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Recent Developments Which May Impact Consumer Access to, and Demand for, Pharmaceuticals
Subcommittee on Health
Prepared Statement of The Honorable Michael Bilirakis
This hearing will now come to order. Today the Subcommittee will consider three matters within the jurisdiction of the Food and Drug Administration which impact the demand for, and the price of, pharmaceuticals. Congress is actively seeking to improve access to affordable prescription drugs for all Americans, and particularly our seniors. As we debate various proposals, we cannot ignore the impact of federal food and drug laws on the availability and affordability of drugs. Today, we will focus on three specific areas which have received a lot of attention recently: access to generic drugs; the authority of the FDA to switch drugs from prescription to over-the-counter status despite a manufacturer's objections; and direct-to-consumer broadcast advertising. At our recent Food and Drug Administration Modernization Act hearing I mentioned my intent to examine issues related to generic drugs. That is the purpose of today's hearing. Generic drugs account for nearly half of all prescriptions filled, yet they amount to less than 20% of pharmaceutical costs. Generics obviously save consumers billions of dollars per year, and we should carefully consider their role as we work to develop a Medicare prescription drug benefit. I am particularly interested in learning more about the science of generics. For instance, how closely must a generic scientifically resemble the innovator drug for it to receive FDA approval? I understand that the scientific standard for generic approval is bioequivalence, but what exactly does that mean? Also, do consumers understand, and feel comfortable with, generic drugs and their role in the modern marketplace? In addition, I am interested to learn why, on average, it takes the FDA longer to approve generic drugs than it does for new drug applications. Of course, we cannot lose sight of the fact that without a healthy, vibrant brand-name pharmaceutical industry, there would be no generic drugs. I'd like to commend our colleague, Mr. Waxman, for his work as co-author of the Hatch-Waxman Act, which increased consumer access to generic drugs, while strengthening patent protections for new chemical entities. The Act has proven quite successful for the past 17 years. Both the brand name pharmaceutical and generic industries have thrived, and consumers have benefitted greatly by access to both new therapies and to cheaper copies of old therapies. That being said, concerns have been raised about provisions of the Hatch-Waxman Act which may lead to anti-competitive behavior. The Federal Trade Commission is presently conducting a year-long review to consider this matter. Our witnesses today will shed light on the continued utility of the automatic 30-month stay on FDA approval during patent challenges, as well as how the 180-day generic exclusivity provision is working. While I know that some of my colleagues may wish to consider additional generic issues, we simply do not have the time today to consider all of these matters. Thus, I hope we can focus on the role of generic pharmaceuticals and not delve into other areas today. The Subcommittee will also consider the authority of the FDA to force a drug to be switched from prescription to over-the-counter status despite the objection of drug's manufacturer. We are not looking at whether FDA should switch specific drugs which have been in the news recently, but rather, whether FDA can, under the law, make the switch. And if they can, what are the policy impacts of such action? Last, we'll hear from witnesses who will discuss the impact of direct-to-consumer broadcast advertising on consumers. In 1997, the FDA changed the guidelines for broadcast drug ads, and since then, this advertising has increased dramatically. While the advertising has mostly focused on the top selling drugs, it has also served to better inform consumers. Today, this Subcommittee will consider the full impact of broadcast drug advertising on consumers. I will now yield to Mr. Brown for an opening statement.
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