Drug Price Competition and Patent Term Restoration Act of 1984. Status, Abstract and Summary from the Thomas database.

S.1225 - Greater Access to Affordable Pharmaceuticals Act (Introduced in Senate).

The Drug Price Competition and Patent Term Restoration Act of 1984, usually refered to as the Hatch-Waxman Act, was designed to promote generics while leaving in tact a financial incentive for research and development. It allows generics to win FDA marketting approval by submitting bioequivelence studies (as opposed to clinical data, which is costlier to compile). It also grants a period of additional marketing exclusivity to make up for the time a patented pipeline drug remains in development. This extension cannot exceed five years, and it is in addition to the 20 years exclusivity granted by the issuance of a patent. Another provision of the Hatch-Waxman grants a 30-month stay to drug companies that file suit against generic manufactures that challenge their patents. This has become controversial in recent years, as pharmaceutical companies have used the provision to keep generics off the market by protecting their drugs with extra patents of poor quality, filing lawsuits to protect the patents even when the lawsuit will be lost, but getting the extra market exclusivity anyway.

Last year, two bills sought to close loopholes in the law exploited by companies to keep generics off the market. The first was S. 812, introduced on May 1, 2002 by Senators. McCain and Schumer and passed on July 31. The House version of the legislation, H.R. 1862, was introduced by Sherrod Brown on May 16, but stalled in the House. On October 21, President Bush announced his intention to use regulatory authority to limit companies to one 30-month extention, and to tighten rules on what patents can be listed in the FDA's Orange Book.

This year, Senators Gregg, Schumer, McCain and Kennedy have introduced similar legislation -S. 1225 - in the Senate.

Statements About and Studies of the Hatch-Waxman Act.

• September, 2002. IMS Health. FDA Generic Approval — How Market Forces Are Pushing the Agency.
• July 30, 2002. Federal Trade Commission report. Generic Drug Entry Prior to Patent Expiration. This report specifically calls for two reforms to the Hatch-Waxman Act:
  • Allowing only one 30-month stay on the entry of a generic drug during pending patent-infringement litigation.
  • Requiring brand-name companies and the first generic applicants to provide copies of out-of-court settlements to the FTC and the Department of Justice to ensure that competition is not compromised.
• July 30, 2002. FTC press release. FTC Recommends Legislative Changes to Hatch-Waxman Act.
• May 30, 2002. PhRMA's Stats & Facts newsletter. Hatch-Waxman Strikes Delicate Balance Between Innovator Intellectual Property Protection and Quick Generic Entry Into Market.
• Summary of Rep. Waxman's speech on the Hatch Waxman Act given November 29, 2001.
• May 24, 2001. Gary Buehler, Acting Director, Office of Generic Drugs, Center for Drug Evaluation and Research, FDA. Statement before the Senate Judiciary Committee.
• October 11, 2000. Federal trade Commission press release. FTC to Study Generic Drug Competition.

  The proposed study would examine whether the 30-month stay and 180-day marketing exclusivity provisions of the Hatch-Waxman Act have encouraged generic competition or facilitated the use of anticompetitive strategies.

• July, 1998. Congressional Budget Office Report. How Increased Competition from Generic Drugs Has Affected Prices and Returns in the Pharmaceutical Industry.
• Gerald J. Mossinghoff. (Former preseident of PhRMA). Article published online by Oblon, Spivak, McClelland, Maier & Neustadt. Overview of the Hatch-Waxman Act and Its Impact on the Drug Development Process.