AMCP calls on Congress for prohibition of generic exclusion agreements

March 18, 2013

The Academy of Managed Care Pharmacy (AMCP) is urging U.S. House leaders to consider a number of proposals to rein in federal spending on healthcare without compromising popular programs such as Medicare and Medicaid.

Edith A. Rosato, RPh, IOM, AMCP’s CEO, suggests that Congress support legislative efforts that would prohibit generic exclusion agreements between brand-name and generic manufacturers, leading to the delay of entry of generic drugs to the marketplace beyond original patent terms, according to a letter dated March 18 to U.S. House of Representative leaders, John Boehner and Nancy Pelosi.

“The Federal Trade Commission under both Democratic and Republican administrations has long considered these settlement agreements as anticompetitive,” wrote Rosato. “In his FY13 budget request, President Obama proposed authorizing the FTC to presume all such agreements illegal and estimated a savings of $11 billion over 10 years to federal healthcare programs, including Medicare and Medicaid.”

Next week, the U.S. Supreme Court will hear arguments about this issue in the case of FTC v. Watson Pharmaceuticals. S.B. 241, the Preserve Access to Affordable Generics Act that was introduced by Sen. Amy Klobuchar (D-Minn.), would prohibit these settlement agreements.

AMCP is also in agreement with President Obama’s proposal to reduce the period of data exclusivity from 12 years for innovator biologic products to seven years, which was outlined in his FY13 budget request. The shortened term of data exclusivity would save the federal government an estimated $4 billion over 10 years.

“AMCP agrees with the president that seven years strikes an appropriate balance between the need for manufacturers of innovator products to recoup their investment in the research and development of these products and the need of patients and payers to have access to biosimilar competitors,” Rosato wrote.

Other AMCP proposals outlined in the March 18 letter asked for opposition to expansion of Medicaid “best price” rebate program for dual eligibles under the Part D benefit, opposition to federal government negotiation of prescription drug prices for Medicare Part D, and opposition to the legalization of the importation of prescription drugs.