Senate Floor Statement Of Senator Patrick leahy On Introduction Of The CREATES Act

Over the past few years, the national headlines have been dominated by stories about the high cost of pharmaceuticals.  We have seen jaw-dropping examples of companies raising the cost of their products overnight, pricing too many families out of the prescription drugs they need to survive.  Just last week, House and Senate Committees charged with oversight of the pharmaceutical industry heard heartbreaking testimony from family members of those dependent on insulin who have been forced to ration their treatment because the annual cost of insulin has nearly doubled since 2012.  That is appalling, and putting Americans into that kind of situation is unacceptable.

Lawmakers across the political spectrum, including President Trump, agree that Congress needs to act to rein in these spiraling prescription drug prices.  Pharmaceutical companies should be compensated for their important work developing lifesaving treatments.  But when companies engage in predatory practices at the expense of consumers, we must act.  That is why today I am reintroducing the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act, bipartisan legislation to end inappropriate delay tactics that are used by some brand-name drug companies to block competition from more affordable generic drugs.  I am glad to be joined by Senators Grassley, Klobuchar, Lee and 24 other Senators of both parties in introducing this bill today. 

The first delay tactic addressed by the CREATES Act involves the withholding of drug samples that generic manufacturers need to gain regulatory approval.  Federal law requires generic competitors to prove that their low-cost alternative is equally safe and effective as the brand-name drug with which they wish to compete.  Unfortunately, some brand-name companies are preventing generic manufacturers from obtaining the samples they need to make the necessary comparison.  This simple delay tactic misuses regulatory safeguards as a weapon to block competition. 

The second delay tactic addressed by the CREATES Act involves the development of shared safety protocols.  For some high-risk drugs, Federal law requires a generic drug manufacturer to join the brand-name drug manufacturer in a single, shared safety protocol for distribution of the drug.  Despite this requirement, some brand-name companies are refusing to negotiate shared safety protocols with potential generic competitors, again undermining those competitors’ ability to gain FDA approval for their generic versions of such drugs.

The CREATES Act allows the FDA more discretion to approve alternative safety protocols, rather than require parties to develop shared safety protocols.  Any safety protocol approved by the FDA must meet the rigorous statutory standards already in place.

These exclusionary practices thwart competition and deny consumers the benefit of lower drug prices.  Recognizing the effect these tactics have in keeping drug prices high, in May 2018, FDA for the first time publicly identified brand-name drug companies that abuse FDA’s safety programs or enact their own restricted distribution systems to delay competition from generic and biosimilar manufacturers. The FDA’s list shows 164 inquiries covering more than 50 prescription drugs where access to samples was at issue. In recent years, according to FDA testimony to Congress, the number of inquiries has increased. 

I share the concerns of Vermonters and Americans across the country that many prescription drugs are simply too expensive.  I hear this again and again, from Vermonters in every corner of our state.  When brand companies can artificially raise the price of drugs by using predatory practices, patients suffer.  Illnesses worsen.  Families, government programs, and other payers in the healthcare system ultimately bear those added, unnecessary costs.  

Making meaningful reform to reduce the cost of prescription drugs should be a top priority for all lawmakers.  The CREATES Act is an important piece of that puzzle, and is widely supported across the political spectrum and has been endorsed by more than 90 groups.  The Congressional Budget Office estimates that the CREATES Act would lower Federal spending on prescription drugs by $3.9 billion and research shows that the savings to patients with employer-based health insurance and the health care system overall would be far greater – many billions of dollars more.

Think for a moment about the impact of price hikes on the family of a patient facing a life-threatening illness.  Across the country, hardworking Americans feel like the system is rigged against them by corporations that are looking to make a profit at any price. 

The CREATES Act is one piece of the puzzle, addressing anticompetitive behavior that delays the creation of affordable generic drugs.  Drug affordability is a bipartisan issue that affects each and every American.  These reforms will make a difference.  I hope we can finally act together to help put more affordable prescription drugs in the hands of Americans.

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