Federal News Service Transcript - Agreement of a Generic-Drugs Bill

Federal News Service

June 5, 2003 Thursday

HEADLINE: NEWS CONFERENCE WITH SENATOR JUDD GREGG (R-NH); AND SENATOR CHARLES SCHUMER (D-NY)
 
SUBJECT: AGREEMENT ON A GENERIC-DRUGS BILL
 
LOCATION: SENATE RADIO-TV GALLERY, THE CAPITOL

SEN. SCHUMER: Well, thank you, Judd. And first, let me thank you for your leadership. Judd and I became friends on the basketball court in the House gym.

SEN. GREGG: We were on the bench, actually, weren't we? (Laughter.)

SEN. SCHUMER: Yes. When no one else showed up, we got to start. And they usually had us guard each other. (Laughs.)

But in any case, I want to thank Judd for his leadership in today and four of us coming together.

I guess they say that politics can make strange bedfellows. And Judd standing here today with me—and John McCain and Senator Kennedy in absentia—but Judd and I being here today remains me of the great artists, Vincent Van Gogh and Paul Gaugin, who were arch- rivals before coming together to create beautiful art. "In general, Vincent and I do not see eye to eye, especially as regards painting," Gaugin wrote to a friend in 1888.

But later that year the two spent nine weeks together in southern France, producing works that helped set the stage for what we know today as modern art.

Well, what Judd and I are working together to achieve today, a hundred years later, may not be art, but the effect might be just as eye-catching. We've achieved a real breakthrough with this agreement, because we've met the original goals of the Schumer-McCain bill by modifying it to address the concerns that critics, like Senator Gregg, had from supporting it last year. We've really come together. We've met halfway. And as a result, I think we've got a stronger bill poised to roll through the Senate, and it stands a good chance of being able to make it through the House as well.

As Judd said, the proposal we've put together makes it easier for less expensive generic drugs, and it'll significantly reduce costs to senior citizens, but also to younger people who need these drugs, and to the U.S. government, and to companies throughout America that are struggling with the high cost of medical care. The U.S. government will save billions of dollars, and that's not chump change. It's real savings, and if there was ever a time we needed those savings, it's now. America's economy is hurting, and prescription drugs become a costly necessity for millions of Americans and for this government. State Medicaid programs, businesses, employers, insurers—we're all struggling to pay for prescription drug coverage. And consumers of all ages are struggling to pay for their prescription drugs. We've all heard the stories.

This bill does something to reverse that situation. It's free- market, pro-consumer, and it doesn't cost the government a penny. It's a nice going-away present for Mitch Daniels. It's the kind of bill he would dream of; that is, again, a bill that's free-market, pro-consumer, and doesn't cost the government a penny.

SEN. GREGG (?): Saves it.

SEN. SCHUMER: Saves the government money to boot.

So let me illustrate how this helps the average consumer. My office surveyed some of the most commonly prescribed drugs for senior citizens in New York, and we figured out how much they'd save if the generic was available. The savings are astonishing, and you can see some of them here, in terms of the gap.

New York City residents pay $1,100 a year for Celebrex. That's a very popular and effective arthritis medication. A generic drug would cost New Yorkers about $420 a year. The numbers are the same in—similar in New Hampshire or throughout the country; I just did them for my state.

In Long Island, the average cost of Lipitor, the popular cholesterol drug, which I am taking, is $935 a year. A generic version is 365 (dollars). Instead of paying $590 for NORVASC, the hypertension and angina drug, people would pay 230 (dollars) a year for the generic version.

So, for the individual consumer, these prescriptions are almost a dream come true. They show that these drugs can one day be within the reach of working Americans, without having to take out a second mortgage.

Judd has gone over some of the details, and I think we'll—they're in the press release—I think we'll forego the details, but Judd is exactly right. We've done a bunch of things. We've kept the basic thrust that you can't go for extra 30-day -- 30-month period and 30-month period and 30-month period. We've made it difficult, if not impossible, to file frivolous patents and extend the original patent to the drug. But we've done it in a different way, one that reduces litigation, so everyone won't be in court arguing. And we've done it in a way that says to a drug company: Continue to innovate; we want you to innovate, because we're not going to do anything to curb your first set rate of return. And so, that's basically what we do here. And we also tell the generic industry: No more games. If you have an exclusivity agreement, you can't use that to prevent the drug from coming on the market. So, this is not pro-brand name drug, it's not pro-generic drug, it is pro-consumer. When either industry is doing something they shouldn't, the bill takes it into account, but does it in a way that they won't end up in court all day long.

So, we're proud of this bill. It's going to make a real difference. And I know with Judd's leadership as chairman of the committee, we'll get it through the health committee and then make sure we can get—make it come to law.

I just want to add a few personal notes. Aside from Judd's leadership, I want to thank John McCain. He was going to be here; I don't know what happened.

STAFF: (Off mike) -- five minutes.

SEN. SCHUMER: Five minutes? Well, we'll hope.

But John has been my partner in this, originally, and he has been a great partner and a—someone who really cared about this issue, stuck his neck out. And when he saw that Judd and I were putting together a compromise, he helped make it happen, he—in the sense that he said, "You do what we have to do to get this bill done." And I appreciate that.

I want to thank Ted Kennedy, also who was going to be here today. But they're very busy. And he—again, when he was chair of the committee, he really made this issue and put it front and center.

And two other people I want to thank are John Edwards and Sue Collins. Both of them worked real hard to make modifications. John has been lobbying me from day one and working with me to make sure this happens, and both of them deserve a lot of credit, as well.

Let's hope we can make this bill law.

SEN. GREGG: Take any questions. One over here.

Q Your -- (off mike) -- notwithstanding, there was a strong bipartisan -- (off mike) -- the Senate, but it was opposed by, in order, the House, the White House and the drug industry.

Do you have any indication that those three interests who were opposed will support this?

SEN. GREGG: Well, first off, I think that we have a much better bill. I mean, obviously, a strong effort was made last year, and my disagreements went basically to the litigiousness that I thought would come out of the bill and to the chilling effect I was afraid it might have on innovation. But those have all been addressed. So I do think we have a much better product to make a case for.

I'm hopeful, and I think we have—I can't speak for the White House, but I do think the administration has looked at this and feels fairly positive about it. I'm hopeful that that will be the case.

As for the House, I would never, never speak for the House of Representatives on any subject. But, hopefully, if the Senate can put together a good bill, the House will take a long, hard look at it.

The industry? I think both sides of the industry might have some concerns because we didn't try to write an industry bill that was either generic-oriented or brand-name-oriented. We tried to write a bill that would be good for the consumer and would also protect the basic goals of those two industries; the brand names wanting to protect their intellectual property and their ability to make money off their intellectual property, and the generics wanting to get on the playing field quickly and without a lot of gamesmanship. We've attempted to do that. And so there may be reservations on both sides, but I think we can overcome them because it's a good bill.

Q Last year's bill was -- (off mike). Is there any estimate on this year's bill? And also, do you -- (off mike) -- Medicare -- (off mike)?

SEN. GREGG: Well, this does have a price tag of savings somewhere in the $60 billion range, depending on what the administration does relative to their regulation on the 30-month rule. But as it presently stands, it would be scored, I think, somewhere in that range.

Will it end up on the Medicare bill? It could, or it could move free-standing, in my opinion. It's going to have a very strong vote coming out of the committee, I think.

SEN. SCHUMER: One other thing I just want to mention, Julie. I don't think this is a weaker bill. I think in terms of the consumer, in terms of bringing the prices down, it's every bit as good as the bill that Senator McCain and I did last year, it just takes a different approach, particularly on the enforcement side, saying there are better ways to do it than long litigation.

Q What was Senator Frist's reaction to the legislation?

SEN. GREGG: You should probably ask Senator Frist. But he was—he's been kept apprised of what we're doing. And, obviously, he's not only the leader, he's the key player on our committee. So we want to make sure Senator Frist is content.

Q Under this legislation, FDA will have to go back and make changes in -- (inaudible) -- regulations -- (inaudible)?

SEN. GREGG: Well, there has been no regulation issued. And we think that they're functioning under a regulatory straight jacket, which doesn't allow them to do as much and be as creative and be as positive as we were. So, we hope that they'll take a hard look at this and evaluate it before they come to a conclusion as to what they put forward as a regulation.

SEN. SCHUMER: And last year, when the FDA came out with this regulation, and many of us called them and asked them: Well, why didn't you do this, this or this?, they said: Much of what we would have to do would have to be statutory; that they didn't have the ability to just write the regulation as best they want. And I'm hopeful that the FDA, when they see this, they'll say: We're supportive of this, and we don't need the regulation. But that will be up to them.

Q Senator Gregg, if I can ask something on another topic, this whole question of --

SEN. GREGG: Well, let's just see if there are any other questions on this topic first.

Yeah?

Q Sure. If this were added to the Medicare legislation, given the potential of $60 billion you'd save, would this essentially free up more funds that are added to the prescription drug benefit in Medicare? I mean --

SEN. SCHUMER: It very well might.

Q—it could be a $60 billion kind of --

SEN. SCHUMER: Well, the $60 billion is everybody's savings; it's not just the government savings.

Q Is that just specific to Medicare? How is that?

SEN. SCHUMER: I can't remember. Our number for Medicare was about $6 billion?

STAFF: Without the current -- (off mike) -- Medicare—or, in this drug benefit, I think it's -- (off mike).

SEN. SCHUMER: Twenty billion (dollars). So, it will clearly free up some money for Medicare if this passes, and for Medicaid and for other things.

SEN. GREGG: Makes it much more attractive to the Medicare package, I would think.

Q Would either of you care to say -- (off mike) -- the Medicare package -- (off mike)?

SEN. GREGG: I think we probably should save that for another event, because that would be—become the dominant topic of this event if we were to get into it, quite honestly. (Chuckles.)

Okay, John, you had a --

Q Yes, the Democrats, as you know, have been outraged that -- (off mike) -- refundable child tax credit was taken out of the tax bill. Now, they're citing 250,000 military families that would now no longer get the child tax credit. What's your response to those charges that this just shows Republicans were, you know—are not doing things for the working poor with tax cuts?

SEN. GREGG: Gee, again, I think that's probably best left to another arena. But I suspect that's going to be addressed by the majority leader and the chairman fairly quickly.

Q Do you think it shows that -- (off mike)?

SEN. GREGG: I'll leave that to the majority leader and the chairman at the moment.

Q What extent is -- (off mike) -- that, again, in a three- month period, that all patents -- (inaudible) -- should be resolved? The generics are concerned that they might -- (off mike) -- will still be -- (off mike).

SEN. SCHUMER: Well, first, the generic can start the suit before the patent actually expires; so, in fact, they can start at any time, up to starting with five years after the drug is on the market.

Q Filed their application.

SEN. SCHUMER: After they filed their application.

Q (Off mike.)

SEN. SCHUMER: Right. Sorry. Filed their application.

So that will cut back on the time rather significantly that is needed there. And I think, you know, smart generic companies will have most of these issues resolved by the time the patent expires. Now, I mean, could it work out in a couple of instances that it wouldn't? Yes. But overall, that doesn't seem to be a problem.

SEN. GREGG: Okay. Last question here.

Q I have two questions. One of the provisions that has affected -- (off mike) -- lawsuits -- (off mike) -- that said that if government -- (off mike) -- did not list certain patents -- (off mike) -- they would lose the right to -- (off mike).

SEN. GREGG: No, that's dropped.

SEN. SCHUMER: Well, the Orange Book provision --

SEN. GREGG: But --

SEN. SCHUMER: There is an Orange Book provision in there.

SEN. GREGG: There is, but it doesn't go to that.

SEN. SCHUMER: It doesn't talk about that. Right.

SEN. GREGG: It's not the use-it-or-lose-it situation or list-it- or-lose-it.

SEN. SCHUMER: Right.

SEN. GREGG: It basically limits the damages that are available if somebody sues on the issue of whether the patent exists. You can't hide the patents any longer and get treble damages.

Is that the correct—the emphasis of that?

SEN. SCHUMER: Yes.

STAFF: It provides for—you can address listing issues in a counterclaim, but only in the context of a counterclaim. And that's what the Federal Trade Commission had recommended in its report last year.

SEN. SCHUMER: I think if you look at this bill overall, I mean, it deals with a lot of the problems. These were not pro-drug, pro- brand, pro-generic, just problems, because this is such a complicated area. And I think we deal with them effectively.

This is a—I am convinced, from my perspective, that this is a better bill, not just a compromise, but a better bill.

SEN. GREGG: Thank you very much.