Generics and biosimilars, key to Trump drug price concerns

After Donald J. Trump said that drug companies are “getting away with murder” with drug pricing, one group said that approving more generic and biosimilar drugs can help control drug costs.

“Pharma has a lot of lobbies, a lot of lobbyists, and a lot of power. And there’s very little bidding on drugs,” Trump said during a press conference in New York. “We’re the largest buyer of drugs in the world, and yet we don’t bid properly.”

"We understand the President-elect's concerns about drug prices. Patients and drug purchasers like the federal government, health systems, employers and others, rely on access to more affordable medicines,” the Generic Pharmaceutical Association (GPhA) said.

Numerous studies demonstrate that generic medicines drive down drug costs through competition, the organization noted. “Generic and biosimilar medicines are a ready-made solution to high drug costs,” said Chip Davis, President and CEO of GPhA, in a December memo to Trump.

Generic drugs make up 89% of prescriptions dispensed in the US, but account for only 27% of total drug costs, according to the GPhA/Quintiles IMS Institute Generic Drug Savings and Access report. “This means hundreds of billions in annual savings for our healthcare system, a foundation to build upon, not to inhibit or put at risk,” Davis said.

“Unleashing the full potential of these medicines will require a bipartisan effort that includes patients, pharmacists, doctors, payors, supply chain partners and others who rely on access to safe, effective and more affordable medicines. It is important that policymakers pursue patient-centric and market-based solutions that enhance competition and expedite generic market entry to bring down prices and improve patient access to medicines,” the memo said.

Still, more can be done to improve access to generic drugs. This includes reducing the backlog of generic drug applications at the FDA, along with working on initiatives that bring more generic and biosimilar products to the market.

GPhA wants to repeal the generic drug penalty in Medicaid and increase generic utilization among the Low Income Subsidy (LIS) Medicare patient population. “Nearly nine in ten (88%) of prescriptions dispensed in the US are generic drugs but the LIS program has historically lagged behind national rates. That means there is an opportunity for millions of the neediest seniors to be spending less money on their medicines and the program could be saving more money, too,” GPhA wrote on its RxSolutions web site.

Meanwhile, the new drug penalty in Medicare will add “significant hurdles to generic drug investment and development, making it more challenging for patients to access generics as an FDA-approved alternative to more expensive brand medications-the exact opposite of what both patients and payors need right now,” GPhA wrote on RxSolutions.

GPhA is also urging Congress to pass the CREATES Act in the Senate and the FAST Generics Act in the House. Both are “viable reforms that could prevent the current anti-competitive business practices that are increasing costs in the American health care system and impeding patient access to more affordable generic drugs,” GPhA said.