OCTOBER 01, 2006

A top policy official at the Federal Trade Commission (FTC) is working to rally public and congressional support for action to curb antigeneric competitive strategies by branded pharmaceutical makers. FTC Commissioner Jon Leibowitz, a keynote speaker at the Generic Pharmaceutical Association's (GPhA) Second Annual Policy Conference in Washington, DC, is convinced that without vigorous antitrust enforcement, much of the cost savings expected from the launch of generic drugs will be lost.

GPhA's conference also featured presentations by former Medicare chief Mark McClellan, MD, PhD, Rep Nathan Deal (R, Ga), and Sens Orrin Hatch (R, Utah) and Henry Waxman (D, Calif). It was Leibowitz's keynote address, however, that focused on the prickly antitrust issues facing generic drug manufacturers.

Along with others at the FTC, Leibowitz has been especially critical of the practice by some brand name drug manufacturers of settling patent litigation by offering "exclusion payments" to keep generic competitors out of the market. According to Leibowitz, these are "pernicious settlements" that rob both consumers and the government of the savings that would otherwise result from generic competition. Although FTC antitrusters cracked down on these agreements 5 years ago, a series of recent federal appeals court rulings now threatens to open the door for the widespread use of exclusion payments to delay generic drug introductions.

Leibowitz is hopeful that "the Supreme Court will eventually weigh in on this problem" and close the antigeneric loopholes created by the Second and Eleventh Federal Appeals Circuit. In the meantime, however, antitrust officials at the FTC have been urging Congress to address the issue of exclusion payments by drug companies.

One bill already in the hopper—the "Preserve Access to Affordable Generics Act" introduced by a bipartisan group of US senators—is being watched closely by officials at the commission. Although the FTC has not officially endorsed that legislation, Leibowitz has told Congress that "we strongly support the intent behind" that bill.