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Drug Industry Wants to Protect Patents, Avoid Price Controls
Congress should not tinker with generic drug laws but instead focus on passing a prescription drug benefit for seniors, the head of the nation's pharmaceutical lobby told an audience in San Francisco on Wednesday. Alan Holmer, president of the Pharmaceutical Research and Manufacturers of America, made his pitch to the Commonwealth Club as Congress considers two separate issues affecting drug and biotech firms. In an interview before his speech, Holmer laid out the industry's twin goals of preserving strong patent protections and fending off drug price controls. Both issues are at play in two congressional battles that find brand-name drugmakers trying to stall a Senate bill designed to aid the generic industry, while they promote a House measure to offer seniors subsidized prescription plans. The Senate action centers on a bill authored by maverick Sen. John McCain, R-Ariz., and liberal Sen. Charles Schumer, D-N.Y. They have proposed strengthening the Hatch-Waxman Act, the 1984 bill that created the ground rules for today's generic drugs. McCain and Schumer would make it tougher for brand-name drugmakers to get patent extensions or use patent lawsuits to stall generics. The bill would also instruct the Federal Trade Commission to investigate allegations that brand-name manufacturers are forcing generic rivals into distribution deals that favor the brand-name firms. The FTC is investigating three such allegations. But Holmer said that the current generic law is working, and that the proof lies in the numbers. Since 1984, there have been 8,259 generic drug applications, and fewer than 6 percent have provoked patent fights. Since 1984, generic drugs have soared from 19 percent to more than 43 percent of total prescription sales. With many brand-name medicines coming off patent soon, Holmer said generic drugmakers are poised to win more than half the market. If the Senate tips the scales too far in favor of generics, he said brand-name manufacturers will lose the incentive to develop new medicines. While Holmer hopes to slow the Senate on generics, he is trying to prod passage of a House bill to offer seniors a prescription benefit by subsidizing their purchase of private insurance to supplement Medicare. Holmer said Rep. Bill Thomas, D-Bakersfield, and Rep. Billy Tauzin, R-La., are still working out the details of legislation they hope to bring to a floor vote this summer. In broad strokes, the proposal would offer varying federal subsidies to help seniors buy private drug insurance. Low-income seniors would get the biggest subsidy. Better-off retirees would pay premiums, deductibles and co-payments that could run about $1,000 per year. Holmer said the drug industry likes the Thomas-Tauzin plan because it keeps the drug subsidy from becoming part of Medicare. He fears that if the senior drug benefit becomes part of that ailing federal program, lawmakers will eventually institute price controls on prescription medicines. ``The history of Medicare has been that they impose price controls on providers and limit access to treatments,'' Holmer said. FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Action on Aging distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.
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