President Obama

Obama proposes seven year rule for biologics

pharmafile | September 21, 2011 | News story | Research and Development, Sales and Marketing |  Obama, biologics 

President Obama has returned to the issue of market exclusivity for biologic drugs as a way of cutting healthcare costs.

The pharma and biotech sectors celebrated in March 2010 when US health reforms were passed and included a 12-year market exclusivity period for biologics.

This was exactly what the sector had lobbied for, and would guarantee billions more in revenues for companies with major biologic drugs.

But President Obama had always favoured a seven year rule instead, and is now proposing once again the much shorter period.

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The proposal is just one of many contained in the White House’s new plan for economic growth and deficit reduction, which proposes savings of $3 trillion in federal health spending over 10 years.

The White House estimates that the shorter period would produce around $3.5 billion in savings for the federal health budget over 10 years, but it will be fiercely opposed by the industry.

The plan also revisits another earlier proposal, to prohibit ‘pay for delay’ deals between pharma and generic companies. If passed into law, this reform is forecast to cut $2.7 billion in federal spending.

Andrew McConaghie

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