On High Drug Prices, Bipartisanship Is Still Alive . . . Maybe?

Despite the deluge of blogs, tweets and magazine articles caterwauling about the alleged death of civility and bipartisanship that pervade Washington in recent years, last week’s  introduction of a bipartisan bill aimed at lowering drug costs proves that there are still issues on which Democrats and Republicans can agree.  The bipartisan bill is called the TERM act, which is the acronym for the “Terminating the Extension of Rights Misappropriated” Act of 2019, H.R. 3199.  The bill is co-sponsored by Representatives Hakeem Jeffries (D-NY), Doug Collins (R-GA), Debbie Mucarsel-Powell (D-FL) and Ben Cline (R-VA).  In a press release announcing the bill, Democrat Mucarsel-Powell stated “Americans are paying too much for prescription medications, and I’ve always been committed to working with anyone — Democrat, Republican, Independent — to lower prescription drug costs.”  Republican Ben Cline echoed her concerns remarking that “Today, prescription drug expenses constitute nearly 20 percent of health care costs and are growing faster than any other health care expenditures. As of 2017, Americans spend more on prescription drugs — average costs are about $1,200 per person per year — than anyone else in the world.”

According to the press release, the TERM act “would address the rising cost of prescription drugs by significantly limiting the process known as ‘evergreening’, whereby pharmaceutical companies make minor changes to a drug and file for a new patent on those trivial changes in order to extend their exclusivity and maintain high prices.”  As co-sponsor Collins lamented “[u]nfortunately, some manufacturers simply file additional patents in order to delay generic drugs from coming to market.” 

Under current U.S. patent law, when a brand drug company places add-on patents on an already approved drug, generic drug manufacturers have the burden of proving why the new patent(s) should not be granted, thereby preventing introduction of generic competition, often for several years. And, of course, they need to litigate issues of validity and/or infringement once any such patents are granted.  This process not only adds significant costs to generic manufacturers, but it also delays the availability of lower cost generic drugs. The TERM Act would shift that burden of proof from the generic drugmakers to the brand pharmaceutical companies.  Thus, when faced with a generic company’s patent challenge, the patent owner would be required to prove by a preponderance of the evidence that the later patent(s) cover “distinct inventions” from the first claimed patent.  Of course, the true test of bipartisanship will come when bills such as the TERM act come up for a vote.

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About Stephen Doherty

Stephen Doherty is Senior Counsel in the Pennsylvania office of Faruqi & Faruqi, LLP. Mr. Doherty practices in the area of antitrust law and is significantly involved in prosecuting antitrust class actions on behalf of direct purchasers of brand name and generic drugs and charging pharmaceutical manufacturers with price fixing and with illegally blocking the market entry of less expensive competitors.

Tags: TERM act, patent law, drug manufacturers, Bipartisanship, prescription drugs, Hakeem Jeffries, Doug Collins, evergreening, Debbie Mucarsel-Powell, Ben Cline Stephen Doherty Stephen Doherty
Senior Counsel at Faruqi & Faruqi, LLP

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E-mail: sdoherty@faruqilaw.com

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