FDA USER FEES COULD "RESTRICT" GENERIC DRUG MARKET PENETRATION
FDA USER FEES COULD "RESTRICT" GENERIC DRUG MARKET PENETRATION by forcing generic mfrs. to "be more selective" in submitting ANDAs to the agency, Michael Peskoe (Bass & Ullman), speaking on behalf of Natl. Assn. of Pharmaceutical Mfrs. (NAPM) counsel Milton Bass, asserted in a prepared statement to the Senate Agriculture Appropriations Subcmte. on April 16. Peskoe explained that "the addition of a substantial fee to [the] already significant expenditure [involved with bioavailability and bioequivalency testing] cannot but force generic manufacturers to be more selective about marketing decisions." As a consequence, Peskoe continued, generic mfrs. "will be forced to restrict market penetration to fewer products," possibly precluding mfrs. from "marketing the types of products that are essential to maintaining a profitable business. The result will be a significant reduction in competition among those companies and products that remain in the market. . . and invariably higher prices for generic drug products." Peskoe maintained that the imposition of user fees at FDA "will discriminate against small generic drug companies." He stated: "Not only will user fees cause higher prices for products that are marketed [since user fee costs will be passed on after approval], they also will reduce the number of different generic products that will be marketed, and may even reduce the number of firms that market generic drugs." Unlike PMA, the NAPM's position on user fees is that they should be "emphatically rejected." PMA, in an April 12 statement before the same subcmte., said that it is opposed to user fees as outlined in the administration's proposed 1986 budget, but is in favor of user fees if "used to supplement FDA's budget and. . . targeted specifically for improvements in NDA review and approval mechanisms" ("The Pink Sheet" April 15, T&G-1). Commenting on the brand name mfrs.' position, Peskoe argued that the "truth behind these views is that brand name drug companies, given their size and the potential profits associated with products they produce, can afford to pay user fees. The generic drug industry, comprised of smaller companies, with far smaller profits, cannot afford to pay them." Peskoe further asserted that the fees "will not reduce government costs for drugs." Rather, Peskoe said, "such costs will increase, well beyond the amount collected, due to the increased prices of generic drug products that these fees will cause."
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