CVS Health, Express Scripts among healthcare organizations to unite behind bill that closes generic drug approval loophole

More than a dozen healthcare organizations have come out in favor of a bill to get generic drugs into the hands of consumers faster by closing a loophole in the law that they say has been exploited by some brand name drug manufacturers.

The bipartisan legislation, called the Fair Access for Safe and Timely Generics Act, would close a loophole in the Food and Drug Administration law which allows branded drug makers to use closed distribution networks to block generic and biosimilar drug competitors.

Specifically, some branded drug makers are preventing competitors from accessing the samples they need to conduct studies for FDA approval of new drug applications.

Abusers of this practice have not denied the existence of the financial incentive for this obstruction, according to an April 6 letter from 18 healthcare organizations to the bill's sponsors.

[Also: Trump's FDA pick Scott Gottlieb has deep ties to pharma industry]

"When asked about potentially approving a sale to a generic manufacturer one executive responded: 'Most likely I would block that purchase. We spent a lot of money for this drug. We would like to do our best to avoid generic competition. It's inevitable. They seem to figure out a way [to make generics], no matter what. But I'm certainly not going to make it easier for them,'" according to the letter signed by 18 healthcare organizations.

The legislation would close this loophole, giving generic drug makers a clear path for market entry that could help save $5.4 billion a year in reduced drug costs, according to Premier, an alliance of healthcare providers, and one of signers of the letter.

The Congressional Budget Office has estimated such action would save the government more than $2 billion over 10 years, according to America's Health Insurance Plans, which also signed the letter commending H.R. 2051.

"The FAST Generics Act closes a loophole in federal law that has too often been exploited by certain brand manufacturers to keep generic and biosimilar competitors out of the market," AHIP said in a release. "By prohibiting this unfair, anticompetitive behavior, the FAST Generics Act takes an important step toward lowering the costs of care and reducing premiums, without sacrificing consumers' access to essential medications."

[Also: FDA warns of fires, explosions from battery-powered medical carts]

The bipartisan bill was introduced by Republican Representatives David McKinley of West Virginia and Steve Stivers of Ohio, and Democrats Peter Welch of Vermont and Kurt Schrader of Oregon.

Other organizations signing the letter include BlueCross BlueShield Association, CVS Health, Express Scripts, and Healthcare Supply Chain Association.

The loophole is in the FDA's Risk Evaluation and Mitigation Strategies program which was created in 2007.

[Also: Study show biosimilar drugs effective, but more research is needed]

The Risk Evaluation and Mitigation Strategies program has been an important tool for patient safety by ensuring that the benefits of a drug or biological product outweigh its safety risk, the letter said.

Yet some drug companies have been exploiting the loophole and abusing the REMS Elements to Assure Safe Use requirements.

"Specifically, certain companies are employing restricted distribution networks to deny manufacturers of generics and biosimilars access to product samples they need to obtain FDA approval and market entry," the letter said. "Many of these restricted distribution setups are implemented completely independently from FDA mandates, and exist solely to exert control of who purchases the product."

Twitter: @SusanJMorse