Generics industry sets record for U.S. approvals, has ‘nothing to apologize for’

Generics industry sets record for U.S. approvals, has ‘nothing to apologize for’
by Michael Glessner
Pharmaceutical Research Analyst, Clarivate Analytics
Life Sciences Connect

Download the full report.

At the 2018 Association for Accessible Medicines (AAM) annual meeting, experts highlighted the generic industry’s recent accomplishments while noting that many challenges lie ahead.

On the positive side for the industry, as noted by Jeff Watson, chairman, president and COO of Apotex, a controversial rule change regarding generic drug labeling in the U.S. was not part of the FDA’s unified regulatory agenda.  The rule change, which would open generic companies to additional lawsuits, won’t be enacted in the near term and could be permanently withdrawn. Watson also noted that 2017 saw the enactment of GDUFA II, which many view as a positive for the industry, as well as the release of an FDA Drug Competition Action Plan that looks to, among other things, eliminate the use of REMS as a strategy to delay generics, advance the acceptance of biosimilars, and expedite the review of high priority generic drug application submissions.

In his welcoming remarks to the Orlando conference in mid-February, Watson also mentioned an initiative supported by AAM to provide free courses on prescription drug abuse at a number of colleges which have already been completed by tens of thousands of students.

Among the many challenges facing the generic industry, Watson mentioned state-level pricing laws in the U.S. that fail to recognize key differences between the generic and branded drug industries.

Chip Davis, president and CEO of AAM, talked about how the generics industry has fewer resources than branded drugs and pharmacy benefit managers (PBMs) to lobby Congress. He estimated that branded medicine spends 25 times the amount the generics industry does on lobbying efforts.  Davis added that generics now control 89% of the U.S. market on a volume basis and 26% on a cost basis.

Davis echoed Watson’s remarks in listing good news for generic pharma: the ratification of GDUFA II, the removal of the labeling bill from the FDA docket and the advancement of biosimilar promotion. He highlighted some major hurdles, as well:

On the political front, he said drug pricing has moved past Obamacare as the number one subject of healthcare debate, while noting that President Trump’s rhetoric railing against the pharmaceutical industry does not distinguish generics from branded medicines.  Consolidation of buyers, continued price deflation and state-level drug pricing laws are all major threats to future profits for those in the industry, he added.

Generic pharma needs to control its own narrative

Davis also talked about how, even though branded medicine is defending generics by blaming rising prices on PBMs, generic pharma needs to control its own narrative.  He said he wants to see more industry leaders reminding America that generic pharma has “nothing to apologize for,” and that generics are the solution to, not the cause of, rising drug prices.

Eric Hargan, deputy secretary of the U.S. Department of Health and Human Services, was emphatic in his AAM remarks that the current administration values affordable medicine.

He said the administration is taking several approaches to lower drug costs including an effort to advance the approval of complex generic drugs, a reduction of the regulatory burden on drug developers and manufacturers and creation of policy that assures rebates given along the supply chain end up in the pockets of patients.  Further savings can be achieved through straightening out drug misclassifications and expediting generic drug approvals, he said.

Hargan said that the two keys to competition are price transparency and a market with a meaningful number of players, and his administration aims to see improvement on both fronts, particularly among the PBM groups that administrate prescription drug programs in the U.S.

All-time high for generic approvals

Anna Abram, the FDA’s deputy commissioner of policy, planning legislation and analysis, mentioned that the agency just released its fiscal 2019 budget and that one area of investment is expected to be a more modern and efficient generics approval process.  The calendar year of 2017 saw an all-time high of 1,027 generic approvals, she said: 843 were full approvals, 184 were tentative approvals, and 80 were for first-time generics.

For more from the FDA on generics, plus additional insights on politics, market trends, addiction prevention, legal and business challenges from numerous other AAM speakers, read Michael Glessner’s full report from the meeting here.

To discuss generic drug development with Michael and other Clarivate industry experts, join us onsite at DCAT Week ’18, from March 19 – 22, 2018 in New York City. DCAT Week is organized and hosted by the Drug, Chemical & Associated Technologies Association (DCAT), a not-for-profit, member-supported, global business development association whose unique membership model integrates both innovator and generic drug manufacturers and suppliers of ingredients, development and manufacturing services, and related technologies. Learn more.

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