Analysis: Red tape stifling generic drugs

By MARA GORDON, UPI Correspondent  |  July 20, 2006 at 9:57 PM
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WASHINGTON, July 20 (UPI) -- American consumers could save millions each year on prescription medication -- that is, if the red tape that prevents the speedy approval of generic drugs is cleared away, health officials said Thursday.

And according to experts who testified before the Senate Special Committee on Aging, making generic drugs more widely available is only a matter of streamlining parts of the healthcare bureaucracy, and rethinking current government policies that make it too easy for makers of pricier brand-name drugs to game the system.

"If we do not fix the obstacles today, I can only imagine the healthcare costs," said Heather Bresch, a vice president at generic drug manufacturer Mylan Laboratories.

Anti-trust experts and representatives of the generic pharmaceutical industry addressed the committee, which held a hearing to examine the impact of Food and Drug Administration policies on the availability of generic drugs.

"Consumers are left holding the bag -- or more precisely, footing the bill," said Jon Leibowitz, Commissioner of the Federal Train Commission.

After patents on expensive brand-name medications expire, other pharmaceutical companies can get generic versions of the drugs -- whose molecular structures are identical to the original -- approved by FDA. Generic drugs are generally much less expensive than brand-name medications, but just as effective.

"The savings that generic drugs offer are particularly important for older Americans," Leibowitz said. "If (current policies affecting generic drug marketing) are allowed to stand, prescription drug costs -- already the fastest growing segment of our nation's spending on healthcare -- will rise even more dramatically."

Generic drugs are generally 50 to 70 percent cheaper than their counterparts, according to Gary Buehler, the director of the Office of Generic Drugs at FDA.

But several roadblocks, according to those who testified Thursday, prevent easy access to generic medication.

When generic pharmaceutical companies apply for FDA approval of their copycat drugs, citizens can file a petition with a concern about the drug's safety.

But according to Buehler, it is often the brand-name manufacturers who file last-minute petitions, wrapping the approval process in more red tape that prevents generics from getting approved quickly.

"The majority of (the petitions) are 11th hour that don't raise any new issues," Bresch said.

Bresch added that authorized generics -- generic drugs manufactured by companies that produce brand-name medication -- are another threat to making generic drugs affordable, because authorized generics are allowed on the market without competition for several months after a brand-name patent expires.

These examples are only a few of many loopholes drug companies use to discourage generics from getting on the market, experts say -- to the detriment of U.S. consumers.

"There are too many people who need these drugs," said Mark Merritt, the president of the Pharmaceutical Care Management Association. "They're great products."

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