ICYMI: Wall Street Journal Reports on How Big Pharma’s Patent Abuses Are Harming Patients & Driving Up Drug Prices
IN CASE YOU MISSED IT: This evening, The Wall Street Journal published a must-read report highlighting the harmful impact Big Pharma’s patent abuse is having on the ability of American patients to access more affordable generic drug alternatives. According to this eye-opening report, despite a record number of generic drugs for cancer and other serious ailments, major drug companies are gaming the patent system to prevent competition and gouge sick Americans. The end result is patients being forced to pay for expensive prescription drugs they cannot afford.
- Record numbers of generic drugs for cancer, heart ailments and other conditions have received U.S. approval in recent years, raising hopes that the new competition would reduce high drug costs. But many of the lower-price medicines haven’t hit the market, a Wall Street Journal review found. The result: Many patients are forced to take high-price medicines, and a widely touted remedy for reining in drug costs has failed to live up to its promise…..The biggest factors, many of the generic-drug experts say, are the legal defenses mounted by brand-name drugmakers. They have sought to keep generics away by adding patents to products, while suing generic drugmakers for allegedly infringing the patents.
Today’s reporting provides further evidence of what CAPA has been telling lawmakers, that Big Pharma’s abuse of the patent system is hurting American patients and this is one key area that enjoys bipartisan support where Congress can and should act to help lower drug prices.
Below is a link and full text of the article:
Many Generic Drugs Haven’t Hit Market, Hindering Cost-Control Efforts
Wall Street Journal, November 19, 2019
Record numbers of generic drugs for cancer, heart ailments and other conditions have received U.S. approval in recent years, raising hopes that the new competition would reduce high drug costs. But many of the lower-price medicines haven’t hit the market, a Wall Street Journal review found.
The result: Many patients are forced to take high-price medicines, and a widely touted remedy for reining in drug costs has failed to live up to its promise.
Drug-industry officials and other researchers say delays in releasing generic drugs sometimes stem from businesses changing their strategies. But they mostly blame protracted legal tie-ups, such as brand-name drugmakers aggressively defending their products by filing additional patents and suing generic-drug companies.
In January, five drugmakers received permission from U.S. health regulators to sell a generic version of antipsychotic drug Latuda. Pharmacists and patients welcomed the decision because the drug’s list price has tripled to nearly $1,223 since it was launched eight years earlier. Eleven months later, none of the companies are selling a lower-price copy.
Since 2016, the Food and Drug Administration has approved 2,492 generic versions of 617 brand-name drugs, according to health-data firm Iqvia. The approvals picked up after the agency began its effort in 2017 to address popular outrage with high drug prices by speeding the review of generic-drug applications.
The number of generic approvals has set records each of the past three fiscal years, according to the Trump administration. Officials have touted the efforts, saying that by bringing competition to the market, drug costs would fall. Generic competition reduces the price of branded drugs by an average of 39% of any branded drug with four copycats, according to an FDA analysis.
But less than two-thirds of generic drugs approved between 2016 and 2018, or 1,249 of the copies, were launched into the market, according to Iqvia. Through June, just 30%—or 134—of the 442 approvals this year have gone on sale. Roughly 40% of last year’s 689 approvals haven’t been launched. (The approvals may include more than one generic for the same molecule.)
The breakdown is especially acute for the most expensive medicines, so-called biologic drugs for ailments such as cancer and rheumatoid arthritis that often list for hundreds of thousands of dollars a year. Copies of these drugs, known as biosimilars, are also being launched less frequently. Only 11 products are available commercially, despite more than two dozen approvals since 2015, the Journal’s review found.
“It’s very troublesome,” said Ameet Sarpatwari, an instructor at Harvard Medical School whose research includes pharmaceutical regulation. “Prompt generic entry is the one known solution to lowering drug prices.”
An FDA spokesman said the agency’s efforts to expedite the approval process has resulted in a better overall generic program, and it will continue to work toward creating a competitive market. He said the agency is encouraged by a “strong pipeline” of applications, but added that companies decide whether to ultimately launch products.
Pharmacists, generic-industry officials and other researchers cite several reasons for the lack of generic launches, including generic drugmakers deciding the potential return isn’t as lucrative as initially thought. Sometimes their plants aren’t ready to make the drugs, either. Meanwhile, consolidation among generic drugmakers has sharply cut the number of companies willing to sell the copies.
The biggest factors, many of the generic-drug experts say, are the legal defenses mounted by brand-name drugmakers. They have sought to keep generics away by adding patents to products, while suing generic drugmakers for allegedly infringing the patents.
The Federal Trade Commission, which tracks patent settlements annually, issued a report in May that found fewer of those agreements are likely to be anticompetitive, even though settlements are increasing overall. The FTC declined to comment on the broader issue.
Most drug-patent disputes in recent years haven’t been over patents for medicines’ active ingredients, but over what are known as secondary patents that cover a drug’s formulation or delivery, studies have found.
Brand-name drug companies are playing “patent games to protect profits and prevent competition,” said Chip Davis, chief executive of the generic-drug industry’s trade group, the Association for Accessible Medicines.
Two biosimilars of the biologic drug Enbrel that were approved by the FDA haven’t been launched, including one from Swiss drugmaker Novartis AG that the health agency approved in 2016.
More than 40 patents have protected Enbrel, a rheumatoid-arthritis treatment. Enbrel’s maker, Amgen Inc., won a court ruling in August related to Enbrel patents, which Novartis is appealing.
Amgen said that protecting its intellectual property helps encourage innovation. Enbrel, which went on sale in the U.S. in 1998, notched $4.8 billion in sales in the country last year. Amgen prices a year’s supply of Enbrel’s 50-milligram dose at more than $67,000.
Belgian drugmaker UCB SA has held off on the launch of at least seven generic versions of its epilepsy drug Vimpat after winning patent-infringement lawsuits. Vimpat, which lists for more than $950 a month, generated $1 billion in global sales for UCB last year. The FDA approved the first generic version in 2016.
UCB said that patients with insurance last year paid an average monthly out-of-pocket cost of $38.50. It also said it provides patients financial support.
Often, branded and generic companies resolve the litigation with the generic drugmakers agreeing to hold off on launching their lower-price copies, sometimes for years. “Every settlement involves delay,” said Michael A. Carrier, a professor at Rutgers Law School who focuses on antitrust and patent law.
Patent settlements are on the rise, according to the FTC. Though the generic drugmakers have to wait, they still can benefit by being paid by the branded companies to stay off the market, or the brand-name drugmaker giving them rights to sell their generic exclusively for a time before other copies can enter the market, Mr. Carrier said.
Generic copies of Latuda won’t go on sale until 2023 under the terms of a deal between the makers of the generics and Latuda’s manufacturer, Sunovion Pharmaceuticals Inc., the U.S. subsidiary of Sumitomo Dainippon Pharma Co. of Japan. The companies reached the deal after Sunovion sued for patent infringement.
Without a generic version of Latuda available, Christina Wagner said she had to stop taking the drug.
Ms. Wagner, 59 years old, a widow from DeLand, Fla., began taking the drug for her bipolar disorder in 2015. But she said she had to reach into her retirement account and get help from her son to afford a copay under her Medicare health-insurance plan that surpassed $500 some months. In March, she told her doctor she couldn’t afford it any longer.
Ms. Wagner said her doctor prescribed other medications but hasn’t found an effective alternative to Latuda, which helped regulate her mood swings.
“Latuda got me to where I could function,” Ms. Wagner said. “I would happily go on it again if there was a generic.”
A spokesman for Amneal Pharmaceuticals Inc., which applied for approval for a generic version of Latuda in 2014, cited litigation for its delay and said its generic is likely to be launched in a few years. Other companies declined to comment or didn’t respond to requests for comment.
Sunovion said a monthly prescription for most patients costs less than $8.50 and the company offers financial help to patients.
The Cleveland Clinic estimates it would have saved $187,651 this year, or about 25% of its spending, if it could purchase a generic version of transplant drug Zortress, said Jeff Rosner, senior director of pharmacy sourcing. Novartis prices a monthly .75-milligram dosage at $1,582.
A generic version of Zortress, from Hikma Pharmaceuticals PLC, was approved last year, but it won’t be launched until March, because Hikma had lost a patent-infringement lawsuit filed by Novartis, according to representatives of Novartis and Hikma.
Novartis said patents play an important role in developing treatments and that it believes in defending its intellectual-property rights.