Replies to post #23198 on Biotech Values

[Biowatch]

Impressive that generics article was front page news in the Washington Post.

DC is a political town, with budget concerns and Federal regulations and agencies always at the top of the news.

The rising cost of healthcare is a hot topic these days.

I don't understand why they don't add more staff to the generics division at the FDA, but their hands may be tied.

[DewDiligence]

Generic applications
overwhelm FDA staff:



Source: Washington Post article in #23204

[DewDiligence]

Administration's Inadequate Funding for FDA's Office of Generic Drugs Is 'Penny-wise and Pound-foolish,' Says GPhA

http://biz.yahoo.com/prnews/060206/nym236.html?.v=15

>>
ARLINGTON, Va., Feb. 6 /PRNewswire/ -- The Generic Pharmaceutical Association (GPhA) today expressed extreme disappointment over the Bush Administration FY 2007 budget's inadequate funding for the Office of Generic Drugs (OGD), an agency within the Food and Drug Administration (FDA) that is responsible for the review and approval of affordable generic medicines. Generics save consumers and public and private health care purchasers billions of dollars each year, and OGD's scarce funds could substantially delay consumers' timely access to these affordable medicines.

"The Administration's budget proposal is penny-wise and pound-foolish," said GPhA President and CEO Kathleen Jaeger. "Generic medicines provide billions of dollars in savings to state and federal programs, employers, insurers and consumers. This budget proposal jeopardizes those savings.

"Instead, the Administration should realize that the return on investment from increased OGD accountability and de minimus funding -- even in the amount of $15 million -- would pay substantial and long-lasting dividends for all Americans. For example, additional OGD funding could yield tremendous financial benefits for several of the Administration's health care priorities, such as Medicare, Medicaid and programs to improve children's health care, assist the chronically ill, and fight AIDS," Jaeger added. "Delaying access to affordable generics, whether it's days, months or years, hurts the health of this nation."

Because generics cost 30 percent to 80 percent less than brands, generic medicines stretch scarce health care dollars while providing the same medicine and same results. A one percent increase in generic utilization nationwide could save the United States $4 billion dollars annually. [A handy factoid.]

In the FY 2007 budget, OGD is flat-funded at best, even though its workload has increased by a staggering 36 percent. OGD currently has a backlog of more than 800 generic drug applications, a number that will only grow as more than $100 billion in brand products are expected to lose patent protection by 2010.

In fact, this is the third fiscal year in a row that OGD's budget has been flat-funded. Although funding for OGD was increased slightly in FY 2003, the funds were not expressly earmarked for specific day-to-day operations on generic applications. As a result, most of the funds went to other agency initiatives. This year, FDA has further reduced the budgets for generic drug research contracts and information processing modernization for the generic drug program.

"It's outrageous to learn that one of OGD's two FY 2007 performance goals is to reduce the approval time for generic drugs by a mere two weeks for the top 25 percent of generic applications. And it's even more outrageous that FDA projects an increase in the median review time to 17.5 months for all other generic applications," said Jaeger. "Sadly, FDA believes that streamlining the review process is the answer. Yet, FDA fails to realize that over the years, OGD and the generic industry have worked successfully on collaborative efforts to streamline the approval process for generic drugs. And, we now have reached a saturation point on administrative efficiency.

"GPhA appreciates OGD's previous efforts to streamline the review process, including staff working overtime. Without additional OGD funding and agency accountability, however, Americans will continue to be denied timely access to affordable medicine.

"We certainly agree with the Administration's budget reference about the need to eliminate unintended loopholes in bringing cost-effective generic drugs to the marketplace. However, it is deeply disappointing that this year's lack of investment in OGD undermines the very goal the Bush Administration rightly extols," Jaeger concluded.

GPhA represents the manufacturers and distributors of finished generic pharmaceuticals, manufacturers and distributors of bulk active pharmaceutical chemicals, and suppliers of other goods and services to the generic drug industry. Generics represent 53% of the total prescriptions dispensed in the United States, but less than 12% of all dollars spent on prescription drugs. For more information about the generic industry, visit http://www.gphaonline.org.

FDA's budget is available at
http://www.fda.gov/oc/oms/ofm/budget/documentation.htm.
<<

[DewDiligence]

FDA Seeks User Fees From Generics Makers

[If the FDA agreed to four-month reviews of generic applications, as Gottlieb suggests they might in return for new user fees from ANDA applicants, it would change the U.S. generic-drug industry substantially. Is Gottlieb’s carrot for real, or is it just a negotiating ploy? Note the reference to Citizens’ Petitions in the last paragraph—this is clearly a sore spot for the generic industry. Please see #msg-9566322 for a graphical depiction of the magnitude of the problem.]

http://online.wsj.com/article/SB114014881471276778.html

>>
Companies Have Urged Speedier
Drug Approvals but Are Likely
To Greet Plan Skeptically

By ANNA WILDE MATHEWS
February 17, 2006

WASHINGTON -- The Food and Drug Administration wants generic-drug makers to pay user fees to fund reviews of their products.

The move comes as the industry is calling for speedier approvals and a larger agency staff commitment to review generics. But the agency's plan is likely to draw a skeptical response from generics makers, which have never paid such fees.

Major branded-pharmaceutical companies and device makers have paid FDA user fees for years, and the laws that govern both expire in September 2007. The FDA and the generics industry likely would have to negotiate the structure of potential user fees before Congress would take up the issue.

The political focus on generics is rising, fueled by continued concern over the cost of drugs and the new Medicare consumer drug benefit. In a House hearing yesterday, the FDA's acting commissioner, Andrew von Eschenbach, was asked about the agency's handling of generic drugs, including its plans for copies of biotech drugs. Dr. von Eschenbach defended the agency's current handling of generic drugs, saying there is "no gap and no delay" in their availability once legal issues are resolved.

The agency hasn't yet issued guidelines for how companies should test copies of biotech products, a few of which could potentially be approved through the current legal generics pathway.

In a speech today at the Generic Pharmaceutical Association's annual meeting, FDA Deputy Commissioner Scott Gottlieb is expected to signal the agency's interest in generic-maker user fees, saying the FDA needs to "make sure that the generic-drug program remains on stable financial footing," according to a draft of the speech.

After discussing user fees, he is expected to say that the agency "can do more with more" and say that the agency's "new drugs program has benefited from funding tools that are not available to us when it comes to generic drugs."

Dr. Gottlieb is also expected to lay out some of the concessions the agency might make in exchange for the fees: perhaps commitments to review first generic applicants in cases without patent protection in four months. The agency could also work on research about how to prove a generic version is equivalent to an original drug, and it plans to smooth communication between reviewers and generic-drug makers.

It is unclear if generic-drug makers will agree to the fees. The industry has complained recently about growing backlogs of its drugs at the FDA and has called for more funding from Congress for the office that reviews generics. "We're not sure that if we agreed to pay user fees that the FDA could guarantee that our products could get to consumers any faster," said Kathleen Jaeger, chief executive of the Generic Pharmaceutical Association, before Dr. Gottlieb's speech.

She said generics makers likely would consider paying user fees if the FDA and the Bush administration would endorse legislative and other changes that the industry believes would speed its products. Among the companies' complaints are petitions filed by branded-pharmaceutical makers, which can delay approval of generics. The FDA says much of the backlog is older drugs that already have generic competitors or generic drugs that can't go on the market yet because the brand drug's patent isn't close to expiring.
<<

[DewDiligence]

There are 1,600 ANDA’s pending at the FDA, twice as many
as in 2005 (see below). Meanwhile, the number of reviewers
in the FDA’s Office of Generic Drugs has barely increased.



Related articles: #msg-9591568, #msg-23423947.

(Source for 1,600 figure: Sandoz)

[DewDiligence]

PDUFA fees for generics? Maybe. For investors in the generic-drug
arena (including MNTA), fees are good because they will presumably
be accompanied by review deadlines, and hence ANDA’s won’t sit
around for years and years because the FDA has more remunerative
things for its staffers to work on.

This is not a new idea, however; for instance, see #msg-9763028,
which was posted four years ago.

http://www.reuters.com/article/idCNN0116207720100201

›Obama Budget Plan Calls for Generic Drugmaker Fees

Feb 1 2010
By Lisa Richwine

WASHINGTON, Feb 1 (Reuters) - Generic drugmakers would pay the U.S. government $38 million to help speed reviews of their medicines under President Obama's fiscal 2011 budget plan released on Monday.

The Obama administration will ask Congress to pass legislation allowing the Food and Drug Administration to collect the fees. The money would be used to "improve review times and reduce the current backlog of applications," budget documents said.

"Generic drugs play an important role in reducing the cost of and increasing access to pharmaceuticals," they said.

Congress will weigh Obama's budget plan as it drafts the federal budget for fiscal 2011, which starts Oct. 1. His proposal for fiscal 2010 also proposed fees from generic drugmakers, but the measure did not make it through Congress. [In the 2010 budget, GPhMA was not satisfied that the fees would ensure timely reviews, and hence they did not support the measure.]

Generic drugmakers have supported the idea of paying fees if they are coupled with improvements in the FDA review process. Manufacturers include Teva Pharmaceutical Industries Ltd <TEVA.TA> and Mylan Inc <MYL.O>.

The industry "remains open" to a fee and "looks forward to working with the administration to develop a meaningful program with measurable results," Generic Pharmaceutical Association President Kathleen Jaeger said in a statement.

Simply providing more money to the FDA "will not provide any sort of immediate positive impact to generic drug stocks until a material decline in review times begins to emerge, likely a matter of years," Needham & Co analyst Elliot Wilbur said in a note to clients.

But the fee program could be a "strong positive" if it ends tactics used to block generic drug approvals or directs money to clearing products held up by those tactics, Wilbur said.

Obama also proposed a $2 million increase in taxpayer funding for the FDA's generic drug reviews.

The agency's total budget would increase by 23 percent from fiscal 2010 to $4 billion.

New funding would be used in part to help the agency prepare for future applications to sell generic copies of biotechnology medicines, health officials said. Congress is weighing creation of a path for companies to apply for FDA approval of generic biotech medicines as part of the stalled healthcare reform legislation. The agency also plans to "expand post-market safety surveillance of medical products," budget documents said.‹