THEY SAID IT! R STREET CALLS FOR BIPARTISAN, MARKET-BASED SOLUTIONS TO CRACK DOWN ON BIG PHARMA’S PATENT ABUSE

Article Highlights How Congress Can Address Patent Thickets, Product Hopping And Other Anti-Competitive Tactics That Keep Drug Prices High

In case you missed it, a recent article from the R Street Institute highlights how Big Pharma’s abuse of the patent system blocks competition from more affordable generic and biosimilar alternatives and keeps prescription drug prices high for patients, taxpayers and the U.S. health care system.

As the article notes, “patents are designed to reward the risky investments required to discover innovative life-saving treatments,” but they can also be “wielded as weapons to extend monopoly power and deter market entry by lower-cost generic drugs.” The analysis adds that “[p]atent thickets, product hopping, and serial litigation can delay generic and biosimilar entry for years, keeping name-brand prices high.”

The piece underscores the importance of market-based solutions that promote generic and biosimilar competition. While generics constitute 90 percent of all U.S. prescriptions, high U.S. drug spending is driven by high-priced brand name drugs, making competition from more affordable alternatives critical to lowering costs.

Big Pharma’s anti-competitive tactics that keep prices high come at significant cost to patients, taxpayers and the entire U.S. health care system. The article points to research showing patent thickets on just five brand name drugs cost between $1.8 billion and $7.6 billion annually, underscoring the need for policymakers to crack down on patent abuse and restore competition to the prescription drug market.

R Street points to bipartisan, market-based solutions gaining momentum in Congress that would address key barriers to generic and biosimilar competition, including:

• The Medication Affordability and Patent Integrity Act (S. 2658), which would strengthen coordination between the U.S. Patent and Trademark Office (USPTO) and FDA by requiring more consistent information across agencies, helping improve patent quality, reduce Big Pharma abuse of the patent system and prevent costly delays in the availability of more affordable generics.
• The Skinny Labels, Big Savings Act (H.R. 6485 and S. 43), which would protect access to safe, lower-cost generic drugs by safeguarding “skinny labeling,” a process where generic manufacturers carve out patented uses from a drug’s FDA label so lower-cost generics can be approved earlier for non-patented uses instead of waiting for all brand label method-of-use patents to expire.
• The Eliminating Thickets to Increase Competition (ETHIC) Act (H.R. 3269 and S. 2276), which would streamline patent litigation, safeguard quality patents that improve existing drugs and promote faster market entry of lower-cost generics and biosimilars.
• The Affordable Prescriptions for Patients Act (S. 1041), also known as Cornyn-Blumenthal, which would hold Big Pharma accountable for patent thickets that block competition from more affordable alternatives and impose billions of dollars in higher drug costs on patients and the U.S. health care system each year.
• The Interagency Patent Coordination and Improvement Act (H.R. 4570 and S. 1097), which would improve coordination between the U.S. Patent and Trademark Office (USPTO) and the U.S. Food and Drug Administration (FDA) to support competition and hold brand name drug companies accountable for patent abuse.
• The Drug Competition Enhancement Act (S. 1040), which would crack down on Big Pharma’s egregious patent abuse tactic called product-hopping, that involves making small changes to a brand name drug to extend monopolies, disconnected from true innovation.

These solutions would help crack down on Big Pharma’s abuse of the patent system, fostering greater competition for more affordable generic and biosimilar alternatives to high-priced blockbuster products.

R Street calls for Congress to work on advancing these solutions during the lame duck or early in the new year:

“With the legislative calendar in the 119th Congress winding down, the Affordable Prescriptions for Patients Act has advanced the furthest, passing the Senate by unanimous consent. The ETHIC Act has also gained momentum, particularly after the House Judiciary subcommittee hearing in June. Both may come into play in the upcoming lame-duck session, but if none of these bills move forward this Congress, then prescription drug affordability will surely gain attention in the next Congress.”

Read the full piece from R Street Institute HERE.  

Read more on how Big Pharma games the system to block competition and keep drug prices high HERE.

Read more on bipartisan, market-based solutions to hold Big Pharma accountable HERE.