NAPM TESTIMONY TO SENATE JUDICIARY COMMITTEE
CONDEMNS DRUG PATENT EXTENSIONS

For Immediate Release:

Washington D.C., August 4, 1999 - The National Association of Pharmaceutical Manufacturers (NAPM) today submitted testimony to the Senate Judiciary Committee condemning Senate Bill 1172, which would grant new patent extensions to eight so-called "pipeline" drugs, including Schering-Plough's blockbuster Claritin^TM. The committee is conducting a hearing on S.1172 today.

The patent extensions under S.1172 would give up to three additional years of competition-free sales to seven pharmaceutical manufacturers, at a consumer cost of over $11 billion from 2002-2012, according to a report released today by the Prime Institute of the College of Pharmacy at the University of Minnesota. Consumers would pay $7.36 billion more for Claritin alone from a three-year delay in generic competition.

Pipeline drugs are drugs that received special 2-year patent term extensions as part of a compromise between the brand and generic sectors of the pharmaceutical industry. The patent extensions were legislated under the
Drug Price Competition and Patent Term Restoration Act of 1984 (Hatch-Waxman Act).

In addition to its Hatch-Waxman extensions, Claritin also received a 22.5-month extension under the General Agreement on Trade and Tariffs (GATT), and now is reportedly poised to secure an additional six-month extension for conducting pediatric studies under the Food and Drug Administration Modernization Act of 1997.

"With S.1172, certain brand name companies, led by the Schering-Plough Corporation, are selectively attempting to undo the policy decision struck in 1984--the policy that all sides agree to--in order to extend their monopoly periods at the expense of competition, consumer savings, and healthcare costs without a corresponding benefit to the consumer," NAPM testified.

While proponents of the legislation claim S.1172 would not necessarily result in the granting of a three-year extension, and merely sets up a "process" to review applications for the extensions, NAPM disagreed, pointing out that:

"One only needs to witness the vigor with which Schering-Plough is pursuing the passage of S.1172 to determine what Schering-Plough believes the outcome for their Claritin application would be...NAPM hopes that the Congress can recognize not only that S.1172's version of a process is a stacked deck against consumers and the generic drug industry, but also that a process was created and is still in place under the Hatch-Waxman Act. Congress should send the message now that this special interest legislation is not about intellectual property rights or about fairness and equity. Congress should send the message that it is serious about containing healthcare costs and about ensuring a competitive marketplace to the benefit of all Americans."

NAPM is the frontline trade organization of the U.S. generic drug industry. Representing generic pharmaceutical manufacturers, distributors and their suppliers, NAPM's first priority is a total commitment to providing safe, effective, affordable drugs to U.S. consumers. NAPM is dedicated to protecting and expanding a thriving, freely competitive pharmaceutical marketplace in which consumers can benefit from high-quality, low-cost alternatives to brand name drugs.

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Editor's Note: NAPM Testimony on S 1172 and complete Prime Institute report available on request.

Contact:
Julie Gross Gelfand
HLM&S PR
1-888-571-2020 or (516) 536-2020

Arthur Tsien or Susan Grymes
Olsson Frank & Weeda
(202) 789-1212

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For more information about NAPM and generic drugs, contact Robert S. Milanese or Leon Shargel at NAPM, (516) 741-3699.

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