Barack Obama has unveiled plans to introduce universal healthcare in the USA and non-branded drugmakers have big smiles on their faces this morning after the president outlined his determination to create a workable biogeneric pathway that could save the taxpayer billions of dollars.

President Obama has announced $3.6 trillion budget proposals which is very much centred on revolutionising healthcare across the Atlantic. He said that “we are making a historic commitment to comprehensive healthcare reform,” adding that it is a step that will make families healthier and companies more competitive.

The president also stated that it is a priority to “give every single American quality, affordable healthcare”, and the budget is going to lead to higher taxes for the rich. However Mr Obama said that “we'll save billions of dollars by rolling back tax cuts for the wealthiest Americans while giving a middle-class tax cut to 95% of hardworking families”.

For healthcare, the new man in the White House says that he will reform the system with a 10-year fund of $634 billion derived from tax revenues. The details of these changes will become apparent over the next few months but President Obama is keen to improve health information technology, allocate more funds to cancer research and make Medicare much more efficient.

However one area that the president is committed to is legislation to allow approval of generic biologics. The budget proposal specifically calls for the creation of a biogeneric pathway and biologic market exclusivity incentives consistent with “the principles in the Hatch-Waxman law for traditional products”.

The latter law provides five years of exclusivity for new medicines, and three years for new formulations of existing drugs. However, innovative drugmakers have been pushing for 14 years of exclusivity. The Obama budget also suggests that “brand biologic manufacturers would be prohibited from reformulating existing products into new products to restart the exclusivity process”, which is known as ever-greening.

The budget proposals went down well with the Generic Pharmaceutical Association president, Kathleen Jaeger. She said that for patients suffering from cancer, diabetes and other diseases, “the support stated by President Obama for a workable biogenerics approval pathway is lifesaving news”.

She added that “with countless patients struggling to pay the high costs of brand biopharmaceuticals, an approval pathway for safe, effective and affordable biogeneric medicines that provides access sooner rather than later is desperately needed”. She added that the exclusivity provisions of Hatch-Waxman “have been a successful model, fostering innovation and competition while saving hundreds of billions of dollars, and this same success can be achieved with biogenerics".

The welcome to the plans from Pharmaceutical Research and Manufacturers of America president Billy Tauzin was a little more cautious. He said that the association, which represents innovative and therefore branded drugmakers, vows to work alongside the President “and all stakeholders committed to reforming our healthcare system in a way that emphasises preventative care and brings high-quality, affordable coverage to all Americans”.

Mr Tauzin added that the proposed funds set aside “are a bold step in the right direction”, and noted that “healthcare reform is not a luxury; it is essential to economic recovery and imperative to making Americans healthier and more productive”. He added that PhRMA also stands in lock step with the President’s courageous call to ‘cure cancer in our time’,” noting that US companies “are working on a record 750 medicines to fight this deadly disease”.

Mr Tauzin also applauded the President’s request to increase funding for the US Food and Drug Administration. However he concluded by saying that “as Congress works through the budget process, we strongly urge against the adoption of policies that could undermine innovation and disrupt patient access to life-saving medicines”.

There will be much discussion over the plans and the issue of raising taxes will raise hackles in certain areas of American society but President Obama looks determined to get his reforms through, and big pharma will be watching the debate very closely.