Posted 21 June 2016
By Zachary Brennan
The Senate Judiciary Committee on Tuesday held a meeting with a panel of experts to discuss a recently introduced bill that seeks to stop branded drug companies from misusing Risk Evaluation and Mitigation Strategies (REMS) to withhold access to drug samples for bioequivalence testing necessary for bringing generic drugs to market.
The bill, known as the CREATES Act and introduced last week, focuses on two tactics often employed by the branded drugmakers to halt or delay generic competition, including:
- Sample-sharing, which occurs when brand name drugmakers prevent potential generic competitors from obtaining samples of the branded product, so the generic companies cannot perform the testing necessary to show that its product is equivalent to the brand-name product, which is a prerequisite for FDA approval.
- Participation in a shared safety protocol, which occurs when branded manufacturers claim to require a distribution safety protocol (known as a Risk Evaluation Mitigation Strategy with Elements to Assure Safe Use, or “REMS with ETASU”) and then refuse to allow generic competitors to participate in that safety protocol, which further undermines generic drugmakers’ abilities to gain FDA approval.
The CREATES Act allows a generic company facing one of these delay tactics to bring an action in federal court for injunctive relief (i.e. to obtain the sample it needs, or to enter court-supervised negotiations for a shared safety protocol).
The bill is backed by 19 physician, pharmacist, hospital and consumer groups, in addition to senators from both sides of the aisle and other experts who believe it could lower the price of drugs, though the industry group PhRMA has offered its opposition to the bill on the grounds of patient safety concerns.
On Tuesday, the Senate committee convened a hearing of lawyers, professors and other experts, nearly all of whom expressed support for the bill.
“While some parties have attempted to use the antitrust laws to address this conduct [of blocking access to drug samples], I believe it is better characterized as a competition policy problem stemming from a regulatory misuse of government regulation,” Sen. Mike Lee (R-UT) said in a statement. “In these situations, the answer is not to pile antitrust enforcement on top of regulation, but to fix the underlying problem: the law itself. I believe the CREATES Act does just that and am hopeful that it will become law and lead to increased competition and lower prices for consumers.”
However, Peter Safir, senior counsel at Covington & Burling who testified on PhRMA’s behalf, said, “Despite the serious safety risks of drugs with REMS with ETASU, the CREATES Act does not establish robust criteria that eligible product developers seeking to obtain such a drug must satisfy in order to protect patients and other individuals who come into contact with the drug during its distribution. The bill requires eligible product developers to obtain an ‘authorization’ from FDA before they can sue an innovator to force the transfer of drugs subject to an ETASU, and the Agency ‘shall’ issue such an authorization within 90 days.”
He also took issue with the bill’s provision that provides that an eligible product developer “need only show that such protocols and other documentation provide safety protections ‘comparable to those’ provided by the innovator’s REMS—rather than equivalent to the existing REMS.”
But as Rachel Sachs, who will join the faculty of the Washington University in St. Louis School of Law in the fall, pointed out to Focus: "The apparent conflict over the
meaning of the term 'comparable' in the context of REMS protocols is
somewhat illusory and shouldn't negatively impact the bill. The FDA has for
years used this exact word when talking about safety protocols for
bioequivalence studies conducted on products subject to REMS, and it seems that
the CREATES Act lifted the phrasing directly from FDA guidance documents."
Beth Zelnick-Kaufman, assistant general counsel for generic drugmaker Amneal Pharmaceuticals, also debated the patient protection claims, saying that there’s nothing in the CREATES Act that’s associated with patient safety issues and that the Act merely ensures generic companies gain access to a drug sample and does not mean they will have unfettered access to use that sample outside of FDA's purview in trials or elsewhere.
Similarly, professor Robin Feldman, director of the Institute for Innovation Law at the University of California Hastings College of the Law, cited FDA’s claim that it has received about 100 letters of inquiry on the misuse of REMS and noted that based on her review of 13 years of generic drug data, “REMS abuse has gone on for a while.”
Sen. Charles Grassley (R-IA) also highlighted what Federal Trade Commission chairwoman Edith Ramirez said in March: “The FTC continues to be very concerned about potential abuses by branded pharmaceutical companies of REMS or other closed distribution systems to impede generic competition. ...[T]his conduct undermines the careful balance Congress struck in the Hatch-Waxman Act to encourage competition from lower-cost generic drugs, and may violate federal antitrust laws.”
The CREATES Act: Ending Regulatory Abuse, Protecting Consumers, and Ensuring Drug Price Competition