Big Pharma’s Fight Against Drug Pricing Reforms Takes a Strange, Desperate Turn

Enlarge / Stephen Ubl, president and CEO of Pharmaceutical Research and Manufacturers of America (PhRMA), speaks during a panel discussion at Bloomberg Live in Washington, DC, in 2017.

After a series of decisive court defeats, the pharmaceutical industry appears to be taking its fight against Medicare drug price negotiations directly to the people, and the White House is not impressed.

This week, the powerful industry group PhRMA (Pharmaceutical Research and Manufacturers of America) launched two striking attacks on federal efforts to lower America’s uniquely astronomical drug prices. In a Tuesday press release, PhRMA announced an analysis suggesting that negotiations over Medicare drug prices — part of the Biden administration’s Inflation Reduction Act of 2022 — could actually cost some seniors and people with disabilities slightly more in out-of-pocket costs. However, the analysis relies on a key (and questionable) assumption that the federal government will set price caps using the highest possible estimate of maximum fair prices in 2026.

Milliman, the PhRMA consulting firm tasked with conducting the study, cautioned that actual prices “will certainly vary due to differences in unit cost and utilization trends, 2026 benefit designs, and actual 2026 maximum fair prices.”

On Wednesday, PhRMA announced an “educational campaign” on how the U.S. intellectual property system “is actually the vehicle for less [drug] “The bold claim will likely come as a shock to the pharmaceutical industry’s many critics, who for years have noted how drug companies exploit double patents or “patent thickets” to extend drug monopolies and prevent low-cost generics from entering the market. market.

“They will lose”

For example, Sen. Bernie Sanders (I-Vt.), a staunch critic of drug pricing, has criticized patent thickets in congressional reports, noting that companies often file dozens of patents for a single drug. Merck, for example, has 168 patents for its cancer drug Keytruda, most of which were filed after the drug was approved by the Food and Drug Administration. Johnson & Johnson, meanwhile, filed 57 patents for its arthritis treatment Stelara, 79 percent of which were filed after FDA approval.

Merck and Johnson & Johnson are members of PhRMA, along with many other renowned pharmaceutical companies, including Pfizer, Bayer, GSK, Lilly, Novo Nordisk and Sanofi.

A 2022 study published in Nature Biotechnology found that of 179 patents covering nine biologic drugs that were the subject of patent infringement lawsuits, 94 percent of the patents covered minor or peripheral aspects of a drug, such as manufacturing techniques. . Only 11 of the 179 patents, 6 percent, were related to a drug’s actual active ingredient. However, these thickets of secondary patents effectively allowed pharmaceutical companies to extend market exclusivity well beyond the 12-year period provided by federal law.

In an attempt to clear up some of those tangles, the U.S. Patent and Trademark Office last month proposed a rule that would affect certain complementary patents, called terminal waivers. Under the proposed rule, if a pharmaceutical company puts a terminal waiver on multiple patents and one of them becomes invalid for any reason, the pharmaceutical company would agree not to enforce any of the other patents linked by the terminal waiver.

On Wednesday, the Biden administration responded to PhRMA’s attacks on drug pricing reforms. In a statement that provided links to PhRMA’s initiatives this week, White House spokesman Andrew Bates called Big Pharma’s drug pricing “corporate scams.” He noted that the pharmaceutical industry spent an “unprecedented $372 million lobbying against” drug pricing reforms but lost the battle against passage of the Inflation Reduction Act.

“Now that President Biden is delivering real savings to families who have been overcharged by Big Pharma for desperately needed medications, they continue to fight tooth and nail against the financial interests of American seniors,” Bates said. “They will lose this fight, too.”

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