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AARP Analysis Debunks Biologic Drug Industry Myth

May 21, 2009

Contact: AARP Media Relations, 202-434-2560, media@aarp.org

WASHINGTON—A new analysis by AARP’s Public Policy Institute reveals the manufacturers of many top-selling biologic drugs have recouped average research and development costs several times over in the past six years, often within a single year. The report’s finding busts the myth that allowing generic versions of biologic drugs will undermine further development of these breakthrough medicines.

Unlike traditional chemical drugs, biologic drugs are made from living organisms. The Food and Drug Administration (FDA) has no process in place to approve less costly generic versions of biologics, which can cost thousands of dollars each month.

AARP’s analysis of ten top-selling biologics finds these drugs have had U.S. sales of between $5.5 billion and $14.9 billion since 2003. The average development cost for a new biologic drug is $1.2 billion, according to the Tufts Center for the Study of Drug Development. All of the drugs examined more than recovered the average development cost of a biologic drug in just three years of sales between 2003 and 2005.

“For more than 20 years, generic versions of chemical drugs have given Americans access to safe, inexpensive treatments for their health problems without hindering scientific innovation,” said AARP Executive Vice President John Rother. “With more Americans taking biologic drugs for relatively common diseases like cancer and multiple sclerosis, it’s time to bring affordable generic biologics to the market.”

AARP is telling lawmakers that a process to approve generic biologic drugs must be a part of comprehensive health reform. The Association has endorsed the “Promoting Innovation and Access to Life-Saving Medicine Act” (H.R. 1427/S. 726), which would create a process for the approval of generic biologic drugs. This bill would prevent generic competition from entering the market for the first five years after a new biologic drug is approved, providing a common-sense balance between encouraging innovation and increasing access to these life-saving medicines.

Rother added: “This bill is a win-win both for biologic drug makers and for those Americans with the most desperate medical conditions who are struggling to afford the medicines they need.”

A competing bill, the “Pathway for Biosimilars Act” (H.R. 1548), would force consumers to wait twelve years before being able to purchase the lower cost generic version of their medicine.

For details on AARP’s health reform priorities, contact AARP Media Relations.

AARP is a nonprofit, nonpartisan membership organization that helps people 50+ have independence, choice and control in ways that are beneficial and affordable to them and society as a whole. AARP does not endorse candidates for public office or make contributions to either political campaigns or candidates. We produce AARP The Magazine, the definitive voice for 50+ Americans and the world's largest-circulation magazine with over 34.5 million readers; AARP Bulletin, the go-to news source for AARP's 40 million members and Americans 50+; AARP Segunda Juventud, the only bilingual U.S. publication dedicated exclusively to the 50+ Hispanic community; and our website, AARP.org. AARP Foundation is an affiliated charity that provides security, protection, and empowerment to older persons in need with support from thousands of volunteers, donors, and sponsors. We have staffed offices in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.

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