Prescription Drug User Fee Amendments Of 2007
Floor Speech
PRESCRIPTION DRUG USER FEE AMENDMENTS OF 2007 -- (Senate - May 07, 2007)
BREAK IN TRANSCRIPT
Mr. THUNE. Madam President, one of the biggest drivers of health care costs today is the cost of prescription drugs. This debate over reauthorization of the FDA has given us an opportunity to really home in on some of the reasons for those high costs of prescription drugs. We say we spend somewhere around $2.2 trillion on health care today or about 16 or 17 percent of our gross domestic product. Of that amount, about 15 to 20 percent of what we spend on health care is for prescription drugs. It is an enormous industry in this country.
Frankly, some remarkable things have happened. We have wonderful therapies that have prolonged life, have improved the quality of life, and for that we can be grateful to those companies which are investing in the research and development that is necessary to bring these types of new therapies and drugs onto the market.
At the same time, we have to be very concerned about the cost of these things. Everybody has to be concerned about that. The taxpayers, who underwrite the cost of Medicare and Medicaid, which is a big part of the cost of health care in this country, have a stake in this debate, as does every consumer who, for prescription drugs--whenever they are diagnosed with something and a doctor prescribes a certain medication, a certain drug, and they have to go get it, obviously that cost is borne by them as consumers and by their health care provider, their insurer. Everybody has a stake in the cost of prescription drugs and doing everything we can to lower their costs, to make them more affordable to average people in this country.
We have an amendment, the Stabenow-Thune-Brown-Lott amendment having to do with citizen petitions, which was just debated. It has been debated. It is under consideration as part of the managers' amendment. I thank the managers, Senators Kennedy and Enzi, for giving us an opportunity to perhaps have it included in the managers' amendment. I think this is an important amendment, one that addresses the issue we are talking about today, the high cost of prescription drugs.
The amendment will reduce the filing of frivolous ``citizen petitions'' that delay entry of generic drugs to the market and unnecessarily increase drug costs for both taxpayers and consumers. My colleague from Michigan, the distinguished Presiding Officer, has discussed this earlier.
A citizen petition is intended to be just that--it is a petition that is filed by an individual or a group in order to raise potential concerns. If you look at what has happened with that, that process has been abused. You can see that even from what the FDA Chief Counsel has said about this process:
These petitions appear designed not to raise timely concerns with respect to the legality or scientific soundness of approving a drug application, but rather to delay approval.
What has happened in this process is it has become hijacked and is being used for purposes for which it was not intended.
Under current FDA regulations, the simple act of filing a petition, no matter how meritorious or frivolous that petition may be, automatically delays the approval of a generic drug. Under current regulations, there is no risk or cost associated with filing a citizen petition. Yet the benefit to a brand-name company in maintaining their market share for even a few months is enormous.
I want to show another chart which I think further defines why there is so much advantage for a company to use this process in a frivolous way, to delay the introduction of generic drugs into the marketplace. Take Flonase, for example. The delay caused by using the citizen petition was 645 days. During that period, the additional sales that were generated were over $1 billion--$1.6 billion. If you look at DuoNeb, another drug, 420 days' delay yielded $262.5 million additional revenue generated during that delay period.
The amendment will allow the FDA to verify that citizen petitions are legitimate by requiring applicants to verify that they have not received compensation from another organization to file such a petition. It will also prohibit delays of generic drug approvals unless the FDA determines within the first 25 days that a petition is filed that the petition raises a genuine public health concern. This amendment helps to remove the incentive for drug companies to file unnecessary or illegitimate citizen petitions.
Even the FDA has said the citizen petition process is inefficient and is often abused by pharmaceutical companies. This is troubling to me because the rising cost of prescription drugs is one of the largest drivers, as I said earlier, of health care costs in our country today. These costs contribute directly to the rising cost of health insurance premiums for families and small businesses and the cost to all taxpayers for what we pay for Medicare and Medicaid.
As a Member of the House of Representatives in 2002, I sponsored legislation that would help speed access to lower cost generics. Back then, one of the major issues of concern to Congress and consumers was the automatic 30-month stay brand-name companies could request whenever a challenge was raised to the patent. FDA regulations at the time essentially allowed a pharmaceutical company to ask the FDA for an unlimited number of 30-month stays as generics sought entry into the market, effectively delaying their approval. Now we are looking at yet another loophole the industry has found to delay access to lower cost generic drugs.
Access to generic drugs is one crucial part of the solution to controlling prescription drug costs. As I said earlier, in overall health care costs, what continues to increase over time is the cost of prescription drugs. As I said earlier, there are also some wonderful therapies, some medications that were brought onto the market that are doing remarkable things for health care in this country. But there is also a long period where drug companies that develop these types of medications and therapies have the exclusive right to market those. During that period, they have an opportunity to recover the cost of the research and development that goes into that particular drug. But there is a point at which that period comes to an end. When that period comes to an end and it is opened to competition, then other generic drug manufacturers can enter the marketplace. What you generally see happen is drug costs go down dramatically when competition takes hold.
I am a big believer in the market. The market works when there is competition. What we will need, if we want to do something about the high cost of prescription drugs and the impact they are having in driving health care costs in this country, is to create more competition in the marketplace.
What this particular loophole does, the citizen petition loophole, is it allows drug companies to take advantage and in a frivolous way use something that was intended for legitimate purposes; that is, to allow citizens to challenge this process, to extend the period in which they can continue to exclusively market a drug to the tune literally of billions and billions of dollars of additional cost. That is wrong.
The amendment we have introduced--the Senator from Michigan, Senator Stabenow, Senator Brown, Senator Lott, myself--would simply bring some clarity to this and make sure, when the FDA has an opportunity to determine, to take a look at these citizen petitions, that petition does, in fact, raise a genuine public health concern. I believe this amendment will help remove the incentive drug companies have to file unnecessary or illegitimate citizen petitions in order to continue to reap some of these profits and take advantage of a loophole that exists today that needs to be closed.
I hope the managers of the bill, those who have been working with us throughout the course of this process, will find their way to accept this amendment into the managers' package, allow it to be adopted as part of the FDA reauthorization and to do something that in a very significant and meaningful way will address what is a serious problem in America today; that is, the high cost of health care which is driving more and more people into the ranks of the uninsured, becoming a higher cost and burden on small businesses, and, as I said earlier, a big component of that cost of health care is the cost of prescription drugs.
I think this amendment, along with others we have debated here today as well--and I happen to support allowing for the reimportation of drugs from Canada and Europe and places such as that, which will help bring drug costs down in this country--these things will all add competition to the marketplace. Competition drives down costs, it drives down costs for consumers, it drives down costs for taxpayers. That is a good thing. This particular amendment closes a loophole that needs to be closed that will bring about lower costs for consumers in this country.
I thank the sponsors and the managers of the legislation for their cooperation and willingness to work with us, and I hope in the end we can have this amendment adopted and do something that is serious and meaningful in terms of eliminating unnecessary delays in allowing for generic drug approvals, getting them into the marketplace, and driving down the cost of prescription drugs.
BREAK IN TRANSCRIPT
Source