three biologic drugs, companies have priced these drugs at only a 20% to 30% lower price than the patented version of the drug.

The Congressional Budget Office has estimated that biosimilars might save the government only about $10 billion in the next 1 years. Biologics accounted for about $46 billion, or 16%, of total prescription drug sales last year, according to IMS Health, a market research firm. Also please keep in mind that pharmaceuticals accounted for only about 10 percent of the nation's overall health care spending last year, according to that same firm.

(7/25/09)- The Senate Health, Education, Labor and Pensions Committee voted to give biologics 12 years of market exclusivity. The White House had proposed 7 years. Representative Henry Waxman (Dem-CA), chairman of the House Energy and Commerce Committee favors only 5 years of market exclusivety.

Legislation expected soon from the Senate Finance Committee will leave out cost-cutting steps as part of an agreement with the industry and the White House, according to word that was leaked to the media.

Senator Edward Kennedy (Dem.-Mass.), who chairs the committee and also the state where many biologic companies reside introduced the 12-year proposal.

The biologic industry is growing at a rate of 18% a year and could hit $100 billion in sales by the year 2011. Other Democrats on the committee who strongly favor his proposal are Patty Murray (Dem-Wash.) and Barbara Mikulski (Dem-Md).

For more on this matter please see our item dated 4/2/09) below.

There are at least two items that are missing from the committee's proposal that also standout. The missing items include two planks of the Obama campaign platform: allowing cheaper drugs to be imported from Canada, and giving the federal government the right to negotiate Medicare drug prices with the drug companies on a centralized basis, instead of the present system wherein the Medicare Part D insurers individually negotiate drug costs with the drug makers.

(4/2/09)- Six senators have introduced legislation in the Senate, similar to Representative Henry Waxman's legislation in the House that we discuss in our item dated 3/16/09 below, that cuts the time allowed before generic versions of biotechnology drugs could compete with the originals to five years. Present law calls for a 12-year period of exclusivity for biologic drugs.

Senator Charles E. Schumer (Dem-NY) stated: "You have a new president, a new chairman on the House and most of all the need to cut costs to achieve national health care."

The bill would give the FDA the discretion to approve generic versions of biologic drugs with less extensive testing.

(3/16/09)- Representative Henry Waxman, the California Democrat who heads the House Energy and Commerce Committee has introduced a bill that would clear a regulatory path for generic drug manufacturers to produce generic versions of biologic drugs after a five year period of market exclusivity. He had introduced similar legislation twice before to no avail.

His bill is co-sponsored by Republican Nathan Deal of Georgia, who had previously opposed such legislation. Senator Charles Schumer, the New York Democratic Senator said that he would introduce similar legislation in the Senate shortly. Former Senator Hillary Clinton, who is the present Secretary of State was a leader while she was in the Senate in having this type of legislation enacted.

Unlike traditional drugs, which are manufactured by chemical interactions, biotechnical drugs are generally proteins manufactured in living cells. Makers of generic biologics must go through the same expensive and time-consuming clinical trials and other requirements that new drugs face. Regular generic drugs must only show bio-equivalency, and not have to undergo the expense of having a new clinical trial before getting the generic drug approved by the FDA for sale to the public.

The Waxman bill would set a five-year period of exclusivity, while the major biotech companies are hoping for 14 years of exclusivity. The Waxman bill does not state whether or not the generic drug makers would have to undergo clinical trials before gaining approval of their product from the FDA

A bill introduced in the House in 2007 from Rep.Joe Barton (R., Texas) and Rep. Anna Eshoo (D., Cal.) that was more favorable to brand-name biotech companies called for 12 years of exclusivity.

Please see:
Patents and Prescription Drugs-Part I
Patents and Prescription Drugs- Part II

FOR AN INFORMATIVE AND PERSONAL ARTICLE ON PRACTICAL SUGGESTIONS WHEN SELECTING A NURSING HOME SEE OUR ARTICLE "How to Select a Nursing Home"

By Allan Rubin
updated November 3, 2009

http://www.therubins.com

To e-mail: hrubin12@nyc.rr or rubin@brainlink.com

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