As the US Presidential elections for 2020 close in, the country’s Association for Accessible Medicines has actively started to lobby for policies to increase competition by establishing “a regulatory and legislative climate in the US that encourages generic and biosimilar entry.”
The AAM – which recently named Dan Leonard as its new president and CEO (Also see "New AAM Chief Sets Out Priorities" - Generics Bulletin, 10 Sep, 2020.) – has published a guide outlining what the association considers to be top issues regarding health care and cost of prescription drugs for voters, named “How to Talk About High Drug Costs in a Time of Economic Insecurity.” The guide insists that increasing competition, especially between generics and brand name drugs, is the only way that costs to patients will fall.
Talking about monopoly pricing, the AAM said that “the abuse of the patent system often delays competition well beyond what Congress intended,” adding that to support increasing competition, multiple generics must continue to compete against brand-name drugs.
Pointing to anti-competitive tactics used by originators to limit patient access to US Food and Drug Administration-approved generics and biosimilars, the AAM emphasized that brand-name pharmaceutical companies could raise prices without threat of competition during the market exclusivity and patent protection period.
Highlighting an tactic under which brand-name pharmaceutical companies are responsible for often filing late-stage patents to extend intellectual-property protections and increase barriers to competition, the association called for further strengthening of patent laws so that “only true innovation is rewarded.” According to the guide, to thwart competition, late-stage patents are pursued by companies that delay generic and biosimilar competition and do not provide patients with a clinically meaningful improvement.
Acknowledging that generics manufacturers often need to engage in lengthy and expensive patent litigation or wait until all patents expire before introducing a cheaper drug, the AAM guide points out that the anti-competitive tactic of “rebate traps” were then used to block competition by rewarding coverage of higher-priced brand drugs instead of generics or biosimilars, even if these finally enter the market.
Policies For Strengthening US Supply Chain
The AAM’s guide also calls for incentivizing US based manufacturing, including grants and tax credits, to create a “more diversified and resilient supply chain.”
To clarify voter concerns about active pharmaceutical ingredient manufacturing facilities being concentrated in China, the AAM guide points to FDA data indicating that over 50% of FDA-regulated API facilities are in the US and Europe, with just 7% located in China.
Nevertheless, the AAM calls for policies to ensure a stable and sustainable market and price for US-made medicines, including harnessing the purchase power of the federal government.
To further secure the supply chain, AAM insisted that the US should establish a list of essential medicines, including those critical to public health and national security, to be prioritized for domestic production. (Also see "Purchasing Commitments Must Underpin US Expansion" - Generics Bulletin, 7 May, 2020.)
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