In Issues 4 and 6 of this publication we discussed several legislative initiatives involving the pharmaceutical industry. At the start of the 111th Congress, two such bills that had failed to pass in the 109th and 110th Congresses were re-introduced.
On February 3, Senator Herb Kohl (D-WI) introduced the Preserve Access to Affordable Generics Act (S. 369) (first proposed in 2006 by Senator Kohl and Representative Henry Waxman (D-CA) in 2006). The current bill is co-sponsored by Senators Brown (D-OH), Feingold (D-WI), Durbin (D-IL) and Grassley (R-IA). Like its predecessor proposals, this legislation would make it unlawful for drug companies to settle patent infringement claims where an ANDA filer receives “anything of value” and “agrees not to research, develop, manufacture, market or sell the ANDA product for any period of time.” Commenting on the bill, which was referred to the Judiciary Committee, Kohl stated: “It’s time to stop these drug company pay-for-delay deals that only serve the profits of the companies involved and deny consumers access to affordable generic drugs. With this legislation, we can end a practice seriously impeding generic drug competition – competition that could save American families and taxpayers billions of dollars in health care costs.” This legislative effort has not dampened the Federal Trade Commission's (FTC) interest in pursuing “reverse payment” cases in judicial forums. As discussed elsewhere in this Issue, FTC Chairman Leibowitz has strongly expressed his intent to pursue reverse payment cases and the FTC recently filed a complaint against several drug companies challenging such a settlement.
On January 15, Representative Jo Ann Emerson (R-MO) reconfirmed her interest in the pharmaceutical sector when she introduced H.R. 573, which would amend the Federal Food, Drug, and Cosmetic Act to prohibit brand-name pharmaceutical companies from marketing their own authorized generics. This bill, which was referred to the House Committee on Energy and Commerce, would prohibit the marketing of authorized generics during the 180-day exclusivity period granted to the first generic pharmaceutical patent challenger to file an ANDA with the FDA. Authorized generics are brand-name drugs that are marketed as generic. The effect is to add an additional generic competitor during the first-filer exclusivity period granted under the Hatch- Waxman Act. (See Issue 1 at p. 9 for a discussion of the competitive issues relating to authorized generics).
Emerson was joined by Reps. Berry (D-AR), Moore (D-KS) and Wamp (R-TN) in sponsoring the bill. H.R. 573 is essentially identical to the bills Emerson introduced during the 109th and 110th Congresses. On February 26, Senator Jay Rockefeller (D-WV) introduced a companion bill, S. 501, which was referred to the Committee on Health, Education, Labor, and Pensions.
It is clear that Congressional interest in the pharmaceutical industry has not waned. With a president who also has expressed concern about competition in the pharmaceutical sector, these bills may very well proceed quickly. For example, regarding “reverse payment” settlements, during his campaign, candidate Obama stated “[a]n Obama administration will ensure that the law effectively prevents anticompetitive agreements that artificially retard the entry of generic pharmaceuticals onto the market, while preserving the incentives to innovate that drive firms to invent life-saving medications.”