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GPhA’s Davis weighs in on drug costs, generic competition

September 21, 2016
Life sciences

As drug costs again become a topic of national conversation, Chip Davis, president of the Generic Pharmaceutical Association, has weighed in on the issue, noting that one point stakeholders from patients to manufacturers and lawmakers can agree on is the importance of competition in bringing down the cost of drugs.

“True competition is the key to providing affordable and accessible medicines to patients, while also constraining costs, which saves our health care system and the American people hundreds of billions of dollars each year,” Davis said. “It is a value proposition not seen in any other segment of our health care system today. I say the focus has potential to bear positive results, because it is by no means guaranteed.”

Davis pointed out that generics, despite making up 88% of all prescriptions, account for only 28% of the total amount spent on prescriptions and have saved the healthcare system $1.68 trillion over the last 10 years. The value of generics has been highlighted by recent reports from the Dept. of Health and Human Services, which issued a January report saying that generics weren’t playing a large role in the drug cost problem, and the Government Accountability Office recently issued a report showing a 59% decline in generic drug prices between Q1 2010 and Q2 2015 under Medicare Part D.

Davis highlighted some potential policies and principles for lawmakers to consider, including promoting timely access to affordable generics, creating policies that recognize the different dynamics of the generics and branded market, ensuring an intellectual property framework that allows for innovation and robust generic competition and stopping some companies from blocking or delaying development of generics. He also called for increased use of generics for all patient populations.

But in the midst of this critical opportunity to make progress on pricing and reducing costs, certain representatives for the brand and biologic industries are driving an agenda that would – if enacted – ultimately leave vulnerable patients without access to affordable medicines,” Davis said. “These industry representatives are saying one thing publicly about the need for competition, but advocating in Congress for something quite different. The policies they are advocating would actually increase barriers for generic entry, leading to less competition and increased costs to the system.”

He also noted that percent increases from the GAO report could be misleading, with some increases over 500% — but highlighted that among products the report cited, the average increase was $0.65 and the average unit price went from $1.62 in 2013 to $2.28 in 2015.

“Moving forward we need to ensure that we do not chill the one, proven market that is performing for patients, payers, taxpayers and our government. Let’s enhance it by removing barriers to competition,” he said. “And at the same time, let’s have a frank discussion about the sectors of the pharmaceutical ecosystem that account for the majority of patients’ costs.”

By David Salazar

Source: DSN

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