While so-called “march-in” rights have yet to materialize in the United States, the controversial measure to cut drug prices appears to be gaining traction with the government.
This week, the Biden administration determined it has the power to take back patents of certain high-priced drugs, Politico first reported. "March-in" rights on government-funded research have long been debated as a potential measure to reduce drug prices, but never actually deployed.
The Administration won’t endorse the widespread use of those rights and is instead planning to lay out its framework on when the "march-in" process could be used, Politico reports.
The move forms part of President Joe Biden’s broader attempt to slash drug costs. Notably, the president’s administration helped pass the Inflation Reduction Act (IRA) last summer, which introduced Medicare price negotiations that are hated by the industry.
Outside of IRA, the Federal Trade Commission has been taking actions to curb drug prices. For instance, the FTC recently released a policy statement warning brand-name drugmakers the agency could take legal action if patents are improperly listed in the FDA's Orange Book.
The industry has already responded sharply to the "march-in" talks. Wednesday afternoon, spokesperson Megan Van Etten for the trade group PhRMA suggested the move would constitute “yet another loss for American patients.”
“The Administration is sending us back to a time when government research sat on a shelf, not benefitting anyone,” she said in an emailed statement.
In a follow-up email, PhRMA argued the U.S. leads the world in drug development “precisely because” the embedded system allows the government, private sector and academic researchers to work together—a configuration that would be upended by the employment of march-in rights.
The march-in authority permits the government to grant patent licenses to other parties—or scoop up licenses for themselves—if taxpayer funding underpinned the patent owner’s R&D process. The authority was carved out in the Bayh-Dole Act of 1980, and, in theory, it could help introduce competition and lower prices for consumers. But the rights have never been used in practice.
This week's developments come after the National Institutes of Health in March rejected a petition to leverage the authority around Pfizer and Astellas’ pricey prostate cancer med Xtandi. The same fate befell a similar petition back in 2016.
In its rejection, the NIH said it shared petitioners' concerns about high drug prices, but that it had also determined Xtandi was “widely available to the public on the market.”
Further, given the drug’s remaining patent life and “lengthy administrative process involved for a march-in proceeding,” NIH figured the march-in authority wouldn’t be an effective means of lowering Xtandi’s price.