GPhA takes aim at Big Pharma

April 1, 2005

The Generic Pharmaceutical Association (GPhA) kicked off its 2005 annual meeting in Boca Raton, Fla., in February with an impressive array of allies from the Bush Administration, the Food & Drug Administration, and the Centers for Medicare & Medicaid Services, as well as top leaders from the generic pharmaceutical industry.

The Generic Pharmaceutical Association (GPhA) kicked off its 2005 annual meeting in Boca Raton, Fla., in February with an impressive array of allies from the Bush Administration, the Food & Drug Administration, and the Centers for Medicare & Medicaid Services, as well as top leaders from the generic pharmaceutical industry.

GPhA president and CEO Kathleen Jaeger told more than 400 attendees at the opening plenary session that 2004 was a year in which the generic industry enhanced its relationship with coalition groups and increased its presence on the state, national, and international levels.

Jaeger wasted no time in taking shots at the brand-name pharmaceutical industry, accusing it of finding new ways to subvert the level playing field envisioned under the Hatch-Waxman Act. She declared that GPhA would continue to oppose unnecessary and excessive patient incentives and market exclusivities and support product liability protections, expanded tax incentives, fast-track FDA review, and additional funding for biotech companies. "With respect to authorized generics, our position is clear. GPhA will vigorously oppose this blatant effort to undermine the incentive to bring patent challenges under Hatch-Waxman," she said. (For more on authorized generics.)

Rep. Henry Waxman (D, Calif.), coauthor of the landmark Hatch-Waxman legislation, told conference attendees that although drug prices have been lowered by as much as two-thirds, due in part to generic substitution, and the generic share of the market has grown steadily since 1984, the law that bears his name has fallen short of being a perfect solution to the problems of high drug prices. "Drug prices have remained higher than they should be in part because of efforts by the brand-name companies to exploit loopholes in the Hatch-Waxman law for the purpose of denying and delaying generic competition," he said.

Mark McClellan, CMS administrator, made it clear to generic industry executives that their products would play a significant role in the administration's new Medicare initiative. McClellan said that the Medicare drug discount card is providing billions of dollars in discounts to close to 6.5 million beneficiaries. "And we're doing it in a way that's providing unprecedented personalized information to seniors about how much they can save by using generic drugs for their personal needs."

McClellan noted that Medicare is seeing a significantly higher rate of generic use than in the senior population as a whole. Until now, he said, Medicare has lagged behind the most effective private health plans in terms of generic drug use. "We're absolutely going to build on this approach in implementing the Medicare drug benefit."

McClellan declared that 2005 would be a critical year for the Medicare program and insisted that generics would play a major role in bringing the program up to date. CMS is expected to spend $300 million on a Medicare outreach public education program that will include informing beneficiaries as to how they can use generics to lower their drug costs.

Lester Crawford, acting FDA commissioner, had high praise for generics. He said that if people devoted more attention to generic drug possibilities, an estimated $17 billion in savings could take place. Crawford extolled the benefits of the Hatch-Waxman Act (1984) and the Medicare Modernization Act (2003) and cited a 2002 Federal Trade Commission report claiming that "bad generic drug policy is bad public health policy." He added that in 2005 the FDA would focus its efforts on, among other things, modernizing the electronic version of the Orange Book and improving median ANDA approval times.