Branded drugmakers in the U.S. aren't happy about the Obama administration's proposal to cut biologics exclusivity to seven years from the previously agreed upon 12 years. But European pharma companies are attacking the measure as well--in part because they fear the EU might play copycat if the plan goes through.
Outspoken drugmakers such as Shire--along with industry associations--are using the familiar this-will-stifle-innovation argument against shortening the exclusivity period. Roche and Merck KGaA have been more cagey, Dow Jones reports, apparently hoping that the proposal will die on its own.
What's most disturbing to drugmakers isn't the proposal itself. Rather, it's that this move follows a series of hits to the branded-drug business model. Budget-minded governments in Europe have been forcing price cuts down Big Pharma throats. U.S. healthcare reform has exacted its own price-cutting toll, and even though drugmakers actually negotiated those cuts themselves, they still hurt when it's time to report financials.
Furthermore, European antitrust types and the U.S. Federal Trade Commission have been cracking down on pay-to-delay patent settlements between branded drugmakers and generics firms--a crusade that may gain more steam now that President Obama has thrown his weight behind it.
- read the Dow Jones piece