- A study commissioned by the nation's largest generics trade group found the U.S. healthcare system could be saving billions of dollars if branded drug manufacturers weren't abusing federal programs meant to make higher-risk pharmaceuticals safer.
- The main program cited throughout the study is known as REMS for short. It was put in place about a decade ago to require drug companies to offer safety strategies for products that carry serious health risks. A majority of REMS programs have distribution restrictions, which some branded drugmakers have taken advantage of by not offering samples of their reference products to generics makers — thereby crimping future competition.
- Of the $13.4 billion in annual savings lost because of branded drugmakers blocking generics companies from accessing reference product samples, $3.1 billion stems from products restricted by REMS programs while the remaining $10.3 billion comes from products that branded drugmakers created non-REMS restrictions for, according to the study.
The Association for Accessible Medicines (AAM), the trade group behind the report, has much to gain by showcasing the savings generics could offer if branded drugmakers weren't standing in the way. Yet they're not alone in their criticism.
"I want to be very clear: a path to securing samples of brand drugs for the purpose of generic drug development should always be available," FDA Commissioner Scott Gottlieb said in a May 17 statement. "Even in the case of limited distribution programs such as those required by certain REMS, there should be a path forward for generic drug development."
The commissioner's statement came alongside a list of companies, including Celgene, Novartis and Gilead Sciences, that the FDA said were potentially blocking market access for generics.
Members of Congress have also sought to make an easier pathway to market for copycat drugs. In June, the Senate Judiciary Committee voted in favor of reporting the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act to the Senate floor. As its name suggests, the CREATES Act, among other things, gives a detailed roadmap for how generics makers can better ensure access to reference product samples.
The act hasn't progressed any further on the legislative front, though, and faces steep opposition from another industry trade group, PhRMA. Still, the fight seems far from over.
"Unfortunately, withholding samples is an accepted business practice for some as a means to artificially protect and extend their monopolies beyond what Congress intended," AAM CEO Chip Davis said in a Sept. 4 statement announcing the release of its new report. "That is why Congress must pass the bipartisan Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act."
AAM's commissioned study also highlights how generics would benefit federal government spending.
It estimates the federal government is losing $5.2 billion annually on savings lost through blocked generic competition. State and local governments are also missing out on $500 million each year, according to the report. Consumers and private insurers also suffer, according to the study, with the former paying an additional $1.8 billion in out-of-pocket costs and the latter forfeiting $5.8 billion in potential savings.