Panel Passes Bipartisan Bill To Stop Payoffs That Delay Generic Medicines

WASHINGTON (Thursday, February 15) – The Senate Judiciary Committee today passed a bill that takes aim at the growing problem of brand-name drug manufacturers using pay-off agreements to delay the public’s access to generic medicines.  The bipartisan Preserve Access to Affordable Generics Act (S. 316) would prohibit brand-name drug companies from exploiting a loophole in the Hatch-Waxman Act to pay generic drug companies to delay entry of new generic medicines into the market.

Senator Patrick Leahy, (D-Vt.), the chairman of the Committee, introduced the bill along with fellow panel members, Senators Herb Kohl (D-Wisc.), Chuck Grassley (R-Iowa), Russ Feingold (D-Wisc.), and Charles Schumer (D-NY).

Below is Chairman Leahy’s statement on the Preserve Access to Affordable Generics Act.

Statement Of Sen. Patrick Leahy
Chairman, Senate Judiciary Committee
On The Preserve Access To Affordable Generics Act (S. 316)
Executive Business Meeting
February 15, 2007 

On January 17, 2007 Senator Kohl and I, along with Senators Grassley, Schumer, and Feingold introduced the Preserve Access to Affordable Generics Act. This is important legislation that will put competitively priced generics on the market and in the hands of consumers across the Nation without delay. The sooner affordable generic drugs are on the market, the sooner Americans start saving on their health care costs.

Of course, the need to bring affordable generics to the market must be balanced with policy that does not hinder those developing these important drugs. Concerns have been raised that the Affordable Generics Act, as introduced last month, could take away some of the incentives generic drug companies depend on when challenging the patents of brand name drugs. Under the Hatch-Waxman Act, generic drug makers operate on a unique business model that relies solely on the ability to challenge weak and invalid drug patents. 

In the weeks since introduction we have worked diligently with industry leaders to reach a proposal that lessens some of their concerns but that saves for our bottom line -- to end the trend of anti-competitive agreements between brand name pharmaceutical companies and generic companies to delay entry of affordable generics into the market. I am pleased that so many key players have come to the table in a good faith effort to find the middle ground. We have indeed made progress. 

I am committed to helping seniors, families, and Americans that are struggling to keep pace with the ever rising costs of health care in this country. The Affordable Generics Act is an important step in that direction; it puts a stop to the practice of collusive market allocation by drug companies and puts savings in consumer’s pockets. I look forward to working with my colleagues on both sides of the aisle to see this bill through to the president’s desk. 

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