Progress made on generic-drug costs and competition, but more work remains

By Todd Ebert

Generic drug price spikes and prescription drug shortages continue to jeopardize patient access to care. President Trump and bipartisan congressional leaders recently took steps to help address the problem as part of the FDA reauthorization process, but there is still more to be done to preserve patient and provider access to critical treatments.

Price spikes often occur when a lack of competition among manufacturers allows high prices to go unchecked. As part of the new FDA reauthorization bill, Congress included provisions to require that the FDA give priority review, within eight months of submission, to abbreviated new drug applications (ANDAs) for drugs with three or fewer approved alternatives, which will streamline the process of additional manufacturers entering the generic drug market.

HSCA applauds President Trump for signing the FDA Reauthorization Act into law, and we applaud bipartisan House and Senate leaders – including Senators Alexander (R-Tenn.), Murray (D-Wash.), Collins (R-Maine), McCaskill (D-Mo.), and Franken (D-Minn.), and Representatives Walden (R-Ore.), Pallone (D-N.J.), Bilirakis (R-Fla.), and Schrader (D-Ore.) – for their efforts to find solutions to generic drug price spikes and ongoing prescription drug shortages.

HSCA and its members are committed to lowering costs and increasing competition and innovation in the healthcare marketplace. We recommend that policymakers take additional common-sense steps to address obstacles to competition in the generic drug market, including expediting supplemental manufacturing requests, eliminating so-called “pay-for-delay” tactics, and addressing loopholes in the FDA’s Risk Evaluation Mitigation Strategies (REMS) program.

Supplemental manufacturing requests made to FDA – including requests to improve, modernize, or expand manufacturing – are currently treated by the Agency as ANDAs, which significantly delays their review and approval. Additionally, the FDA has sometimes been unresponsive to questions and requests about the pending applications, which further slows down the approval process. Supplemental manufacturing requests should be handled separately from ANDAs, and should only be evaluated on the areas that will be changed or enhanced. Expediting these supplemental requests will allow manufacturers to produce drugs more efficiently.

Some brand name pharmaceutical manufacturers are attempting to pay the manufacturer of the first generic alternative not to enter the market. Also known as “pay-for-delay,” this practice allows the brand name drug to remain the only product on the market, which delays patient access to cheaper alternatives. HSCA supports a legislative solution, the “Preserve Access to Affordable Generics Act” (S.124), which would eliminate the tactics that allow brand name manufacturers to prevent or delay generic manufacturers from entering the marketplace with competitor products.

Additionally, some brand name manufacturers are exploiting a loophole in the FDA’s REMS program to prevent generic and biosimilar manufacturers from accessing the product samples they need to obtain FDA approval and market entry. HSCA supports the “FAST Generics Act of 2017” (H.R. 2051) and the “CREATES Act” (S.974), which provide generic and biosimilar drug manufacturers a clear and efficient pathway to obtain samples and to combat these anticompetitive practices, and empower courts to award damages to the affected generic and biosimilar manufacturers.

HSCA represents the nation’s leading healthcare group purchasing organizations (GPOs), the sourcing and purchasing partners to virtually all of America’s 7,700+ hospitals, as well as the vast majority of the 68,000+ long-term care facilities, surgery centers, clinics, and other healthcare providers. Our GPO members have a unique line of sight over all aspects of the healthcare supply chain. We look forward to continuing to work with policymakers and all supply chain stakeholders to find additional solutions to the ongoing challenges of generic drug price spikes.

Todd Ebert, R.Ph., is president and CEO of the Healthcare Supply Chain Association.