FDA moves to prevent Pharma from 'gaming' generic drug system

WASHINGTON (Reuters) - The U.S. Food and Drug Administration moved on Wednesday to prevent pharmaceutical companies from “gaming” the system to block or delay entry of generic rivals.

A view shows the U.S. Food and Drug Administration (FDA) headquarters in Silver Spring, Maryland August 14, 2012. REUTERS/Jason Reed

FDA Commissioner Scott Gottlieb said in a blog post that the agency plans to hold a public meeting on July 18 to identify ways pharmaceutical companies are using FDA rules to place obstacles in the way of generic competition.

“We know that sometimes our regulatory rules might be ‘gamed’ in ways that may delay generic drug approvals beyond the time frame the law intended, in order to reduce competition,” he said in the blog post. “We are actively looking at ways our rules are being used and, in some cases, misused.”

The move comes as President Donald Trump and lawmakers in Congress search for ways to lower the cost of prescription drugs. Trump is preparing to put out an executive order on drug pricing, according to media reports, and last week U.S. Senator Ron Wyden introduced a bill to require companies to explain the reasons for significant price increases.

“Americans are sick and tired of seeing the cost of their prescription drugs race past their paychecks,” said Wyden, an Oregon Democrat.

The FDA does not include price considerations when deciding whether to approve a new drug, but Gottlieb said the agency can facilitate increased competition by approving lower-cost generics. That means removing some of the obstacles placed by branded companies in the way of generic manufacturers.

These obstacles can include limiting the availability of branded products for testing by generic companies, or prolonging negotiations with generic companies over the implementation of shared risk-management programs.

Gottlieb said recently that the FDA is evaluating whether to waive a requirement that generic companies and brand companies share a single system to ensure a drug’s safe use.

The FDA’s move comes two days after Republican Senator Chuck Grassley urged Gottlieb in a letter to consider recommendations in two bills co-sponsored by Grassley to enhance access to generic drugs; and encouraged him to work closely with the Justice Department and Federal Trade Commission to address anti-competitive behavior in the drug industry.

Representatives from the pharmaceutical industry’s main lobbying group, the Pharmaceutical Research and Manufacturers of America, were not immediately available for comment.

Gottlieb said the agency plans to examine policy and program changes, including using its own authorities more forcefully and potentially collaborating more closely with other agencies.