US Government and Generic Drugs: More Activity in Congress and Elsewhere

In the June 19 issue of E-TIPS, we reported two US Government administrative changes designed to bring generic drugs to market more quickly. Later in June, the US Government took other initiatives aimed at reducing prescription drug prices, both in the US and internationally. In the first development, the House of Representatives and the Senate each passed similar versions of Medicare reform legislation. The omnibus bills covered various issues relating to the US Medicare system, including provisions for legalizing the importation of drugs, originally manufactured in the US, from Canada, where drugs are substantially cheaper. The legislation is designed to address the increasing cost of prescription drugs in the US. However, it is unlikely that Americans will cross the border to Canada in droves in search of cheap drugs, as a result of this legislation. The real objective of the proponents of the new legislation was to force US drug manufacturers to cut prices, thus eliminating the need for Canadian imports. In the past, two similar pieces of legislation were passed but never implemented. Instead, the FDA used its overriding authority to halt the importation of drugs, ostensibly due to safety concerns. The FDA could repeat this move; however, since the new legislation is limited to Canada, this is less likely to occur. In the second development, the US pharmaceutical industry appears poised to accede to patented drugs becoming more accessible to poor nations. In the past, the US Government, in response to concerns from the pharmaceutical industry, blocked WTO member proposals to permit generic manufacturers from developing countries to sell their inexpensive drugs to other developing countries with no manufacturing facilities. As a compromise, the US had offered to permit such sales for only a limited number of diseases. Now, however, the US appears to be prepared to drop this limitation. This issue will be discussed during the next WTO trade negotiations scheduled for September in Cancun, Mexico. See the article US Government and Generic Drugs: Faster and Cheaper in the June 19 issue of E-TIPS: http://makeashorterlink.com/?N2A413645. For more information on this topic, visit: http://www.cnn.com/2003/ALLPOLITICS/06/20/medicare.senate/, http://makeashorterlink.com/?M17746935, http://www.legalmediagroup.com/news/print.asp?SID=12764&CH. Summary by: Lenni Carreiro