Bipartisan Senate Bill Aims to Curb Drug Patent Abuse

The bill 'puts an end to practices that prioritize profits for pharmaceutical companies ahead of Americans' health.'

A bipartisan group of U.S. Senators has introduced legislation to curb anticompetitive patent law abuse by "bad actors" in the pharmaceutical industry.

The Affordable Prescriptions for Patients Act, introduced this week in the Senate Judiciary Committee and sponsored by Sens. John Cornyn (R-TX) and Richard Blumenthal (D-CT), would lower drug prices for consumers by removing bad-faith, cumbersome hurdles in the patent review process such as the "patent dance" and "product hopping" that critics say are exploited by drug makers to delay market entry for cheaper generic and biosimilar alternatives, according to their joint media release.

"The pharmaceutical industry's shameless abuse of the patent system has driven costs sky-high for consumers by keeping generics off the market and stifling innovation," Blumenthal says. "Our common-sense reforms will protect competition and reduce prices at the pharmacy."

The senators say their bill "puts an end to practices that prioritize profits for pharmaceutical companies ahead of Americans' health."

"By stopping abuses of our patent system, this legislation will pave the way for generics and biosimilars to compete with branded drugs and aggressively lower drug prices for consumers in the process," Cornyn says.

"Texans shouldn't have to pay more at the pharmacy counter because of bad actors who game the patent system and prevent cheaper generics from coming to market," he says.  

The bill is cosponsored by Senators Ted Cruz (R-TX), Dick Durbin (D-IL), Chuck Grassley (R-IA), and Amy Klobuchar (D-MN).

Product Hopping, Patent Dance

A 2020 analysis by Matrix Global Advisors examined five branded drugs and estimated that product hopping – a tactic used by drug makers to "hop" patient onto a newer, slightly reformulated drug as a patent is about to expire – added $4.7 billion to annual U.S. healthcare expenditures.

The patent dance, under current law, places no limits on the number of patents that a branded biologics maker can claim – abusing laws enacted by Congress in 2010 intended to ease biosimilar entry.

The Cornyn-Blumenthal bill "places a reasonable limit" on the number of patents a manufacturer can contest, preventing a "patent thicket" designed to entangle and trip up the launch of cheaper alternatives.

The senators say their bill will deter brand biologics from "gaming the system", while preserving incentives in the patent system to encourage innovation.

Bad faith exploitation of drug patents has gotten renewed media attention of late as consumers struggle with the continued and relentless growth of healthcare costs.

In a lengthy report this week, The New York Times detailed schemes that drug maker AbbieVie used to "game" the patent system and delay for years the release of generic alternatives to its golden goose arthritis treatment Humira, all of which resulted in $114 billion in additional profits for the drug maker.

PBMs Cheer

The Pharmaceutical Care Management Association cheered the news that the legislation, initially filed by Cornyn in 2021, was re-filed this week.

"PCMA applauds the reintroduction of this critical bipartisan legislation aimed at ending anti-competitive practices that game the patent system, blocking more affordable generic and biosimilar options from entering the prescription drug market," PCMA President and CEO JC Scott says.

"Promoting greater competition to lower prescription drug costs for patients is fundamental to the mission of pharmacy benefit companies and we look forward to supporting the successful passage of this important measure."

PhRMA did not return HealthLeaders' requests for comment on Wednesday.