Obama & McCain Agree On One Thing: Generics

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genericYou’re not surprised, are you? In any event, expanding the use of low-cost generics, including versions of biologics, would be near the top of their health care agendas, according to their advisers, who were speaking at a conference for the generic industry.

“We know that expanding the use of generics and eliminating barriers to that goal must be a centerpoint of any health reform effort,” Dora Hughes, a health care adviser for Obama, according to the Associated Press. And McCain adviser Douglas Holtz-Eakin echoed the sentiment: “Controlling health care costs has to be the imperative of any effective health care reform.”

And both campaigns pledged their support to help create a market for generic biologics, a long-sought goal of generic makers such as Mylan Laboratories and Teva Pharmaceuticals, which yesterday released this commissioned report. Biotechs, you may recall, do not face generic competition in the US, because the FDA lacks authority to approve copies. Three bills have been introduced, but behind-the-scenes bickering over immunogenecity and interchangeability has thwarted compromise.

The generic and biotech industries, meanwhile, spent millions of dollars lobbying Congress over how generic biotech drugs should be approved. Perhaps the greatest disagreement is over how long a biotech drug should be on the market before a generic drugmaker can challenge its patent. The BIO trade group wants 14 years of data exclusivity, while generics say no more than five years.

And the AP notes that biotechs such as Amgen and Genentech will face strong push-back no matter which candidate next occupies the White House. “Senator McCain’s instincts are to make the period as short as possible so that you can get products to market more quickly,” says Holtz-Eakin. Obama also supports making the exclusivity period as short as possible for biotech drugs, Hughes adds.

In an investor note this week, Lehman Brothers analyst Tony Clapsis wrote that “regardless of who is elected, we expect progress in Congress and the likely passage of a (follow-on biologics) FOB pathway by 2010. The trrigger event we look for is when key members of the House of Representatives begin to forge a consensus on what they believe a pathway should look like. We think a pathway would probably include about 10 years of data exclusivity for innovator companies; allow for quicker development of follow-on products, and give the FDA the authority to approve substitutable products over time.”

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