FTC Challenges Biotech Industry’s Plea for 12-Year Protection from Generics

Attack of the Knockoffs: FTC Challenges Biotech Industry’s Plea for 12 Year Protection from Generics

Friday June 12, 2009 (foodconsumer.org) -- There is much controversy in the world of biotech medicine, the fastest growing category of health spending in the United States. The Federal Trade Commission has taken on the biotech industry’s assertion that their innovations should be protected for 12-14 years before generic drugs are allowed to compete.

 Biotech drugs are an expensive undertaking; unlike medicines produced from chemical synthetics, they are manufactured from living matter and can cost thousands of dollars to produce; the industry itself argues that in order to recoup the cost of researching, testing and producing the original drug, the dozen year lead time is essential.

But consumer groups such as AARP are pleased with the FTC’s announcement; they agree that biotech drugs are expensive, which is precisely why they are for a speedier turn around for knock-offs.  

The FTC does acknowledge that biotech drugs are more complicated, thus more costly to produce than are other drugs that generic drugs have been allowed to cash in on, such as antibiotics. Because of this, the board asserts that the discount provided by generic biotech drugs would only be 30%, as opposed to the 90% discount that generic synthetic drugs offer. 

Another point of contention is over the extent of testing generic medicine much undergo before they can be approved. In 1984, a bill was passed that allowed generic medicine to compete after they “proved,” through simple lab tests, that they were equivalent to branded medications. However, the complexity of biotech research should require, according to the Biotechnology Industry Organization, that generics of such drugs be held to a higher standard than traditional drugs. “I would never take a biologic that had not been tested in humans. The risks are too high,” said Dr. Jay P. Siegel, a senior scientist at Johnson & Johnson (New York Times).

Economically, the outcome of the debate will be of interest to many. Biotech Industry has been touted by the New York Times as a “current grail of economic development.” In a recent global biotech convention in Atlanta, no fewer than 27 states paid $100,000 each to try and woo researchers to construct campuses in their cities. 

(Rachel Stockton)