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AARP Wants Bigger Role in Prescription Drug Cases
WASHINGTON, April 22 — AARP says it intends to join lawsuits around the country to help its 35 million members gain access to lower cost prescription drugs. Lawyers for the organization said today that they would soon become involved in two types of cases. One challenges tactics used by brand-name drug companies to delay the marketing of low-cost generic medicines. In the other type of case, states are defending innovative programs to buy large quantities of prescription drugs for their citizens at low prices. Drug companies have challenged some of these programs, in Vermont, Maine, Florida and Michigan, on the ground that they improperly exploit the federal Medicaid law to secure drug discounts or rebates. William D. Novelli, executive director of AARP, said, "We plan to join several high-profile cases that would make generic drugs more readily available to consumers." Formerly known as the American Association of Retired Persons, the advocacy group is open to people 50 or older. Millions of its members are enrolled in Medicare, which does not currently provide outpatient drug coverage. Stuart R. Cohen, a lawyer at AARP, said, "We are looking at the full range of litigation concerning drug costs, with an intention to become involved in those cases that we think would be most appropriate for our members." AARP lawyers said their participation could change the balance in the courtroom, by underlining the significance of consumer interests in cases that involve complex questions of antitrust and patent law. In addition, they said they would try to influence settlement negotiations for the benefit of their members. Dr. Beatrice Braun, a board member of AARP, said the group would throw its weight behind efforts to "stop the abuse of drug patent laws." In some cases, plaintiffs charge that brand-name drug companies paid millions of dollars to generic drug companies to keep their products off the market. Judge Nancy G. Edmunds of the Federal District Court in Detroit ruled that one such agreement, between Hoechst Marion Roussel and Andrx Pharmaceuticals, was "unlawful on its face." The agreement, Judge Edmunds said, violated the Sherman Antitrust Act by assuring Hoechst of the entire market for Cardizem, a drug used to treat high blood pressure and chest pain. The companies are appealing the decision. Christopher P. Molineaux, a spokesman for the Pharmaceutical Research and Manufacturers of America, a lobby for brand-name drug makers, said he did not know about AARP's plans. "We share AARP's desire to have affordable drugs for seniors," Mr. Molineaux said. "We agree that there is an important role for generic drugs in the health care system. But it's short-sighted to focus only on affordability. If you skew the balance too far toward the use of generic drugs, you reduce the revenue stream that feeds the research that generates new drugs." AARP is stepping into a political minefield. Robert F. Leibenluft, a former official at the Federal Trade Commission, said, "The hottest area in health care antitrust law — indeed, arguably in all of antitrust — involves agreements between brand-name and generic drug manufacturers to settle patent litigation." In 1984, Congress passed a law intended to reduce the time and expense of bringing generic drugs to market. Herbert J. Hovenkamp, a professor at the University of Iowa who has written a treatise on antitrust law, said companies were "taking advantage of a kind of loophole in the statute" to delay generic competition. But Kevin D. McDonald, a lawyer for brand-name companies, said: "One person's loophole is another person's proper patent protection. Some plaintiffs' lawyers seem to resent all patents, valid or not." Executives at brand-name drug companies said they had become worried that Congress might revise the law to make it easier for generic drug makers to get their products onto the market. That could mean the loss of tens of millions of dollars in sales for blockbuster drugs, which could lose more than half their share of the market within two years after generic competitors go on sale. AARP lawyers said they might enter some of the lawsuits brought by the Prescription Access Litigation Project, a coalition of 75 consumer and health groups. In the last year, the coalition has filed 30 class actions asserting that large drug companies improperly inflated the prices for drugs like tamoxifen, Cipro and BuSpar. Kathleen D. Jaeger, president of the Generic Pharmaceutical Association, said generic drugs typically cost 20 percent to 30 percent less than brand-name products when they enter the market. If several generic drugs are competing, she said, they may sell for 60 percent less than the brand-name drug. In the last few years, many states have joined consumer groups, insurers and health plans in lawsuits alleging that drug companies tried to extend their monopolies in certain markets by improper means. Because generic drugs typically cost less than brand-name medicines, many people believe that generic drugs are inferior, but the Food and Drug Administration insists that that is false. The agency says generic drugs have the same active ingredients, and deliver those ingredients into a patient's bloodstream in the same time, as the brand-name versions of the drug. AARP's support for generic drugs coincides with its lobbying for prescription drug benefits under Medicare. By every estimate, such coverage will be costly for the government and for taxpayers, but Mr. Novelli said that proper use of generic drugs would make Medicare drug benefits more affordable.
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