AAM submits comments to HHS, FTC on impact of GPOs, wholesalers on access to generic medicines
The Association for Accessible Medicines has submitted comments to the U.S. Department of Health and Human Services and the Federal Trade Commission in response to a request for Information to better understand how the practices of pharmaceutical middlemen—group purchasing organizations and drug wholesalers—may be contributing to generic drug shortages.
“The sustainability of competitive generic and biosimilar markets and the continuing supply of Food and Drug Administration approved/licensed generic and biosimilar medicines for patients, uninterrupted by shortages, is in jeopardy,” said David Gaugh, interim president and CEO of AAM.
Gaugh added, “Although generic and biosimilar manufacturers have contributed to dramatically lower rates of health care spending, their ability to continue to provide affordable medicines is threatened by excessive consolidation of intermediary participants—group purchasing organizations (at both the retail and hospital levels), wholesalers, and pharmacy benefit managers.”
[Read more: Challenges continue, but generics companies see a bright future with biosimilars]
The letter requests that the FTC issue a section 6(b) Order to investigate the contracting practices of buying groups that contribute to the root causes of drug shortages. AAM also suggests that the agencies issue new Statements of Antitrust Enforcement Policy in Healthcare that lower the (now withdrawn) “market power” safe harbors for buying groups; and revise and/or clarify the Anti-Kickback Statute safe harbor provisions to exclude anticompetitive fees and charges imposed by Buying Groups.
Gaugh continued, “As AAM notes in its full written statement, without remedial action, the high concentration of buying power in the generic and biosimilar markets —combined with anti-competitive contract terms—will continue to cause harm to patients and consumers in the form of terminated or abandoned products and drug shortages. This, combined with poorly designed federal and state policies, has driven generics and biosimilars to unsustainably low prices. The agencies should act to reverse this trend by striking the right balance between affordability to the health care system and incentives to reinvigorate robust generic and biosimilar markets.”