About PhRMA
The Pharmaceutical Research and Manufacturers of America (PhRMA) represents the country’s leading innovative biopharmaceutical research companies, which are laser focused on developing innovative medicines that transform lives and create a healthier world. Together, we are fighting for solutions to ensure patients can access and afford medicines that prevent, treat and cure disease. Over the last decade, PhRMA member companies have invested more than $850 billion in the search for new treatments and cures, and they support nearly five million jobs in the United States.
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Thank you for including PhRMA in the Listening Session today. I am Vice President, Intellectual Property and Law at PhRMA, the Pharmaceutical Research and Manufacturers of America. PhRMA represents the country’s leading innovative biopharmaceutical research companies, which are focused on developing innovative medicines that transform lives and create a healthier world. PhRMA member companies have invested more than $850 billion in the search for new treatments and cures over the last decade, supporting nearly five million jobs in the United States.
Biopharmaceutical R&D is lengthy, costly and uncertain. It takes 10 – 15 years to go from early research to FDA approval, costing an average of $2.6 billion to develop a medicine. And potential medicines fail during the various stages of the research process. Only 12 percent of potential drugs entering into clinical trials make it through to FDA approval. IP protections, including patents, provide incentives to engage in risky research to recoup costs and fund the research for the next therapy or cure.
A medicine can incorporate various patented inventions based on R&D activity both before and after FDA approval. These inventions can range from a compound, to different dosage forms for administering a drug to patients, to manufacturing methods, to methods of using medicines in new diseases, among other inventions. Yet the biopharmaceutical sector has fewer patents than other technology sectors.
The U.S. IP system balances incentives for innovation and affordability. The Hatch-Waxman Act of 1984 created a framework that specifically provided for incentives for innovation and created the generic approval pathway to provide access to generic drugs. To allow generic companies to seek to enter the market prior to patent expiration, Congress created a process by which generic companies can certify that patents are invalid or not infringed and the innovator company can bring a patent infringement suit and have these issues decided in court. The framework works, as there are robust challenges and litigation, and 90% of prescriptions for drugs are filled with generic drugs.
The Biologics Price Competition and Innovation Act, 2010 legislation which is modeled after the successful framework established under Hatch-Waxman, created a different regulatory model and patent process for biosimilars, but also balances incentives for innovation and affordability.
Of course, patents can be challenged at the PTAB, and it is important to consider the role the PTAB plays as part of the broader IP system.
IPR proceedings were intended as an efficient alternative forum to district court where patents could be challenged. However, as noted in the NPRM, repeated IPR challenges to the same patent can erode reliability and risk deterring investment in new technologies.
Although some assert that reforms raise drug pricing issues, such assertions fail to recognize that biopharmaceutical patent PTAB petitions reflect a small percentage of the overall petitions. In addition, challenges by entities seeking to market generic drugs and biosimilars are in the context of broader frameworks and themselves rarely lead to generic or biosimilar entry.
In our sector, challenges can be duplicative of litigation or other proceedings. The Hatch-Waxman process leads to robust litigation. Given the 30-month stay of FDA final approval, courts target prompt proceedings and rarely stay the litigation. Such challenges do not serve as alternatives to litigation and instead are duplicative, escalating costs and creating uncertainty for patent owners, who must defend their patents simultaneously in multiple venues against multiple challengers. On the other hand, there may also be instances where a patent, not utilized with a marketed product, could be challenged at the PTAB without resulting in such duplicative litigation.
PhRMA is supportive of use of discretion by the Director to avoid unnecessary, repetitive, or burdensome patent challenges. PhRMA submitted comments in response to the NPRM in which we supported the goals expressed in the NPRM and provided feedback on individual elements of the proposed rule.
PhRMA suggests that changes to the PTAB include guidance for patent owners and petitioners, and notes that a fact specific review of considerations around a particular PTAB challenge may be helpful when using discretion under some factors.
We are also supportive of legislation such as the PREVAIL Act that would provide additional reforms that would be more stable across Administrations.
Reliable and predictable patent protections play a vital role in encouraging biopharmaceutical innovation and driving investment in life-saving inventions. PhRMA thanks the Office for including us today and looks forward to future discussions.