Worries About Innovation Incentives Keep Some Generic, Patent Bills Out of HELP Legislation
Executive Summary
In a win for the branded industry, just one of the three amendments that caused the initial markup of the Senate Health Committee’s drug pricing legislation to be postponed got included in the package advanced to the floor.
Two policies intended to make it easier to get generic versions of brand name medicines to the market were pulled from consideration at the Senate Health, Education, Labor, and Pensions Committee 11 May, seemingly due to Republican concerns that the legislation would not strike the right balance between incentivizing innovation of new medicines and ensuring affordability.
The planned amendments from Sens. Maggie Hassan, D-NH, and Mike Braun, R-IN, were all bipartisan, but led to the breakdown of the first attempt to mark up a group of bills targeting drug prices on 2 May. (Also see "Senate HELP Panel’s Confounded Markup Points To Challenges Ahead For Chairman Sanders" - Pink Sheet, 2 May, 2023.)
HELP Committee Chair Bernie Sanders let Hassan bring forth her amendments at the 2 May markup despite what Ranking Republican Sen. Bill Cassidy said was an agreement to keep them off the table. Cassidy said he made concessions to what he expected to be brought up “with the understanding and commitment from the chair and his staff that these policies would not be included,” Cassidy said during the first mark up.
Ostensibly, Cassidy argued that the bills lacked the necessary Congressional Budget Office score and technical assistance from federal agencies to be considered. And some Republicans, including Cassidy himself, acknowledged they had supported this legislation as cosponsors in the past.
But at the rescheduled markup 11 May, it seemed clearer that for at least some members of Cassidy’s side of the aisle the amendments were problematic from a policy perspective.
During the second markup, Hassan pulled an amendment called the Ensuring Access to Generic Medications Act, which would have empowered generic manufacturers to challenge brand name manufacturers that she said overstate the scope of certain patents to keep out competition, such as when a patent for the original use of a drug expires and manufacturers “misuse a new method of use patent” and create barriers for generic competitors, a practice sometimes called evergreening. (Also see "USPTO-FDA Collaboration: Stakeholders Advocate Action From PTAB Proceedings To Examiner Resources" - Pink Sheet, 5 Apr, 2023.)
At the 2 May markup Hassan said brand manufacturers “exploit” the deference FDA gives to brand companies’ submitted information about the reach of their patents and that her amendment would give generic companies the right to challenge this unfair practice.
Hassan also pulled the Increasing Prescription Drug Competition Act, which was designed to stop brand companies from using risk evaluation and mitigation strategy patents to keep generics off the market and give generic companies a private cause of action in cases where brand manufacturers do not appropriately identify a REMS patent in reporting to FDA. (Also see "Delisting Of Jazz’s Xyrem Patent In Orange Book Could Spur More Infringement Counterclaims" - Pink Sheet, 21 Nov, 2022.)
“It didn’t seem as if this was quite ready to go. And so I appreciate their work to increase generic competition and strike the right balance but as I said we couldn’t quite get there from the technical process,” Cassidy said in response to Hassan and Braun pulling these proposals on 11 May.
Hassan was able to work with Cassidy to modify her third amendment with Sen. Rand Paul, R-KY, to get it through committee as part of S. 1114, the Expanding Access to Low-Cost Generics Act of 2023, which prevents generic drug companies from delaying the start of their 180-day market exclusivity periods. (Also see "Senate Committee Passes Moderate PBM Reform, But Has Its Eyes On Stronger Policies" - Pink Sheet, 11 May, 2023.)
“Over the last week, we’ve worked together to ensure that this bipartisan bill eliminates the guessing game around inactive ingredient amounts, while also adding protection to ensure that only generic manufacturers with an impending application can receive this information from the FDA,” Hassan said.
Cassidy said this amendment “strikes the right balance to help get lower cost generic drugs to market faster. … This will prevent generic drug companies from having to play a game of battleship with FDA over the receipt of their products.” However, he also acknowledged that some of his members still have concerns.