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Price Relief, Innovation, and Competition for Essential Drugs (PRICED) Act Would Expedite Biosimilar Market Entry

Although the 12-year exclusivity period for original biologic products was a heavily negotiated provision of the Biologics Price Competition and Innovation Act (BPCIA), increased spending on biologic drugs has led to calls to shorten that exclusivity period to expedite biosimilar market entry. Most recently, on June 23, 2016, Illinois Congresswoman Jan Schakowsky and Senators John McCain (R-AZ) and Sherrod Brown (D-OH) introduced the “Price Relief, Innovation, and Competition for Essential Drugs” (PRICED) Act in the U.S. House of Representatives and Senate. The bills would amend the “first licensure” provisions of the BPCIA to shorten the market exclusivity period for new biologics from 12 to 7 years. Similarly, the President’s budget for fiscal year 2017 recommended “prohibiting additional periods of exclusivity for brand biologics due to minor changes in product formulations.”

A. Curtailing Spending On Biologic Drugs

Since the BPCIA took effect in 2010, only two biosimilar products (Zarxio and Inflectra) have been approved, while spending on biologic drug products has nearly doubled to more than $128 million. The PRICED Act is intended to speed lower-cost biosimilar products to market. According to Office of Management and Budget estimates, the PRICED Act would save the Federal government $21 billion over 10 years.  The House version, H.R. 5573, has been referred to the House Energy & Commerce Committee.

B. Upsetting A Delicate Balance

Trade organizations representing originator drug and biotechnology companies “strongly oppose” shortening the data exclusivity and/or market exclusivity periods for original biologic products. Doing so, they say, “would reduce research and development investment in the US,” stifle industry innovation, and ultimately “deprive patients of many new treatments and cures in the future.”

Underlying these complaints is the belief that the PRICED Act would undercut the delicate balance struck by the BPCIA, which established an abbreviated approval pathway for biosimilar products similar to the Abbreviated New Drug Application (ANDA) process for generic drugs. The 12-year market exclusivity period of the BPCIA was designed to take into account the generally longer, riskier, and costlier process of developing a biologic product, and the potential inadequacy of patent protection in the face of a long product development timeline. New efforts to significantly shorten the long-debated and heavily-negotiated exclusivity period may be viewed as attempts to break promises to originator companies just as they are facing biosimilar competition.

C. Complicating International Agreements

The PRICED Act also could complicate or hinder the development of biologics under the Trans-Pacific Partnership (“TPP”) trade agreement, pursuant to which innovator biologics are entitled to 8 years of exclusivity. While consumer advocacy and medical aid organizations have criticized TPP’s supposed capitulation to “Big Pharma,” industry groups and the Obama Administration have agreed that an exclusivity period for original biologic products is necessary to avoid the trade-distorting effects of weak intellectual property laws in many countries.

That rationale reflects longstanding U.S. trade policy, exemplified by the Agreement on Technical Barriers to Trade and Agreement on Trade-Related Aspects of Intellectual Property Rights, and recognizes that pharmaceutical research and development and the protection of intellectual property are areas in which the U.S. has a clear competitive advantage and trade surplus.

D. Other Efforts To Make Drugs More Affordable

The PRICED Act follows on the heels of the “Creating and Restoring Equal Access to Equivalent Samples” (CREATES) Act, which the Senate Judiciary Committee introduced to confront “behavior that blocks competition and delays the creation of affordable generic drugs.”  (Please see here for more information on the CREATES Act.) The PRICED Act, like the CREATES Act, reflects the long-running tension between promoting innovation and making drugs more affordable.

© 2020 Foley & Lardner LLPNational Law Review, Volume VI, Number 194

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About this Author

David L. Rosen, Foley Lardner, FDA Regulatory Lawyer, Life Science Industry Attorney,
Partner

David Rosen is a partner and public policy lawyer with Foley & Lardner LLP. Mr. Rosen has extensive experience in health law, life sciences, and food and drug regulation, including a range of Food and Drug Administration (FDA) regulatory issues affecting prescription and over-the-counter pharmaceuticals, medical devices and biologics. He is co-chair of the firm’s Life Sciences Industry Team and is also a member of the firm’s Government & Public Policy Practice and the Health Care and Food & Beverage Industry Teams.

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Courtenay C. Brinckerhoff, intellectual property  law attorney, Foley & Lardner  Law Firm
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Courtenay Brinckerhoff is a partner and intellectual property lawyer with Foley & Lardner LLP. Ms. Brinckerhoff’s practice focuses on client counseling in all aspects of obtaining, licensing and enforcing patents and conducting freedom-to-operate and due diligence investigations. She is chair of the firm’s IP Law and Practice committee, immediate past vice chair of the firm’s Chemical, Biotechnology & Pharmaceutical Practice and a member of the firm's Patent Trials group, Appellate Practice and Life Sciences Industry Team. She also is involved with Foley’s Medical Device Initiative and Nutraceuticals Team. Ms. Brinckerhoff is the editor and primary author for Foley’s PharmaPatentsBlog.com.

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Ms. Brinckerhoff works with clients in diverse industries, including pharmaceuticals (chemical and biotechnological), human and animal food products, nutraceuticals, and medical devices. She has particular experience with transdermal pharmaceutical products (patches, gels, and liquids), oral dosage forms (including controlled/extended release formulations), enzyme-based technologies, diagnostic and therapeutic antibodies, active and passive immunization therapies, and personalized medicine.

She has served as vice chair of the firm’s Chemical, Biotechnology & Pharmaceutical Practice and is an active member of the firm's Appellate Practice and Life Sciences Industry Team.

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Jason Drori is a senior counsel in the Business Litigation & Dispute Resolution Practice of Foley & Lardner LLP. Mr. Drori concentrates his practice on the legal needs, business challenges, and regulatory pressures of the life sciences sector, particularly pharmaceuticals. He represents pharmaceutical companies and other drug industry stakeholders in commercial disputes as well as investigations and enforcement actions by the Department of Justice, federal regulatory agencies, and State Attorneys General. Mr. Drori litigates complex, high-profile cases involving...

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Simon J. Elliott, Foley Lardner, Patent Application Drafting Lawyer, Due Diligence Attorney
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Simon Elliott is an associate and intellectual property lawyer with Foley & Lardner LLP. Dr. Elliott’s practice involves patent prosecution, patent application drafting, opinions, and client counseling in all areas of biotechnology, pharmaceuticals, food products, and cosmetics. He is a member of the Chemical, Biotechnology & Pharmaceutical Practice and the Energy Industry Team.

Prior to joining Foley, Dr. Elliott was a patent agent at the patent boutique of Sterne Kessler Goldstein & Fox, P.L.L.C., where he prepared and prosecuted...

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