[Ip-health] Philly Inq. on patent extentions in bioterror legislation

[Mike Palmedo]

http://www.philly.com/mld/inquirer/news/nation/11354603.htm

Drug firms on Senate agenda

Legislators want better medicines to protect against bioterror attacks
and epidemics.

April 10, 2005
Philadelphia Inquirer
By Chris Mondics

WASHINGTON - When the SARS viral epidemic swept out of southern China in
early 2003, spreading as far as Canada and the United States, hundreds
of people died, thousands were quarantined, and international travel was
severely restricted.

The epidemic was contained, but not before it had devastated lives,
traumatized entire regions, and wreaked economic havoc.

Now, the prospect of another SARS-like outbreak, or a repeat of the 2001
anthrax attacks that left five Americans dead, is spurring efforts in
the Senate to enact incentives for drug companies to develop medicines
to protect against biological attacks and epidemics.

Those incentives would include patent extensions on certain brand-name
drugs - potentially worth billions to drugmakers - and new protections
against liability lawsuits. Sen. Judd Gregg (R., N.H.), Senate Majority
Leader Bill Frist of Tennessee, and Sen. Rick Santorum (R., Pa.), all
key Senate players, are sponsoring one bill. In the coming weeks, Sens.
Joe Lieberman (D., Conn.), the former vice presidential candidate, and
Orrin G. Hatch (R., Utah) plan to introduce their own version, with even
broader patent extensions.

The useful patent life on a medicine is about 10 years. Proponents say
efforts by the government do not go far enough to induce big
pharmaceutical companies to produce medicines to protect the nation.

"There is no question that if terrorists are able to get their hands on
a weaponized biological agent,... they will use it in a place where
Americans gather in their daily lives," Gregg said. "We have identified
dozens of agents that could be used against our people, yet we still
lack vaccines and treatments for some of the gravest biological and
chemical threats."

Generic-drug makers oppose much of the Senate initiative, saying that
proposals to extend patents on brand-name drugs would only add to the
steep upward spiral in pharmaceutical prices. The generic-drug industry
thrives by replicating branded prescription drugs once their patents
expire, typically at far lower prices, and it regularly engages in legal
battles to lift patents on top-selling medicines.

"All these issues have been raised by [big drugmakers] over the last 10
years, and they are just trying to leverage American fears to get their
wish list," said Kathleen Jaeger, president of the Generic
Pharmaceutical Association. "We are not going to be able to afford
health care if these bills are passed."

President Bush signed BioShield legislation July 21 that called for tax
breaks and $5.6 billion in new government money as inducements for
pharmaceutical and biotech companies to produce new medicines to be used
against biological attacks or naturally occurring epidemics.

Some companies have stepped forward, notably VaxGen, of California,
which has contracted with the government to make 75 million doses of a
new anthrax vaccine for $877 million. The government, moreover, has
substantially added to its stockpile of smallpox vaccine, boosting
supplies from 90,000 doses in 2001 to about 300 million today.

But Gregg and others say the response of big pharmaceutical companies,
which have the money and research capabilities to quickly generate new
medicines, has been tepid.

A repeat of the anthrax attacks or the SARS (severe acute respiratory
syndrome) epidemic is likely to be economically devastating. Economists
said the SARS crisis reduced growth in China and other booming Asian
countries affected by the outbreak by 2 percentage points. In Canada,
where an outbreak in Toronto from February through May 2003 led the
World Health Organization to warn against travel to the city, thousands
were quarantined, and travel and tourism-related business nose-dived.

The problem in responding to such threats, from the perspective of big
drugmakers, is that the BioShield legislation lacked protections against
lawsuits. Drugmakers fear legal exposure, because drugs produced to
protect against the ghoulish stew of microbes and chemical agents that
might be used in an attack could not be tested in humans. To do so would
require that subjects be exposed to the deadly pathogens.

That means the medicines and vaccines most likely would be tested only
on animals. While such trials can tell researchers much about a
potential medication, they cannot show with certainty what the effects
will be in humans.

Big drug companies, moreover, complain that the additional funding and
tax breaks in the BioShield law are not enough of an incentive.

The main reason is that a biological agent that would be used in an
attack, or a germ capable of unleashing an epidemic such as the 1918-19
influenza outbreak that killed up to 40 million people worldwide, is by
definition a rarity. Thus, a defense against them is less likely to be
commercially viable.

Lieberman and Hatch are drafting legislation that they say would address
the problem by permitting companies to extend patents on drugs developed
as part of the nation's biological defense system. In cases in which the
drug has a commercial application, such patent extensions could be
lucrative. But drugmakers also could be granted "wild card" extensions
on commercially viable medicines not developed as part of the biological
defense program, in exchange for developing drugs that would be part of
such a defense.

Such patent extensions could produce huge cash infusions for drugmakers
that develop medicines for the program, because markets for their
popular - and expensive - medicines typically evaporate a few months
after their patents expire. That is when generic-drug makers market less
expensive copies.

Both Senate proposals would shield drugmakers from liability. The Gregg
bill also includes patent-extension provisions.

On their face, such provisions would seem to provide an enticing package
of legal and financial incentives for big drugmakers. But the
manufacturers, excoriated over high prices and safety problems with some
of their medicines, have lobbied little on the measure. Some say they
are reluctant to fight over patent extensions, a difficult sell.

"We are a little skeptical that in this climate people are going to want
to support a benefit" for the industry, said Dolly Judge, a Pfizer
lobbyist. "To make a big investment taking up our time and resources, we
want to make sure that this is viable."