[Congressional Record Volume 155, Number 34 (Thursday, February 26, 2009)]
[Senate]
[Pages S2569-S2570]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ROCKEFELLER (for himself, Mr. Schumer, Mr. Kohl, Mr. 
        Leahy, Mr. Brown, and Mr. Inouye):
  S. 501. A bill to amend the Federal Food, Drug, and Cosmetic Act to 
prohibit the marketing of authorized generic drugs; to the Committee on 
Health, Education, Labor, and Pensions.
  Mr. ROCKEFELLER. Mr. President, I rise today with Senators Schumer, 
Kohl, Leahy, and Brown to reintroduce an important piece of 
legislation, the Fair Prescription Drug Competition Act. Our 
legislation eliminates one of the most prominent loopholes that brand 
name drug companies use to limit consumer access to lower cost generic 
drugs; it ends the marketing of so-called ``authorized generic'' drugs 
during the 180-day exclusivity period that Congress designed to 
specifically allow true generics to enter the market.
  An authorized generic drug is a brand name prescription drug produced 
by the same brand manufacturer on the same manufacturing lines, yet 
repackaged as a generic. Some argue that authorized generic drugs are 
cheaper than brand name drugs and, therefore, benefit consumers. In 
reality, authorized generics only serve to reduce generic competition, 
extend brand monopolies, and lead to higher health care costs for 
consumers over the long-term. As I have said many times, authorized 
generics are a sham. They are brand name prescription drugs in 
disguise.
  After up to 20 years of holding a patent for a brand name drug, the 
manufacturer doesn't want to let go of their enormous profits. So, they 
repackage the drug and refer to it as a generic in order to achieve a 
very simple goal--to drive true generics out of the market by offering 
the drug at a lower price initially; then, when victory is assured, 
raising the cost on the so-called ``authorized generic'' to gain a 
larger profit. This is a huge problem and one that is becoming even 
more prevalent as patents on some of the best-selling brand name 
pharmaceuticals expire.
  In 1984, Congress passed the Hatch-Waxman legislation to provide 
consumers greater access to lower cost generic drugs. The intent of 
this law was to improve generic competition, while preserving the 
ability of brand name manufacturers to discover and market new and 
innovative products. Over time, brand name manufacturers found ways to 
exploit certain loopholes in the Hatch-Waxman law to the detriment of 
generics.
  As a result, Congress enacted amendments to the Hatch-Waxman Act as

[[Page S2570]]

part of the 2003 Medicare prescription drug law. These amendments were 
designed to close long-standing loopholes that were delaying generic 
competition and hindering consumer access to lower-cost generic drugs. 
These reforms were also intended to strengthen the 180-day period of 
market exclusivity for generic manufacturers that pursue costly patent 
challenges.
  The Hatch-Waxman Act and the additional reforms included in the 2003 
Medicare law provide crucial incentives for generic drug companies to 
enter the market and make prescription drugs more affordable for 
consumers. As health care spending continues to skyrocket, finding ways 
to reduce costs is crucial. Today, generic medications comprise more 
then 56 percent of all prescriptions in this country, but they only 
generate 13 percent of our Nation's drug costs. Furthermore, generic 
drugs are 50 percent to 80 percent cheaper than brand name drugs. In 
fact, generic drugs save consumers an estimated $8 to $10 billion a 
year at retail pharmacies. For working families, these savings can make 
a huge difference, particularly during a recession. We must protect the 
true intent of the Hatch-Waxman Act and increase access to affordable 
prescription drugs for all Americans. The Fair Prescription Drug 
Competition Act does just that by eliminating the authorized generics 
loophole, protecting the integrity of the 180 days, and improving 
consumer access to lower cost generic drugs.
  I urge my colleagues to support this timely and important piece of 
legislation.
                                 ______