High drug prices? Senators blame Big Pharma for abuse of the drug patent system

The Pharmaceutical Research and Manufacturers of America was in the congressional hot seat again last week. Members of the Senate Judiciary Committee grilled the drug industry trade group about whether alleged abuse of the patent system contributes to high drug prices.

“I’m a big believer in our patent system, and I believe in the exclusivity that is provided to people who discover new lifesaving drugs,” Sen. John Cornyn, R-Texas, said. “But at the same time, I’m angry when I look at the abuse of the patent system.”

Patents are meant to reward innovation by allowing drugmakers to exclusively sell new medications on the market for a set period of time, typically 20 years. During this time, other companies can’t manufacture and market generic versions of the drug, which limits competition.

Committee Chair Dick Durbin, D-Ill. said that in 2022, manufacturers raised the prices of more than 1,200 medicines by an average of 32%, which was four times the rate of inflation. All too often, steep prices result from “skilled lawyers manipulating the patent system and skirting our nation’s competition laws,” he said.

Senators from both parties accused drugmakers of gaming the system. Companies may file as many as 160 patents for any given drug, Cornyn said. This tactic, which is referred to as “evergreening,” is an industry practice in which a drugmaker extends its patent by making small tweaks to the drug or the device used to deliver medication. For example, Sen. Peter Welch, D-Vt., pointed out that Novo Nordisk currently holds 25 patents for Ozempic, 21 of which have to do with the injectable pen that delivers the medication, not the drug itself.

One recent analysis showed that the 10 best-selling drugs in the United States in 2021 were tied to 1,429 patents and patent applications – 72% of which were filed after FDA approval, Durbin said.

Related: FTC targets 300 Big Pharma ‘junk patents,’ sends warning letters to top drugmakers

The committee already has passed several bipartisan bills targeting “pay-for-delay” agreements, in which brand-name drug manufacturers compensate generic or biosimilar manufacturers for delaying the entry of their drug onto the market; sham citizen petitions submitted to the FDA for the primary purpose of interfering with a competitor’s application; and product hopping, in which manufacturers shift patents from an old version of a brand-name drugs to a new branded product.

However, Jocelyn Ulrich, vice president of policy and research for PhRMA, defended the current patent system, which she characterized as a “resounding success.”

“Importantly, our intellectual property system not only incentivizes the development of new medicines but it spurs competition that lowers health-care costs,” she said. “Congress should be focused on advancing policies where competition could be advanced without undermining the very foundation of the industry’s ability to innovate.”