US R&D and copy drugmaker slam Obama budget plans to back generics

US President Barack Obama yesterday unveiled a $3.73 budget request which contains several provisions that affect the pharmaceutical industry with regard to speeding the approval of generics and putting a stop to generics settlements - or so-called “pay-for-delay” deals - claiming these could save as much as $8.79 billion over the next 10 years. The proposals have been strongly criticized by both research-based and copy drugmakers.

Those projected savings appear far higher than estimates published by the Congressional Budget Office in 2010. The CBO, which analyzed a similar proposal in the Senate, found the legislation would have saved the government $2.7 billion over 10 years.

As part of his 2012 budget proposal, Pres Obama is calling for a reduction in the exclusivity period for branded biologic, or biosimilar, drugs from 12 years to seven, which the White House claims would save $2.34 billion over a decade. As for as pay-for-delay arrangements, he proposes giving the Federal Trade Commission powers to block such pacts, whereby brand-name drug companies pay their generic competitors to drop patent challenges that could lead to early entry of cheaper generic copies.