Senate OKs Measure for Faster Access to Generic Drugs

The Senate on Thursday approved a long-stalled measure to make it easier to get cheaper generic prescription drugs to market, adding an important cost-control provision to legislation that would expand Medicare to cover pharmaceuticals.

The generic-drug measure, a compromise offered as an amendment to the Medicare bill, would close patent-law loopholes that allow brand-name drug manufacturers to protect themselves from competition by delaying the sale of generic equivalents.

The agreement passed 94 to 1, capping years of debate over how to streamline the generic-drug approval process without crippling the incentives for brand-name companies to invest in the research needed to develop drugs. Both California senators voted in favor of passage; Sen. Orrin G. Hatch (R-Utah) was the only opponent.

“We want to make generic drugs more available to consumers on a faster time frame,” said Sen. Judd Gregg (R-N.H.). “At the same time, we want to continue to encourage innovation in our brand-name companies.”

The bill builds on rules issued last week by the Food and Drug Administration to speed the approval of generic drugs. That action stole some of Congress’ thunder on legislation it has labored on for years. But between the FDA rules and the Senate legislation, proponents estimate, consumers would save more than $60 billion over 10 years as a result of increased availability of generic drugs.

The bill’s prospects are uncertain in the House, where similar legislation died last year. Ken Johnson, spokesman for the House Committee on Energy and Commerce, said Republicans planned to put a generic-drug provision in their version of the Medicare bill, but it was unclear whether the provision would mirror Senate language.

Senate sponsors say the outlook for the bill is improved by changes made since last year, including limits on lawsuits by generic-drug companies that Republicans had sought. Gregg is one of several Republicans who opposed last year’s Senate bill but now favors the compromise.

The generic-drug amendment was approved as the Senate continued debate on legislation to provide prescription-drug coverage for Medicare beneficiaries and to overhaul the health-care program to expand the role of the private sector.

Some have complained that the Medicare bill, although it provides new insurance for drug expenses, would do little to solve the related problem of soaring prescription drug costs. Those costs are expected to rise roughly 19% this year.

Generic drugs are often priced as much as two-thirds less than their name-brand counterparts, and their costs have been rising at a much slower rate.

The Senate bill is designed to crack down on a drug industry practice that critics say amounts to gaming the legal system to unfairly extend the life of patents.

Current drug patent laws were supposed to balance two competing aims: rewarding pharmaceutical firms for innovative research and development of new medications while ensuring that less expensive generic drugs are eventually available to consumers. Patents protect new drugs from competition for 20 years from the date their manufacturer files for FDA approval.

But critics say that drug manufacturers have stifled competition from generic versions of name-brand medications by exploiting legal loopholes that allow the companies to block a generic drug from the market for an additional 30 months -- simply by filing a lawsuit alleging patent infringement.

In some cases, manufacturers have secured multiple 30-month delays by filing suits that critics say are frivolous, keeping a generic competitor off the market for years.

Such protection against generic competition can have an enormous effect on a company’s profit and market share. For example, within two months after a generic version of the antidepressant Prozac went on the market, Eli Lilly & Co.’s sales of the drug dropped roughly 70%.

The amendment approved by the Senate would codify the new FDA rule that allows brand-name manufacturers only one 30-month patent extension. The Senate bill also would prohibit brand-name drug companies from paying potential competitors to keep them from marketing generic versions. And it includes other provisions to reduce and streamline litigation over drug patents.

Jeff Trewhitt, spokesman for the Pharmaceutical Research and Manufacturers of America, the trade association for brand-name pharmaceutical companies, said that although the bill is an improvement over the measure approved last year by the Senate, his organization’s members still are concerned that new patent limits would make it harder for them to finance research into new drugs.

“It is important that the tilt in incentives not be given to the generics industry, since it is the innovative brand-name industry that researches and develops new medicines that patients need,” he said.

Still, Trewhitt suggested that the drug lobby would not pull out the stops to block the provision because it is preoccupied with the larger Medicare bill.

“At this point, our major concern is that Congress pass a bipartisan drug-benefit bill,” he said.