[Ip-health] Market or data exclusivity for biologic drugs?

James Love james.love at keionline.org
Wed Jan 26 12:12:12 PST 2011

Among other things, no one is certain whether or not the new Heath Care
Reform legislation provides 12 years of market or data exclusivity, or
something else.   Jamie


JANUARY 26, 2011
Firms Push for Biotech Generics

A battle is heating up over the meaning of a single word in the health
overhaul that could mean billions of dollars to the makers of
biotechnology drugs.

The word is "exclusivity." Last year's health law says brand-name makers
of the blockbuster medicines are entitled to 12 years of it. The
question is whether makers of generics have to wait the whole period
before even beginning to seek approval—or can get a head start with
regulators so their copies can hit the shelves as soon as the 12 years
are up.

Companies including pharmacy network CVS Caremark Corp. and insurer
Aetna Inc. want to get their hands on the cheaper generics as soon as
possible, and they're calling on the Food and Drug Administration to
interpret the law in a way favorable to generic-drug makers.

Biotech medicines, or "biologics," are derived from proteins and used to
treat cancer, rheumatoid arthritis and other diseases. Some cost tens of
thousands of dollars a year per patient, adding a big cost burden for
insurers, Medicare and others who pay for the drugs.

The health-law provision, years in the making, for the first time
creates a path to approval in the U.S. for less-expensive generic

This week three Democratic senators and Republican Sen. John McCain of
Arizona came to the generic drug makers' aid.

"We are extremely concerned about possible interpretations ... that
could further delay the availability of generic biologic drugs,
restricting access for many Americans and driving up costs for the
federal government," said a letter signed by Mr. McCain, a longtime
drug-industry critic, and Democrats Sherrod Brown of Ohio, Tom Harkin of
Iowa and Charles Schumer of New York.

The letter amounted to a counterattack against another bipartisan
quartet of senators who asked the FDA earlier this month to preserve
"incentives for innovators to research and develop new treatments."

Those other senators and brand-name drug makers such as Amgen Inc. said
the FDA should establish 12 years of "data exclusivity." That would bar
generics makers from drawing on the existing product's data during the
exclusivity period, delaying the generic drug's application for

CVS Caremark interprets the law to mean that branded drug makers get
only four years of data exclusivity and 12 years overall sales
protection. The company, a big distributor of generic drugs, joined
Aetna, Humana Inc. and seniors' lobby AARP in a letter to the FDA, dated
Jan. 20.

"The availability of biogenerics will help reduce costs for health
plans, employers and federal programs and will help make these
medications more affordable to patients," said a CVS spokeswoman.

The FDA says it is reviewing all the comments.

State pension funds in California and Ohio have called for early access
to generic biologics to save money. A spokeswoman for the Ohio Public
Employees Retirement System said: "If OPERS could achieve at least a 25%
reduction in the cost of biologic drugs, it would save the system over
$12.7 million in one year," she said.

Medicare paid more than $2 billion for three antianemia biologics in
2009, said an agency spokeswoman.

Biotech-drug makers say they need 12 years protection from generics to
pay for costly research. "Congress intended data exclusivity to be an
incentive for innovation," said Amgen, which makes several top-selling

The health-care law doesn't specify "market" or "data" exclusivity, said
generic drug lawyer Kurt Karst of Hyman Phelps & McNamara PC. He noted
that the wrangling is only the latest episode in an the ongoing war over
generic biologics, also called biosimilars. President Barack Obama's
administration wanted only seven years of sales exclusivity in the bill,
but he was outgunned by industry lobbyists including the Biotechnology
Industry Organization or BIO.

"This fight was bitter from the start, because the brand-name companies
won 12 years exclusivity," said Mr. Karst.

Making the matter trickier, some companies produce both brand-name and
generic medicines. The world's largest generic-drug company by sales,
Teva Pharmaceutical Industries Ltd., also has a branded biologic for
multiple sclerosis.

Teva, which is part of the generic drug makers' trade group, applied for
membership in BIO recently, a move that industry lawyers in Washington
said caused consternation among BIO's established members. They said BIO
members must pledge to support the group's policy positions, and it
advocates 12 years of data exclusivity.

"We have publicly stated that we intend to grow significantly in
biologics. Membership in BIO is a natural fit," said a Teva spokeswoman.
A BIO spokesman said Teva's application "will go through our
board-approved review process."

Write to Alicia Mundy at alicia.mundy at wsj.com

James Love, Director, Knowledge Ecology International
http://www.keionline.org | http://www.twitter.com/jamie_love
Wk: +1.202.332.2670 | US Mobile +1.202.361.3040 | Geneva Mobile +41.76.413.6584

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