Bills to Lower Prescription Drug Costs and Boost Biosimilars Sent to Biden’s Desk

By Eileen McDermott
April 15, 2021

“If a company invents an innovative new drug, they are rewarded with [the] exclusive right to sell that drug for a period of time. However, companies have found loopholes to claim new innovations on the same drug, that aren’t really innovations, to extend their exclusivity and prevent cheaper generics from coming to market.” – Cassidy press release

The U.S. House of Representatives yesterday approved two bills meant to lower prescription drug prices and sent them on to President Joe Biden for approval. The Advancing Education on Biosimilars Act and the Ensuring Innovation Act were introduced by U.S. Senator Bill Cassidy, M.D. (R-LA) and broadly aim to improve the current market for cheaper generic drugs.

Advancing Education on Biosimilars Act

https://depositphotos.com/29660399/stock-photo-medicine-business.htmlThe Advancing Education on Biosimilars Act chiefly targets education. It was introduced by Cassidy and Senator Maggie Hassan (D-NH). Generally, the bill calls for the creation and maintenance of a website “to provide educational materials for health care providers, patients, and caregivers, regarding the meaning of the terms, and the standards for review and licensing of, biological products, including biosimilar biological products and interchangeable biosimilar biological products.”

“Biosimilar alternatives can help save lives and lower health care costs, but currently many doctors and patients in New Hampshire and across the country are in the dark about this affordable option,” said Hassan in a press release.

The release also quoted Meaghan Rose Smith, Executive Director of the Biosimilars Forum, who said that “with increased use of biosimilars and better patient access to these life-changing therapies, the U.S. could save $100 billion in the next five years.”

“Passing these bills in Congress has the potential to lower prescription costs for patients, but also for taxpayers, because taxpayers pay a lot of the bill too,” said Cassidy. “The [Advancing Education on Biosimilars Act] improves awareness for the doctor, and the patient, that these drugs are effective and they’re less expensive.”

Ensuring Innovation Act

The Ensuring Innovation Act was introduced by Cassidy and Senators Tina Smith (D-MN) and Roger Marshall (R-KS). According to the press release, it will “provide clarity for drug exclusivity to prevent awarding market exclusivity to products that do not represent true innovation and unduly delay cheaper generics from entering the market.”

Though the bill makes no mention of patents, it ostensibly addresses practices such as “evergreening,” “patent thickets” and “product hopping,” which have been targeted by Congress before. In a 2019 hearing on the topic, senators cited statistics such as:

  • For the top 12 drugs in America, drug companies filed an average of 125 patent applications, averaging 38 years of market exclusivity—nearly double the guaranteed term. (Blumenthal D-CT)
  • A 2019 study found that the cost of prescription drugs was $1,016 per capita in the United States—double the average of comparable countries—and that brand names accounted for only 10% of prescriptions filled in the country, but 77% of all drug spending. (Feinstein D-CA)

But during that same hearing, the Pharmaceutical Research and Manufacturers of America (PhRMA) noted that:

  • It takes an average of 10-15 years and $2.6 billion to bring a pharmaceutical product to market. The industry spent $90 billion in 2016 alone—six times the average of other manufacturing industries, and yet there is no guarantee of success. 90% of products don’t make it to market. (PhRMA)
  • Prior to the Hatch-Waxman Act, 19% of prescriptions were filled with generics; today, 90% are. (PhRMA)

“If a company invents an innovative new drug, they are rewarded with [the] exclusive right to sell that drug for a period of time. However, companies have found loopholes to claim new innovations on the same drug, that aren’t really innovations, to extend their exclusivity and prevent cheaper generics from coming to market,” added yesterday’s press release.

“We need to stand up for Americans who are struggling to afford life-saving prescription drugs. This is especially important as we navigate the public health and economic crisis of COVID-19,” said Smith.

Marshall added that, as a physician, he believes the current regulatory landscape “unnecessarily delays patient access to FDA-approved generics” and that the bill “ensures affordable life-saving medicine while preserving innovation for cutting-edge medicine.”

With broad bipartisan support, Biden is likely to sign the bills.

 

Image Source: Deposit Photos
Author: lightsource
Image ID: 29660399

The Author

Eileen McDermott

Eileen McDermott is the Editor-in-Chief of IPWatchdog.com. Eileen is a veteran IP and legal journalist, and no stranger to the intellectual property world, having held editorial and managerial positions at several publications and industry organizations. She has acted as editorial consultant for the International Trademark Association (INTA), chiefly overseeing the editorial process for the Association’s twice-monthly newsletter, the INTA Bulletin. Eileen has also served as a freelance editor for the World Intellectual Property Organization (WIPO); as senior consulting editor for the Intellectual Property Owners Association (IPO) from 2015 to 2017; as Managing Editor and Editor-in-Chief at INTA from 2013 to 2016; and was Americas Editor for Managing Intellectual Property magazine from 2007 to 2013.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

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  1. Xtian April 16, 2021 2:44 pm

    Can someone help me? I read the linked “Ensuring Innovation Act.” One edit is to delete the use of “Active ingredient (including any ester or salt of the active ingredient)” and replace it with “Active moiety” as that term is defined in section 314.3 of title 21. Well, Section 314.3 is a definition that is essentially the same as the text to be deleted:

    “Active moiety is the molecule or ion, excluding those appended portions of the molecule that cause the drug to be an ester, salt (including a salt with hydrogen or coordination bonds), or other noncovalent derivative (such as a complex, chelate, or clathrate) of the molecule, responsible for the physiological or pharmacological action of the drug substance.”

    How does this amendment, which I agree is more precise, “provide clarity for drug exclusivity to prevent awarding market exclusivity to products that do not represent true innovation and unduly delay cheaper generics from entering the market”?

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