Did FDA Just Snatch Control Of The Drug Price Debate?
This article was originally published in Scrip
Last week, the head of the Pharmaceutical Research and Manufacturers of America, Stephen Ubl, told industry to stop playing defense and go on the offense to drive the discussion about drug prices.
The FDA, however, may have just beaten drug makers to the punch.
By instituting a new policy to expedite the reviews for applications of generic versions of medicines that are the sole source on the market, the FDA may have taken a big step in changing the conversation about prescription drug pricing – at least in situations involving older marketed products whose prices have recently skyrocketed.
Under the FDA's new policy, companies like Turing Pharmaceuticals Inc. and Valeant Pharmaceuticals International Inc. that buy up older sole-source drugs and take advantage of that status by jacking up the medicines' prices will have less incentive to follow that pattern.
The FDA unveiled its new expedited action for abbreviated new drug applications (ANDAs) in a manual of policies and procedures, a public document used to outline federal directives and changes to internal guidelines and processes.
FDA spokesman Stephen King told Scrip the public debate over sole-source drugs "prompted us to review our policies on point."
"We identified a gap and were able to identify a path forward to address it by revising our review prioritization policy," King said.
He said the FDA has estimated the change in its policy could potentially expedite up to 125 more ANDAs than before the revision.
King emphasized that while all ANDAs that qualify are eligible for an expedited review, "high quality submissions are easier to act upon than low quality submissions."
Lawmakers have been pressing the FDA for months to make such a change for fast-tracking applications for generic versions of sole-source medicines.
At a Senate hearing in January, Sen. Susan Collins (R-ME) suggested the FDA ought to be able to use an "express lane" for those products – especially when the owners of the sole-source branded medicines have substantially increased their prices.
She called on Janet Woodcock, director of the FDA's Center for Drug Evaluation and Research, to work with lawmakers to set a timeline for expediting approvals of generics with the intent to "discourage a company from buying up a decades-old drug and increasing its costs."
Collins insisted that if that expedited pathway was "short enough," the "hedge-fund pharmaceutical companies" – meaning Turing – would be discouraged from buying sole-source drugs with the aim of hiking their prices.
The lawmaker, who chairs the Senate Aging Committee, had joined Sen. Claire McCaskill (D-MO), the ranking member, earlier this month in introducing a bill that seeks to require the FDA to fast-track the review of ANDAs for generics in which there is a shortage of the medicines or there's only one supplier of a product and act on the application within 150 calendar days.
The legislation also calls for the FDA to establish a new generic priority review voucher, which would be awarded to manufacturers with successful ANDAs involving a medicine that was on the agency's drug shortage list or provided competition against sole-source products. The vouchers would be used to expedite the review of another ANDA.
Collins and McCaskill have been investigating companies that have significantly raised the prices of their drugs, like Turing and Valeant, and are holding a series of hearings on the matter – the first of which was in December, with a second set for March 17.
What's been most frustrating for hospitals in trying to obtain drugs like Valeant's Nitropress (sodium nitroprusside) and Isuprel (isoprenaline), Erin Fox, director of the Drug Information Service at the University of Utah Health Care in Salt Lake City, told Scripbefore testifying at the December Senate hearing, is knowing the company isn't using the extra cash it's making off its dramatic price increases to improve the way those products are manufactured, because, after all, the firm doesn't actually make the medicines – Pfizer Inc. subsidiary Hospira Inc. does under a contract.
After being the subject of investigations by prosecutors in Massachusetts and New York, the Securities and Exchange Commission and Congress, Valeant officials pledged to employ "more modest" pricing of their medicines from now on and to seek fewer transactions focused on what it called "mispriced" products – with CEO Michael Pearson, who recently returned to his post after being severely ill with pneumonia, reiterating that point during a March 15 conference call with investors and analysts.
Rep. Elijah Cummings (D-MO), the ranking member of the House Oversight and Government Reform Committee, who also has been investigating Turing and Valeant, commended the FDA for instituting the new policy – declaring "it will encourage generic competition for high-priced brand-name drugs and provide patients with less expensive medications that they desperately need."
"It also sends a message to drug companies like Turing and Valeant that exploitive behavior will not be tolerated," Cummings told Scrip in an emailed response to questions.
But even with the FDA's changes, the debate over prices is unlikely to go away anytime soon – especially when lawmakers continue to set their sights on expensive innovator products like Gilead Sciences Inc.'s Sovaldi (sofosbuvir).