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Tuesday, Oct. 22, 2002

"Our message to brand-name manufacturers is clear: You deserve the fair rewards of your research and development; you do not have the right to keep generic drugs off the market for frivolous reasons," Bush said.

The president stepped into the White House Rose Garden with U.S. Department of Health and Human Services Secretary Tommy Thompson and acting Food and Drug Administration chief Lester Crawford to outline the rules that officials estimate could save American consumers $3 billion a year as the patents on about 200 medications are set to expire over the next three years. The action would close loopholes in the laws that allow competition between generic and brand-name drug makers.

"We live in an age of miracle drugs. Millions of Americans - and citizens from many other lands, for that matter - have found healing and hope from medicines discovered and created in this country," Bush said.

The changes are in reaction to a study by the Federal Trade Commission, "Generic Drug Entry Prior to Patent Expiration: An FTC Study," released in July, that found drug companies filing what the agency described as frivolous lawsuits aimed at preventing brand-name medications from being channeled into the marketplace as less-expensive generic versions.

The report examined "blockbuster" drugs such as Capton, Cardizem CD, Paxil, Pepcid, Prozac, Xanax, Zocor and Zoloft, among others.

At issue is the termination of patent rights under the 1984 Hatch-Waxman Act. The law allows generic competition when new drug's patent and market exclusivity protection expires. The law provided incentives to support the development of generic versions of off-patent drugs.

Generic drugs must be approved by the government, however, and those approvals can be subject to legal delays or stays of up to 30 months if the application is challenged.

The FTC investigation discovered that some drug makers may have manipulated the law to delay the approval of competing generic drugs, Bush said. When a drug patent is set to expire, some companies file a new patent based on a minor feature of the medication such as the color of the pill bottle or a specific combination of ingredients unrelated to the drug's effectiveness.

'Original Intent'

"These steps we take today will not undermine patent protection," Bush said. "Instead, we are enforcing the original intent of a good law."

The new FDA rules would allow one 30-month automatic stay in patent infringement litigation involving a generic drug application. Drug manufacturers would be limited to one stay per generic application, to resolve allegations that a generic drug maker is infringing on a drug patent. Multiple stays have led to delays in moving brand-name drugs into the generic market by as much as 70 months in total, the study said. Under the new rules, that would not be permitted.

"In this way, the brand-name company buys time through repeated delays, called automatic stays, that freeze the status quo as the legal complexities are sorted out," Bush said.

The White House said Monday the proposal was in response to bipartisan concern in Congress.

Teddy Isn't Satisfied

Sen. Edward Kennedy, D-Mass., chairman of the Health, Education, Labor and Pensions Committee, complained that Bush's plan did not go far enough. Kennedy spokesman Jim Manley told United Press International the senator thought "this is a small down payment, but no substitute, for the more comprehensive generic drug legislation that died in the Republican-controlled House after it passed the Senate."

That bill would have closed some of the loopholes that allowed brand-name drug manufacturers to extend their patent exclusivity.

Bush's proposal lifts two provisions from that bill, but Manley said Kennedy wanted the bill to do more to close the loopholes he says brand-name manufacturers have been manipulating.

Generic Pharmaceutical Industry Association told UPI it had not yet received the details of Bush's plan and would not comment until it had a chance to review them.

Pharmaceutical Research and Manufacturers of America, a lobbying association representing brand-name drug manufacturers, also had not reviewed the details of the proposal.

PhRMA spokesman Jeff Trewhitt told UPI: "This is a complex matter and we need time to look at it. We're still trying to pin down the details."

Copyright 2002 by United Press International.

All rights reserved.

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