Pharma Companies That Block Generics Will Be Publicly Shamed by FDA

An FDA-maintained website is being established to call out brand-name pharmaceutical companies who try to block generic drugs from entering the US market. According to FDA Commissioner Scott Gottlieb, the website will be updated regularly as a component of President’s Trump’s relatively industry-friendly plan to curb drug pricing issues.

Generic companies need drug samples in order to develop copycat versions, however makers of branded drugs, who are most interested in protecting their market share, are understandably reluctant to allow those drug samples to get into their hands. This has prompted pharmaceutical companies to take advantage of specialty distribution or Risk Evaluation and Mitigation Strategy (REMS) programs to keep generic companies from gaining access to drug samples.

Over 150 letters from generic drugmakers have been submitted to the FDA after the companies have faced roadblocks in securing samples. The hope is that the new website will deter branded drugmakers from engaging in these non-competitive practices, thereby reducing their monopoly and driving drug prices down.

“I think that the problem is that we have such a Byzantine, complex system. That to think that there one policy reform that you are going to implement that is just going to create a much more competitive landscape, that’s not the reality. This system was built up over many years through the hard work of a lot of lobbying dollars,” said Gottlieb. “And I think that in order to start to dismantle it, it is going to take a series of interlocking reforms and someone who understands how these different parts are working together in a pernicious way to disadvantage consumers and patients.”

In addition to the website, the FDA will also address the way in which drugmakers have abused REMS rules by issuing new guidance. Branded and generics companies can use a shared REMS program for a drug or drug class, but the FDA will soon be able to grant exceptions allowing the generic company to develop their own REMS if the branded drugmaker is dragging its feet.

“The guidance will say that FDA shall grant a waiver to a generic company if it can demonstrate to FDA that these negotiations are being dragged out,” said Gottlieb. “I think just by telling the marketplace that I’m willing to give a waiver to the generic companies to go their own way and develop their own REMS more easily, that’s going to discourage the branded drug companies from doing this in the first place.”

While Gottlieb doesn’t support the notion that the website will practice “public shaming,” the Association for Accessible Medicines (AAM) sees the action as just that. While the association – which represents generic companies – believes the public site is a step in the right direction, they maintain that the only way to improve competition is to pass the CREATES Act, a bill which would allow generic drugmakers to sue branded pharmaceutical companies in the event that they are denied samples.

“It is important that the FDA shares the names of these companies that are abusing safety programs to pad their monopolies at the expense of patients, but shame hasn’t proven effective in changing behavior when billions of dollars are on the line. For the sake of American patients, the Administration must work with Congress to pass the CREATES Act and finally put an end to these abuses,” said Allen Goldberg, AAM VP of communications.