The Lower Drug Costs Through Competition Act would give the FDA six months to approve generic drugs, for which a brand name version of the active drug has already been authorized. The bill has bipartisan support, and he believes it could be passed as part of the year-end negotiations in President Obama’s lame-duck session.
U.S. Rep. Kurt Schrader has introduced legislation with bipartisan support that he believes will limit pharmaceutical profiteering and encourage manufacturers to produce generic versions of drugs for which there’s currently no competition.
“I’m trying to come up with a bipartisan way to get it passed,” Schrader told The Lund Report. “It will take the profit motive away from buying up orphan drugs. We expedite the process of getting an alternative.”
The Canby Democrat has co-sponsored the Lower Drug Prices Through Competition Act with Rep. Gus Bilirakis, R-Fla.
A lack of competition for many old generic drugs has allowed hedge funds and other Wall Street profiteers to buy up the rights for the drugs and exploit the monopolies with price hikes as much as 7,000 percent.
The most notorious case is Turing Pharmaceuticals, a company that markets just two drugs, neither of which it developed and both of which it enjoys monopolies. One of the drugs, Daraprim, is used to treat toxoplasmosis and was first approved in 1953. After it was purchased by Turing, the cost of the medication went from $13.50 a tablet to $750.
The approval process for medications at the Food & Drug Administration is notoriously slow and laborious, even for generic drugs, where the active ingredient is identical to brand name drugs. Schrader said that his bill would push for generics, which may differ in their inactive ingredients, to be approved in no more than six months.
“That’s lightning-speed for the FDA,” he said. “They can’t lock in the insane profits for years.”
Turing’s exploits have been repeated many times over as Wall Street discovered a new way to score easy profits at the expense of patients, insurance companies and an often accommodating government. “Wall Street has found out it’s a good way to make a lot of money because Congress isn’t acting,” Schrader said.
The situation has worsened as generic drug manufacturers consolidate and many are bought up by brand-name drug manufacturers to limit competition and counter the pressure by pharmacy benefit managers.
But Schrader’s bill indicates Congress has finally decided there are indeed limits on its tolerance for pharmaceutical greed, at least when a market-based solution presents itself. He said one company was ready to manufacture an alternative to the Epipen and could have had it on the market in months. Mylan purchased the epinephrine auto-injector from Merck and jacked the price up from $100 to $600 since 2009, sparking outcries.
Schrader was hopeful his bill could pass in the upcoming lame-duck session, before the new president takes office in late January. “This is a market-based solution that encourages competition. PhRMA is not fighting it.”
He said it would augment a bill that passed the House in July, the 21st Century Cures Act, which is waiting to get out of the Senate Committee on Health, Education, Labor and Pensions as well as pass the Senate. The bill passed the House 344-77, with the support of all five Oregon representatives.
That bill expedites the FDA process, provides access to treatments that have already passed muster in Europe, Japan and Canada, and beefs up funding for the federal agency.
Jesse Ellis O’Brien, the political director of the Oregon State Public Interest Research Group, said he was leery of lowering the standards for approval at the FDA, but otherwise supported the sweeping act as well as Schrader’s smaller bill.
“It’s the most outrageous issue,” he said. “It wouldn’t be sufficient to fix the whole system. It’s far from the only problem.”