Data Exclusivity for Biologics at Forefront of International Trade Agreement Negotiations

A host of biopharmaceutical regulatory issues are said to be at the forefront of trade talks between the US and a group of 11 countries in the Asia-Pacific, potentially complicating both the agreement and the Obama administration's already complicated relationship with the pharmaceutical industry, reports Reuters.

The agreement in question is known as the Transpacific Partnership (TPP)-a regional trade policy long under negotiation and periodically subject to transparency concerns from legislators and public advocacy groups who fear the US Trade Representative (USTR) is keeping negotiations secret to limit public input. Those concerns apparently led to House Oversight Committee Chairman Darrell Issa (R-CA) leaking part of the proposed agreement.

But even if transparency concerns remain, it is the Obama administration's stance on data exclusivity for biological medicines that has earned the ire of the biopharmaceutical industry, reports Reuters.

"The White House, for whatever reason, is pursuing a trade policy that (potentially is at odds with) US law," said Harrison Cook, a vice president at pharmaceutical manufacturer Eli Lilly, to Reuters. "It is difficult to understand, given the strong support and the realization this that kind of protection is needed for the future of the industry."

Under the terms of Title XIII of the Patient Protection and Affordable Care Act (PPACA), sometimes referred to as "Obamacare," manufacturers of biological medicines were granted 12 years of data protection for their biological products, during which time manufacturers of generic biological products-also known as biosimilars or follow-on biologics-could not obtain approval from the US Food and Drug Administration (FDA).

According to one congressional staffer involved in the negotiations, the 12 years of exclusivity was a serendipitous turn for biopharmaceutical companies, who had sought the comparatively long period of exclusivity from the outset. Congressional Democrats, some of whom sought exclusivity periods as short as five years, were ultimately defeated after some Democrats with biotechnology industries headquartered in their districts broke ranks to side with Republicans in support of lengthy exclusivity provisions.

The Obama administration's trade agreement so far isn't pushing explicitly for those 12 years of exclusivity, leaving open the potential for USTR negotiators to settle on a lesser number of years such as the seven years of exclusivity originally sought by both the Obama administration and congressional Democrats during the 2010 debate over the PPACA.

At issue for biopharmaceutical companies is the amount of time and money it takes to generate data showing their product is both safe and effective. After the protected period of data exclusivity ends, generic companies are allowed to reference the data as a means to show that their highly similar product will-presumably-exhibit the same safety and efficacy profile as the originator. Given the high cost of developing the data, branded biologics companies want more time to recoup their up-front costs before being subject to generic competition which historically has eroded much of the product's market share.

Though negotiations continue, the USTR said it is attempting to address underlying issues related to data exclusivity "before proposing any specific provisions."