- The Washington Times - Tuesday, October 22, 2002

President Bush yesterday ordered the federal government to block pharmaceutical companies from using legal loopholes to monopolize prescription drug formulas, a move expected to save Americans $3 billion a year.

The president is calling for stricter enforcement of a law that allows brand-name drug makers to file patent-protection lawsuits, which allow 30-month stays on patents. Repeated filings of lawsuits can delay by years the availability of cheaper generic drugs.

Under the new order, companies will be allowed a single 30-month stay.

"I'm taking action to close the loopholes, to promote fair competition and to reduce the cost of prescription drugs in America," Mr. Bush said during a Rose Garden announcement.

"By this action, we will reduce the cost of prescription drugs in America by billions of dollars and ease a financial burden for many citizens, especially our seniors."

The president said some drug companies "have manipulated the law to delay the approval of competing generic drugs."

The companies sometimes file for new patents based on minor changes, such as the color of the pill or the packaging, or after adding one or more ingredients that do not change the drug's effectiveness, Mr. Bush said. The tactic allows a drug maker to extend its monopoly.

Patents on brand-name drugs run an average 11 years.

"We are enforcing the original intent of a good law," Mr. Bush said. "Our message to brand-name manufacturers is clear: You deserve the fair rewards of your research and development; you do not have the right to keep generic drugs off the market for frivolous reasons."

Under the proposal, Mr. Bush said, "Some patents will no longer be entitled to protections like the 30-month stay, including patents on packaging and others that have little or nothing to do with valuable innovation and drug therapy."

Preventing companies from filing numerous stays on their patents will have a dramatic effect on drug costs, now rising about 20 percent a year, he predicted.

"Last year, the average brand-name drug cost more than $72 per prescription. The average price for generic drugs, which were just as safe and effective as the brand-name drugs, were just $17 per prescription," Mr. Bush said.

The president's proposal will proceed through a 60-day public comment period before the administration moves to make the rule final, said a senior official, speaking on the condition of anonymity.

With congressional and gubernatorial elections two weeks away, some Democrats accused the Bush administration of playing politics with seniors, who historically vote in high percentages during midterm elections.

"This sounds like an Election Day conversion," said Sen. Charles E. Schumer, New York Democrat.

Mr. Schumer sponsored legislation, approved three months ago by the Democratic-controlled Senate, to make generic drugs more widely available.

"This could be a very good proposal, but given the White House's track record on this issue, it could be just another loophole to let the name-brand drug companies delay the implementation of generic drugs," Mr. Schumer said.

House Minority Leader Richard A. Gephardt, a Missouri Democrat who is testing the waters for a presidential run in 2004, said, "The president's new rules are a cynical election ploy that won't get the job done. The president has come in with an 11th-hour, election-year gimmick that might or might not stand, and would take years to help people anyway."

But Bill Novelli, executive director and chief executive officer of AARP, applauded the administration's move, saying the proposed rules "should provide significant relief for millions of citizens, especially older Americans, who will now have more affordable alternatives to costly brand-name pharmaceuticals."

Total U.S. spending on prescription drugs reached nearly $155 billion in 2001, according to the National Institute for Health Care Management. Generic drugs make up about half of all prescriptions filled in America.

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