Industry group pushes back against proposed bill to reduce drug exclusivity
- The Biotechnology Organization (BIO), a major trade group, has come out strongly in opposition of a newly-proposed bill which would lower the exclusivity period for biologic drugs to seven years from the current 12 years.
- In a statement released last week, BIO argued the bill would severely hamper innovation and serve as a disincentive for manufacturers to invest in new drugs.
- Representative Jan Schakowsky (D-IL), along with other Democratic lawmakers, introduced HR 5573 on June 23, seeking to amend the current law which has enshrined the 12-year exclusivity period. The law prohibits other drugmakers from introducing competing products during that time.
Biologic exclusivity has been a long-simmering flash point, both for domestic and trade policy. Consumer groups have criticized the policy for limiting competition and driving up the costs of drugs.
"By reducing the period of exclusivity from twelve years to seven, we can increase competition by allowing for the development of generic versions of these expensive drugs," said Schakowsky in a statement last week.
Citing data from the Department of Health and Human Services’ 2017 budget request, Schakowsky said reducing the exclusivity period to seven years would save the federal government and taxpayers $6.9 billion over 10 years.
BIO strongly opposes the effort, noting the bipartisan support for the legislation which first established the 12-year period.
"Data exclusivity of 12 years is an essential incentive for the huge risks associated with biotechnology investment. The majority of biotechnology companies are small, private start-ups, heavily reliant on venture capital investment," said Jeanne Haggerty, a senior vice president for federal government relations at BIO.
"Undermining investment in these companies means undermining investment in the next biomedical breakthroughs for patients," Haggerty said.
Exclusivity periods were repeatedly fought over in negotiations for the Trans-Pacific Partnership, a major 12-nation trade deal which includes both developed and developing economies. Some countries in the TPP wanted a five-year period of exclusivity. Final negotiations led to a compromise 8-year period in the U.S., according to Regulatory Focus.
The bill still has a long way to go before becoming law but, given the increasing pace of biosimilar development in the U.S., legislation such as this will take on increasing importance. Biosimilar manufacturers are working to bring copies of a number of high-profile biologics onto the U.S. market, although biologic drugmakers are pushing back to fight loss of patent exclusivity.
And the current charged environment on drug prices only further opens up branded biologic makers to scrutiny, as many biologic drugs command higher prices.