Lipitor’s patent loss signals future for other top drugs
If the patent cliff were a sports team, Pfizer’s cholesterol- lowering drug Lipitor (atorvastatin) would be its mascot. Because it’s the top-selling drug, well, ever — with 2010 sales well in excess of $7 billion in the United States alone — Lipitor’s loss of patent protection on Nov. 30, 2011, didn’t start or end the patent cliff but in many ways symbolized it.
“We’ve never had an $8 billion drug go off patent before, and you don’t know whether it’s a one-off or not a one-off,” IMS Health VP industry relations Doug Long told Drug Store News. “And I think only time will tell.”
This year, several more top-selling drugs will lose patent protection. These include Bristol-Myers Squibb’s and Sanofi’s blood-thinning drug Plavix (clopidogrel), the No. 3 drug, with $6.1 billion in U.S. sales in 2010, according to IMS; AstraZeneca’s antipsychotic and antidepressant Seroquel (quetiapine), with sales of $4.4 billion; and Merck’s allergy and asthma drug Singulair (montelukast), with sales of $4.1 billion.
But a couple of factors have entered the mix: One is Pfizer’s efforts to protect Lipitor beyond patent expiration, which included an authorized-generic deal with Watson Pharmaceuticals to compete with Ranbaxy Labs’ generic version and a deal with pharmacy benefit managers to require dispensing of branded Lipitor instead of the generic, though this deal attracted some scrutiny from Congress. Another tactic Pfizer is pursuing is an OTC switch for Lipitor, though the outcome of this remains far from certain, as previous attempts by other companies to sell statins over the counter have proven unsuccessful.
Later in the decade, after the patent cliff ends, Long foresees an “innovation drought” that could adversely affect the generics industry. Drug companies will concentrate on specialty drugs instead of primary care drugs, forcing generic drug makers to step up their pursuit of newer sources of revenue like follow-on biologics.
GDUFA reduces wait time for generics
For all the talk about generic drugs and their potential to save piles of money for the country’s healthcare system, it’s going to be a while before many of them actually reach consumers because of the Food and Drug Administration’s huge backlog of generic drug regulatory approval applications.
Currently, according to the Generic Pharmaceutical Association, it takes 31 months for the FDA to review an electronically submitted abbreviated new drug application, which has resulted in a backlog of more than 1,000 applications awaiting FDA approval. Under the recently negotiated Generic Drug User Fee Act, however, the wait time will be reduced by more than two-thirds, to 10 months. The act, for which the FDA released guidelines last month, will provide the agency with nearly $1.5 billion in supplemental funding through user fees and will effectively eliminate the application backlog by the end of fiscal year 2017, according to the GPhA.
In addition, GDUFA will help improve the safety of the country’s drug supply. Currently, according to the GPhA, almost 40% of prescription drugs in the United States are imported, while up to 80% of the active pharmaceutical ingredients in those drugs are sourced abroad. Still, according to the Government Accountability Office, the FDA was able to conduct good manufacturing practice inspections at 11% of the foreign sites in its database, compared with 40% of domestic sites. GDUFA will help increase the number of sites inspected.
“The Generic Drug User Fee Act is a milestone for the generic drug industry and a major win for American healthcare consumers,” GPhA president and CEO Ralph Neas said. “This program, as negotiated, will result in expedited access to low-cost, high-quality generic drugs for Americans, and will further safeguard the quality and accessibility of our nation’s drug supply.”
80% of drug shortages are injectables, 80% are generics
One issue that is unlikely to see resolution this year is the growing problem of drug shortages. As of October 2011, the Food and Drug Administration and the American Society of Health Systems Pharmacists found shortages of 168 drugs. According to healthcare analytics firm IMS Health, while this represents a small and highly concentrated portion of the overall drug market, it includes a number of critical drugs used to treat cancer, infections, cardiovascular disease, central nervous system disorders and pain. In addition, more than 80% of these 168 drugs are injectables and more than 80% are generics.
IMS VP industry relations Doug Long said one cause for the shortage was efforts by generic drug makers to move up the value chain and develop more specialized therapies. Many of the drugs experiencing shortages — some of which are 20 to 30 years old — are no longer profitable and thus no longer made. “I think the progress that we’ve made is identifying the causes of [shortages],” Long told Drug Store News.
Meanwhile, the Obama administration sought to address the problem with a rule issued last month that would require manufacturers that are the sole producers of certain drugs to report any interruptions in manufacturing to the FDA. The Generic Pharmaceutical Association also called for the creation of a new initiative to gather current and future supply information from various stakeholders for certain products and use the information to identify current and potential supply gaps, focusing on products with an expected shortage time longer than 90 days. IMS also recommended the creation of an early warning system for drug shortages that would include systematic risk identification, continuous long-term demand forecasting, creation of a supply volatility index and comprehensive predictive modeling.