Regulatory Focus™ > News Articles > Bill Would Close Loopholes Now Preventing Some Generic Drugs From Being Approved

Bill Would Close Loopholes Now Preventing Some Generic Drugs From Being Approved

Posted 22 September 2014 | By Alexander Gaffney, RAC

Bill Would Close Loopholes Now Preventing Some Generic Drugs From Being Approved

A new bill introduced last week would seek to limit the use of safety programs required by the US Food and Drug Administration (FDA) to delay and even prevent the introduction of generic drugs into the market.


REMS were first introduced under the 2007 Food and Drug Administration Amendments Act (FDAAA), and were meant to act as a regulatory hedge against potentially risky products. REMS typically include the following elements: A communication plan, Medication Guides (MedGuides), an implementation plan and elements to ensure safe use (ETASU) of the drug.

ETASU's are REMS' most stringent requirements and include prescriber requirements, enrollment forms, training materials, process controls, consent forms, safety controls and monitoring programs. Some REMS will only include one or two of these elements, while others, such as the REMS for isotretinoin, may include nearly all of them.

The overarching goal of an ETASU is this: Keep drugs out of the hands of patients who won't benefit, and ensure that those who do receive the product use it correctly. Human rights campaigners have even tried to use it to keep certain drugs from being used at a US military facility located at Guantanamo Bay, Cuba (to no success).

But as branded pharmaceutical companies have found out, it also has another handy use: keeping patent-protected drugs out of the hands of generic pharmaceutical manufacturers who want to make copies.

Restricted Access: Not Just for Patients

As Focus noted in May 2012, companies have been using REMS to stifle their market competition for quite some time. ETASUs, in particular, have been used to tightly control access to drugs, ensuring that generic drug companies can't get their hands on the products to reverse-engineer their production.

While government competition regulators at the Federal Trade Commission (FTC) have expressed concern with the practice, they have thus far decided not to intervene. And in the meantime, there have been other REMS-related market access issues as well. As we wrote in October 2013, another statutory requirement under FDAAA that all companies institute a single, shared REMS plan for their drugs has also been used to prevent and delay market access for some drugs, leading to calls for FDA to step in (which it has not).

The Generic Pharmaceutical Association (GPhA) has recently highlighted the issue, and commissioned a study which found that delayed market entry due to REMS and REMS-like restrictions cost US consumers north of $5 billion per year in higher drug costs due to reduced generic competition.

New Legislative Efforts

But the use of REMS as a tool to restrict market access may come to an end if a new piece of legislation introduced this week is ultimately successful.

The bill, the Fair Access for Safe and Timely (FAST) Generics Act, would shut down some of the loopholes that generic pharmaceutical companies now say are being exploited by branded pharmaceutical companies.

Under the proposed legislation, REMS could not be used to restrict access to products which are sought "for development purposes" so long as access to the product is "reasonably necessary to demonstrate sameness, biosimilarity or interchangeability."

The key section of the legislation:

"As a condition of approval or licensure, or continuation or renewal of approval or licensure, of a covered product under section 505 of this Act or section 351 of the Public Health Service Act, respectively, the Secretary shall require that the covered product’s license holder not adopt, impose, or enforce any condition relating to the sale, resale, or distribution of the covered product, including any condition adopted, imposed, or enforced as an aspect of a risk evaluation and mitigation strategy approved by the Secretary, that restricts or has the effect of restricting the supply of such covered product to an eligible product developer for development or testing purposes."

The legislation would also make it illegal for any drugmaker to restrict access to their product through agreements limiting the sale, resale or distribution of a drug product, regardless of whether it has a REMS program or not.

Companies would also be allowed to make a written request to FDA for access to a product, which could compel the NDA holder to grant access. Failure of FDA to respond to the request will be considered authorization, the legislation says. The authorization allows the generic pharmaceutical company to obtain "reasonable quantities" of a drug from a company at a "reasonable, market-based price."

Failure to provide access to a product would open up a company to injunctive relief and "treble damages," the legislation notes.

Shared REMS Relief

The legislation also addresses the issue of single shared REMS systems (more on that here) Focus wrote about last year. "With respect to a REMS product, no license holder shall take any step that impedes the prompt development of a single, shared system of elements to assure safe use … or the entry on commercially reasonable terms of an eligible product developer into a previously approved system of elements to assure safe use," the legislation states.

In a statement, GPhA praised the bill, calling it an "important bill" which "promises to prevent unnecessary delays for patients waiting for generic choices and save billions for taxpayers, patients, and the federal government."

The legislation is co-sponsored by Reps. Steve Stivers (R-OH) and Peter Welch (D-VT).


Fair Access for Safe and Timely (FAST) Generics Act

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