The Cross-Border Biotech Blog

Biotechnology, Health and Business in Canada, the United States and Worldwide

Tag Archives: FTC

Monday Biotech Deal Review: February 1, 2010

Canadian biotech companies were busy making and closing deals this week, with $44 million raised, four new licensing and collaboration deals, and particularly big weeks for Ospens and the MDS/Dahaner transaction. Read more of this post

Even More Antitrust Scrutiny Pending for Pay-for-Delay Generics Deals

The U.S. Federal Trade Commission published a report today (subtly) entitled “Pay-for-Delay: How Drug Company Pay-Offs Cost Consumers Billions” claiming that settlements between patentees and potential generic entrants where the generic manufacturer is compensated result in delays averaging 17 months longer than the delays in settlements where no compensation is paid. 

“Pay for Delay” is the top “Hot Topic” on the FTC’s homepage, and appears to be getting a lot of attention from Bureau of Competition Director Richard Feinstein: this is is the FTC’s second report on the topic since 2009, and the reports have been accompanied by Congressional testimony, two active cases and “multiple” investigations.

Add to this the announcement by the European Commission this week that it is also investigating these deals, with GSK and AstraZeneca confirming requests for information, and it’s clear the global regulatory heat on these settlements in being turned up.  So far, though, the EU statements are more moderate, with European Competition Commissioner Neelie Kroes reportedly saying only: “We need to monitor this type of agreement in order to better understand why, by whom and under which conditions they are concluded.”

Some more details from the reports:

  • The FTC study looked at 218 final settlements between 2004 and 2009, of which 66 involved “some form of compensation” (the FTC counts non-cash consideration, like agreement not to launch authorized generics, in this group).
  • The EU cites a similar 25% of 200 examined cases where payments were made.
  • The latest FTC report doesn’t provide the primary data, but their analysis shows that “there is less than a 1% chance that this large a difference in average time to entry would be observed if the amount of delay from the two types of agreements were drawn from the same statistical distribution.”
  • The FTC report weights the analysis by the amounts of the annual sales of the applicable drugs, but it says that the “distribution of annual sales figures for drugs covered by these pay-for-delay agreements is not discernibly different from the distribution of annual sales figures for drugs covered by agreements that restrict generic entry with no payment to the generic.”

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Trends Update — Biosimilars: The State of Play of U.S. Follow-on Biologics Legislation

With the Senate Finance Committee voting this week in favour of its health reform bill, the legislative process will now move on to an attempt to reconcile the House bill and the two Senate bills in conference.

What does this mean for a biosimilars pathway?  Will there be one?  What will the exclusivity period be?  The Senate Finance bill is silent on the topic, and the two other bills both include a biosimilars pathway with a 12-year exclusivity period.

Twelve years makes the Biotechnology Industry Association (BIO) and the National Venture Capital Association pretty happy, but the Obama administration and  the FTC argue in favo(u)r of a much shorter period.

Today, a new opinion piece in the New England Journal of Medicine generated a lot of buzz, mostly because it argues for a 5-year exclusivity period (but also because it was an odd roll-out for NEJM’s new conflicts disclosure policy).

When the In Vivo Blog polled the question earlier this year, the majority vote was for 10-12 years; but me and some peeps on twitter (hi @InVivoBlogChris and Maureen @FierceBiotech) and in real life (anonymous) thought at the time the number would land under 10 years.  I’m sticking to that bet.

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Trends Update — DTC Genetic Testing: Survey of State Laws on False Advertising

B&W_DNA_sequenceOne aspect of direct-to-consumer genetic testing that requires particular vigilance is the “consumer” aspect.  We should expect that as the underlying technology becomes cheaper and testing companies proliferate, there will be more who prey on insecurity and health fears to make a quick buck while providing little value (or worse, missing genuine concerns).

GenomeWeb Daily News today notes a survey of state “false advertising” laws (pdf) conducted by Anya Prince, a student with the Georgetown University Law Center’s Harrison Institute for Public Law.  At the moment, the survey reports, there are no state laws specific to genetic testing.  However, the survey does identify various generic false advertising laws that could apply if DTC providers make false or misleading claims.  As GenomeWeb notes, the Federal Trade Commission has already shown an interest in policing the area.  Together with the CDC, they put out a flyer in July 2006 on DTC genetic tests for consumers, advising that the tests are only truly valuable if interpreted by a doctor or trained counselor.

Some skeptics note that the value of tests for genetic predispositions is minimal.  Even without a genetic test, we know that if we want to avoid heart disease we should eat well and exercise.

Similarly, even without specific laws aimed at genetic shenanigans, we already know that providers who want to avoid liability should, in their literature and in their contracts, be honest with their customers about what the results do and do not mean.

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Trends Update — Biosimilars: Sen. Kennedy, Gov. Dean and NVCA Study all Support 12+ Years of Exclusivity

The debate over the proper data exclusivity period for innovator biologics (as protection against biosimilars/follow-on biologics/subsequent-entry biologics) had a busy week last week.

A couple of thoughts:

  1. The exclusivity period in the EU is 8 years (data) +2 years (marketing) +1 year (for new indications), and the current proposal in Canada is 6 years, so a baseline of 12-14 years’ protection would leave the U.S. system paying for exclusive pricing longer than other major markets.  I’m fine if the U.S. decides to further subsidize pharma innovation, but I’d prefer a more transparent approach with less market distortion; and
  2. It’s hard to balance rationally between data exclusivity and patent exclusivity when the patent system is in significant flux.  Having patent reform as a moving piece (or as part of biosimilars legislation) only muddies the debate.

Update: The WSJ picks these up this morning too.  Here’s the NVCA story, and here’s the one on Kennedy’s efforts and the debate it’s generating in committee.

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FTC Weighs In: Favors Compromise on Biosimilars Exclusivity, Disfavors Pay-For-Delay

The FTC released a report today that explores the economics of biosimilars’ market entry and competition.  It predicts that biosimilars will be priced only 10 to 30% under their corresponding pioneer biologics; and that pioneer biologics will retain 70-90% of their market share subsequent to biosimilar market entry. 

Based on these predictions, the FTC concludes that the proposed 12-14 year exclusivity period (here’s looking at you, Eshoo-Barton) is “too long.”  I’m sticking with my guess that we see a compromise from Waxman on the exclusivity period, landing around 8-10 years.

The report also reiterates the FTC’s opposition to pay-for-delay deals and corresponding support for H.R. 1706.

P.S. The InVivo blog says there’s convergence on “biosimilars” over  “generic biologics” and “follow-on biologics” as the nomenclature of choice (presumably “subsequent-entry biologics” loses too), so I’m running with it.

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He Loves Me, He Loves Me Not: CSL Gets Mixed Messages from Uncle Sam

Godward-He_Loves_Me%2C_He_Loves_Me_Not-1896Last week, CSL heard from the Federal Trade Commission that the agency is opposed to CSL’s proposed $3.1 billion merger with Talecris Biotherapeutics.

Don’t worry, CSL, Health and Human Services still loves you.  To the tune of a $180 million order for CSL’s H1N1 swine flu vaccine bulk antigen.  HHS will also fund the clinical trials.

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FTC Proposed Rule for Medical Record Privacy for Non-HIPAA Entities

One of the concerns about the privacy of electronic medical records is that many of the major providers — notably Google and Microsoft —  are not “covered entities” under HIPAA and are therefore not subject to its privacy provisions.

The funding for Electronic Health Records in the American Recovery & Reinvestment Act of 2009 comes with a requirement that HHS study, in consultation with the FTC, “potential privacy, security, and breach notification requirements” with respect to entities not covered by HIPAA, and make recommendations within one year.

In the interim, Section 13407(g)(1) of the Recovery Act requires the FTC to promulgate regulations on breach of security notification provisions.

The FTC has proposed a breach notification rule, and is coordinating with HHS.  The proposed rule:

  • requires vendors of personal health records and related entities to provide notice to consumers following a breach, and reaches through to require the vendors’ service providers to notify the vendors;
  • sets the standard for what triggers the notice requirement, as well as the timing, method, and content of notice; and
  • requires FTC notification of any breaches.
Public comments are being accepted through June 1, 2009, and can be submitted online at https://secure.commentworks.com/ftc-healthbreachnotification.  In particular, the FTC is seeking comments on:
  1. the nature of entities to which its proposed rule would apply;
  2. the particular products and services they offer;
  3. the extent to which vendors of personal health records, PHR related entities, and third party service providers may be HIPAA-covered entities or business associates of HIPAA-covered entities;
  4. whether some vendors of personal health records may have dual roles as a business associate of a HIPAA-covered entity and a direct provider of personal health records to the public; and
  5. circumstances in which such a dual role might lead to consumers’ receiving multiple breach notices or receiving breach notices from an unexpected entity, and whether and how the rule should address such circumstances.

 

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