[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]
EXAMINING FDA'S GENERIC DRUG AND BIOSIMILAR USER FEE PROGRAMS
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON HEALTH
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTEENTH CONGRESS
FIRST SESSION
__________
MARCH 2, 2017
__________
Serial No. 115-10
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the Committee on Energy and Commerce
energycommerce.house.gov
__________
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COMMITTEE ON ENERGY AND COMMERCE
GREG WALDEN, Oregon
Chairman
JOE BARTON, Texas FRANK PALLONE, Jr., New Jersey
Vice Chairman Ranking Member
FRED UPTON, Michigan BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois ANNA G. ESHOO, California
TIM MURPHY, Pennsylvania ELIOT L. ENGEL, New York
MICHAEL C. BURGESS, Texas GENE GREEN, Texas
MARSHA BLACKBURN, Tennessee DIANA DeGETTE, Colorado
STEVE SCALISE, Louisiana MICHAEL F. DOYLE, Pennsylvania
ROBERT E. LATTA, Ohio JANICE D. SCHAKOWSKY, Illinois
CATHY McMORRIS RODGERS, Washington G.K. BUTTERFIELD, North Carolina
GREGG HARPER, Mississippi DORIS O. MATSUI, California
LEONARD LANCE, New Jersey KATHY CASTOR, Florida
BRETT GUTHRIE, Kentucky JOHN P. SARBANES, Maryland
PETE OLSON, Texas JERRY McNERNEY, California
DAVID B. McKINLEY, West Virginia PETER WELCH, Vermont
ADAM KINZINGER, Illinois BEN RAY LUJAN, New Mexico
H. MORGAN GRIFFITH, Virginia PAUL TONKO, New York
GUS M. BILIRAKIS, Florida YVETTE D. CLARKE, New York
BILL JOHNSON, Ohio DAVID LOEBSACK, Iowa
BILLY LONG, Missouri KURT SCHRADER, Oregon
LARRY BUCSHON, Indiana JOSEPH P. KENNEDY, III,
BILL FLORES, Texas Massachusetts
SUSAN W. BROOKS, Indiana TONY CARDENAS, California
MARKWAYNE MULLIN, Oklahoma RAUL RUIZ, California
RICHARD HUDSON, North Carolina SCOTT H. PETERS, California
CHRIS COLLINS, New York DEBBIE DINGELL, Michigan
KEVIN CRAMER, North Dakota
TIM WALBERG, Michigan
MIMI WALTERS, California
RYAN A. COSTELLO, Pennsylvania
EARL L. ``BUDDY'' CARTER, Georgia
Subcommittee on Health
MICHAEL C. BURGESS, Texas
Chairman
BRETT GUTHRIE, Kentucky GENE GREEN, Texas
Vice Chairman Ranking Member
JOE BARTON, Texas ELIOT L. ENGEL, New York
FRED UPTON, Michigan JANICE D. SCHAKOWSKY, Illinois
JOHN SHIMKUS, Illinois G.K. BUTTERFIELD, North Carolina
TIM MURPHY, Pennsylvania DORIS O. MATSUI, California
MARSHA BLACKBURN, Tennessee KATHY CASTOR, Florida
CATHY McMORRIS RODGERS, Washington JOHN P. SARBANES, Maryland
LEONARD LANCE, New Jersey BEN RAY LUJAN, New Mexico
H. MORGAN GRIFFITH, Virginia KURT SCHRADER, Oregon
GUS M. BILIRAKIS, Florida JOSEPH P. KENNEDY, III,
BILLY LONG, Missouri Massachusetts
LARRY BUCSHON, Indiana TONY CARDENAS, California
SUSAN W. BROOKS, Indiana ANNA G. ESHOO, California
MARKWAYNE MULLIN, Oklahoma DIANA DeGETTE, Colorado
RICHARD HUDSON, North Carolina FRANK PALLONE, Jr., New Jersey (ex
CHRIS COLLINS, New York officio)
EARL L. ``BUDDY'' CARTER, Georgia
GREG WALDEN, Oregon (ex officio)
C O N T E N T S
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Page
Hon. Michael C. Burgess, a Representative in Congress from the
State of Texas, opening statement.............................. 1
Prepared statement........................................... 3
Hon. Gene Green, a Representative in Congress from the State of
Texas, opening statement....................................... 3
Hon. Gus M. Bilirakis, a Representative in Congress from the
State of Florida, opening statement............................ 5
Hon. Frank Pallone, Jr., a Representative in Congress from the
State of New Jersey, opening statement......................... 6
Hon. Greg Walden, a Representative in Congress from the State of
Oregon, opening statement...................................... 8
Prepared statement........................................... 8
Witnesses
Janet Woodcock, M.D., Director, Center for Drug Evaluation and
Research, Food and Drug Administration......................... 9
Prepared statement........................................... 11
Answers to submitted questions \1\........................... 117
Allan Coukell, Senior Director of Health Programs, The Pew
Charitable Trusts.............................................. 53
Prepared statement........................................... 55
Answers to submitted questions............................... 123
David R. Gaugh, R.Ph., Senior Vice President for Sciences and
Regulatory Affairs, Association for Accessible Medicines....... 61
Prepared statement........................................... 64
Answers to submitted questions \2\........................... 128
Juliana Reed, Vice President of Government Affairs, Coherus
Biosciences, Immediate Past President of the Biosimilars Forum. 72
Prepared statement........................................... 74
Answers to submitted questions \3\........................... 131
Bruce A. Leicher, Senior Vice President and General Counsel,
Momenta Pharmaceuticals and Chair of Biosimilars Council,
Association for Accessible Medicines........................... 77
Prepared statement........................................... 79
Answers to submitted questions \4\........................... 133
Kay Holcombe, Senior Vice President, Science Policy,
Biotechnology Innovation Organization.......................... 85
Prepared statement........................................... 87
Answers to submitted questions \5\........................... 135
Submitted Material
Statement of the Federal Trade Commission........................ 107
----------
\1\ The committee did not receive a response from Dr. Woodcock by
the time of printing.
\2\ The committee did not receive a response from Mr. Gaugh by
the time of printing.
\3\ The committee did not receive a response from Ms. Reed by the
time of printing.
\4\ The committee did not receive a response from Mr. Leicher by
the time of printing.
\5\ The committee did not receive a response from Ms. Holcombe by
the time of printing.
EXAMINING FDA'S GENERIC DRUG AND BIOSIMILAR USER FEE PROGRAMS
----------
THURSDAY, MARCH 2, 2017
House of Representatives,
Subcommittee on Health,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to call, at 10:00 a.m., in
room 2123 Rayburn House Office Building, Hon. Michael Burgess
(chairman of the subcommittee) presiding.
Present: Representatives Burgess, Guthrie, Lance, Griffith,
Bilirakis, Long, Bucshon, Mullin, Collins, Carter, Walden (ex
officio), Green, Engel, Schakowsky, Butterfield, Matsui,
Castor, Sarbanes, Schrader, Kennedy, Cardenas, Eshoo, DeGette,
and Pallone (ex officio).
Also present: Representative Welch.
Staff present: Mike Bloomquist, Deputy Staff Director;
Karen Christian, General Counsel; Jordan Davis, Director of
Policy and External Affairs; Paige Decker, Executive Assistant
and Committee Clerk; Paul Edattel, Chief Counsel, Health; Blair
Ellis, Digital Coordinator/Press Secretary; Adam Fromm,
Director of Outreach and Coalitions; Jay Gulshen, Legislative
Clerk, Health; Zach Hunter, Director of Communications; Katie
McKeough, Press Assistant; Carly McWilliams, Professional Staff
Member, Health; Alex Miller, Video Production Aide and Press
Assistant; Dan Schneider, Press Secretary; Danielle Steele,
Policy Coordinator, Health; John Stone, Senior Counsel, Health;
Josh Trent, Deputy Chief Health Counsel, Health; Hamlin Wade,
Special Advisor, External Affairs; Luke Wallwork, Staff
Assistant; Jeff Carroll, Minority Staff Director; Tiffany
Guarascio, Minority Deputy Staff Director and Chief Health
Advisor; Dan Miller, Minority Staff Assistant; Olivia Pham,
Minority Health Fellow; Samantha Satchell, Minority Policy
Analyst; Andrew Souvall, Minority Director of Communications,
Outreach and Member Services; Kimberlee Trzeciak, Minority
Health Policy Advisor; and C. J. Young, Minority Press
Secretary.
OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF TEXAS
Mr. Burgess. I want to welcome everyone to the subcommittee
hearing, and I ask that all guests take their seats and the
subcommittee will now come to order. The chair recognizes
himself for 5 minutes for the purpose of an opening statement.
Today's hearing marks the Health Committee's first public
discussion on the reauthorization of several key user fee
programs at the United States Food and Drug Administration.
This hearing will focus on the generic drug and biosimilar user
fee programs, and we will turn our attention to the
reauthorization of the Prescription Drug User Fee Act and the
Medical Device User Fee Amendments later this month. All four
of these programs will expire in September, and thus must be
reauthorized for fiscal years 2018 through 2022. Chairman
Walden and I are committed to moving the user fee legislation
through committee following regular order, with time to spare.
I want to welcome Dr. Woodcock back to the subcommittee. I
would also like to commend the Food and Drug Administration and
industry for the various briefings that they have provided
members and members' staffs throughout the negotiation process
and for transmitting the proposed agreements to Congress in a
timely manner pursuant to the process laid out in statute.
Committee staff has been working on a bipartisan basis with
the Senate Health Committee to review the agreements in detail
and to develop the necessary authorizing language for
consideration. I appreciate the technical assistance that the
Food and Drug Administration has provided, not to mention the
expertise of our legislative counsels. It is because of these
efforts that we are well on track for a timely reauthorization.
Since 1992, with the initial authorization of the
Prescription Drug User Fee Act, revenues generated from
regulated industry fees have supplemented congressional
appropriations and significantly enhanced the Food and Drug
Administration's ability to review product applications and a
more predictable manner.
Based in large part on the success of the Prescription Drug
User Fee Act, medical device user fees were authorized in 2002,
followed by Generic Drug User Fee Amendments of 2012, and the
Biosimilar User Fee Act of 2012, both of which are the focus of
today's hearing. I look forward to learning more about their
implementation to date, and ways to improve these important
programs going forward.
Approval of additional biosimilars will undoubtedly
increase competition in a complex and often costly biologic
drug market. Small-molecule generics already account for
billions of dollars in savings each year. Nonetheless, for a
variety of reasons, generic competition is lacking for certain
products despite the absence of patent protection. We will hear
from the Food and Drug Administration and from industry about
how improving and reauthorizing the Generic Drug User Fee
Amendments will help to close those gaps.
We will also hear from our colleagues, Kurt Schrader from
Oregon and Gus Bilirakis from Florida, about H.R. 749, the
Lower Drug Costs through Competition Act, a bill that they
recently introduced along with a bipartisan number of
cosponsors. H.R. 749 aims to encourage market entry by generic
manufacturers in situations where it may not otherwise make
sense from a business perspective.
I understand that introduction of this bill has led to a
robust discussion about additional and alternative ways to spur
such competition. That is a good thing. I appreciate the
sponsors' willingness to hear from a variety of stakeholders
and to work with bipartisan committee staff to improve the bill
prior to proceeding to markup.
Again I want to welcome all of our witnesses here today. I
apologize for the late start. Thank you for being with us, and
look forward to your testimony. The chair now recognizes the
ranking member of the subcommittee, Mr. Green from Texas, 5
minutes for an opening statement, please.
[The prepared statement of Mr. Burgess follows:]
Prepared statement of Hon. Michael C. Burgess
The Subcommittee will come to order.
The Chair will recognize himself for an opening statement.
Today's hearing marks the Health Subcommittee's first
public discussion on the reauthorization of several key user
fee programs at the U.S. Food and Drug Administration (FDA).
This hearing will focus on the generic drug and biosimilar user
fee programs and we will turn our attention to reauthorization
of the Prescription Drug User Fee Act (PDUFA) and the Medical
Device User Fee Amendments (MDUFA) later this month. All four
of these programs expire in September and must be reauthorized
for Fiscal Years 2018-2022. Chairman Walden and I are committed
to moving the user fee legislation through Committee, following
regular order, with ample time to spare.
I want to welcome Dr. Woodcock back to this Subcommittee. I
would also like to commend the FDA and industry for the various
briefings they provided our members' staffs throughout the
negotiation process, and for transmitting the proposed
agreements to Congress in a timely manner pursuant to the
process laid out in statute. Committee staff has been working
on a bipartisan basis with the Senate HELP Committee to review
the agreements in detail, and develop the necessary authorizing
language for our consideration. I appreciate the technical
assistance FDA has provided, not to mention the expertise of
our legislative counsels. It because of these efforts that we
are well on track for a timely reauthorization.
Since 1992, with the initial authorization of PDUFA,
revenues generated from regulated industry fees have
supplemented Congressional appropriations and significantly
enhanced FDA's ability to review product applications in a more
efficient and predictable manner. Based in large part on the
success of PDUFA, medical device user fees were authorized in
2002, followed by the Generic Drug User Fee Amendments of 2012
(GDUFA), and the Biosimilar User Fee Act of 2012 (BsUFA)-both
of which are the focus of today's hearing. I look forward to
learning more about their implementation to date and ways to
improve these important programs going forward.
Approval of additional biosimilars will undoubtedly
increase competition in the complex and often costly biological
drug market. Small molecule generics already account for
billions of dollars in savings each year. Nonetheless, for a
variety of reasons, generic competition is lacking for certain
drug products, despite the absence of patent protection. We
will hear from FDA and industry about how improving and
reauthorizing GDUFA will help close these gaps.
We will also hear from our colleagues Kurt Schrader (D-OR)
and Gus Bilirakis (R-FL) about H.R. 749, the Lower Costs
Through Competition Act-a bill they recently introduced along
with a bipartisan roster of co-sponsors. H.R. 749 aims to
encourage market entry by generic manufacturers in situations
where it may not otherwise make sense from a business
perspective. I understand that introduction of this bill has
led to a robust discussion about additional and alternative
ways to spur such competition. That is a good thing. I
appreciate the sponsors' willingness to hear from a variety of
stakeholders and work with bipartisan Committee staff to
improve the bill before proceeding to markup.
I want to welcome all of our witnesses and thank you for
being here. I look forward to your testimony.
OPENING STATEMENT OF HON. GENE GREEN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF TEXAS
Mr. Green. Thank you, Mr. Chairman, and thank Dr. Woodcock
for being back with us and our distinguished panelists for the
hearing this morning.
Today is the first hearing of the user fee agreement
reauthorization cycle. We have learned a great deal since the
first prescription drug user fee agreement authorization, and
every 5 years have amended and expanded the user fee programs
to build on past successes and further support timely review
and approval of safe and effective medical products.
The affordability of therapies is an issue of great growing
concern. Robust competition in the prescription drug market
between innovative drugs and generic drugs and innovator
biologics and biosimilars is crucial to providing patients with
greater access to affordable therapies. Generic drugs are
proven to be a safe and affordable alternative to brand name
drugs.
It is estimated that generic drugs account for 89 percent
of prescriptions dispensed in the U.S., but only 27 percent of
the total drug cost. In 2015 alone, generic drugs saved
American families $227 billion. Similar to generics,
biosimilars hold great promise to make complex products
available at lower cost to patients.
Due to growing concerns about the time it is taking FDA to
review generic drug applications and the backlog of such
applications, Congress passed the generic drug user fee
amendments in 2012. Interest in participation in the program
has exceeded initial predictions, and the agency has struggled
to get the new program off the ground and keep up with the
oversize workload and undersized resources.
GDUFA II, like subsequent reauthorizations of the
prescription drug and medical device user fee programs provides
an opportunity to address lessons learned from the past 4 years
and improve the program so that we have a strong market of safe
and effective generic drugs. Following the enactment of the
Biologics Price Competition and Innovation Act, the biosimilar
act, BP act, BsUFA, was established. Welcome to the FDA
acronyms.
BsUFA II provides an opportunity to build on progress made
and enhance the program. Stakeholders and the FDA have agreed
to review timelines, meeting structures, and new programs to
increase the number of first-cycle approvals which will save
resources for sponsors and the agency and, more importantly,
make safe and effective therapies available to patients and
introduce additional competition in the market.
I look forward to hearing more about the agreements between
the stakeholders and the FDA on GDUFA II and BsUFA II. It is
crucial that Congress authorize these programs in a timely
manner to ensure the agency has the resources and tools needed
to support generic and biosimilar competition.
And I want to mention my concern about the impact of the
administration's across-the-board hiring freeze with the FDA.
FDA must have an adept and capable and sufficiently sized
workforce to make timely scientific decisions in the interest
of patients and the public health. Currently, FDA has 1,000
vacancies at the agency and the majority of which are in the
Center for Drug Evaluation and Research.
We worked to help the agency attract and hire highly
qualified professionals at the 21st Century Act. The hiring
freeze threatens the laudable work that could have a
detrimental impact on the hiring goals all ready to negotiated
performance goals of the user fee agreements. I hope the
administration takes this into account when implementing this
deeply flawed policy.
We are also here today on H.R. 749, Lower Drug Costs
through Competition Act. Over the past few months we have had
productive and bipartisan conversations about the proposal and
ways to achieve the shared goal of enhanced generic
competition. I have concerns as the legislation is written,
however, including a concept of how a priority review voucher
for generic drug manufacturers will impact with existing and
newly negotiated provisions of GDUFA II.
I would like to continue to work with my colleagues to
improve the legislation. There is a growing bipartisan support
for the government to take action and lower prescription drug
costs. Rising drug costs is not a simple problem and with a
simple solution. While more competition for generics and
biosimilars is an important way to make medicines more
affordable, it alone is not sufficient to address the problem
of affordabilities.
Mr. Chairman, I would like before I yield the remainder of
time to my colleague from Colorado, Congresswoman DeGette, just
for the public do you have any knowledge that we are going to
have a hearing next week on the markup of the Affordable Care
Act?
Mr. Burgess. It is my understanding that the markup has not
been noticed and it will be noticed in a timely fashion if it
occurs.
Mr. Green. Well, thank you for that little bit of
information. I will yield my time to my colleague.
Ms. DeGette. Thank you. Well, just in the few seconds left
I want to echo Mr. Green's concerns about this hiring freeze,
particularly with the implementation of 21st Century Cures, but
also with reauthorization of the UFAs, because I don't see how
we can improve access if we have a hiring freeze.
The other executive order that we are deeply concerned
about on both sides of the aisle is this order that you have to
repeal two regulations before you can enact a new regulation,
because as we are trying to implement the UFAs and also 21st
Century Cures I don't see how we are going to be able to use
those draconian, I think it is just draconian in this
standpoint.
Mr. Chairman, I am going to have a series of questions that
I am going to submit to Dr. Woodcock and our other witnesses
about this, but I think this is something, a concern that we
share on both sides of the aisle. And I appreciate your comity,
and I yield back.
Mr. Burgess. The chair thanks the gentlelady. Does the
gentleman from Texas yield back? Apparently so. The chair then
recognizes the gentleman from Florida, Mr. Bilirakis, 5 minutes
for an opening statement, please.
OPENING STATEMENT OF HON. GUS M. BILIRAKIS, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF FLORIDA
Mr. Bilirakis. Thank you. Thank you, Mr. Chairman. Again
thank you for including the Lower Drug Costs Through
Competition Act as part of this hearing. I am proud to join my
colleague, Congressman Kurt Schrader, to responsibly use the
power of the free market to bring lower prices and more drug
choices to the market.
This legislation would directly address some of the
problems we have seen with bad actors in the drug space such as
Turing Pharmaceuticals and Valeant Pharmaceuticals. Too often
we have seen the price of lifesaving medications skyrocket due
to bad actors taking advantage of monopolies in the market. We
cannot allow this to continue. Our bill would incentivize drug
companies to enter into these markets where no generic
currently exists. My constituents in Florida and folks
nationwide need relief. I hope that this committee will move
this bill this month, and I yield back. Thank you, Mr.
Chairman.
Mr. Barton. Would the gentleman yield some of this time to
me, Mr. Chairman?
Mr. Burgess. The gentleman from Texas is recognized if the
gentleman from Florida yields back.
Mr. Bilirakis. Yes, I yield back.
Mr. Barton. I won't take any more than 3 minutes and 47
seconds. I want to thank you, Mr. Chairman, and I want to thank
the ranking member, Mr. Green, for hosting this hearing today
on the Biosimilar User Fee Act. Not everything in the
Affordable Care Act was bad. I know that is a shock for my
friends on the minority side to hear a Republican say that. But
Congresswoman Anna Eshoo and myself put in a strong biosimilar
section in this committee, in the Affordable Care Act markup
when the Energy and Commerce Committee did that.
It was one of the few bipartisan provisions, it created a
new and distinct biosimilar industry sector. Success of that
regulatory provision can only be measured now by how it is
implemented. We have thousands of patients, Mr. Chairman, that
are facing cancer, inflammatory disease, kidney disease, and
other serious disorders. We expect that they will benefit from
biosimilars over the next decade. Although this is a new
industry, I do believe that Congress and the administration
have an important role to play in the development and success
of the biosimilar marketplace.
So while this is not the focus of the hearing today, I
would ask that we take a look at this CMS finalized payment
methodology that they just finalized and, in my opinion, if
that stands it will dramatically reduce the investment and
availability of biosimilars.
So Mr. Chairman, thank you for the hearing. I look forward
to hearing the witness. We are glad to have you again, you have
been here before. And with that I yield back.
Mr. Burgess. The chair thanks the gentleman. The chair
recognizes the gentleman from New Jersey, Mr. Pallone, the
ranking member of the full committee, 5 minutes for an opening
statement, please.
OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF NEW JERSEY
Mr. Pallone. Thank you, Mr. Chairman. Mr. Chairman, I must
follow up on the little dialogue that you had with Ranking
Member Green at the end of his statement with regard to the ACA
bill. It seems like everyone knows that there is going to be a
markup in full committee next Wednesday of the Affordable Care
Act except for the Democrats who haven't been told anything.
And I know you have long been an advocate for regular order, I
just want to read this statement from the Speaker.
The Speaker on the Today Show on February 28th, he said
that the majority's proposed ACA replacement legislation will
be carefully considered and completed through the committee
process with public engagement and transparency. We are going
through the committee process step-by-step. We are having
public hearings. We are having committees work on legislation.
We are not hatching some bill in a back room and plopping it up
on the American people's front door.
Well, I have been told, not by the Republicans, not by The
Chairman, not by you, but by, you know, K Street and everyone
else around here that you guys can go down to H-157 right now
as we speak and go in there to the basement, the secret
basement that, you know, that the Speaker says would never
happen, and look at the bill that is going to be marked up next
Wednesday. But I can't go down there. You know, maybe the
lobbyists know where it is, they know what is in it. You know,
I don't know what the media knows, but they certainly know
there is a markup. Maybe the Russian ambassador is down there
and he can tell us what is in the bill. Maybe they will let him
in, but they won't let me in.
And I want to commend you again, Mr. Burgess, Chairman, you
were on MSNBC's Chris Hayes last night and you said that you
don't agree with the decision to keep the House's GOP bill
secret, warning that it could backfire. You suggested
Republicans owed it to the public to share their plan. It is
time. Put your pencils down and turn your papers in, he told
MSNBC's Chris Hayes.
So you seem to be an advocate for letting everyone see
this. I mean, I would just remind you, I know you always talk
about transparency with the ACA, but when the Democrats
considered the ACA, the House conducted 79 committee hearings
and markups over a 2-year period. The House posted the original
language of the bill online for 30 days, engaging in public
deliberation before the first committee held the markup.
Now from what I can see, what is going to happen is you may
put out a notice Monday of a markup in full committee
Wednesday, we come back Tuesday night and we won't even have 12
hours before the markup would happen. Now I don't know that
that is for sure, but that is what everybody is hearing. So let
me just ask you, can I go down right now myself, Mr. Green, Ms.
Eshoo, can we go down to H-157 and see this bill? Would you
just ask, I would like to know whether I can go down there and
look at this bill.
Mr. Burgess. Were you asking Mr. Green or myself?
Mr. Pallone. No, I am asking you, Mr. Chairman. I mean, I
like what you said on MSNBC, but can I go down and look at the
bill?
Mr. Burgess. The chair does not have that information
available, but I will find out for you and relay it to you as
soon as it becomes available.
Mr. Pallone. Well, I would appreciate it because I really
think that Democrats should be looking at the bill in addition
to K Street, in addition to the media, and God knows what goes
on with the Russian ambassador. But I want to yield the balance
of my time to Mr. Schrader.
Mr. Schrader. Thank you. I want to thank the ranking member
and thank you, Mr. Chairman, for having the hearing.
On a more bipartisan note, I think it is pretty evident
American patients, states, and taxpayers, we are paying
exorbitant prices for many prescription drugs, and it is really
time for Congress to act. Every few months we are seeing
headlines about exorbitant price hikes from unscrupulous bad
actors like my good friend Gus Bilirakis talked about.
Buying the rights to produce drugs that have been on the
market for decades usually where there are no competitors,
seemingly overnight these prices go through the roof. In the
case of Daraprim, a drug used by some transplant patients,
people living with AIDS, Turing Pharmaceuticals raised the
price from $13.50 per pill to $750--come on, man. Last year,
Valeant, another pharmaceutical company raised the price of
their drug to treat lead poisoning, been around forever, by
more than 2,700 percent. That is criminal.
For both these drugs and many others, the drugs have been
off patent for years and ages. There is no generic competitor
on the market. Unfortunately, generic manufacturers who want to
bring a competitor face this long approval process we are going
to be talking about. I think GDUFA I is going to help a bunch.
But our bill, lowering drug costs through competition, makes a
huge difference in getting these drugs to market that much
faster. It also looks at the risk mitigation strategies,
potential abuse.
We have solicited feedback on our bill, look to learn more
from stakeholders. This hearing hopefully provides another
opportunity. It is important. I am glad we are able to come
together in a bipartisan fashion to make this happen.
And I yield back, Mr. Chairman.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman. We now conclude with member opening statements.
The chair would like to remind members that pursuant to
committee rules, all members' opening statements will be made
part of the record.
For what purpose does the gentleman from Oregon seek
recognition?
OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF OREGON
Mr. Walden. Just to make a brief opening statement, Mr.
Chairman. And I want to commend my colleague from Oregon and my
colleague from Florida for bringing this legislative concept
forward. It is one we have talked about. I think it makes a lot
of sense. It is a piece of the puzzle, it is not the whole
puzzle. It doesn't solve all the problems, but that is how we
are going to look at this, a piece at a time trying to get it
right.
And so I commend Mr. Schrader. I commend Mr. Bilirakis and
others, and I want to thank our witnesses for their
participation today. And we look forward to bipartisan
legislation when it comes to this and other issues before the
committee. With that I yield back.
[The prepared statement of Mr. Walden follows:]
Prepared statement of Hon. Greg Walden
Thank you Chairman Burgess.
I can say without a doubt that this critically important
FDA user fee reauthorization process is in good hands with you
at the helm. I remember you leading the charge during the last
reauthorization cycle in 2012 to push for a number of key
process improvements at the agency that have directly benefited
patients. This subcommittee hearing, and those that will follow
starting later this month, are great opportunities to learn how
we can build upon those efforts, as well as on the many game-
changing provisions in the 21st Century Cures Act, which I am
committed to ensuring is fully funded and implemented. A point
I made clear to the President last month.
And, Chairman Burgess, you are exactly right that we are
both committed to a timely user fee reauthorization and it is
my goal, in working with the Senate, to move legislation
through Congress and on to the President's desk well in advance
of the August recess. Committee staff has already hit the
ground running and has been meeting frequently on a bipartisan
basis with FDA and the industry negotiators to review the
agreements and iron out technical issues with the legislative
language.
Reauthorizing improved generic and biosimilar user fee
programs will lead to timelier approvals and lower drug costs.
It's that simple.
I also want to take a minute to applaud my friend from
Oregon, Rep. Schrader, and Rep. Bilirakis, for working together
on pursuing additional ways to promote more generic
competition, particularly in therapeutic areas where it is
sorely lacking.
Thank you to Dr. Woodcock and her team at FDA, as well to
the industry negotiators here today. I look forward to working
with all of you in my capacity as Chairman going forward.
I yield back the balance of my time.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman. And again we want to thank all of our witnesses
for being here today, for taking time to testify before the
subcommittee. Each witness will have the opportunity to give an
opening statement followed by questions from members.
We have two panels of witnesses today, and we will begin
with Dr. Janet Woodcock, the director, Center for Drug
Evaluation and Research at the Food and Drug Administration. We
appreciate you being here this morning, Dr. Woodcock. You are
recognized for 5 minutes for an opening statement, please.
STATEMENT OF JANET WOODCOCK, M.D., DIRECTOR, CENTER FOR DRUG
EVALUATION AND RESEARCH, FOOD AND DRUG ADMINISTRATION
Dr. Woodcock. Thank you. We are here today to discuss the
proposed reauthorization of two user fee programs known by the
acronyms of GDUFA and BsUFA that support review of generic
drugs and biosimilar drugs, respectively. FDA approval of
generic or biosimilar versions of brand drugs after patent and
exclusivity protections have expired, introduces competition
into the marketplace and results in more affordable medicines.
Indeed, generic drugs are estimated to have saved the
American public $1.5 trillion over the last 10 years. Almost 90
percent now of all prescription drugs dispensed in the U.S. are
generics. Before GDUFA I was enacted, Congress, the industry,
and FDA all recognized that the program was a victim of its own
success and it was not able to keep up with the flood of
applications that were coming in.
Congress authorized GDUFA I, and I am happy to report it
has been a success. FDA has met all the program goals of GDUFA
I. In addition, virtually all of the piled up applications have
been reviewed and either approved, they have been sent to the
manufacturer for the deficiencies, or they are in a new review
cycle. So they are all in process of the review process.
FDA approved or tentatively approved 835 generic drugs in
fiscal year 2016, which is a new record, and over the 4 years
of this program so far we have approved 56 new generics, first
generic drugs. Similarly, the biosimilar user fee program is on
track to provide affordable alternatives to biologicals. So
far, four biosimilars have been approved and we are working on
64 development programs with developers that would provide
competition for 23 biologics. We have also issued six final and
four draft guidances.
But these user fee programs are version 1.0. We and
industry have learned a lot in the course of operating these
over the last 4-plus years. So over the past year, we worked
hard with industry to envision ways to improve the program that
meets the industry's need for timeliness, transparency,
predictability, but also meets the public's need for a steady
flow of high quality affordable medicines.
We think the proposals for GDUFA and BsUFA II meet these
twin objectives from both the public good and working well for
industry and the agency. Additionally, across multiple drug
user fee programs that are up for reauthorization, we have
added new financial management provisions and modified fee
structures in a way that will simplify and improve the
infrastructure of all these user fee programs, so that is a
part of these two new programs.
As in your work with 21st Century Cures, which we were
happy to work with you on, these user fee programs are intended
to improve U.S. citizens' access to safe and effective
medicines, and it is really important that they be reauthorized
because they are providing that function now.
I will be happy to answer any questions.
[The prepared statement of Janet Woodcock, M.D. follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Burgess. The chair thanks Dr. Woodcock. Thank you for
your testimony. We will move on to the question and answer
portion of the hearing. I begin the questioning by recognizing
myself for 5 minutes.
Dr. Woodcock, the FDA, Food and Drug Administration, often
reviews and makes decisions on complex, novel drug applications
for serious conditions within 6 months. Decisions on whether to
approve such new drug applications are almost always made in
the first review cycle. On the other hand, the median review
times for generic drug applications have actually increased
since the Generic Drug User Fee Amendments was authorized, and
in 2015 reached 48 months with only nine percent of generic
applications approved in the first review cycle.
So this doesn't seem like the right direction. In 5 years
from now, what percentage of first-cycle approvals would you
consider a success?
Dr. Woodcock. Well, I would consider a success to be a
considerable increase over the rate we are seeing now. I think
we are up about 10 percent maybe. It is hard to say with the
recent submissions, but we can look at the class of 2014-2015
and see how many of those have gotten a first-cycle approval.
And it is still I think under 10 percent.
So if we could get up to 20, 25 percent it would be
excellent, and then keep building that over time. Because right
now, if, next year if a company were to send in, if you were a
company you would send in a generic drug and, say, it would be
a first generic and it were a good application, it was
complete, you could be on the market in 8 months.
Mr. Burgess. I beg your pardon?
Dr. Woodcock. You could be on the market in 8 months.
Mr. Burgess. 8 months. So I guess the issue is here is
really how do we move the needle so that the overwhelming
majority of generic applications are actually approved on the
first cycle?
Dr. Woodcock. That is one of the goals of GDUFA II. So for
complex generics we have put in and proposed a program where we
would work with the companies before the application was
submitted and work out a lot of the complex issues. These might
be applications where there is an injector or other device used
with them, or where there are very complicated molecules.
But also we plan to provide more training and interaction
with industry up front in general so that they can get to a
point where their applications can be approved on the first
cycle.
Mr. Burgess. Under anyone's definition that would be moving
the needle. For priority submissions of noncomplex products,
which according to the Food and Drug Administration itself
constitute a relatively small portion of their overall workload
but are especially important to public health, should the
agency have a similar program to ensure quality applications
are submitted at the outset, reduce the opportunity for
failure?
Dr. Woodcock. Well, we are proposing that at least for
complex drugs that there be a very intensive program to make
sure that they get it right the first time.
Mr. Burgess. Are there additional tools or authority that
the Food and Drug Administration would need particularly in the
space that deals with the development of complex generics under
the 505(j) pathway?
Dr. Woodcock. What we are proposing in GDUFA II would give
us new tools. We would actually meet with the companies in
advance. There would be submissions during and interactions
during the review process. This is actually somewhat similar to
what we do for the new drugs that you mentioned earlier.
And I will point out that the PDUFA program over the 20
years of operating has brought the first-cycle drug approval up
to what, well over 80 percent of drugs that are approved on the
first cycle now in the new drug side. But it wasn't that way at
the beginning.
Mr. Burgess. Dr. Woodcock, do you think the FDA needs
additional authority in order to approve drugs faster on this
pathway?
Dr. Woodcock. No. I think that we need more, the resources
that we have negotiated under GDUFA II or other types of
resources provided, because this is a labor-intensive activity,
all these additional interactions with the industry that help
them get their submission in shape the first time.
Mr. Burgess. Well, I certainly thank you for being here
today. Again, as I mentioned to you before we started, it
doesn't seem possible that this is the third reauthorization
that I have lived through. I really do appreciate your
testimony. I appreciate putting together the list of
medications that actually have been approved that may not be
generally known, so I appreciate you making that as part of the
packet today of information that you shared with the
subcommittee.
And I will yield back my time and recognize Mr. Green for 5
minutes for questions, please.
Mr. Green. Thank you, Mr. Chairman. Dr. Woodcock again,
welcome. The review model instituted by PDUFA is a result of
lessons learned over the years and a commitment from both the
FDA and industry to work towards a first-cycle approval. PDUFA
now enjoys an average 80 percent first-cycle approval. One
common criticism we have heard of the FDA is the need to
improve the quality of applications under GDUFA so it moves
more toward approving the applications in the first cycle. In
fact, you note in your testimony that prior GDUFA generic
applications were approved in one review cycle less than one
percent of the time. That rate has increased to nine percent
under GDUFA I. Following the chairman's question, follow up,
can you elaborate more on how GDUFA II will improve that first-
cycle approval?
Dr. Woodcock. Yes. Well, first of all, we are getting
industry focused on the fact that the benefits of a first-cycle
approval. In the past it was about a median of four cycles, and
sometimes we would go up to 11 cycles, industry would go
through in getting their application, and sometimes they had
time because they were waiting for patents to expire or what
have you.
So we are going to focus on that and then for the very
complex ones we are going to put in place, we are proposing to
put in place a special program where we work with the industry
before they submit their application. So that is off the clock,
all right. And we help them get it, meet with them and help
them get it into place and we issue certain guidances early,
and then we meet with them during the program to make sure the
review is on track and that they have answered all the
questions.
Mr. Green. OK. Much attention has been given to the backlog
of the generic applications. Can you help this committee
understand the nature of these pending applications and what
the agency has done to address them? I think you may have
answered that, that you are actually working with them before
filing, so I appreciate that.
On the BsUFA meeting, Dr. Woodcock, when you were here last
February to testify about the implementation of BsUFA you
discussed the increasing number of meeting requests that the
agency was receiving from sponsors. We have heard from industry
that these meetings are valuable and providing clarity about
the data and the information the agency will need for approval
and to address any outstanding questions FDA will have early in
the process. What improvements of these meetings with sponsors
will be made under BsUFA II?
Dr. Woodcock. Yes. Well, those meetings are very valuable.
We are all feeling our way in biosimilarity. It is a new
concept. It is not safety and effectiveness, it is
biosimilarity that provides the entry to the market, and how to
prove that is a new concept. So we had not been meeting all of
our meeting goals under BsUFA I because the industry appetite
for them was very large and we were not able to meet with all
the industry that wanted to meet with us.
So under BsUFA II we have changed some of the timelines. We
are increasing the staffing so that we will be able to meet
these meeting goals and meet with industry that needs to talk
with us about how to craft their biosimilar program. Much of
this is analytical work, in vitro work, sometimes though there
would even be a clinical trial that would be done.
Mr. Green. In the short time I have left, let me just ask
too about some of the concerns about the, as I said in my
opening statement about the number of vacancies at the FDA and
also a freeze on hiring. Obviously that would hurt the process
right now, and is there anything the FDA can do now with staff?
Dr. Woodcock. Well, as you know, our hiring problems have
been persistent for the last 5 or 6 years and we have run
deficits. We are working with the new administration and we
hope that we will be able to address these issues, continue to
address them as we have been trying to address them.
Mr. Green. Thank you, Mr. Chairman. I have one other
question. Can you explain different considerations given under
GDUFA II for small businesses, because that is one of the
issues we have heard.
Dr. Woodcock. Yes, there is a different fee structure for a
small business exemption so that that will help, and there are
different levels of the program that--small business exemption,
yes. It is complicated how we are doing it so we can get back
to you, but we have taken the issue of small business more into
account in the fee structure in GDUFA II.
Mr. Green. Thank you, Mr. Chairman. I yield back.
Mr. Burgess. The chair thanks the gentleman. The gentleman
yields back. The chair recognizes the gentleman from Kentucky,
Mr. Guthrie, vice chairman of the committee, 5 minutes for your
questions, please.
Mr. Guthrie. Thank you, Mr. Chairman. Thank you, Dr.
Woodcock, for being here. We appreciate it very much. Do you
know the percentages of generic drug applications that go
through more than three review cycles, or how about five review
cycles?
Dr. Woodcock. Well, it depends on when you are talking
about because that is in flux right now. Historically, the
median was four, so about half were less than four or less, and
obviously about half were more than four, OK.
Mr. Guthrie. Yes.
Dr. Woodcock. OK, so now that is shifting a little bit.
That curve is shifting to the left and we hope to see fewer and
fewer total review cycles. The reason that is happening right
now is because we are doing a lot of information requests and
we are going back and forth with the company during the review
cycle to try and get as much of this fixed as possible. And we
hope that the vast majority of ones, all these ones that we
have been reviewing, will be approved on the second or third
cycle.
Mr. Guthrie. OK.
Dr. Woodcock. But the older ones may still need
considerable fixing up before they can get approved.
Mr. Guthrie. You almost got to my next question, but so how
many total years in like the back, when you talk about back and
forth between FDA and the company, if you are in three cycles,
I mean, how many years is that typically? Or maybe even 5
years.
Dr. Woodcock. Historically that is very difficult to say,
all right. Right now the first cycle is going to be 10 months,
right. And then you send it back to the company, say, if it
doesn't get approved, and then it depends on when they send it
back to us. Right now the industry due to our vigor in getting
through all these, industry has 1,800 applications with them
that they are trying to respond to and send back in. Well, that
is a lot of applications and they aren't going to be able to
send them all back in a month.
So what we think is over the next few years, if GDUFA II is
reauthorized we will get into a steady state. And you put an
application in and you have a predictable path, you know when
you are going to get it back. If it isn't approved, you will
have time you can rapidly work on it, send it back in a couple
months and it will be fixed. Now if, and if I may go on.
Mr. Guthrie. Go ahead, yes.
Dr. Woodcock. What if they have a plant somewhere that has
been found to have problems, now that may take longer to
remediate especially if very serious deficiencies were
identified. So there are going to be some outliers where they
can't really send it in again until the issues with their
manufacturing or some other serious issue is remediated.
Mr. Guthrie. Are the multiple review applications, are they
typically from smaller companies or newer companies or with
less experience, or does experience and company size not
matter?
Dr. Woodcock. We have found them from everybody.
Mr. Guthrie. OK.
Dr. Woodcock. So there is a lot of educational work to be
done.
Mr. Guthrie. Are there any particular characteristics of
applications that come through on the first cycle that you say,
well, these are characteristics that could be expanded
throughout the rest of the, people having issues with that?
Dr. Woodcock. Yes, and we are making a great effort to try
and identify that and have standardized tables and more
standardized submissions and so forth so that industry knows,
have we filled everything out, is everything complete, is it
all in here? We are doing more on the refusal to file so they
get it back quickly, and it isn't filed so they can make sure
it is complete before they get in the process and have to wait
8 months. So we agree with you. If we could identify those
characteristics, we could help the applications be more
complete.
Mr. Guthrie. Yes. Well, I wanted to help you and help
everybody work better. That is why we are here. So does FDA
currently expedite resolution of an inspection related issue
when it is the only obstacle for generic approval particularly
if the case is priority submission? So do you expedite
inspection related issue?
Dr. Woodcock. We may expedite ones that are straightforward
but, you know, we are dealing with fraud sometimes, we are
dealing with very serious deficiencies, say, with sterility of
drugs and so forth, and those have to be remediated by the
sponsor before we could responsibly approve the drug.
Mr. Guthrie. Absolutely. We don't disagree with that. Well,
thank you, you answered my questions. I yield back almost a
minute of my time.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman. The chair recognizes the gentleman from New
Jersey, Mr. Pallone, the ranking member of the full committee,
5 minutes for your questions, please.
Mr. Pallone. Thank you, Mr. Chairman.
Dr. Woodcock, I wanted to ask you about the abuse of REMS.
I believe with many of my colleagues on the committee that we
should encourage and support robust generic competition in the
marketplace, however, if we are to achieve this goal we must
ensure that we are limiting barriers to generic entry wherever
possible. Unfortunately, there is evidence that some brand drug
manufacturers are using REMS programs to delay competition by
preventing generic and biosimilar manufacturers access to
samples of branded drug products and these samples are needed
by generic and biosimilar manufacturers to conduct the
bioequivalence studies needed for FDA approval.
So my question is, you note this problem of certain brand
companies delaying or denying generic companies access to
reference products in your testimony, can you discuss further
how REMS programs are being inappropriately used to delay
generics' entries to the market and what steps the agency is
taking to curb those abuses?
Dr. Woodcock. Well, the REMS programs and other restricted
distribution programs restrict general access to the drugs in
some cases. And so a generics company would have to get the
drug in order to compare it in a bioequivalence study and also
compare back, reverse engineer the product so they are making a
copy. And in many cases they have been denied access to the
drug and so they are not able to do those things.
The steps we have taken, we are willing to review the
protocol of the generic and send a letter to the brand saying,
this is an appropriate use for the drug and it is under, you
know we have looked at it, so that there isn't a reason that
says, well, we are worried these people are irresponsible and
they are going to take our drug and do something.
We have made it clear that drugs even under REMS can be
used for bioequivalence studies and so forth, but we can't
compel companies to give their drug away to a competitor, to a
generic competitor. We have also talked to the FTC about this
general issue and, you know, had shared conversations with
them.
Mr. Pallone. Well, are there other tools or authorities
that you need or you suggest to address the abuse? You said
that you can't compel, but should we be legislating something?
Dr. Woodcock. I don't know the answer to that. But I know
it is a problem that we struggle with a lot and that the
companies struggle with and it has delayed availability of
generics.
Mr. Pallone. And I was going to ask you this, but I think
you answered the question. But let me just say that you seem to
think that there is, the argument is made that REMS drugs have
high risk profiles that make it unsafe for generic companies to
be able to access them for purpose of development, but I think
your answer to that is not really.
Dr. Woodcock. Yes. And we are willing to look at the
protocols under which they are going to be tested and tell the
brand company that we find these acceptable uses.
Mr. Pallone. OK. All right, let me move to the priority
review. Prescription drug costs in this country continue to
soar, and the examples of Sovaldi, Daraprim, and EpiPen have
all highlighted the very real problems. I believe that we would
all agree that expediting access of generic drugs is one way we
can help to address high drug costs. On average the cost of a
generic drug is 80 to 85 percent lower than the brand name.
So my question is prioritizing the review of first generics
and sole-source generics is one way the agency can help ensure
there is competition, can you please discuss how the agency
currently prioritizes the review of generic drugs and how the
timeline for review of an application that is prioritized
differs from a standard generic drug application?
Dr. Woodcock. We prioritize first generics, shortage drugs,
drugs under PEPFAR, and certain other categories where, say,
there is a sole-source drug, and we shorten the time that we
expect to get done to 8 months. So we move them through more
quickly kind of like the express lane at the supermarket, OK,
so we do prioritize those.
Now it is quite possible that it might be difficult to
shorten those timelines more, and the reason for that is the
inspections that have to be done. We have to do inspections,
and in fact the generics typically have many more
establishments in their application than a brand application
has and they might be all over the world. And if we haven't
been there in a certain amount of time based on a risk based
assessment we need to go do an inspection.
Mr. Pallone. And is this why under GDUFA II the FDA and
industry have agreed on this 8-month priority review for
certain applications? I mean, how do you get that 8-month
review timeline?
Dr. Woodcock. Well, it is gotten by we need to have enough
time in which to do inspections in different countries, if
necessary. And why is that? Why would we want to make sure we
had done inspections? Well, recently, for example, we have had
cases where testing labs actually switched the samples like
this so that the results would come out similar, because you
are supposed to be similar and it wasn't going to be similar.
So they switched samples so that they would get the right
results.
We have had other cases where people are going to release
their drug based on their own specifications and they found it
wasn't going to meet the specifications so they made up new
test results. So our obligation is to if we approve a generic
drug in the United States, the public needs to know it is going
to work the same as the brand drug it replaces, and that is why
we have to go and do inspections sometimes. Now if we have been
in the facility recently then we might not have to do that. And
so we only do it on a risk base, based on whether we have been
in there and other considerations.
Mr. Pallone. All right, thank you. Thank you, Mr. Chairman.
Mr. Burgess. The chair thanks the gentleman and the
gentleman yields back. The chair recognizes the gentleman from
Florida, Mr. Bilirakis, 5 minutes for your questions, please.
Mr. Bilirakis. Thank you, Mr. Chairman. And I thank you,
Dr. Woodcock, for being here, appreciate it so much.
A couple of years ago Turing Pharmaceuticals took an off-
patent drug that treats HIV patients, Daraprim, and raised it
by a price of 5000 percent. Unfortunately, this was not a
standalone situation. Since then we have seen other drug
companies, Valeant and Mylan, take old drugs and raise the
price because of a lack of competition in the marketplace.
I have heard there were about 150 off-patent drugs that
exist where we could have a generic, but no generic company has
chosen to enter those markets. Is 150 an accurate number? What
are some of the reasons for that kind of situation?
Dr. Woodcock. Our understanding right now is there are 182
drugs that are off-patent and have no generics competition and
there may well be other generics that are sole-source where the
innovator has withdrawn, because right now there are 546 drugs
where the brand name has withdrawn from the market and some of
those may only have one generic.
So if you lump them all together we call them sole-source
products, they only have one source. And the reasons for that
we believe are mainly market reasons that companies don't think
it is worth their return on investment, they don't think if
they enter that market they would make money compared to other
opportunities they might have to make money. And so many of
them have small markets and so forth. For example, we recently,
there were recently drugs that have, you can file a generic
now, and we had nine generics file for one and we had 16 file
for another.
So where there is a big market there is a great interest,
right, in getting a generic, but these small market drugs maybe
that are seen as, not a good income stream or maybe they will
be overtaken in a number of years, there isn't as much in
trust.
Mr. Bilirakis. Thank you for that. Do you know the size of
the generic filing backlog and how old are some of the filings?
Dr. Woodcock. There is no backlog in the filing.
Mr. Bilirakis. No backlog?
Dr. Woodcock. Correct. Yes, there hasn't been for some
time, that is right. So they are filed within, we are given a
certain time period to do the filing review and we have no
backlog within that. Yes, there was at the beginning of GDUFA
that we eliminated.
Mr. Bilirakis. OK, thank you very much. In your testimony
you talk about the approval process. You have 8 or 10 months to
review an application and if they are deficient you issue a
complete response letter. How long does it take for a company
to respond?
Dr. Woodcock. That is highly variable. And right now, as I
said earlier, I believe it is longer than it will be in the
future because we did have that backlog of applications. We got
a lot of them through our system. We sent them back to the
companies. Right now there are 1,800 applications at the
companies and, you know, that is a surge of responses. They are
going to have to prioritize those and get the ones they deem
most important back to us first. So we don't control the time
where they are back with the companies.
Mr. Bilirakis. But on the average how long would you say?
Dr. Woodcock. Well, because it is a moving target, it was
different before GDUFA and it has changed during, I think it is
really hard to say. Ideally, it would only be a few months
unless there are facility problems where a facility must be
remediated, or we have seen some major problem, say, with the
data where they have to go back and reverify it or redo it and
those would be much longer.
Mr. Bilirakis. A company that is into its fifth review
cycle, how many years old could that application be assuming
everyone used their full time allotted in each section what
would you say?
Dr. Woodcock. It is really hard to say, but----
Mr. Bilirakis. Can you give me any specific examples?
Dr. Woodcock. Well, it might be 5 years, say, it could be 5
or 6 years----
Mr. Bilirakis. Five or six years.
Dr. Woodcock. Under review, yes.
Mr. Bilirakis. Thank you very much. Well, you know what, I
will probably yield back, Mr. Chairman, because my next
question is very long. Appreciate it. We will submit it for the
record, I appreciate it. I yield back.
Mr. Burgess. The chair thanks the gentleman and appreciates
his consideration. The chair recognizes the gentleman from
Oregon, Mr. Schrader, 5 minutes for questions, please.
Mr. Schrader. Thank you, Mr. Chairman, and I appreciate Dr.
Woodcock being here, and thank you for FDA's attention on this
and working with the committee. Nice to see a process in
general working very well and everyone willing to make it work
hopefully even better and I appreciate your participation.
Pretty impressive with the backlog being reduced 90 percent
in a 5-year time span. Wish we could do that in a lot of other
areas in government these days. But I am curious about, the
terminology acted on, in terms of reducing that backlog. What
percentage of that backlog constitutes new applications, maybe
reapplications, people that didn't even have a good application
to begin with, that you couldn't even begin to make substantive
comments on, do you have that breakdown for the committee?
Dr. Woodcock. Yes, it is a pretty substantial percentage.
Keith, do you know the number? OK, we can get back to you on
that but there is a pretty substantial percentage of that,
quote, backlog that couldn't be approved or tentatively
approved the first time and required going back to the company
and then resubmission.
Mr. Schrader. So most of it is just normal, what you would
call perhaps normal, didn't quite get it all right, please fill
in the blank?
Dr. Woodcock. Correct. That is correct.
Mr. Schrader. All right. So what about just, have you given
any thought--you have done a lot of good work with
preapplication processes and all that. How about just an
education session, I mean, particularly for the small outfits
that just don't have the team of lawyers or whatever to work
through or read all these Web sites? They are just trying to do
the Lord's work. Is there an opportunity for folks to tune in
to an education session once or twice a year about here is what
you need to do and here is some of the common problems we see?
Dr. Woodcock. Yes, and we do that routinely and a
tremendous amount. And also we issue guidances on most new
reference drugs that come out, the brand drugs, and so we will
issue guidance well in advance on how to develop a generic for
that.
Mr. Schrader. Well, I am not talking just guidance, I am
talking about a real person, sitting down.
Dr. Woodcock. Oh, we do. So we have webinars. We go to the
technical meetings of the associations. We do gather up common
deficiencies and we post lists of these and we are really
trying. But we think it will take, we are seeing improvement.
We are up to nine percent, right, of first-cycle approvals with
the new ones, but we think it will take time. We don't like
cycles either because it increases our work. It slows time to
access and it just clogs up the system. But we will, I agree,
education is the key to get--and also our refusal to file, we
list all the reasons.
Mr. Schrader. So with all that again each of my colleague
Congressman Bilirakis' point, if you are doing all this or
there seems to be, I think, a number of cycles that we should
allow the reapplication for and then maybe cut it off.
At some point, if you are doing all the up-front work and
everyone agrees you are doing the education, plus the guidance,
plus the review, at some point so the backlog, you know, out of
the 1,800 or whatever it is that are still in the backlog, how
many have been, it would be interesting for us to know how many
have been through one cycle, two cycles, three cycles to get to
the average or whatever, because there is some due diligence on
a company's part, to not waste your time or the taxpayers'
dollars.
Dr. Woodcock. Yes. Well, we could certainly provide you
with what statistics we had. As part of getting this whole
program up and running we have put in a new IT system that
tracks the process from soup to nuts so to speak. And we can
get reports out of that and I am trying to get these reports by
cohort, like the class of '13, the class of '14, the class of
'15, what happened to them, how many cycles.
Mr. Schrader. That would be really helpful.
Dr. Woodcock. Yes. So we are very interested in that too
and we can provide you with what information we have on that.
Mr. Schrader. I guess then the last comment I make, Mr.
Chairman, is that, our bill, we are really trying to target
those lifesaving medications. These are medications that aren't
just a public health priority which you already prioritize, but
these are, immediate either acute or chronic health care
lifesaving medications we are trying to accelerate to market.
And generally the ones we are talking about aren't very
complex, wouldn't take hopefully FDA's resources to an extreme,
and many can be manufactured right here in the United States to
decrease that global footprint you talk about that would really
require a lot of time. And I think that is the rationale
between our bill trying to make sure that that is the top
priority because it is lifesaving and has to be done almost
immediate.
And I appreciate your efforts on our behalf, and I yield
back, Mr. Chairman.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman, and the chair recognizes the gentleman from
Missouri, Mr. Long, 5 minutes for questions, please.
Mr. Long. Mr. Chairman, today we are discussing issues of
competition and ways we can improve drug development to lower
cost in the private drug market. On that theme and before I
forget, I would like to ask unanimous consent to enter into the
record a letter from the FTC to CMS outlining ways in which we
can best maintain a system of competition and transparency
between providers and payers in this market.
Dr. Woodcock, to promote the goal of achieving first-cycle
approvals and approvals on the earliest legally eligible date,
the industry has placed a focus on increasing transparency and
communication during the review process. Under the current
agreement, how often and at what stages of the review and
approval process does FDA communicate with the applicant?
Dr. Woodcock. Well, we usually don't communicate with a
technical matter with the--well, let me start again. There is a
process called controlled correspondence. That was part of
GDUFA I agreements and we had a backlog of that. OK, we are
totally caught up with that and we answer all these. These are
inquiries from sponsors that are written that we can answer
about their application and we send those back. And we get
hundreds of those every year, so we are in written
communication.
But right now we do not really have meetings and those type
of communications with applicants prior to----
Mr. Long. So you are not getting any type of feedback or
anything from the applicants?
Dr. Woodcock. Not currently. That is not how the process
was set up.
Mr. Long. OK.
Dr. Woodcock. However, the proposed GDUFA II for the
complex generics will set up more processes that we can talk to
the applicants beforehand. For the more simple generics, which
are many of them, the guidance that we put out before they
start making their product should provide all the information
they need on submitting an application and what they need to
do. It is basically a cookbook.
Mr. Long. OK. With that I yield back, Mr. Chairman, thank
you.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman. The chair recognizes the gentlelady from
California, Ms. Eshoo, 5 minutes for questions, please.
Ms. Eshoo. Thank you, Mr. Chairman. And Dr. Woodcock, it is
nice to see you again. Even though he left awhile ago, I want
to publicly acknowledge the kind and generous remarks of
Congressman Joe Barton relative to the biosimilars legislation
that became part of the ACA. It was a big vote in the full
committee here, 47 to 11. It was Senator Kennedy's legislation
in the Senate and his Republican sponsor was Senator Orrin
Hatch.
So when I hear the steps being taken to fulfill what we set
out to do, it was to bring biosimilars forward essentially in
the form to create a generic biosimilar. And so that was a
while ago. We passed the ACA several years ago, so the
implementation is slow but each step is very important.
Dr. Woodcock, I read all 24 pages of your written statement
last evening, and I think that what I drew from it is the
following that progress is being made on several fronts. I
think that when we talk about hiring freezes and words that are
very familiar around the Congress, they start losing their
meaning. They start losing their meaning, because if in fact,
which you have the agreements that you have entered into with
industry partners on user fees for both of these
reauthorizations, if you don't have the staff, forget the
timing of these applications or the timeliness of when these
applications can really get to market.
So I don't know if, well, I hope that there will be
advocates from the majority that will point this out to the
administration, because I think every question and comment
today with the exception of what Mr. Pallone said in the
beginning about will there/won't there be a hearing next week,
or a markup next week, they have all been tied to timeliness.
And so I just want to underscore that.
I also want to add something else to this, and that is that
these user fees are private sector dollars. And all of this
business with sequester, I did legislation on it so that the
FDA would be able to have access to those dollars and it made
it all the way up to the conference committee and someone
pulled it out.
But I still think that it is very important, it is
something that is very important to appreciate. And so those
private sector dollars should not be treated the way the public
sector dollars are treated, and I think FDA is more than
entitled to use those dollars as a result of the user fees in
order to accomplish all the things that you wrote about in your
24-page written statement.
I want to turn to something that I have been pursuing,
well, now it is more than a couple of years. We all know that
the FDA plays a critical role in protecting the health of all
Americans, but all the members of this committee may not be
aware that there is an FDA Office of Women's Health. And it was
established by an act of Congress in 1994, and I think it
demonstrates the impact, the importance that the FDA and
Congress placed on ensuring that the FDA adequately considers
the impact of its decisions on women, which leads me to sodium
oxybate.
This is an important drug but it is also a dangerous drug.
It is also a dangerous drug if it gets into the wrong hands.
Well, I think that we all feel that we read too many stories
today about sexual violence against women and there are, it is
just the list goes on and on. But what I want to pursue with
you--and I have a stack of letters. It is like we are pen pals.
I am not satisfied on the following front and that is that as
the drug moves to a generic version that the word safety with a
big red stamp can honestly be placed on the generic. And you
know that I have had misgivings about it.
What I would like to ask you today, because there is not a
lot of time--I have a minute and, oh, I think I have gone
over--is to ask you to make a commitment today to me to meet
with me and the women advocates that care so much about this.
Would you be willing to do that?
Dr. Woodcock. I am happy to do that.
Ms. Eshoo. All right, that would be great.
Thank you, Mr. Chairman, for your indulgence.
Mr. Burgess. The gentlelady yields back. The chair thanks
the gentlelady and recognizes the gentleman from North
Carolina, Mr. Butterfield, 5 minutes for questions, please.
Mr. Butterfield. Thank you very much, Chairman Burgess.
Thank you for holding this very important hearing today. These
agreements that we are talking about, Mr. Chairman, are so
important to improving public health and they represent good
faith negotiations between the prior administration and
industry. They show the way that the FDA should work and it is
my hope that the current administration does not stand in the
way of progress.
The advances in biologics and generics have been quite
significant and generics have saved our healthcare system
nearly $1.5 trillion over the last 10 years. Biologics have
helped develop treatments for serious diseases like rheumatoid
arthritis. It is important that we continue to build on this
progress by supporting the FDA's agreement with industry.
However, it is highly concerning that this administration
seems to not understand the challenges facing FDA in ensuring
safety while working with industry to approve treatments. The
administration believes that the process at the FDA is, quote,
slow and burdensome, end of quote, despite a record year of
generic drug approvals or tentative approvals in 2016. It is
critical therefore that the administration respect these
agreements and ensure that the FDA has all of the resources
that it needs to review these important treatments.
If the administration truly wants FDA to protect public
health and fulfill its mission, it should not implement a
hiring freeze that could prevent the replacement of key
personnel. Now is the time to staff up at the FDA and other
agencies as well whose mission it is to work for the betterment
of public health. It should also follow through on Congress'
promise to provide additional resources to the FDA as this
committee did through the 21st Century Cures Act. Lastly, the
administration should nominate an FDA administrator committed
to the agreements reached with industry and not someone who
wants to simply accelerate drug approval without concern for
safety and efficacy.
Dr. Woodcock, thank you for your testimony. Thank you for
the FDA's efforts to reach these agreements with industry, and
I appreciate your explanation of how additional resources were
important in implementing the first act. Do you agree or
disagree that the additional 1,000 new employees hired during
the first agreement helped increase the FDA's responsiveness to
these applications?
Dr. Woodcock. Absolutely, they were essential. And that is
part of, first, our agreement and then our track record that we
have succeeded with this program.
Mr. Butterfield. At the end of January, Democratic leaders
on this committee sent a letter to the administration asking
for clarification about the January 23rd executive order
implementing the freeze. In that letter they asked whether
federal hiring for programs supported by user fees at the FDA
would be subject to the freeze or if those programs might be
eligible for an exemption from the executive order. I am
concerned that this executive order could in fact make it more
difficult to implement these agreements and respond to the
applications.
Can you please describe the potential impact of the
executive order on the generic and biosimilar user fee
agreements?
Dr. Woodcock. Well, as I said earlier, we are working with
the administration and we hope we can move forward on all these
programs. But we are working closely with the administration
now.
Mr. Butterfield. All right. Well, I wish you the best of
luck on that. Dr. Woodcock, you described significant
challenges in hiring staff who can address the complexity of
biologics. How can the additional hiring authority in the 21st
Century Cures Act help with that? Does the executive order
compromise any of those hiring authorities?
Dr. Woodcock. Well, I want to thank the committee for their
work on 21st Century Cures. I think it is a good step forward.
We are working on planning the implementation of the various
provisions within 21st Century Cures and we hope to continue to
move ahead on that.
Mr. Butterfield. All right. All right, like Mr. Bilirakis
said a few minutes ago, my last question would consume the time
and so I am going to yield back. All right, thank you, Mr.
Chairman.
Mr. Burgess. The chair thanks the gentleman. The chair
recognizes the gentleman from Oklahoma, Mr. Markwayne Mullin, 5
minutes for your questions, please.
Mr. Mullin. Thank you, Mr. Chairman. And Dr. Woodcock,
thank you so much for being here. I know you are doing the best
you can underneath the circumstances and I really appreciate
your focus on industry. I mean that is where it starts.
A big focus I have is obviously watching over small
businesses too, and one of the concerns I have, or the primary
concerns, really, I have is over the GDUFA--am I pronouncing
that right, by the way? These acronyms we have up here
sometimes might be easier to explain them rather than to say
them--was it didn't provide any relief for small businesses. Do
we believe on the second GDUFA it is being addressed?
Dr. Woodcock. It is being addressed in two ways. One, for
the first filing people will not have to pay fees if they are
not on the market for their manufacturing facility. Those were
the people who were the hardest hit, those who hadn't a
contract for manufacturing. And then the fees are going to be
tiered. There is a different fee depending on the volume in the
various company programs, so there is various tiers.
So we were very conscious of the small business and also
the different size of the businesses. And we tried to craft
with industry the fee structure in a way it would be fair to
everyone.
Mr. Mullin. Thank you. And another concern we have been
hearing is the inconsistency on the FDA inspections. Some
businesses we have heard have been put on hold. Are we
addressing that?
Dr. Woodcock. The FDA is going through a huge
reorganization of our field force, which is not the Center for
Drugs, it is the Office of Regulatory Affairs which houses all
our inspectors or our field inspectors, and they expect in May
to go into a reorganization at which time they will have a
pharmaceutical inspectorate. In other words, a group of
individuals who will solely inspect drug manufacturing
facilities instead of, you know, inspecting foods maybe and the
devices and so forth.
And so we hope to have a very close relationship with them.
We have worked out a new process by which these facility
evaluations will be done between us and we hope that one of the
big payoffs is going to be a great deal more consistency in how
we approach these facilities.
Mr. Mullin. With these field inspectors do they have SOPs,
standard operating procedures?
Dr. Woodcock. They do. They have compliance policy guides
they call them which guide how you do an inspection and so
forth, but we are also working on what we call the new
inspection protocol which will be much more of a checklist type
of thing. We are piloting that now.
Mr. Mullin. One of the most frustrating things and the
reason why I am really focused on this, especially with those
businesses that have been put on clinical holds, as a small
business owner myself it is imperative that I deliver the same
product over and over and over again. And I am in the service
industry and we have well over 150 individuals that work with
us and we are constantly trying to improve our operating
procedures.
But when you have people that had the authority that the
inspectors do and they are inconsistent in delivering that,
just standard operating procedures seems like that that would
clarify so much that we have in bringing clarity to and surety
to those that they are going in and inspecting. And I get that
you have a new field staff, but surely there is ways that we
can help, we can work together with bringing consistency to the
industry, because the last thing we need is inconsistency on
something that is so important with the Food and Drug
Administration.
Dr. Woodcock. Well, I agree with you. And actually
yesterday marked a landmark where we signed a mutual reliance
agreement with Europe over working to rely upon their
inspections in Europe and they would rely on ours in the U.S.
And to do this internationally, which will really help on speed
that we have been talking about today and help leverage other
inspectorates, we need to move toward common procedures so
that----
Mr. Mullin. Agreed.
Dr. Woodcock [continuing]. We can understand what each
other has done and feel comfortable relying on it. So we are
working in that international area too. But I completely agree
with you, and we are actually working on, underneath our
concept of operations we have put forward for the new structure
we are working on SOPs. That is the next step.
Mr. Mullin. Thank you. And if I can be of any assistance to
you in it, please let me know.
Mr. Chairman, I yield back.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman and the chair recognizes the gentleman from
Georgia for 5 minutes for questions, please.
Mr. Carter. Thank you, Mr. Chairman. Dr. Woodcock, good to
see you. Thank you for being here. We appreciate your
participation in this. As I understand it, the generic drug
user fee act was designed to speed up access and that you were
going to get help from the companies, from the manufacturers,
the generic manufacturers in order to speed up that process and
it was somewhat of a trade-off. And I think the original idea
was good and certainly to a certain extent it has worked.
But let me ask you, of the 6,000 outstanding abbreviated
new drug applications what percentage of those would you say
have begun the process of being reviewed by the FDA?
Dr. Woodcock. All.
Mr. Carter. All of them have begun?
Dr. Woodcock. Right. Well, first of all, I am not sure
where the 6,000 comes from. There was 2,800 and some right
before the program started and then we have gotten a certain
number each year, up to a thousand each year since the program
started. But meanwhile we are approving some, you know, all
during that period as well.
Mr. Carter. OK. What can we do to help you? What can
Congress do? Tell me what we can do in----
Dr. Woodcock. You can probably pass GDUFA II, OK.
Mr. Carter. OK.
Dr. Woodcock. Because what you are maybe hearing, all
right, is that the old applications, the ones that were sitting
there well before this program started, when they come out they
are going to be 5 years old because they were sitting around
all that time.
Mr. Carter. Sure.
Dr. Woodcock. But the ones, say, next October, if you pass
this legislation or something near it, the agreement is in 10
months, you send in a good application, in 10 months you are on
the market. And we hope as many as possible will get that
first-cycle approval, either tentative approval or full
approval, depending on the patent status so that they are off
our plate, OK, they are done. And we hope to continuously
improve that over the next 5 years so that by the end of that
time most of the applications would go through and be out on
the market.
Mr. Carter. OK. I trust you and I hope you are right and I
hope that is the scenario that plays out.
Hang with me for just a second. As you know, I am the only
pharmacist currently serving in Congress and I am under a lot
of pressure trying to answer what is going on with prescription
drug pricing, why are these drugs going up? We have had
instances over the past 2 years that I have been a member of
this August body where we have had bad actors in the
marketplace, where we had Turing Pharmaceuticals, where we had
Valeant, where we had Mylan.
And now we have, just recently we had this drug come out,
deflazacort, that is going to be marketed as Emflaza by
Marathon Pharmaceuticals. Interestingly enough, I just recently
found out that that CEO was also involved in the Valeant case.
So, this is not something new with him.
My question is this. I have had compounding pharmacies come
into my office and tell me we could have helped in that
situation particularly with the situation with the Daraprim in
Turing, that they could have marketed that but they needed FDA
to give them that authority to do that and they couldn't get
it. FDA can help us in these situations where these rogue
companies, if you will, have us by the short hairs and we
cannot do anything about it. We have the ability out there.
And I know the safety part of it is extremely important. I
respect that and I am very sensitive to it, but at the same
time, I think it is irresponsible of us--and I say us being
government and the FDA. I put us in the same bucket there. I
think it is irresponsible of us not to at least attempt to do
something about that.
Dr. Woodcock. Well, we are happy to work with Congress.
There is a range of options that people brought up and we are
willing to work with Congress.
Mr. Carter. OK. Well, see, that is what I am telling you.
That is what the people coming in my office are telling me is
that they had an alternative to the Daraprim, but they couldn't
get it approved through you to get it marketed.
Dr. Woodcock. Well, yes, we don't approve compounded drugs.
That is mainly under state as you know, but there are a number
issues probably too complicated for a 5-minute conversation.
Mr. Carter. Exactly.
Dr. Woodcock. But we are certainly, the issue sole-source
or only a few source drugs where then they are vulnerable to
market, you can rise up the prices easily----
Mr. Carter. Exactly.
Dr. Woodcock [continuing]. Is a problem that many people
are trying to address. As I said there are 182 drugs that we
know of that are off-patent and have no generic competition
right now.
Mr. Carter. And let me, we need to address that because
that is not the way the system was set up and that is not the
way the free market ought to be working. Those drugs ought to
have generics as soon as they come--what is causing that, do
you know?
Dr. Woodcock. We believe that there are market forces. It
is not attractive enough to be a competitor. It is a small
market or has some other characteristics where the generics are
not interested. This has been going on for years, so the people
had plenty of opportunity to submit generic applications but
they haven't.
Mr. Carter. And that seems to be what we are headed toward
that what the Emflaza is doing, I mean, this is for Duchenne
muscular dystrophy. I mean, you know, they have a limited
market that they are catering to and we need to make sure those
patients, and they need it now. They can't wait.
Dr. Woodcock. Well, that drug is newly approved in the
United States so it is protected by various exclusivities.
Mr. Carter. But that drug has been being used in Europe for
years.
Dr. Woodcock. I know.
Mr. Carter. And it is just much, much less than what they
are going to be charging for it in America. Now that is
outrageous. I don't like the federal government being involved
in anything, but we need to step in there. That is wrong.
Dr. Woodcock. So that is the situation. So there are some
brand drugs that have pricing issues in people's minds and then
there are generic drugs or brand drugs that actually could have
generic competition that don't have them.
Mr. Carter. I can accept it to a certain extent if it is
innovative, but that is not innovation. That is just bringing
something over here and playing the market.
Dr. Woodcock. Sure.
Mr. Carter. Mr. Chairman, I apologize. I know I went over
my time and I yield back.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman.
Dr. Woodcock. Mr. Chairman.
Mr. Burgess. Yes.
Dr. Woodcock. I misspoke earlier in my oral. Could I just
give you a very brief correction?
Mr. Burgess. Great, sure.
Dr. Woodcock. Thank you. I said we have approved 56 first
generics. What I meant is in the backlog cohort only there were
56 that we have approved, all right. We have approved 405 first
generics overall during GDUFA I. So it is in my testimony but I
just wanted to correct the record here. Thank you.
Mr. Burgess. Very well, and we appreciate you being here
with us, Dr. Woodcock. We are not going to recess, but
immediately transition into our second panel of witnesses who
we thank for being here today and taking the time to testify
before the subcommittee. Again Dr. Woodcock, thank you for your
testimony. As a reminder, each witness will have the
opportunity to give an opening statement followed by questions
from members.
So the committee will come back to order. Again I want to
thank our second panel of witnesses for being with us today and
appreciate their indulgence.
Our second panel of witnesses today includes Mr. Allan
Coukell, Senior Director of the Health Programs at Pew
Charitable Trusts; Mr. David Gaugh, Senior Vice President of
Science and Regulatory Affairs, Association for Accessible
Medicines; Mr. Bruce Leicher, Senior Vice President and General
Counsel of Momenta Pharmaceuticals and Chair of the Biosimilars
Council for the division of the Association of Accessible
Medicines; Ms. Juliana Reed, vice president of Government
Affairs, Coherus Biosciences, and immediate past president of
the Biosimilars Forum; and Ms. Kay Holcombe, senior vice
president of Science Policy, Biotechnology Innovation
Organization. We appreciate all of you being with us today. We
will begin our panel with you, Mr. Coukell, and you are now
recognized for 5 minutes for an opening statement. Thank you.
STATEMENTS OF ALLAN COUKELL, SENIOR DIRECTOR OF HEALTH
PROGRAMS, THE PEW CHARITABLE TRUSTS; DAVID R. GAUGH, R.PH.,
SENIOR VICE PRESIDENT FOR SCIENCES AND REGULATORY AFFAIRS,
ASSOCIATION FOR ACCESSIBLE MEDICINES; JULIANA REED, VICE
PRESIDENT OF GOVERNMENT AFFAIRS, COHERUS BIOSCIENCES, IMMEDIATE
PAST PRESIDENT OF THE BIOSIMILARS FORUM; BRUCE A. LEICHER,
SENIOR VICE PRESIDENT AND GENERAL COUNSEL, MOMENTA
PHARMACEUTICALS AND CHAIR OF BIOSIMILARS COUNCIL, ASSOCIATION
FOR ACCESSIBLE MEDICINES; AND KAY HOLCOMBE, SENIOR VICE
PRESIDENT, SCIENCE POLICY, BIOTECHNOLOGY INNOVATION
ORGANIZATION
STATEMENT OF ALLAN COUKELL
Mr. Coukell. Thank you, Mr. Chairman, Ranking Member Green,
and members of the subcommittee. I appreciate the opportunity
to present testimony. Pew is a nonprofit, nonpartisan research
and policy organization with programs that touch on many areas
of American life. I was asked today to focus on the challenge
of rising pharmaceutical costs within the user fee context and
beyond it.
As you know, drug spending in the United States topped $300
billion in 2015. That is up nine percent just in that year
alone. That is faster growth than the rest of health care and
it is a trend that strains budgets and helps drive up insurance
premiums and the cost of Medicare and other taxpayer-funded
programs. It also hits consumers in the pocketbook, and three-
quarters of Americans say that prices are unreasonable.
The evidence suggests this is not a short-term fluctuation
but a long-term trend, a trend that is driven largely by the
rising cost of new medicines especially high cost specialty
drugs that are used by only one or two percent of the
population but account for about a third of drug spending. Some
of these products are exciting therapeutic advances, true
breakthroughs, some are not, but they are reaching market at
ever higher launch prices, and year-on-year increases in price
after launch are another major contributor to rising drug
spending. A number of generic drugs have also undergone steep
price hikes, but in general generic prices as a category remain
flat or falling.
So what can be done in response? Well, changes to FDA's
approval process may offer some potential to address drug
spending, many key opportunities lie elsewhere. Generic
competition has long been the main tool to manage drug prices
in the United States, and the first GDUFA agreement has helped
to reduce the backlog of pending applications.
Other potential areas for efficiency include policies to
ensure that generic companies have access to brand name
products for bioequivalence testing, policies to limit so-
called pay-for-delay settlements that in some cases cause
anticompetitive delays in market entry. The Lower Drug Costs
Through Competition Act would award a generic priority review
voucher to manufacturers who bring drugs to market in cases of
limited competition or a drug shortage and would establish a 6-
month timeline for FDA review of priority applications compared
with the 8-month priority review goal in GDUFA II.
It is important to note that FDA does already prioritize
generic applications when there is only one competing product,
so the net benefits and practical feasibility of a 6-month
review are a little bit unclear. Perhaps more important than
shortening the duration of review is reducing the number of
review cycles. And I commend the FDA and the industry for their
shared commitment in GDUFA II to improving first-cycle success
rates.
When focusing on measures to increase competition, we
should note that the biologic drugs which are a big driver of
increased spending won't be affected by changes in the generic
approval process. However, anything that hastens biosimilar
development including better aligning the exclusivity for
biologics and small molecules would help to reduce spending.
There are also potential ways to increase competition among
drugs that are already on the market.
There are well established tools in the commercial
insurance market, tools like formulary placement and prior
authorization that are absent or limited in parts of the
Medicare program and consideration could be given to policies
that would increase competition within Medicare Part D and Part
B and potentially shift some drugs from one program to the
other. More broadly, factoring value into coverage decisions
including the choice not to cover a drug whose cost isn't
justified will help reduce overpayment for marginal clinical
gains, and Congress could take steps to help advance this
alignment.
Finally, there are opportunities to improve transparency in
purchasing. Pharmacy benefits managers negotiate deep discounts
from drug companies on behalf of their employer and insurance
clients, but these contracts can be extremely complex making it
difficult for even the sophisticated clients to determine
whether they have achieved an optimal share of savings.
Congress could consider requiring greater transparency of
contract terminology and definitions between payers and PBMs as
well as mandating the ability to audit these arrangements.
The balance between access to innovative medicines and
constraining cost growth is a long-term challenge with no
single solution. In striking the right balance, Congress should
look both within and beyond the user fee agreements. I thank
you for holding this hearing and welcome your questions.
[The prepared statement of Mr. Coukell follows:]
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Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman. At this point the chair would like to recognize
the chairman of the full committee.
Mr. Walden. I thank the subcommittee chairman. I appreciate
the indulgence of the committee and our witnesses. We need to
deal with a slightly different matter that involves us all and
I just want to clarify, because I know there have been
questions that have been raised.
Reports that the Energy and Commerce Committee is doing
anything other than a regular process of keeping its members up
to speed on the latest developments in its jurisdiction are
false. We are continuing to work on drafting and refining
legislative language to provide relief from a failing law, and
by that I mean Obamacare. Part of that process is giving
committee members and staff the opportunity to work closely
together to draft a bill that reflects the concerns of our
constituents and reflects our mandate from voters to repeal and
replace Obamacare. Simply put, Energy and Commerce majority
members and staff are continuing to discuss and refine draft
legislative language on issues under our committee's
jurisdiction.
And with that I yield back to the chairman.
Mr. Burgess. The chair thanks the gentleman.
Mr. Gaugh, you are recognized for 5 minutes for your
opening statement, please.
STATEMENT OF DAVID R. GAUGH, R.PH.
Mr. Gaugh. Thank you, Chairman Burgess, Ranking Member
Green, and members of the Subcommittee on Health. And first,
let me thank you for asking me to participate in this very
important and timely hearing. I am David Gaugh, senior vice
president for Sciences and Regulatory Affairs at the
Association for Accessible Medicines, AAM, formerly GPHA, and I
am a licensed pharmacist.
AAM represents key stakeholders to the generic industry and
generics represent 89 percent of all prescriptions dispensed in
the U.S., but only 27 percent of the expenditures on
prescription drugs. As such, generic drugs play an ever-
important role in bringing down artificially high prices of
drugs, thereby keeping medicines within the reach of the
American public.
I would like to begin today by commending the committee for
your continued focus on these important issues as we examine
them here today. The generic industry's remarkable growth plays
a vital role in the lives of Americans every day. This growth
in the generic industry has also served to underscore the
critically important role of the FDA and, as I will highlight,
the level of cooperation between industry and the FDA has never
been greater. However, the agency remains underfunded and the
responsibility of ensuring access to safe, effective, and
affordable medicines is a shared one and that is why the
generic industry has agreed to provide FDA with additional
resources to address these ongoing challenges.
I am here to discuss AAM's conviction that the best way of
achieving the goal of providing patients access to generic
alternatives is through the development of policies that
promote robust, competitive markets. Generic manufacturers make
complex analyses when selecting which products to pursue. This
analysis can include assessing the complexity in reverse
engineering, the state of intellectual property of the product,
the size of the market, the likely number of competitors, the
product development and manufacturing capabilities, and all
cost associated. Because of these complexities, AAM believes
that the best way to control drug costs generally is through
the policies that incentivize competition, and GDUFA II does
just that.
The priority of the generic industry in GDUFA II was to
achieve a more effective and transparent generic review
program. We believe that accomplishing this will improve the
rate of first-cycle approvals on the earliest legally eligible
date through greater transparency and communications between
the agency and the industry. Thus, both FDA and the generic
industry benefit by sharing knowledge and experiences
throughout the review process. Our goal is not merely a faster
review timeline, but a more effective review process. The fewer
review cycles required to get to approval, the sooner patients
and payers can experience the benefits of generic competition.
We strongly believe that GDUFA II is well positioned to achieve
this goal.
A few of the key areas to focus on: Application Metrics. So
the FDA will act on 90 percent of all ANDAs within 10 months
for standard application and all those indicated as priority
within 8 months and this includes the inspection component of
the review process.
Bridging, or we called it no ANDA left behind--prior to the
completion of GDUFA I, all applications and supplements that
did not have an official GDUFA I goal date and were
subsequently given target action dates will be assigned a GDUFA
II goal date on or near October 1 of 2017.
GDUFA II creates a pre-ANDA submission communication
pathway for complex products. This early engagement between
industry and the FDA will significantly contribute to the
applicant's ability to improve the overall submission quality
of ANDA's which in turn will contribute to first-cycle
approvals.
This agreement includes transparency and communications
between FDA and the ANDA applicant through the liberal use of
information requests, division review letters, and the complete
response letter. These enhancements are intended to decrease
the number of review cycles and move them for first-cycle
approval.
Reporting and accountability is also included with several
new performance and financial reporting requirements to enhance
transparency and efficiently maintain them. These new reporting
requirements will allow Congress, industry, and FDA to better
assess FDA's resource management, planning, and processes.
Small business consideration--the proposal supports small
businesses by exempting them from a facility fee until the
first ANDA is approved in that facility, and the proposal also
provides for the tiering of the annual ANDA program fee based
on small, medium, and large companies and this tiering is based
on the number of approved ANDAs those companies hold.
In conclusion, Mr. Chairman, the GDUFA II user fee proposal
is culmination of months of negotiations between FDA and
industry, and the final product as transmitted to Congress
represents a careful balance among all stakeholders involved.
We respectfully urge the committee to approve GDUFA II as
negotiated and agreed to by the FDA and industry without
changes to this agreement. Thank you.
[The prepared statement of Mr. Gaugh follows:]
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Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman. Ms. Reed, you are recognized for 5 minutes for
an opening statement, please.
STATEMENT OF JULIANA REED
Ms. Reed. Thank you, Mr. Chairman and members of the
committee for the opportunity to be here today. I am Juliana
Reed, vice president of Government Affairs for Coherus
BioSciences and the immediate past president of the Biosimilars
Forum. I was a member of the Forum's biosimilars user fee
negotiating team last year.
The Biosimilars Forum appreciates the opportunity to
testify today regarding its participation in the negotiations
for the BsUFA program for fiscal years 2018 to 2022, or BsUFA
II, and to provide our perspective on the reauthorization of
the user fee legislation. We urge Congress to support the
outcome of BsUFA II and to reauthorize the program prior to
September 30th, 2017.
The Biosimilars Forum is a nonprofit trade association
representing biosimilars manufacturers who are dedicated to the
development of a new and sustainable biosimilars market in the
U.S. with the goal of expanding access to these important
medicines while lowering costs for patients and the overall
U.S. healthcare system. The members of the Biosimilars Forum
represent the majority of the U.S. biosimilars program and
development at the FDA and are subject to the user fees we are
discussing today.
The Biosimilars Forum is solely focused on biosimilars and
the associated policies necessary to foster a vibrant U.S.
biosimilars market that delivers high quality, safe, and
effective biosimilar medicines over the long term. This
singular focus on biosimilars is important. It is a recognition
that biosimilars are unique, they are not generic drugs, and
they are not branded biologics.
Biosimilars are a new and distinctive industry sector,
created by Congress via the Biologics Price Competition and
Innovation Act, or BPCIA, and governed by new and
individualized policies and regulations solely devoted to this
sector of the biosimilar pharmaceutical industry. In fact,
FDA's regulatory treatment of biosimilars reinforces the
uniqueness of each product through the agency's approval
pathway, naming policy, and pharmacovigilance efforts. This
distinction is important to the members of the Forum and
something on which we continuously work to educate our
partners.
As we work together to build this new industry, we all need
to look at biosimilars with a different lens that acknowledges
this distinction. The Biosimilars Forum is proud to have
participated in industry negotiations with the FDA regarding
the reauthorization of BsUFA and greatly appreciates the
cooperation of the agency and the other industry groups
represented during the negotiations.
The Forum entered into BsUFA II negotiation process with
four primary goals: ensuring solid financial support for the
program; improving communication between the FDA and
biosimilars products sponsors; increasing transparency during
the approval process and regarding the spending of user fees;
and preventing the expenditure of BsUFA funds on extraneous
policy issues or activities that are not exclusive to
biosimilars.
Within BsUFA II there are significant enhancements to the
biosimilar user fee program that support the review and
approval of biosimilar medicines in the U.S. These agreed-to
enhancements include a revised review process meant to increase
the transparency and communication that will facilitate an
increase in the likelihood of first-cycle approval; agency
commitments to complete and publish several draft and final
guidance documents that will provide industry with additional
clarity and certainty regarding the biosimilar development and
review process; agency commitments to augment and strengthen
staffing of the biosimilars program including hiring product
reviewers; and enhancements to the user fee structure and
management that will allow greater transparency,
predictability, and long-term stability of the program in the
U.S. Again, we encourage Congress to support the BsUFA
reauthorization and provide the FDA with the necessary
resources it needs to continue to build its program.
Mr. Chairman, reauthorization of the BsUFA is key to
successful implementation of the BPCIA. But I would be remiss
if I didn't also mention that it is critical for all federal
agencies to be consistent in their treatment and support of
biosimilars and to recognize that this new industry has
additional needs in order to further ensure that biosimilars
will increase access and lower costs for patients who need
these medicines.
As noted, FDA has a responsibility for making clinical
distinctions among products and the agency's policies support
the notion that each biosimilar is unique. Unfortunately, CMS
did not share this view. Congress should require CMS to review
its current reimbursement policy for biosimilars and make it
consistent with FDA biosimilar policies. Specifically, FDA
policy on biosimilars acknowledges the unique nature of each
biosimilar and CMS should align its policy by assigning unique,
individualized billing codes to each biosimilar.
FDA guidance to industry makes it clear that each
biosimilar is approved in a distinct fashion with variances in
approved clinical indications and interchangeability, if
possible. FDA's guidance for industry on nonproprietary naming
of biologic products further distinguishes individual
biosimilars and brand biologics by setting out a naming system
whereby different suffixes will be assigned to the name of the
biosimilar and its reference products. CMS policy should
likewise recognize this distinction for payment and
reimbursement purposes.
In addition, as the Biosimilars Forum works closely with
patients and the providers who will prescribe biosimilars it is
critical that they understand the science behind biosimilars
and the FDA's rigorous review process so they have confidence
when using and prescribing them. We call on all stakeholders
including Congress to support collaboration and education
efforts to advance biosimilars.
Thank you for the opportunity to be here. I apologize I
went over my time, and I am happy to answer any questions.
[The prepared statement of Ms. Reed follows:]
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Mr. Burgess. The chair thanks the gentlelady.
Mr. Leicher, you are recognized for 5 minutes for an
opening statement, please.
STATEMENT OF BRUCE A. LEICHER
Mr. Leicher. Good morning, Chairman Burgess, Ranking Member
Green, and members of the Subcommittee on Health. Thank you for
the opportunity to participate in this important hearing. I am
Bruce Leicher, Senior Vice President and General Counsel of
Momenta Pharmaceuticals and the Chair of the Biosimilars
Council Board. I had the opportunity to participate in the
BsUFA I as well as the BsUFA II negotiations in those
capacities.
The Biosimilars Council is a division of Association for
Accessible Medicines. It works to ensure a positive regulatory
and policy environment for biosimilar products and educates the
public and patients about the safety and effectiveness of
biosimilars. We are deeply committed to accessible, affordable,
and high quality medicine, and we strongly support the BsUFA
III package.
I would like to start with a personal story as someone who
has worked in the biotechnology industry for over 25 years and
in the biosimilars industry since its inception. About 8 years
ago I appeared before the House Judiciary Subcommittee on
Courts and Competition Policy to support the BPCIA. Many of the
witnesses testified about their fears of biosimilars, how
biosimilars were more complicated than generics, and how we
should be very careful about proceeding with biosimilars
legislation. I testified about how significant scientific
innovation would address these concerns and make biosimilar
competition possible. I emphasized that American ingenuity
would make us global leaders by enacting legislation that did
not put a ceiling on biosimilar innovation.
Congress listened and acted with courage. It passed the
BPCIA. American innovation was unleashed. Many prior opponents
of biosimilar competition entered the business and today we
have a growing and thriving biosimilars industry creating good
jobs and leading the world with our innovative science,
particularly in the science of more fully understanding our
biologic products.
Today, Dr. Woodcock reported that over 64 biosimilar
programs were under review of development of 23 different
biologic products. Momenta alone has seven biosimilar
development programs. This was made possible by the BPCIA and
by BsUFA I user fee funding. We learned in BsUFA I, however,
that the innovation involved in biosimilar development, that
is, the science of understanding what is in a biologic for
comparison purposes, is complicated and involves many new
skills that the industry and the FDA need to understand. This
requires new staff and training to assure high quality and
efficient review. Historic FDA staffing cannot meet these
needs, reviews which depend far less on clinical data and far
more on new, innovative scientific techniques that demonstrate
that a biosimilar is highly similar to the reference product
and has no clinically meaningful differences.
In addition, even more innovation is underway to allow for
approval of interchangeable biologics which can be shown to
perform the same in any given patient, and, when approved,
substituted at the pharmacy like generic drugs. This innovation
is what makes biosimilars competitive, affordable, safe, and
effective for patients, but these innovations squarely depend
on having the critical additional FDA resources to be funded by
BsUFA II.
Innovation was used to craft the BsUFA II commitment
letter. We took a hard look at the first 5 years. Not only are
new FDA resources needed, more efficient regulatory approaches
that use funding more wisely are necessary to accelerate FDA
review. Together we included innovations from BsUFA I and PDUFA
to enhance the review process and to ensure regulatory clarity.
The BsUFA II user fees are now tied to the level of resources
needed and adjust with resource demand. It is also important to
emphasize that the funding provided by user fees is in addition
to, not a substitute for, congressional appropriations, and
expenditure is contingent as in the past on an appropriate
spending trigger.
Specific improvements include enhanced communication and
meeting opportunities that eliminate unnecessary delays; using
resource capacity planning to set budgets, staffing levels, and
fees; adopting the highly effective program review model to
increase first-cycle application approvals; commitments to
dedicate staffing and to issue regulatory guidance to promote
best practices and predictability; and expanding biosimilar
education activities. Each improvement accelerates high quality
development and review to help assure that patients have more
timely access to lifesaving, affordable, safe, and effective
biosimilars.
So in conclusion, BsUFA II is the culmination of months of
hard work and negotiations between the FDA and industry. It
represents a careful balance among the stakeholders. We
respectfully urge the committee to approve a clean draft of
BsUFA II without changes to the underlying agreement. Timely
passage is important to ensure patients have access to
lifesaving biosimilar medications that they require. This
historic agreement provides a critical step toward
accomplishing this goal.
Thank you, and I would be happy to answer any questions.
[The prepared statement of Mr. Leicher follows:]
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Mr. Burgess. The chair thanks the gentleman. Ms. Holcombe,
you are recognized 5 minutes for an opening statement, please.
STATEMENT OF KAY HOLCOMBE
Ms. Holcombe. Mr. Chairman, what an honor it is to speak
with you today. In 1992, this committee planted the seed that
has grown into user fee programs that provide FDA with a
significant portion of the resources it needs to ensure that
patients have timely access to safe and effective medicines.
This committee also successfully produced with an overwhelming
bipartisan House vote, the BPCIA, legislation that established
an FDA pathway for the approval of biosimilars.
BIO was an early and strong supporter of this legislation
to create a balanced pathway for greater competition in the
biologics marketplace and of the user fees to make that work.
BIO is the world's largest trade association representing
biotechnology companies, academic institutions, state
biotechnology centers, and related organizations across the
United States and in more than 30 other nations. Our membership
includes most of the large biopharmaceutical companies, but the
vast majority of our members are small biotechnology companies
working on the most cutting-edge R&D. BIO is proud of the
innovative spirit and dedication of these small companies.
I want to focus my comments today principally on the
reauthorization of the biosimilars user fee program. We believe
the BsUFA reauthorization proposal you are considering meets
all of our overarching goals and supports and enhances the
biosimilars user fee program. We strongly support timely
reauthorization of BsUFA.
During the course of BsUFA I, FDA issued guidance documents
to assist sponsors and other stakeholders to understand the
agency's expectations and how this new process would work. They
also issued final guidance on naming for biosimilar and
innovative biological products to establish a way to provide
clarity for prescribers and patients and to assist
pharmacovigilance. In addition, FDA issued five guidance
documents that remain in draft, including the most recent draft
guidance on the agency's views on determining
interchangeability.
BIO continues to urge that the agency finalize this draft
guidance as quickly as possible as interchangeability is an
important component of promoting the biosimilars marketplace.
Because of both the complexity of the products and the novelty
of this category of highly similar or interchangeable products,
we recognize that these early years necessarily have been a
time of learning and building. And although four new
biosimilars products approved since enactment of BPCIA and
initiation of BsUFA may seem like a small number, we are
confident that the program and the availability of biosimilars
to patients will grow as the agency builds expertise and
capacity.
With this as background, BIO worked with FDA, other
industry organizations, and other stakeholders to develop
proposals for continued progress and enhancements during BsUFA
II. Some of the key commitments have already been mentioned
here and I am not going to mention them again. The hope is that
these new programs under BsUFA II will enhance the ability of
sponsors and patients to work together to get biosimilars to
the marketplace.
I want to mention in particular the BsUFA commitments that
relate to financial enhancements of the program to provide
sustainability for the BsUFA program and to provide commitments
to hiring goals and moving forward with FDA's hiring of the
skilled staff that it needs to do its job. BIO has longstanding
views about the negative potential consequences of the
sequester of user funds or hiring freezes that can result in
FDA's inability to fill vacancies and make the new hires that
are necessary for meeting its commitments under these user fee
programs.
User fees support a significant number of FDA personnel
including those needed to carry out the BsUFA commitments. If
FDA is unable to make these hires, user fees cannot be spent.
This is a situation that is unacceptable to fee payers and is
not good for FDA or for the patients who are waiting for the
approval of biosimilar therapies.
Finally, Mr. Chairman, I want to address very briefly your
request to comment on the Lower Cost Drugs Through Competition
Act. BIO supports competition in the prescription drug
marketplace. We believe a robust, competitive market exists
today, but we also recognize that there can be more done to
promote generic entry particularly where an older, off-patent
drug has lost regulatory exclusivity yet lacks meaningful
generic competition.
We all want to see FDA approve generic drugs as efficiently
as possible. Competition and greater choice are good for
patients, and whatever reasonable steps can be taken to help
FDA enhance its generic drug processes should be considered
seriously. On behalf of BIO, I want to thank you for the
opportunity to present our views today, and I am happy to take
any questions you may have.
[The prepared statement of Ms. Holcombe follows:]
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Mr. Burgess. The chair thanks you. That concludes our
witness testimony. We will move into the question portion of
the hearing for our second panel. I recognize myself 5 minutes
for questions.
Mr. Gaugh, if I could start and ask you, you were here, I
think, when Dr. Woodcock gave her testimony. And I think, if I
understood her correctly, she said that there is no backlog in
the approval of generic drugs, and I would just ask you if you
agree with that statement.
Mr. Gaugh. So there is a bit of a discrepancy between the
industry and the FDA on that statement, whether or not there is
a backlog, but it doesn't really matter what word you use. I do
agree with Dr. Woodcock that all applications are currently
under review. But if you look back at the original statutory
backlog of GDUFA I, there were 2,866 products in that category.
There are now 1,500 in that category that are still not
approved. So they are going back and forth under active review
between the FDA and industry, but those are still sitting there
so they have been there for 4 years or longer. Add in year 1
and year 2 applications and there is another 2,000, roughly,
and those have been under review for at least 2 years.
Mr. Burgess. Mr. Gaugh, staying with you, I guess the
question is has the FDA met all of its goals under the first
generic drug user fee agreement?
Mr. Gaugh. Yes, they have.
Mr. Burgess. But then we continue to hear significant
concern about review times and the number of cycles it takes to
approve applications, the lack of communication between review
division staff and applicants, so are you confident that the
new agreements will address those concerns?
Mr. Gaugh. Yes. So in the first agreement, in GDUFA I,
there were no solid metrics--I will use that phraseology--for
the pre-GDUFA and years 1 and years 2. In years 3, 4, and 5
there were solid metrics. So we have seen some significant
advances in those years and that is why we are asking the FDA
to divide out the metrics, or the report-out metrics if you
would that they are giving us, in cohort years, so we can know
how things are happening per year.
When we look at a first-cycle review of only nine percent
that is looking over the entire cohort. We would like to see
what that looks like per cohort.
Mr. Burgess. I guess what I would like to get from you is a
sense as what the FDA can do to substantially improve the
review process and what steps can industry then take to improve
the quality of submissions on a more consistent basis?
Mr. Gaugh. So the steps we have taken in GDUFA II are a
couple. One, Dr. Woodcock talked about the complex products,
and so we have preapplication meetings that help us understand
that. That happens with every one of the products under the
ANDA, understanding there is only about 150 to 175 products
there, but they have that opportunity to have those
conversations before the application is even submitted, so both
industry and the FDA knows what is coming in the door.
Under GDUFA II we have done that in the complex products
and so we think that will take large steps in getting to that
first-cycle review for complex. It doesn't fall for the
noncomplex products. But remember, there is over a thousand
applications that are entered into the FDA every year for
review and approval. That would be a huge resource drain to try
to have those pre-meetings. We are working in that direction,
but again this is GDUFA II, not GDUFA VI.
Mr. Burgess. And thank you. I thank you for your responses.
Ms. Holcombe, if I could ask you, you referenced in your
testimony the learning and building that has been going on
during the Biosimilar User Fee Agreement course. If I
understand correctly there have been four approvals with
biosimilars; is that accurate?
Ms. Holcombe. Yes, that is accurate.
Mr. Burgess. It seems like a low number.
Ms. Holcombe. It does.
Mr. Burgess. So would you care to expound upon that?
Ms. Holcombe. We have hope.
Mr. Burgess. We all have hope.
Ms. Holcombe. I know hope is not a strategy.
Mr. Burgess. This is a very hopeful subcommittee.
Ms. Holcombe. As Dr. Woodcock mentioned, FDA is working
with sponsors, biosimilar sponsors, now through the course of
the biosimilar product development meetings on 64 development
programs to 23 reference biological products. So we can't
obviously predict that all 64 of these are going to turn out to
have marketed products, but certainly some high percentage of
them will. So we could move over the next few years, certainly
over the next 5 years, from 4 products to 56, let's say, or
even 46, which would be terrific.
Mr. Burgess. Agreed. That would be terrific.
I yield back my time and recognize Mr. Green for 5 minutes
for questions, please.
Mr. Green. Thank you, Mr. Chairman.
And Mr. Leicher, in the first panel Dr. Woodcock discussed
the increasing number of meeting requests that the agency
received from sponsors. You mentioned in your testimony that
one of the improvements under BsUFA II is enhanced
communication and meeting opportunities that are hopefully help
to eliminating delays in development and review of biosimilars.
My first question, what improvements to these meetings with
sponsors would be made under BsUFA II and why are these
improvements helpful from your perspective?
Mr. Leicher. So yes, there are several improvements that
have been made. One was a discussion that we had with the
agency about including specific reference to biosimilars in the
preapplication IND best practice guidance document as well as
in the meeting guidance documents which provide for specific
responses, commitments to time frames for responses, and that
can really enhance sort of correcting things in advance before
an application is filed.
The other piece is the adoption of the program review model
which was developed in PDUFA, so that when an application is
filed there are specific goals set within the agency for
timelines. There is a preapplication meeting with the sponsor
to work out complicated issues and make sure that what is filed
is approvable. And there is a series of communications and
responses to the applicants so that you can actually strive for
a first-cycle review the first time and do it right the first
time.
Mr. Green. BsUFA II also moves from a 10-month timeline for
review to a 12-month. Can you explain why this change was made
and how will this impact the biosimilars?
Mr. Leicher. The ultimate goal of the change was to get to
first-cycle approvals. What we believe was learned in PDUFA was
that additional time was important to enable the communication
that I was just discussing to occur so that we can actually
respond to information requests and to communications in that
time frame and actually finish it the first time, rather than
have it coming back and then waiting another 6 months beyond
the 10-month period.
Mr. Green. And our goal again is to move with the process
to make sure they do their job but also move it quickly. Mr.
Coukell, the FDA approval process ensures drugs are safe and
effective. Some have proposed policies to address pricing that
circumvents that process. Do you have a position on whether we
should look for solutions to pricing concerns that go outside
the FDA approval process?
Mr. Coukell. Thank you for that question. Dr. Woodcock in
her testimony talked about the FDA's process for going out to a
manufacturing facility and being on the floor and really seeing
what happens there, and then talked about looking at data on
bioequivalence to make sure that the copy of the innovative
product performs in exactly the same way. If we are getting
drugs that haven't gone through that process we don't have
those same guarantees.
Mr. Green. Thank you. This is a question for both of you
and Mr. Gaugh. I think we all agree that generic drugs are
saving money and making medicines more affordable to patients.
In fact, the Association for Accessible Medicines estimates
that the generics are saving American families over $4 billion
a week. And while generics account for 89 percent of the
prescriptions expenses in America, it is only 27 percent of the
total drug cost. That is why I think it is important to do what
we can to reduce the barriers to the generic competition and
lower the often burdensome cost of prescription drugs.
Mr. Schrader and Mr. Bilirakis have proposed one way to
address this important issue, and I am interested to hear what
else could be done to increase generic competition in the
market. Mr. Gaugh, what other policy proposal do you believe
should increase generic competition and access to generic
drugs, and also to Mr. Coukell and Mr. Gaugh.
Mr. Gaugh. Thank you. Dr. Woodcock also spoke earlier today
about the REMS situation that we have. And so I know that in
that bill that Representative Bilirakis and Schrader put
forward that was to have a study on REMS, but we don't need
another study on REMS. We have been looking at REMS since I was
at the GDUFA table in 2012 and working on solutions for that.
And we have had solutions that have been presented even in the
last 6 months that never quite make it into the bill.
So REMS is one of the main indicators that prevents generic
products from coming to market because we can't get the product
to be able to develop it and develop the generic of the
innovator.
Mr. Green. Mr. Coukell, do you want to use my last 19
seconds?
Mr. Coukell. Well, there aren't that many drugs with that
type of REMS, but there are some big drugs in there. One of
them in that category is the seventh-most costly drug in the
Medicare program. It is $2 billion a year. So making sure that
there is a pathway to market for generic versions of those
drugs and non-REMS drugs that have restricted distribution
could be meaningful.
Mr. Green. OK. Thank you, Mr. Chairman. I yield back.
Mr. Lance [presiding]. Thank you very much. The chair
recognizes Dr. Carter of Georgia.
Mr. Carter. Thank you, Mr. Chairman, and thank all of you
for being here. Mr. Coukell, Mr. Gaugh, I understand both of
you are pharmacists; is that correct?
Mr. Coukell. Yes, sir.
Mr. Gaugh. Yes, sir.
Mr. Carter. Good, good. I want to talk about something. I
want to talk about PBMs, pharmacy benefit managers, OK, one of
my favorite topics. Mr. Coukell, you say in your written
testimony here, pharmacy benefit managers, the middlemen, that
insurers and employers pay to both administer prescription drug
benefits and negotiate discounts from drug companies play a
crucial role, using their large sales volumes and their ability
to create formularies to force drug companies to offer deep
price concessions. However, a share of the savings accrues to
the pharmacy benefit managers themselves, and their contracts
can be extremely complex, making it difficult even for
sophisticated benefits administrators to determine whether they
have achieved optimal savings.
Let me ask you, when you have three companies that control
almost 80 percent of the market, as we have here in this
country where we have three PBMs that control 80 percent of the
market, wouldn't you agree that that is not much competition
there? If you look at the pharmacy benefit managers and you
look at their profits over the years, you see that they have
exploded, that they have profits that have increased over 600
percent. Obviously they are not doing what they were supposed
to have done.
Now you go on to say that Congress could consider requiring
greater transparency of contract terms and definitions between
payers and pharmacy benefit managers. Such a bill has been
introduced by Representative Doug Collins of Georgia, the MAC
Transparency bill that will call for more sunlight to be shed,
for more transparency in our drug pricing system. I would like
to just get your comments on that if you would about how that
could help us in bringing down drug prices.
Mr. Coukell. Thank you for that question. PBMs with their
negotiating power play an important role in bringing down drug
prices, and then the important question is, is the ultimate
payer, the self-insured employer or the insurance plan, getting
adequate benefit? And of course the PBMs have to make some
money in that deal too. That is their business model.
In my testimony in calling for transparency that was not
calling for public transparency on the price, but because these
contracts are so complex and they have so many fees, the
question is are there standards around contract definitions as
well as audit mechanisms and standards around lack of conflict
of interest in the people who advise on PBM contracts that
could be beneficial to the ultimate payer.
Mr. Carter. And listen, I don't have any trouble with
anybody making money, more power to them, and that is not what
I am getting at. But what I am getting at is that this is a
shell game. They are ripping off the public, I am telling you,
and that is what is happening with the PBMs. They are not
achieving what they set out to achieve and what we think they
are achieving by bringing down drug prices, because they are
not passing them on.
Yet they avoid transparency, and this is what this
legislation is trying to do. There has to be transparency
within the marketplace. I will give you an example. We had the
problem as you are well aware of, of the EpiPen that went up to
like $600 for a two-pack. And when I was on the Oversight
Committee we had the CEO of EpiPen of Mylan Pharmaceuticals,
the manufacturer of that product, testify before us and she is
at the beginning, I as a pharmacist, I was at the end.
So she says, OK, when it leaves us this is what the price
is--and I am going to just make up a number, $150--when it gets
to me it is $600. What happens in between? That is what we are
trying to figure out. In between is that man behind the
curtain. In between is the PBM. They are the ones who are
marking that drug up and not passing it on. This is causing a
problem in the market, in the generic drug market. This is one
of the reasons why prescription drug prices are so high.
And this is why Representative Collins' bill, I think, is
so essential and that we should pass it here in Congress, the
MAC Transparency bill. Again I am not opposed to anybody making
money, but I am opposed when they are causing the public the
distress that they are causing them by increasing drug prices
the way that they are.
Now there are others who need to be held responsible,
including pharmacists, including pharmaceutical manufacturers,
all of us have a part in this. But the transparency needs to
happen. It needs to happen not only so we can bring down drug
prices, but the things that is going to bring down healthcare
costs all together in our healthcare market is going to be more
competition. That is why this hearing is so important.
How can we bring about more competition within the generic
drug market within health care itself? That is what we are
working on right now in Congress when we are talking about
health care and we are talking about all the things that we are
talking about here. How do we increase competition so that we
can bring down costs? One way we do that is through encouraging
more competition within the generic drug marketplace. That is
what we have got to do. That is going to bring the prices down.
Just one quick example of how it does that in my own life.
When I was still practicing I had this little company down the
road who decided they wanted to get involved and wanted to
become a player in the pharmacy market. I think the name of the
company was Walmart. They came up with this. We are going to
give you a 30-day prescription, a 30-day supply of generics for
$4. I thought they were crazy. I said man, there is no way. I
can't even buy it that cheap. I bowed my back and I said there
is no way I am going to do that.
Well, guess what. A week later I was doing it. A week later
I called my suppliers and I said you have got to do something.
I have people walking down to that store and I am not going to
have that. That is the way you drive down drug prices, through
more competition, through more manufacturers, generic drug
manufacturers on the market. That is the answer.
Thank you. I am sorry, I didn't mean to go on, but thank
you very much.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman and recognizes the gentleman from Oregon, Dr.
Schrader, 5 minutes for your questions, please.
Mr. Schrader. Thank you very much, Mr. Chairman. Dr. Gaugh,
just to confirm, in the previous session, previous panel, Dr.
Woodcock indicated there might be in the neighborhood of 183
sole-source drugs where there is no generic competition. Would
you agree with that number, roughly?
Mr. Gaugh. Roughly, yes.
Mr. Schrader. All right. Could you talk briefly about the
pre-ANDA meetings and the increased communication and GDUFA and
how you see this new process working out to make it even
better?
Mr. Gaugh. Yes, in the pre-ANDA meetings it gives the
industry the opportunity to meet with the FDA prior to actually
filing the application with the FDA. It could be one or more
meetings. Those meetings allow that conversation back and forth
between the agency and the industry so that they can determine
if they are taking the right path, or maybe they need to make a
slight move in that path forward so when they do file their
application the application is usually substantially complete
and we would anticipate a first-cycle review of that.
Mr. Schrader. Good, very good.
Ms. Holcombe, one portion of our bill, Lower Drug Costs
Through Competition Act, trying to close a loophole in the
tropical disease priority review process. Some bad actors have
announced plans to access brand name priority review vouchers
by buying the rights to manufacture a drug from overseas and
then bring it back to the U.S. for approval without having to
do any additional research or development.
Would you agree that this program was intended to act as an
incentive for new research, new drugs in the U.S. market, not
just merely to adopt something from overseas?
Ms. Holcombe. I would agree that this program was intended
to ensure that U.S. patients affected by these tropical
diseases would be able to access safe and effective drugs to
treat them. Our concern about the provision as it currently is
written is worrying about taking away from FDA the ability to
decide on an application-by-application basis what data are
needed to provide an approval for a drug.
So there may be cases where a company has perfectly
legitimately marketed a drug and had it approved first in a
country where these diseases are endemic, and then brings this
application to the U.S. because U.S. patients are now being
affected from, because they travel out of the country, for
example.
But if there have been legitimate, good, solid clinical
studies that already have been done that are applicable to the
U.S. patients who are affected by this condition, FDA will
decide that maybe we don't need additional studies. If FDA has
a different view, then of course they should be able to say to
the company you need to do new studies. And sometimes that is
going to happen for various reasons.
Mr. Schrader. And that is what our bill, I think, is trying
to get at, give FDA the final say----
Ms. Holcombe. Yes.
Mr. Schrader [continuing]. Using whatever appropriate
studies are out there. Dr. Gaugh, a question on the risk
management strategies and studies that we are trying to put in
our legislation. Do you have any idea about the number of
companies that may be restricted from accessing the market
because of the REMS current provisions?
Mr. Gaugh. There is somewhere in the realm of 80 to 95
companies that have the restricted REMS.
Mr. Schrader. Oh, so a substantial number.
Mr. Gaugh. And then there is another probably 40 to 45
companies that have a restricted distribution set up, but it is
not part of the REMS system.
Mr. Schrader. Very good. And with that I yield back, Mr.
Chair, thank you. Thank you, all.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman. The chair recognizes the gentleman from New
Jersey, Mr. Lance, 5 minutes for questions, please.
Mr. Lance. Thank you, Mr. Chairman. Good afternoon to the
panel. Mr. Gaugh, following up on the chairman's questioning,
do you believe it will be helpful for the FDA to have more
presubmission meetings for noncomplex priority submissions?
Mr. Gaugh. I think the answer to that is it would always be
more helpful, yes. I think it is a more complex process than
that. As we talked earlier, there is around a thousand
applications that are filed every year, and with a thousand
applications and having one or two or three meetings with the
FDA on a thousand different products, probably so resource
restrictive it couldn't happen.
So in GDUFA II we agreed to start this process in complex
products, explore it and then we will move forward from there.
Mr. Lance. Thank you. Is there anyone else on the panel who
would care to comment? Thank you. Again Mr. Gaugh, in your
opening statement you mentioned a more effective generic drug
review program as a goal of your organization. Touching on
GDUFA II pre-ANDA submission communications pathway and
information requests and division review letters, do you think
these initiatives will reduce review cycles and what are the
additional ways your organization believes the FDA sponsored
dialogue could be enhanced?
Mr. Gaugh. So the potential does exist for that increased
review and decreased cycle review time. In GDUFA I those
information requests and division review letters were not part
of the process, but we did negotiate with the FDA early on in
GDUFA I to have them begin doing that which they did. So we
have now codified that in GDUFA II, so that does give us the
opportunity during a review cycle, whether it is chemistry,
microbio equivalence, for the reviewer to give an information
request, for example, to a company who would then have roughly
15 days to respond and that could then move it right on in that
still first-cycle review process.
Mr. Lance. Thank you.
Ms. Holcombe, good afternoon. It is always a pleasure to be
with you. In your testimony you note that BsUFA II addresses
the hiring issue which should result in improved processes and
faster review times. Given that the reviewers are the same as
PDUFA reviewers, do you believe the goals set out need to have
any potential bandwidth issues for reviewers, or can we work
together in that regard?
Ms. Holcombe. So BsUFA will benefit from the hiring goals
that are included in the PDUFA agreement that this committee is
going to consider at a subsequent hearing because of the fact
that the reviewers are the same.
Mr. Schrader. Are the same, yes.
Ms. Holcombe. One of the issues with getting biosimilar
products has been that these, when FDA was not sufficiently
staffed in CDER and CBER in general, these reviewers who were
reviewing two categories of products now just were simply
overwhelmed. So we need to have changes in the hiring
processes, we need to have some of the changes in 21st Century
Cures, and we need to be sure that FDA is going to be able to
meet those annual commitments for hiring.
Mr. Schrader. Thank you. And I am so pleased that we don't
have acronyms here in this----
Ms. Holcombe. We don't use acronyms.
Mr. Schrader. Acronyms, no. Thank you very much, Mr.
Chairman, and I yield back the balance of my time.
Mr. Burgess. The chair thanks the gentleman. The gentleman
yields back. The chair recognizes the gentlelady from
California, Ms. Eshoo, 5 minutes for questions, please.
Ms. Eshoo. Thank you, Mr. Chairman. First, thank you to
each witness. You did a terrific job. And I want to point out
something that maybe some of you don't know, maybe everybody
does. But even if everybody does, it is still worth saying it
for the record, and that is that Kay Holcombe said when she
began her testimony it is such an honor to be here. Here was
her home. Kay Holcombe is one of the most distinguished
individuals to have served on the staff of the Energy and
Commerce Committee.
And I remember so well the farewell reception for Kay, boo-
hoo, we were all boo-hooing. But that reception was filled with
Republican senators, Democratic senators, Republican House
members, Democratic House members. I mean, the breadth and the
depth of her knowledge, her professionalism, and that
recognition on a bipartisan basis is something that I will
never forget. And I don't think there are that many people that
could bring that kind of a crowd together. So she is a superb
professional and you know what, Kay, it is in honor to see you.
And I waited so I could say this. I waited so I could say this
because I have got to get out to Dulles, and wheels up and
westward bound.
There is something in listening to the testimony of
everyone here today, and members almost to a person have spoken
about how the generic industry has grown, what it offers the
American people. That generic drugs now account for 89 percent
of prescriptions that are dispensed in the United States and
that it saved the United States healthcare system almost, just
rounding it off when you are talking about trillions, right,
$1.5 trillion. That is not just walking-around money. That is
not just loose change. And that is a period of over a decade.
So my question to you is, that is a huge number and the
savings are huge. Why do we have such a problem with the
pricing of drugs in the country? They should be coming down not
going up, according to these statistics. Can any of you speak
to that?
Mr. Leicher. I could speak to it from a biologics
perspective.
Ms. Eshoo. Short, because I have another question too.
Mr. Leicher. We don't yet have the biosimilars pathway up
and running at the full tilt, essentially, as Kay spoke to
earlier.
Ms. Eshoo. I know that one very well, believe me. I have
shot more bullets across the bow on it.
Mr. Leicher. And with the change in mix in products heavily
to the biologics end of the spectrum, without this we had
savings from generics.
Ms. Eshoo. Well, how much of the generic industry would you
say that biologics is?
Mr. Leicher. How much of the generics industry is
biologics? I am not sure I understand the question.
Ms. Eshoo. Well, you are saying that biosimilars have
really not arrived yet and I agree with you.
Mr. Leicher. In the market----
Ms. Eshoo. The Obama administration dragged their heels. I
don't know what this administration is going to do. We don't
have interchangeability. The pricing is what CMS has done and I
think they screwed it up. So, it is not good, I don't think. I
would give it a C- so far.
Mr. Leicher. What I would say is the majority of the
highest selling products today are shifted over to the
biologics end of the spectrum, so the opportunity to capture
savings from generic substitution has declined as the biologics
have taken the lead.
Ms. Eshoo. I appreciate what you have said. I am not so
sure that I, in terms of the numbers that are stated and where
we are in terms of drug prices, I don't know. Is there a fact
gap in this, Kay? Do you want to take a stab at it?
Mr. Gaugh. I think it is key to point out the----
Ms. Eshoo. Is your name Kay?
Mr. Gaugh. Sorry. No, it isn't.
Ms. Eshoo. Kay.
Ms. Holcombe. I don't know whether, there are some fact
gaps which are much longer than a 5-minute conversation, but I
do think that increased competition in the marketplace is going
to drive down prices. And as Bruce pointed out, the biologics
marketplace is at the chic end of the spectrum and as we have
more biosimilars entering that marketplace I think we are going
to see a difference. With the number of programs in development
now, my speculation is that these programs represent the top
used and the top selling biological products. These are the
ones that are going to have biosimilars first. And I think we
will, by the end of this next 5-year period we will be able to
predict much more accurately what is going to happen in terms
of the overall marketplace as we get more of these products on
the market.
Ms. Eshoo. Thank you very much. My time is up. Thank you,
everyone. Have a great weekend.
Mr. Burgess. The gentlelady yields back. The chair thanks
the gentlelady. Before I yield to the gentleman from New
Jersey, Mr. Gaugh, did you have something you wanted to offer
us?
Mr. Gaugh. I was just going to point out the facts that you
are talking about. So 11 percent of the products on the market
account for the opposite of 27, so 11 percent of the products
on the market, the brand products, account for 63 percent of
the dollars that are being spent. And those prices you see
going up all the time, whereas in generics that is where the
savings report comes. You see the savings from the generics and
the prices typically going down and competition is what drives
that. Thank you.
Mr. Burgess. The chair thanks the gentleman, and the chair
recognizes the gentleman from New Jersey for 5 minutes for
questions, please.
Mr. Pallone. Thank you, Mr. Chairman. As I mentioned
earlier with the first panel, I believe as this committee looks
at policies to encourage and support robust generic competition
that we must also examine the barriers that are currently
preventing generic access.
And so if I could start with Mr. Gaugh--I hope I am
pronouncing it right. In her testimony, Dr. Woodcock noted that
certain brand companies are using REMS programs to delay or
deny generic manufacturers access to reference product. Can you
please discuss further ways, or the ways in which certain brand
companies directly or indirectly refuse access to the reference
product for generic drug development?
Mr. Gaugh. Yes, thank you. In the REMS program they are set
up under--and not all REMS. There are multiple different levels
of REMS. But in the REMS ETASU programs they are set up where
they are restricted distribution programs. It is much like an
early drug investigational review product where you keep tight
controls so that you know exactly where each tablet, capsule,
injectable vial went to from a patient standpoint.
They have done the same thing in the REMS, and so when you
try to buy or try to purchase that since you are not a
qualified patient, if you will, you don't get access to those
drugs. And even though the REMS was not set up for that and
there is a process currently where you contact the FDA, the FDA
writes a letter to the company, that is really the only thing
that happens. There is no stick to that, if you will.
Mr. Pallone. Thank you. I didn't realize that Dr. Woodcock
was here. I really love the fact you stay for the second panel.
You are one of the few people that does that.
Mr. Leicher, I also understand--well, I want to ask you
something about utilizing restricted distribution programs
also, but that was a tactic that Turing was utilizing to block
competition to Daraprim. Can you discuss how certain brand
companies are using the restricted distribution practices also
to block access to reference product and the types of product
that these practices are being used for?
Mr. Leicher. Well, thank you for the question, and what I
would like to add to is this is not just a REMS problem, and it
is actually a much bigger problem, actually, in many respects,
in the biosimilars business, because when we are developing
generic drugs we need a smaller quantity to do analytical
testing.
When we are developing biosimilars we have to do clinical
trials with blinded vials and purchase very large quantities to
do the adequate studies. And when you call a wholesaler to
purchase a drug with an adequate medical license or pharmacist
license, what you are finding increasingly today is wholesalers
saying we can't sell it to you because you are doing biosimilar
testing. And when we ask why, it is because they have to
provide our name to the manufacturer and the manufacturer says
you can't supply it.
And that is the reason why we are very, we strongly support
the FAST Generics Act or the CREATES Act as a solution to make
that practice unlawful, because it ought to be a condition of
approval that products are made available to licensed regulated
companies by the FDA to develop biosimilars.
Mr. Pallone. OK, thanks. One more question of Mr. Coukell.
In your testimony you discussed a landscape with a number of
different drug pricing challenges including launch prices and
year-over-year increases. You have also talked about the need
to increase generic competition, specifically policies to
ensure generic companies have access to samples of the
reference product for bioequivalence testing. Could you
describe how that policy could be implemented in a way that
yields the most savings?
Mr. Coukell. Yes, sir. So first of all, REMS are there to
protect patients and we have to make sure that those
protections remain in place, but that is completely doable. And
then there is sort of two pieces to it. One is, can the generic
company get access to the product for purposes of testing, and
there is a number of mechanisms and a couple have just been
mentioned in the pieces of legislation that were mentioned. And
then the second piece is can the company marketing the product
that is under a REMS have access to the REMS program itself
which is another barrier.
So they have to be able to get the product for testing and
then they either have to be able to negotiate their way into a
shared REMS program or stand up their own independent REMS
program, and the FDA needs discretion to help them find the
right solution on that latter part.
Mr. Pallone. OK. Well, I want to thank you all and thank
the chairman also, because it is my hope that the committee
continues to discuss legislation to promote generic competition
and that we also consider policies that will address the use of
REMS as a barrier for generic entry.
One of the concerns I have, Mr. Chairman, is I am starting
to hear from different people who will say, well, generics
aren't really a factor in trying to keep drug prices down, and
I continue to believe that they are. I am kind of shocked by
the fact that even some of my colleagues will say that they are
not. So I think it is important, the things that we are
discussing today and in the future. Thanks again.
Mr. Burgess. The gentleman yields back. The chair thanks
the gentleman. And seeing that there no further members wishing
to ask questions, I do want to thank our witnesses for being
here today. It was a long hearing and I appreciate your
indulgence.
Two unanimous consent requests, or three unanimous consent
requests from Mr. Schrader to enter into the record a letter
from Premier, an alliance of 3,700 hospitals \1\; the American
Academy of Ophthalmology \2\; and a letter from the American
Academy of Dermatology. \3\ And then further, Mr. Long of
Missouri had asked that we include a letter from the Federal
Trade Commission in the record. So, without objection, so
ordered.
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\1\ The information was unavailable at the time of printing.
\2\ The information was unavailable at the time of printing.
\3\ The information was unavailable at the time of printing.
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[The information appears at the conclusion of the hearing.]
Mr. Burgess. Pursuant to committee rules, I remind members
they have 10 business days to submit additional questions for
the record. I ask the witnesses to submit their response within
10 business days upon receipt of the questions. And without
objection, the subcommittee stands adjourned.
[Whereupon, at 2:03 p.m., the subcommittee was adjourned.]
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