GPhA Sees Generic Legislation Passing House After S 812 Clears Senate

The Generic Pharmaceutical Association appears confident it will not have to make significant concessions to move S 812 through the House.

Entitled the "Greater Access to Affordable Pharmaceuticals Act," the bill cleared the Senate by a significant margin (78-21), which "signifies that...this bill has momentum going into the House," GPhA CEO Kathleen Jaeger said at a July 31 U.S. Chamber of Commerce meeting in Washington, D.C.

"We are very hopeful by the end of the year that we will have modest reform in this area," she added.

The Pharmaceutical Research & Manufacturers of America, however, does not believe the bill, which was sponsored by Sens. John McCain (R-Ariz.) and Charles Schumer (D-N.Y.), will receive the same treatment in the House.

If the House takes up generic drug legislation, "there will be a considerably different result than what we saw in the Senate," PhRMA VP-Policy Richard Smith said at the Chamber of Commerce meeting.

PhRMA's response to the passage of the Senate bill has been three-fold: minimizing the bill's significance for consumers compared to the failure of the Senate to pass a Medicare bill; arguing that a Federal Trade Commission report on generic competition provides grounds to reconsider the bill; and highlighting a statement of opposition from the Patent & Trademark Office.

"The real news today is not S 812, it's the Senate's failure to pass a Medicare drug benefit," Covington & Burling partner Bruce Kuhlik declared. "That's really the big news in terms of access." Kuhlik is joining PhRMA as general counsel in October.

"In terms of cost and all of that, our own analysis of the numbers...shows that S 812 in its current form would just really be a blip. It would have very, very minor impact on consumer drug costs," Kuhlik maintained.

The Senate voted on four different Medicare proposals, but none received the 60 votes needed for passage.

PhRMA VP-Policy Richard Smith pointed out the recommendations in the FTC report released July 30 differ somewhat from the terms of S 812. The report "does not share a single recommendation with what is in S 812," he declared.

However, supporters of S 812 are also touting the FTC report - which does conclude there are problems with the current system (see ¹ (Also see "FTC Backs Single 30-Month Stay On Generic Approvals In Patent Litigation" - Pink Sheet, 5 Aug, 2002.) ).

The July 30 letter from PTO Commissioner James Rogan to Sen. Orrin Hatch (R-Utah) may be more helpful to PhRMA than the FTC report.

The PTO letter lists several objections to S 812, among them the fact that the bill would only allow manufacturers to use 30-month stays for patents that are issued at the time of the NDA approval.

"The timing of issuance bears no relation to the importance of the innovation," PTO states. "Moreover, the patent applicant often has no control over when [a] patent issues."

The letter also criticizes the bill for eliminating the right of manufacturers to sue for patent infringement if they do not exercise the right under Hatch/Waxman procedures within 45 days of an ANDA filing, placing time limits on companies' ability to sue.

The McCain/Schumer legislation would bar patent infringement challenges unless they are filed within 45 days of paragraph IV certification (² (Also see "FDA Ginseng Labeling Enforcement Stressed In House Ag Approps Bill" - Pink Sheet, 15 Jul, 2002.), p. 17).

Finally, PTO responds to the overall tone of the debate. "Each pharmaceutical patent, like all other patents, is entitled to a presumption of validity and should be judged accordingly," the letter says.

"All patent applications are examined with equal scrutiny and all patents must satisfy the same criteria of utility, novelty and nonobviousness before they are issued," it states.

Although House Energy & Commerce Committee Chairman Billy Tauzin (R-La.) has indicated interest in possible reforms of the patent system, the committee has not yet said it would consider the legislation. However, Tauzin has committed to drafting a reimportation proposal, which is also addressed in S 812.