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Healthcare Stakeholders Urge Senate to End REMS Abuse, Increase Generic Drug Competition

Contact: Steve Arnoff 202.249.7113 

WASHINGTON, DC (Jan. 5, 2016) — In response to a recent hearing of the Senate Special Committee on Aging to examine factors contributing to “price spikes in off-patent drugs”, the Generic Pharmaceutical Association (GPhA) and 10 stakeholder groups representing pharmacists, chain drug stores, pharmacy benefit managers, public and private retirement systems, and others, sent a letter to the Committee calling for consideration of the Fair Access to Safe and Timely (FAST) Generics Act (H.R. 2841) to improve competition in the pharmaceutical marketplace. The FAST Generics Act would strengthen Risk Evaluation and Mitigation Strategies (REMS) and prevent some brand drug manufacturers from exploiting loopholes in the law that block patient access to safe, effective, affordable generic drugs.

“Misuse of FDA REMS patient safety programs is one way that certain brand drug companies delay generic competition,” said Chip Davis, president and CEO, GPhA. “Failure to address the loophole that makes these abuses possible is a missed opportunity to encourage more competition in generic drugs and to generate billions of dollars in additional savings for patients and the health system.”

REMS are FDA-mandated programs that provide additional information to patients and providers, and in certain cases restrict distribution of the product so that only specified entities have access to it. Some companies establish voluntary restricted distribution networks to deny manufacturers of generic and biosimilar drugs access to product samples they need to obtain FDA approval and market entry. H.R. 2841 would cut down on these abuses and would save the federal government approximately $2.4 billion over 10 years, according to the Congressional Budget Office.

As the letter states, “Companies that exploit restricted access programs delay generic competition and undermine the intent of Hatch-Waxman at the expense of America’s patients and healthcare systems.”

“Any policymaker seeking ways to lower health costs should consider increasing competition from generic drugs by embracing measures such as the FAST Generics Act,” said Davis. “Competition from generic drugs has saved the health care system $1.68 trillion over the past decade and $254 billion in 2014 alone, according to the 2015 Generic Drug Savings in the U.S. report. We can do more to expedite patient access to safe, effective and more affordable generic drugs.”

The FAST Generics Act is just one more way to curb practices that unnecessarily increase prescription drug prices in this country. Congress can also take these steps to increase pharmaceutical competition:

• Ensure a fully-resourced Food and Drug Administration (FDA) can address the backlog of more than 3,800 generic drug applications stalled while waiting for approval and shorten FDA median generic drug approval timelines, which, at the industry’s best estimate, currently stand at 48 months.
• Increase generic utilization among the low-income Medicare and Medicaid populations, which could save up to $17.7 billion over 10 years.
• Work closely with industry and regulatory partners to ensure that the framework for biosimilars, safe and effective alternatives to costly brand biologic drugs, expands and expedites patient access. Estimated biosimilars savings range from $44 billion to $250 billion.
• Repeal Sec. 602 of the Bipartisan Budget Act of 2015. The Medicaid rebate increase for generic drugs in the budget deal is bad for Medicaid and its beneficiaries, bad for taxpayers, and it should be immediately repealed.

The letter to the Senate Special Committee on Aging in support of the FAST Generics Act is available here.

About GPhA
GPhA represents the manufacturers and distributors of finished generic pharmaceuticals, manufacturers and distributors of bulk pharmaceutical chemicals, and suppliers of other goods and services to the generic industry. Generic pharmaceuticals fill 88 percent of the prescriptions dispensed in the U.S. but consume just 28 percent of the total drug spending. Additional information is available at gphaonline.org. Follow us on twitter: @gpha.