House Subcommittee Holds Fiery Hearing on Generic Competition

On Wednesday, March 13, 2019, the House Energy and Commerce Subcommittee on Health held a hearing to discuss a slate of bills, all aimed at reducing the price of prescription drugs by reducing barriers and accelerating the introduction of generic competition in the market.

Up for discussion at the hearing were the following bills:

  • R. 938, the “Bringing Low-cost Options and Competition while Keeping Incentives for New Generics (BLOCKING) Act of 2019,”introduced by Representatives Kurt Schrader and Buddy Carter, would discourage parking of 180-day exclusivity by a first generic applicant by allowing FDA to approve a subsequent generic application prior to the first applicant’s first date of commercial marketing when the following four conditions have all been met: (1) the subsequent application is ready for full approval; (2) a minimum of 30 months has passed since at least one  first applicant submitted their application for the drug; (3) any related patent litigation has been fully resolved; and (4) no first applicant is approved.
  • R. 965, the “Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act of 2019,”introduced by Representatives David Cicilline, Jim Sensenbrenner, Jerry Nadler, Doug Collins, Peter Welch, and David McKinley, would establish a process by which generic manufacturers could request that FDA authorize them to obtain sufficient quantities of samples for testing.
  • R. 985, the “Fair Access for Safe and Timely (FAST) Generics Act of 2019,”introduced by Representatives Welch, McKinley, and Cicilline, establishes an authorization process by which generic manufacturers can gain access to samples of approved drug products that they are trying to genericize.
  • R. 1499, the “Protecting Consumer Access to Generic Drugs Act of 2019,”introduced by Representative Bobby Rush, would make it illegal for brand-name and generic drug manufacturers to enter into agreements in which the brand-name drug manufacturer pays the generic manufacturer to keep a generic equivalent off the market.
  • R. 1503, the “Orange Book Transparency Act of 2019,” introduced by Representative Robin Kelly, would help to ensure that the Orange Book is accurate and up-to-date, by requiring manufacturers to share complete and timely information with FDA, as well as ensuring that patents listed in the Orange Book are relevant to the approved drug product. Patents found to be invalid through a court decision or a decision by the Patent Trial and Appeal Board would be required to be removed promptly.
  • R. 1506, the “Fair and Immediate Release (FAIR) of Generic Drugs Act,”introduced by Representative Nanette Barragán, would allow any generic filer who wins a patent challenge in court or is not sued for patent infringement by the brand manufacturer to share in the 180-day exclusivity period of first applicants that enter into patent settlements that delay entry.
  • R. 1520, the Purple Book Continuity Act of 2019,”introduced by Subcommittee Chair Ann Eshoo, would amend the Public Health Service Act to codify publication of approved biological products in the Purple Book in a similar format and with similar requirements to the Orange Book, specify that the Purple Book should be published electronically on FDA’s website and updated routinely, and direct FDA to consider the types of patents that should be listed in the Purple Book.

Hearing Discussion

While all the bills introduced by multiple representatives were bipartisan, partisanship quickly reared its ugly head when Republican leadership raised concern that lowering drug costs, an issue both parties have supported, had turned one-sided as Democrats kept them in the dark on bill language and witness attendance. They argued that many of the bills before the Subcommittee lacked bipartisan support due to short-notice, and that some of the proposed legislation even made complex changes to the FDA without the agency’s input or attendance at the hearing.

Republicans and several witnesses expressed concern that legislation discussed would stifle innovation. Witnesses testified that settlements between branded and generic manufacturers get generic products to market more quickly than requiring parties to pursue the full litigation process. Democrats continuously stressed than more generic competition was needed to immediately lower prices, and many encouraged greater biosimilar market entry and uptake.

CREATES Act

There was some confusion and disagreement over whether the CREATES Act being reviewed was different from the bipartisan CREATES Act from last Congress. Chester Davis, Jr., the President and CEO of the Association for Accessible Medicines, noted that he supported the CREATES Act in the Senate that has not been modified, and was confused over how they were different.

In response to questioning by Chairman Pallone on whether the CREATES Act would unintentionally incentivize frivolous lawsuits, Mr. Carrier and Mr. Davis stressed it would not, but that it would keep the FDA at the center of the issue, and would only trigger litigation when a brand manufacturer fails to negotiate through fair market value.

Lou Kennedy, CEO and Owner of Nephron Pharmaceuticals, stated that acquiring samples through REMS helps generics to prove their safety and quality to the FDA, and explained they are required to pass every test the branded drug went through and more. Mr. Davis opined that the CREATES Act puts more teeth into safety and quality standards without hampering the FDA.

Generic and Biosimilar Competition

According to Anthony Barrueta, Senior VP of Government Relations for Kaiser Permanente, the availability of generics are crucial to keeping the cost of drug benefits stable over time, and older drugs not leaving branded status on time cause spikes in cost. He stated his belief that this is the reason why Americans have seen increased deductibles and benefits and encouraged Congress to deal with the issue upfront before moving towards innovative biologics. He noted that Kaiser has had over 75 percent usage of one biosimilar over the reference product, and that data demonstrates the biosimilars are performing excellently. He advocated for the availability of good, unbiased information on biosimilars and drugs for practitioners across the country. He also pointed to patent thickets as a major barrier to biosimilar entry.

Orange and Purple Books

While all agreed that the Orange and Purple Books needed updating, differences emerged in how to do so. Witness Michael Carrier, a professor at Rutgers Law School, explained that the Orange Book doesn’t currently make clear when a patent has been invalidated, and the FDA doesn’t check the court system daily to provide updates. Jeff Kushan, Sidley Austin LLP partner, warned that it would be tedious to update the Orange Book constantly when many of the patents found to be invalid go through several appeals before a final decision. He also noted that the Purple Book isn’t currently useful to manufacturers and suggested making it searchable, as well as implementing a listing system for patents without breaching confidentiality.

 

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