GPhA Applauds New Bill Seeking to Limit Costly Misuse of Drug Safety Programs

PRESS RELEASE

WASHINGTON, DC (September 18, 2014) — A bill introduced today by Representatives Steve Stivers (R-OH) and Peter Welch (D-VT) calls for common-sense reforms to close costly loopholes that are being abused in current Food and Drug Administration (FDA) Risk Evaluation and Mitigation Strategies (REMS) programs as well as other restricted access programs. The Fair Access for Safe and Timely (FAST) Generics Act effectively prohibits companies adopting restricted access practices solely as a strategy to avoid generic competition at the expense of patient access to affordable medicines.

“This important bill introduced today by Congressmen Steve Stivers (R-OH) and Peter Welch (D-VT) promises to prevent unnecessary delays for patients waiting for generic choices and save billions for taxpayers, patients, and the federal government,” said Ralph G. Neas, President and CEO, GPhA. “These programs should be established for what Congress intended: keeping patients safe. Instead, some companies have adopted business strategies that deter competition under the guise of safety. This bill would put an end to that regrettable practice,” said Neas.

The number of medicines with more restrictive safety designations has increased over the past five years, with more than 50% of REMS programs in 2014 including stricter “Elements to Assure Safe Use” (ETASU) requirements, versus 2009, when fewer than 20% of products featured ETASUs. This is the area of REMS most often abused by brand companies, so the increased prevalence creates a growing opportunity for these practices. In addition, it has been reported that some brand companies have self-created and self-imposed restricted distribution programs in the absence of any formal FDA mandate, solely as a tool to impede distribution.

According to findings from Matrix Global Advisors, the ongoing abuse of REMS and REMS-like programs to prevent generic competition is costing the American health care system and patients $5.4 billion in annual pharmaceutical spending that could be saved if the 40 drugs examined in the study were allowed to come to market as generics. These efforts are particularly critical as the U.S. market prepares for the entry of biosimilars. In fact, the study identifies approximately $140 million in lost savings for every $1 billion in biologics sales.

The FAST Generics bill aims to counter these abuses by setting forth more explicit legal requirements and processes regarding the acquisition of product samples by generic and biosimilar developers, while putting safeguards in place to protect public health.

“At a time of increasing budgetary pressures, this bill represents a common-sense way for Congress to offset spending. It is critical that we act now, before this misuse expands and threatens the progress of new therapies that represent the next frontier of savings: biosimilars,” said Neas. “Timely passage of this bill will be a victory for everyone who relies on access to safe, effective generic medicines.”

About GPhA

GPhA represents the manufacturers and distributors of finished generic pharmaceuticals, manufacturers and distributors of bulk pharmaceutical chemicals, and suppliers of other goods and services to the generic industry. Generic pharmaceuticals fill 86 percent of the prescriptions dispensed in the U.S. but consume just 27 percent of the total drug spending. Additional information is available at www.gphaonline.org. Follow us on twitter: @gpha.