Pricing

Scott Gottlieb has some ideas about blocking any more would-be Martin Shkrelis from price gouging

Martin Shkreli. Bloomberg via Getty Images

FDA commissioner Scott Gottlieb wants to stop the next Martin Shkreli before he, or she, gets started on the next drug price gouging scandal. And shining a bright light on the drugs most vulnerable to pricing abuse will be one way to get started.

In testimony before the House appropriations subcommittee Thursday, the new commissioner highlighted several methods that could prevent biopharma companies from gaming the system, focusing specifically on “situations where off-patent drugs lack an approved generic competitor.” Gottlieb will get the FDA to publish a list of drugs that are off patent “for which FDA has not approved a single generic applicant.”

Scott Gottlieb, FDA Commissioner

Gottlieb wants to flag the potential for a repeat of Shkreli’s decision to buy an old generic, Daraprim, and then raising the price of the drug overnight by more than 5000% at his company, Turing. Daraprim had no generic competition on the market, giving Shkreli a clear and legal path to jacking up the price.

There are various ways to improve the generic drug approval process to increase competition and prevent players from gaming prices, he says. But it’s clearly an issue he wants to tackle early on.

“We do have situations where speculators, for lack of a better word, can come in and buy a low volume generic, jack up the price knowing that it will take potentially years for generic competition to come on to the market so they have that sort of an exclusivity period,” said the commissioner.

Gottlieb outlined a three-prong plan to speed up generic drug approvals and completely eliminate the backlog of applications for knockoffs, hurrying along cheaper alternatives to brand therapies that could go a long way to reducing the country’s spending on pharmaceuticals.

He told lawmakers that he plans to:

— “Curtail gaming by industry of our regulations which can extend monopoly periods beyond the time frame Congress intended, hindering competition.”

— “Improve the processes that enable generic versions of complex drugs to be approved for marketing.”

— “Increase the overall efficiency of the generic drug review process while completely eliminating the backlog of generic applications.”

The REMS program (risk evaluation and mitigation strategies), he noted, has been used to slow generic competition, and streamlining the process by waiving the requirement that a generic and brand manufacturer share a single system for assuring safe use could be used to eliminate one tool used to slow generics.

In the past, generic manufacturers have had to sue brand operations which refused to negotiate a shared safety system as a way to block cheaper competition.

Rep. Robert Aderholt

Gottlieb also singled out the oncology division at the FDA for embracing the breakthrough therapy program, speeding along new approvals. Unfortunately, he added, not every part of the agency does as well as the oncology group, and he intends to bring the laggards up to speed. In addition, he added, the FDA could do more by taking a more progressive view of some new technologies, like biomarkers, in assessing drugs, looking at trial designs to find more efficient ways to develop drugs and adding new tools for therapeutic reviews.

It was immediately clear that the lawmakers of all stripes didn’t care for the Trump administration’s plans for the 2018 FDA budget.

Democrats and Republicans alike wasted little time in criticizing the Trump administration’s plan to double up on industry user fees while slashing the federal government’s contribution to the FDA’s budget.

“The agency’s chances of offsetting budget authority with user fees face a very stiff uphill battle in the future,” noted Alabama Republican Robert Aderholt. He also cited the FDA’s rapid progress in hustling along new approvals of Keytruda, which he should help, “utilizing the latest technology, make drugs accessible before a lengthy drug trial.”

One plus for the FDA: Gottlieb noted that the FDA is no longer in the grip of a federal hiring freeze imposed by President Trump, according to RAPS. The freeze, he told lawmakers, has been lifted.



The best place to read Endpoints News? In your inbox.

Full-text daily reports for those who discover, develop, and market drugs. Join 21,000+ biopharma pros who read Endpoints News by email every day.

Free Subscription

Biomanufacturing