Lovenox is a widely prescribed blood thinner derived from animal proteins that is used for preventing blood clots. It is tremendously popular, having garnered about $4 billion in sales last year. On July 23, 2010, the federal Food and Drug Administration (FDA) approved generic drug manufacturer Sandoz's application to begin producing a lower-cost version of the drug, but the manufacturer of the brand-name drug, Sanofi-Aventis, sought an injunction asking a federal court to order the FDA to withdraw this approval.
"Biologic drugs," which are derived from living organisms, require additional testing for impurities not found in chemically derived drugs. Biologically derived drugs are critical in treating many serious chronic illnesses that affect older populations disproportionately, such as diabetes, cancer, rheumatoid arthritis and multiple sclerosis. They are now the fastest-growing area of the drug market.
Sanofi argues that the FDA should never have approved Sandoz's application because the FDA required additional safety data related to the drug during the process of generic approval. The additional safety data request, Sanofi argues, proves that the generic drug manufacturer's compound is not the same as Lovenox and, therefore, cannot be sold as a generic equivalent. The FDA called that argument "meritless" and noted that "[i]n its zeal to maintain a monopoly for Lovenox, a life-saving drug, Sanofi challenges FDA's authority to require testing for impurities," a requirement that the FDA points out is demanded not only by logic but explicitly required by law.
AARP filed a "friend of the court" brief on behalf of the FDA, pointing out that Sanofi's requested injunction had far reaching implications, not only for the patients who use Lovenox. By adopting Sanofi's arguments, the court would allow all other patent holders of biologic drugs to create (in the words of the brief) an "impenetrable roadblock for future approvals of generic biologic pharmaceuticals." AARP's brief carefully detailed the important role of the FDA in speeding safe and effective alternatives to market, and addressed the critical importance of maintaining a competitive marketplace in pharmaceuticals.
The brief pointed out that Lovenox is expensive, and widely used. In the absence of competition, patients who cannot afford the drug will continue to have to go without treatment. Prescription drug spending has skyrocketed over the last two decades, from an estimated $40 billion in 1990 to more than $300 billion in 2009. In the 12-month period ending March 2010, the price of the brand-name prescription drugs most widely used by Medicare beneficiaries increased by almost 10 percent, the highest rate of increase since AARP began tracking these prices in 2002.
Biologic drugs are an important factor in the escalation of drug prices. They are among the most expensive, which has led many insurance carriers to impose extremely high co-insurance rates specifically on biologics. Their cost has also skyrocketed Medicare pharmaceutical costs; the top six biologics accounted for $7 billion of the nearly $17 billion spent on prescription drugs in the Medicare Part B program. About one out of eight prescriptions written today is for biologics. By 2012, biologics are expected to account for more than one quarter of all drug spending in the United States.
Generic drug competition has proven to be one of the most effective means of slowing the spiraling cost of pharmaceuticals, and generics now make up nearly 70 percent of drugs prescribed today, up from 12 percent in 1984 when the Hatch-Waxman Act (federal law streamlining the approval of generics) was enacted. Generic competition in the biologic market, AARP's brief pointed out, is more important than ever.
The U.S. District Court for the District of Columbia was unpersuaded by Sanofi's argument that an injunction is needed, ruling in Sanofi-Aventis v. FDA et al. that the tests for an injunction require a very high showing that Sanofi did not meet.
Among other things, the court found that the public would be harmed by a court-ordered delay in the distribution of a generic drug that is approximately 30 percent to 35 percent cheaper than Lovenox. Citing AARP's amicus brief, the court concluded that Sanofi had failed to establish that the public interest favors interim injunctive relief.
As noted in The Wall Street Journal, "The Lovenox case is being closely followed by the drug industry because it hinges largely on the Food and Drug Administration's authority to set special standards for approving certain complex protein-based drugs. The decision could affect future FDA methods for approving generic biologic drugs."