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FDA Approving Generic Drugs at Record Rate

November 20, 2018

The U.S. Food and Drug Administration (FDA) approved a record number of generic drugs in fiscal year 2018.

“In fiscal year 2017, the agency tentatively approved or [fully] approved a record of 937 generic drugs,” FDA Commissioner Scott Gottlieb reported in a statement. “This fiscal year, we broke our record by tentatively approving or approving 971.”

A report by PricewaterhouseCoopers (PwC) identifies a surge in the number of approvals since President Donald Trump signed the 2017 Food and Drug Administration Reauthorization Act (FDARA). “For some generics, approvals are coming in as few as eight months instead of the previous standard of 15 months in Fiscal Year 2016,” the study reports. In 2017, FDA fully approved 86.5 percent more generic drugs than in 2014. The pace of approvals increased further in 2018, as Gottlieb announced.

FDARA, part of the Trump administration’s agenda to increase competition in the prescription drug market, instituted policies enabling FDA to shorten its drug review processes. Since FDARA went into effect, the pace of approval for generic drugs and their entry into the marketplace has increased dramatically. According to the PwC report, “these efforts likely will succeed in bringing new generics to the market more quickly and predictably.”

Cutting Review Time

A new system that puts some drugs at the front of the line for approval has also reduced the wait time, according to the PwC report.

“Certain generic drugs are now eligible for ‘priority review’ if they meet the criteria, reducing review time by two months for full applications and most application amendments and post-approval changes,” the PwC report’s authors wrote.

‘Great Strides’ by FDA

Charlie Katebi, a state government relations manager at The Heartland Institute, which publishes Health Care News, says the recent FDA reforms are already having a positive impact.

“Since President Trump took office, FDA has made great strides in reforming the drug approval process, especially for generic drugs,” Katebi said. “Commissioner Gottlieb’s Drug Competition Action Plan is making it easier for consumers to access generic versions of the prescription drugs they need, and at affordable prices.”

Drug Competition Action Plan

Drug availability and affordability are strongly dependent on balancing patent protection, which encourages development of new drugs by providing a temporary monopoly on their production and sale, with limits on patent periods, which help to ensure the prompt development of lower cost alternatives called generics. Trump has made increasing generic drug competition a priority since taking office, and Gottlieb implemented the Drug Competition Action Plan in June 2017 to improve access to generic drugs.

“No patient should be priced out of the medicines they need, and as an agency dedicated to promoting public health, we must do our part to help patients get access to the treatments they require,” Gottlieb said in a statement announcing the plan. “Getting safe and effective generic products to market in an efficient way, being risk-based in our own work, and making sure our rules aren’t used to create obstacles to new competition can all help make sure that patients have access to more lower-cost options.”

Taking Action

Although the full plan has yet to be revealed, FDA has already taken two important steps to improve access to affordable prescription drugs.

First, the agency published a list of off-patent, off-exclusivity prescription drugs for which generic alternatives do not exist. Second, FDA implemented a new policy that will streamline the generic drug review process, especially where there is limited competition.

“When I started as FDA commissioner, I made clear that one of my top priorities would be ensuring the agency does all it can to help ensure American patients have access to affordable, quality medicines that meet their needs,” Gottlieb said in a statement. “To accomplish this, we have taken many important actions to encourage the timely development and approval of lower-cost generic drugs and are beginning to see results.”

More Reforms on Way

FDA is working on additional reforms to make sure the system encourages expansion of drug availability instead of allowing companies to use the government to suppress competition, Gottlieb says.

“Our work will include continued efforts to shut down practices used by branded firms to ‘game’ the system and take advantage of certain rules, or exploit loopholes, to delay generic approval,” Gottlieb said in a statement.

Katebi says those efforts will benefit consumers.

“The Drug Competition Action Plan, if fully implemented, will dramatically reduce the barriers and regulations that protect drug companies’ patents at the expense of consumers,” Katebi said.

FDA’s long-term strategy to increase generic drug access is far from complete at this point, according to Gottlieb. The agency intends to increase competition for complex prescription drugs, which are in high demand and often have no cost-effective generic alternatives, the commissioner says.

“We’ll continue taking additional steps to help ensure patients have access to the drugs they need by making generic drug approval more efficient and predictable,” Gottlieb said in a statement.

Chris Talgo (ctalgo@heartland.org) is an assistant editor at The Heart- land Institute. Emma Kaden (ekaden. heartland@gmail.com) writes from Arlington Heights, Illinois.

INTERNET INFO:

“Is new generic competition enough to lower drug costs?” Regulatory Spotlight, PwC Health Research Institute, https://www.heartland. org/publications-resources/ publications/pwc-study-on-faster- approval-of-generic-drugs

Article Tags
Health Care
Author
Chris Talgo is senior editor and research fellow for the Stopping Socialism project of The Heartland Institute.
ctalgo@heartland.org