Amy Klobuchar Discusses Big Pharma Paying Generic Companies To Delay Introduction Of Competing Drug

4 months ago

At a Senate Judiciary Committee hearing on Tuesday, Sen. Amy Klobuchar (D-MN) spoke about prescription drug prices.

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Transcript

00:00 Senator Klobuchar. Thank you very much Mr. Chair and thank you for the work that we've done together on the

00:06 negotiation. Medicare prices, we're so pleased I was hearing you talk Mr.

00:11 Mitchell about Eliquis, one of the drugs as you know that's now being negotiated

00:16 of the ten blockbusters with many more to come. I want to start though with one

00:23 of the issues at a bill that still hasn't passed that Senator Grassley and

00:28 I have been working on for a really long time which I know he mentioned pay for

00:33 delay and as you know Mr. Mitchell anti-competitive pay for delay

00:39 settlements where a branded pharma company pays off a generic or biosimilar

00:44 company to delay the introduction of the competing drug product is sadly a common

00:49 practice. Our bill it's called preserve access to affordable generics and

00:56 biosimilars act strikes a balance between targeting anti-competitive

01:00 settlements while allowing pro-competitive patent settlements to

01:04 proceed and saving an estimated 1.6 billion 1.6 billion over 10 years. Mr.

01:12 Mitchell you mentioned the drug that you depend on Revlimid which that was

01:17 caught up in a pay for delay settlement as I understand. How did that affect the

01:21 cost of the drug for you personally? How to pay for delay deals, keep the cost of

01:26 prescription drugs high for patients generally? I took Revlimid for five and a

01:31 half years and during the time I took the drug both the price underlying price

01:37 and my out-of-pocket rose dramatically. When by the way Revlimid was the second

01:44 most expensive drug for Medicare until it began to have competition last year

01:49 to treat only 39,000 patients the second most expensive drug for Medicare at 5.4

01:55 billion dollars. When the drug company that owns the patent decided to let

02:03 competition come on the market it limited the generics to a lower market

02:09 share 10% each for the first two competitors. If you have a limited market

02:14 share as part of the deal you will not lower your price because you cannot gain

02:18 market share. What happens then is the brand drug company and the two generics

02:24 in the case of Revlimid shared the monopoly and the price didn't come down.

02:27 This is a pay for delay deal. This is making an arrangement to say we won't

02:32 fight you in court instead we'll give you a market share limited deal and you

02:37 will make a whole lot of money for a few years while we delay real competition.

02:42 Very good description, thank you. Turning to another issue that has been

02:48 discussed today that's sham FDA petitions Dr. Feldman. This practice

02:55 risk delaying the approval of generic drugs and biosimilars imposes

02:59 unnecessary burdens on FDA resources to add to everything else when they have so

03:04 much to do. Senator Grassley again and I introduced a bill the Stop Stalling Act

03:09 to give the FTC enhanced authority to crack down on abuses of this process

03:14 while allowing petitions submitted in good faith to raise legitimate health

03:18 and safety concerns. CBO estimates that the bill would save taxpayers 400 million

03:25 over 10 years. As you know both of these bills have gone through this committee

03:30 on a voice vote. Which types of entities filed the majority of citizen petitions

03:36 challenging FDA approval of generic or biosimilars Dr. Feldman? Brand name drug

03:43 companies. Okay and can you elaborate on the harms to patients and competition

03:49 caused when pharma companies use a citizen petition process to delay entry

03:54 of competing drugs? I just find it ironic indeed when it's a citizen petition

03:59 process and the citizens are getting screwed by it but continue on. I have

04:04 felt that same irony myself. So it's first of all we should say that

04:09 companies are doing this because every day of delay for some of these

04:14 blockbuster drugs can be worth millions or tens of millions of dollars for the

04:19 company. So there's a strong incentive to do this and basically what

04:23 happens is the brand name firms will wait until the right moment to put a

04:29 question to the FDA to request they not approve a generic medication and it

04:36 slows things down. And every day that we slow things down is more revenue for the

04:42 brand name manufacturers but it's one less day that that patients get access

04:45 to generic drugs. And we know that generic drugs are the number one way to

04:50 lower prices in this country. It is a way to bring down costs for patients. So I

04:56 think it's it's a good bill and as you said these are these are not citizen

05:02 petitions they are they are put put out there by the companies to for economic

05:08 gain. Last, Professor Rye, the price of 25 brand name medications that Medicare

05:16 spends the most on, some of which are negotiated of course right now or in

05:20 negotiations, have on average tripled in price since they hit the market. You

05:26 have written that Medicare price negotiations will promote the entry of

05:30 new drugs by reducing the incentives for brand drug companies to engage in

05:35 anti-competitive patent strategies that can allow for these price increases. So

05:39 this kind of where our Medicare negotiations that is almost a outcome of

05:44 all of this bad activity sort of hits the road and combines with this patent

05:50 patent problem. How will requiring drug companies to negotiate prices with

05:55 Medicare, as I said with more on the road despite lawsuits going on right now all

05:59 over the country to try to stop us, which seems unbelievable to me given that

06:03 Congress is the one that made the deal and Congress can change a deal, how will

06:08 requiring drug companies to negotiate prices with Medicare deter pharma

06:13 companies from playing patent life-cycle games to preserve

06:18 high prices and facilitate entry of competitors and further reduce prices? So

06:24 I think the Inflation Reduction Act is one of the most important patent reforms

06:29 of the 21st century and the reason is this. It finally places a time limit at

06:35 least for Medicare on how long you can extend an old drug, which means that you

06:41 have to come up with new drugs, truly new drugs and that is a game-changer it

06:47 seems to me. Now I wish it was only more than ten drugs and it is increasing

06:52 fortunately but I think that's how it spurs innovation and Dr. Veldman noted

06:57 this as well or Dr. Mitchell noted this point as well that it spurs

07:01 innovation to prevent patent abuse. Very good. Thank you and I'll turn it back to

07:07 the chair. Thank you. Thank you very much Senator Klug.

Amy Klobuchar Discusses Big Pharma Paying Generic Companies To Delay Introduction Of Competing Drug

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