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Executive Summary

REP. WAXMAN WILL REVISIT ORPHAN DRUG EXCLUSIVITY NEXT YEAR, House Commerce/Health Subcommittee Counsel William Corr predicted at a March 28 meeting of the Food and Drug Law Institute. "I think it will be in the next session of Congress," Corr said. "We will be back with additional proposals. I don't know if it will be the same one. But we have to come back because it . . . is a matter of time." Corr said that as more profitable orphan drugs are approved, "our view is that the support for the Act will diminish, certainly the support for exclusivity will diminish." He continued: "I argue that it will lose its support if we have a series of drugs that are approved, that are there clearly because they're trying to block competition. It's a drug that they have every financial incentive in the world to make. The Act is simply being used to block others, which is not the way it is intended." Corr cited pentamidine, Burroughs Wellcome's Retrovir (AZT), and human growth hormone as examples of profitable orphan drug products, and predicted that erythropoietin (EPO) will be "the next one." Amgen expects approval for EPO for end-stage renal disease by the end of the year. Waxman (D-Calif.) decided last month that he would bring legislation to reauthorize orphan product research to the House floor, without including amendments to the Act's exclusivity provisions. His bill passed the House, on March 22 by a 409 to 1 vote. The legislation is expected to be considered by the Senate any day. Corr explained Waxman's reasons for dropping endorsement of the amendments to the exclusivity provisions of the Act. "Eventually we decided to go forward with the legislation without any change in the exclusivity rules," he said. "We did that because of our concern that the Orphan Drug Act grant program has to be reauthorized. You can not imagine the difficulties on the Hill with the budget this year." Corr pointed out that the budget "limits the discretionary spending to a 2% increase in FY '89." The Orphan Drug Act, as it is currently written, provides "a safe haven" for the biotech companies when they are uncertain about the status of their patents, Corr said. "If you have any question about your patent status and you can be the first one approved, you've got seven years . . . Why not take advantage of it?" Corr added that the House judiciary committee had been asked to rectify the problem, so that companies would not try to get every drug approved as an orphan. However the committee said it had not yet discussed the issue with the biotech industry. As a result, Corr noted, "there is not going to be a solution, at least in the near future, to the patent laws."

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