GPhA to Congress: FDA Proposed Rule on Labeling Risks Widespread Confusion, Undermines Hatch-Waxman

GPhA to Congress: FDA Proposed Rule on Labeling Risks Widespread Confusion, Undermines Hatch-Waxman

Current Approach Creates Patient Safety Risks, Adds $4 Billion in Annual Health Costs, Experts Say

WASHINGTON, DC (February 28, 2014) — Today, the Generic Pharmaceutical Association (GPhA) hosted a Congressional briefing highlighting the economic impact and serious dangers to millions of American patients if the Food and Drug Administration's (FDA) proposed rule on prescription labeling is implemented as drafted.
The briefing for members of Congress and staff featured experts discussing the proposal, which calls for generic manufacturers to unilaterally change product labels, an action currently prohibited by law.

"This proposal directly undermines the 'sameness' of generics and their brand counterparts —a fundamental scientific principle that is the very cornerstone of the success of generic medicines in the last thirty years," said Gordon Johnston, former Deputy Director, FDA Office of Generic Drugs. "The proposed rule paves the way for different versions of safety information for the same products, undermining the important principle of consistency. Disregarding decades of regulatory stability in this way will create unwarranted confusion, raises patient safety concerns and threatens the system that created thousands of affordable options for consumers. "

Alex Brill, Economist and CEO, Matrix Global Advisors, said, "By allowing label changes without prior FDA review and approval, the proposal will expose generic drug manufacturers to new liability that will drive up costs of generic drugs by at least $4 billion annually and, furthermore, may create confusion in the marketplace for patients, pharmacists and physicians. The resulting cost increase will be borne by both consumers in the form of higher insurance premiums and the government in the form of higher Medicare and Medicaid costs."

A recent report by Matrix Global Advisors estimates that U.S. health care costs would rise $4 billion annually if the proposed rule is enacted. Medicare and other government programs will incur $1.5 billion in annual new spending, while private insurers and patients will pay $2.5 billion per year.

GPhA opposes the rule in its current form but continues to advocate for a multi-stakeholder collaboration to find a workable solution that does not undermine patient safety or access.

"Generic manufacturers stand ready to engage with the FDA in meaningful dialogue about how the proposed rule can be improved in a way that does not exceed FDA statutory authority or put patients at risk." said Ralph G. Neas, President and CEO, GPhA.

Matrix Global Advisors (MGA) report: FDA's Proposed Generic Drug Labeling Rule: An Economic Assessment
GPhA Overview and Assessment: Food and Drug Administration's Proposed Rule Supplemental Applications Proposing Labeling Changes for Approved Drugs and Biological Products
Infographic: FDA Proposed Rule Would Cause Dangerous Confusion, Economic Side Effects

About GPhA
GPhA represents the manufacturers and distributors of finished generic pharmaceuticals, manufacturers and distributors of bulk pharmaceutical chemicals, and suppliers of other goods and services to the generic industry. Generic pharmaceuticals fill 84 percent of the prescriptions dispensed in the U.S. but consume just 27 percent of the total drug spending, saving the health system nearly $200 billion annually. Additional information is available at Follow us on twitter: @gpha.


Steve Arnoff


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