By Donald Zuhn --
In November, we noted that the nation's largest mail order pharmacy, Franklin Lakes, NJ-based Medco Health Solutions, Inc., had announced that consumers could expect to see the establishment of a follow-on biologics regulatory pathway in the United States by 2011 (see "Medco Predicts Follow-on Biologics Regulatory Pathway by 2011"). Medco also announced that if Congress could meet such a timeline, more than $34 billion worth of biogeneric drugs could become available in this country between 2013-2017 (the company's calculations included a two-year interval for follow-on biologics to become available after innovator patent rights expire).
Last week, Reuters reported that Teva North America CEO Bill Marth predicted that there was a "very good chance" Congress would pass a follow-on biologics bill in 2009. Despite the looming economic crisis -- or perhaps as a result of it -- the Reuters report noted that many "industry observers" see passage of a follow-on biologics bill as a way for President-elect Obama to cut healthcare spending. Mr. Marth cautioned, however, that passage of a follow-on biologics bill would depend on which issues the Obama Administration would decide to attack first.
Mr. Marth acknowledged that passage of the bill would require that generic and innovator companies come to some resolution on an appropriate exclusivity period, which he called the "toughest [issue] to negotiate." Mr. Marth asserted that generic companies, like Teva, support a seven-year period while innovator companies support a fourteen-year period. As we reported in November, Teva provided financial backing for a study that concluded that an exclusivity period of seven years would be "sufficient for maintaining strong incentives to innovate while fostering a competitive marketplace" (see "Former House Ways and Means Economist Claims 7-Year Data Exclusivity Period Is Sufficient"). We also reported last summer that the Biotechnology Industry Organization (BIO) indicated that either H.R. 1956 (providing fourteen years of exclusivity), H.R. 5629 (providing twelve years of exclusivity), or S. 1695 (also providing twelve years of exclusivity) would "come close" to striking a balance between meaningful cost savings for biologics spending and providing needed protections for innovator drug makers (see "CBO Releases Report on Senate Follow-on Biologics Bill; BIO Calls for Congress to Pass Biologics Bill in 2008").
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