US Bill to stop industry payoffs that inhibit generic drug competition - passed by the House - now clears Senate

The US Senate Appropriations Committee last week voted to pass Wisconsin Democrat Senator Herb Kohl's bill intended to reduce the number of pay-for-delay settlements that keep generic drugs off the market.

The Preserve Access to Affordable Generic Drugs Act (S 369), included in the Financial Services and General Government Appropriations bill reported out of the Senate Appropriations Committee, combats the anti-consumer practice of brand-name drug manufacturers using pay-off agreements to keep cheaper generic equivalents off the market. Under these pay-off agreements, brand name drug companies settle patent disputes by paying the generic drug manufacturer millions of dollars in exchange for a promise that it will keep its version of the drug off the market. The companion bill, HR1706, was recently passed by the House of Representatives as part of HR 4899, the Supplemental Appropriations Act of 2010 (The Pharma Letter July 28).

'The cost of brand-name drugs rose nearly 10% last year. In contrast, the cost of generic drugs fell by nearly ten percent. At this time of spiraling health care costs, we cannot turn a blind eye to these anticompetitive backroom deals that deny consumers access to affordable generic drugs,' said Senator Kohl.