Drug makers’ REMS misuse costs $13.4bn per year: report
The misuse of federal drug programmes by branded pharmaceutical companies is costing the US healthcare system $13.4 billion per year in lost savings, a report commissioned by a generics trade group has claimed.
The report, which was released on Tuesday, August 4, after being commissioned by the Association for Accessible Medicines (AAM), examined the “ongoing misuse” of restricted access and Risk Evaluation and Mitigation Strategies (REMS) programmes.
REMS are drug safety programmes which are required by the Food and Drug Administration (FDA) for certain high-risk pharmaceuticals.
“But brand drug manufacturers sometimes use these programmes and other forms of restricted access to keep generic manufacturers from obtaining samples needed to develop generic drugs,” said the report.
Findings suggest that of the total $13.4 billion in lost savings (which is an increase of 250% in the last four years), $3.1 billion is attributable to products restricted by REMS, and $10.3 billion to products with non-REMS restrictions.
The federal government and private insurance companies take the brunt of these losses with $5.2 billion and $5.8 billion in losses, respectively.
Consumers pay an extra $1.8 billion in out-of-pocket costs, while state and local governments and other small payors lose savings of more than $500 million.
AAM claimed that, without congressional action, these costs can be expected to increase.
Chip Davis, president and CEO of AAM, said: “Unfortunately, withholding samples is an accepted business practice for some as a means to artificially protect and extend their monopolies beyond what Congress intended.”
He added that this is why Congress must pass the bipartisan Creating and Restoring Equal Access to Equivalent Samples Act, which is aimed at facilitating the entry of lower-cost generic and biosimilar versions of drugs.
In May, Scott Gottlieb, commissioner of the FDA, made public a list of companies that have potentially been blocking access to the samples of their branded product.
A generic drug developer generally needs between 1,500 and 5,000 units of the brand drug to perform studies for FDA approval.
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