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House Subcommittee Holds Hearing on Generic Drug Access and FDA Abuses, Praises CREATES Act

Yesterday afternoon the House Subcommittee on Regulatory Reform, Commercial, and Antitrust Law held a hearing on antitrust concerns, the FDA’s approval process for generic drugs, and how it impacts access to generic drugs. Both Democrat and Republican members agreed that abuses of the regulatory process were a serious problem and endorsed the CREATES Act to stop these abuses. The hearing demonstrated that the CREATES Act enjoys bipartisan support, and that there is an opportunity for meaningful legislation to reduce drug prices.

The two panels had very impressive witnesses: FDA Commissioner Scott Gottlieb, Acting FTC Director Markus Meier, Professor David Olson of Boston College, Professor Erika Lietzan of the University of Missouri, Alden Abbott of the Heritage Foundation, and Professor Aaron Kesslheim of Harvard Medical School. All of the professors except Lietzan endorsed the CREATES Act and spoke about REMS abuses, product hopping, and abuse of citizen petitions. These abuses were covered in last week’s FDA public meeting that we previously mentioned, and many of the committee members were familiar with these problems.

In his testimony, Commissioner Gottlieb observed that FDA policies indirectly impact the cost of medicines, especially generic drugs. He said that the FDA wanted to strike a good balance between access and innovation but “denying generic companies access to samples is not what Congress intended.” We need to ensure that consumers benefit from generic drug competition. Meier agreed and said the FTC was making this a top priority and had a long history of working with the FDA. He added that the FTC had recently filed a lawsuit against a company for these abuses, but that antitrust concerns were slow and uncertain, and could not replace meaningful reform.

Professor Lietzan was the only person to speak in defense of the status quo. She asserted that the citizen petition process promotes transparency and accountability (despite the fact that most citizen petitions are filed by brand name drug companies and denied). She also said that denials do not mean petitions are invalid, that claims that petitions delay generic drugs are based on anecdotes, not hard evidence, and that brand companies generally operate in good faith. The other witnesses disagreed; Mr. Abbott observed that a great deal of economic research shows the companies are manipulating regulations to block access to generics, and cited the case of ViroPharma filing 24 citizen petitions to block a competitor.

Professor Kesselheim delivered a ringing endorsement of reform. In response to questions from committee members, he noted that brand manufacturers usually get twelve to sixteen years of exclusivity for their drugs and make very large profit margins. “What we’re discussing has nothing to with innovation and everything to do with ensuring consumers can get the medicines they need.”

This hearing was a welcome indication that the CREATES Act has deep and bipartisan support. We urge the House Judiciary Committee to pass the CREATES Act and send it to the floor to promote affordable generic medicines for all Americans.

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