New rules promise faster generic drug approval by limiting laws

WASHINGTON -- Cheaper generic versions of pricey medications could reach consumers more quickly under federal rules announced Thursday -- but not as quickly as the Senate hopes to speed them.

The goal is to save consumers and taxpayers billions in health care costs. The question is how far the government will challenge the brand-name drug industry to do that.

The Bush administration issued new rules to make it harder for brand-name drug companies to block generic competition.

"We will bring generic drugs to the market much more quickly, in some cases years earlier," said President Bush, estimating the changes could save $3.5 billion a year.

Under the rules, lawsuits to stall Food and Drug Administration approval of the cheaper generic could only trigger a single 30-month delay. Today, brand-name companies can file repeated patent infringement challenges that trigger multiple 30-month stays.

The new FDA rule, which takes effect Aug. 18, also forbids frivolous patents -- such as those covering a drug's packaging -- from being registered with FDA and thus triggering the delay.

Generic drugs typically cost less than half the price of their brand-name counterparts, so every month that the maker of a blockbuster brand can stave off competition means big profits.

The announcement came one day after a key Senate committee passed legislation that goes further than the FDA rule blocking multiple-lawsuit delays by allowing generic companies to countersue and thus potentially avoid any delay.

The legislation would also block other tactics that thwart generic competition -- including payoffs to generic companies to keep cheaper products off the market.

Lawmakers pledged to push ahead with the legislation, and FDA commissioner Mark McClellan called it "complementary and consistent" with his agency's new rules.

But the powerful brand-name drug industry killed similar legislation last year, and was noncommittal Thursday on whether it would accept even the FDA's first-step change, which could be challenged in court unless that same Senate bill ratifies it.

"Current law works well," said Bruce Lott of the industry's Pharmaceutical Research and Manufacturers of America.

Consumer advocates feared the incremental FDA rule could doom bigger reform.

"Make no mistake about it, these regulations are being issued today to thwart far more protective rules that are very popular in Congress," said Ron Pollack, executive director of Families USA.

The issue comes amid increasing concern about aggressive drug-industry tactics.

Take Cardizem CD, a popular blood pressure medicine. In 1998, German maker Hoechst paid generic manufacturer Andrx Corp. just under $100 million to keep its cheaper version off the market for 11 months. Cardizem users were paying $73 a month for the brand-name drug, when the generic cost just $32, according to a class-action lawsuit that recouped some of the money for consumers through an $80 million settlement in January.

The first generic version to win FDA approval gets six months of exclusive sales before another generic competitor can be approved, a clock that doesn't start ticking until the sales begin. The Senate bill would make generic companies forfeit that valuable exclusivity if they enter a Cardizem-like deal to stall generic sales, something else FDA doesn't address.

"When it comes to improving access to less expensive generic drugs, halfway measures won't cut it," said Sen. Charles Schumer, D-N.Y., who joined Sens. Edward Kennedy, D-Mass., and Judd Gregg, R-N.H., in pledging to push forward with their broader legislation. It could reach a full Senate vote next week.

Patent issues aside, the FDA is seeking an extra $13 million in funding for additional generic work -- educating consumers that generics are just as good as brand-name competitors, and advising generic manufacturers on how to avoid application errors that delay their approvals.