Generic Drug Deals – One More Area Being Explored to Help Reduce Cost of Healthcare by the FTC

According to this article from the New York Times, only 22 percent of prescription spending is the US is spent on generic drugs, the rest is name brands prescribed by physicians.  Major drug companies cut deals with generic manufacturers granting who can market them and I see this as having a pricing impact, just common sense will tell you that much.  These are deals made before the patent runs out.  

Teva Asking FDA for Approval for Biosimilar Drug To Provide the ...

There are a few of these in court with companies like Teva, who are challenging patents in order to produce a generic version, ask Merck  and Amgen for a couple examples.  in 2009 there were 19 settlements.  Why are generic companies challenging patents, simple because they can today with the focus on reducing the cost of medications and healthcare in the lime light.  This is interesting how the deals come around with certain companies allowed to make a generic equivalent to market and sell the drug before the official patent expires.  It sounds crazy to me as to why don’t we just shorten the patent time as this is what it appears the matter is all about anyway, but the deal allow exclusive rights to some generic companies, some benefit and others do not. 

So now that we have more “deals” taking place, we have the FTC involved, one more government agency.  Patents and Intellectual Property are changing in the world today and yes I think every company deserves the opportunity to recover what they have spent in research and development for sure, but I wonder at times when you look at the huge profits made and the inter looping of pharmacy benefit companies making huge dollars at all of this, if the scales are somehow unbalanced here?  As mentioned here, the House Bill for reform already includes a ban for this type of practice while the Senate version does not.  This is a bunch of red tape here that complicates the process and basically makes the production of generic drugs a business and political issue instead of creating what was supposed to be a cheaper route for consumers to be able to afford medications.  Where is one of the largest areas affected – cancer drugs, tied up in political rhetoric.  The FDA approves these deals right?  One more instance here today on how healthcare is tied up beyond supply and demand with multiple government agencies now involved in what is the right thing to do.  BD 

The group plans to ask Congress on Wednesday to block business deals in which they say makers of name-brand drugs directly or indirectly pay generic makers to delay competition from cheaper generic alternatives.

The House bill already includes such a ban. The Congressional Budget Office, considering only federal drug spending, has estimated that the House provision could save the government $1.8 billion in health costs over the next 10 years.

In recent years, critics say, deals between name-brand makers and generic makers have delayed the introduction of a range of generics including cancer drugs, antidepressants and prescription-strength antacids. The F.T.C. has estimated that such deals currently cost American consumers $3.5 billion a year.

Settlements, she said, typically award the generic challenger the right to enter the market before a brand’s patent is due to expire, giving consumers earlier access to affordable drugs. And compensation, she said, is often for legitimate side deals, like the generic company’s supplying ingredients to the name-brand maker.

Deals to Restrain Generic Drugs Face a Ban - NYTimes.com

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