Justice

Drug Companies Are Exploiting This Law to Keep Prices High

March 8th 2017

By:
Kyle Jaeger

Pharmaceutical companies are exploiting a Food and Drug Administration (FDA) policy to undermine competitors and maintain monopolies on their products, The Atlantic's Sarah Zhang reported Wednesday.

Opioid Pills

Citizen petitions — which were introduced by the FDA in the 1970s to allow individuals to flag concerns about drug safety — are increasingly filed by pharmaceutical companies against competitors who are attempting to sell generic versions of their drugs. By filings these petitions, companies can effectively extend their exclusive hold on a drug beyond the expiration of their patent, as it can often take months for the FDA to respond to a citizen petition.

As the Atlantic noted, "According to a study last year, brand-name pharma companies filed 92 percent of 505(q) citizen petitions, a specific type related to pending generic applications."

For example, take Mylan Pharmaceuticals, the maker of EpiPen, that was widely rebuked last year for hiking the drug's price.

In 2015, Mylan submitted a citizen petition against Teva's generic version of EpiPen, alleging that the generic option failed 93 percent of the time. That conclusion was based on a study that Mylan commissioned, and it was "flawed from start to finish," according to Diana Zuckerman, the head of the nonprofit FDA monitor National Center for Health Research. 

hands-holding-pills

In another case, the drug company ViroPharma submitted 24 citizens petitions against a competitor that was attempting to sell a generic version of their antibiotic, Vancocin. The Federal Trade Commission (FTC) accused the company of violating antitrust laws in February, which ViroPharma said was "wholly without merit." 

The FDA recognizes that drug companies have exploited this system — writing in its 2015 annual report that the citizen petition process “may not be discouraging the submissions that are intended primarily to delay the approval of competing drug products and do not raise valid scientific issues" — but so far, it has only just begun to implement policies aimed at deterring drug companies from exploiting the citizen petition.

FDA

Last year, the FDA enacted a new rule for citizen petitions that took effect in January. It narrowed the window of time that these petitions can be filed. 

"When submitted early, such as when we are making decisions about the bioequivalence requirements for a generic drug product or before we have received the first [application] for a drug or biologic, a petition may contain information that can contribute towards our evaluation of an application," the FDA wrote, but noted that, "when petitions are submitted late in the review process for challenged applications and do not raise valid scientific or legal issues, they may have the effect of improperly delaying the approval of an application."

However, a recent study published in The New England Journal of Medicine examining citizen petitions raised doubts about the effectiveness of this policy change. 

The authors of the study said that such "limited remedies available leave plenty of room for strategic behavior," and noted that eliminating the abuse of citizen petitions by pharmaceuticals demands "stronger procedural blocks" such as "requiring that drug companies file their citizen petitions within a year after the generic company files its application, or establishing that issues raised by petitions will be resolved on a separate timeline from the generic’s approval process."

[h/t The Atlantic]