A powerful US House committee has voted to give branded biologic drugs 12 years’ market exclusivity from generic competition, but also to ban “pay-for-delay” settlements.

The House Energy and Commerce Committee has voted 47-11 in favour of the 12-year exclusivity amendment put forward by California Democrat Anna Eshoo over a provision drafted by the Committee’s chairman, Democrat Henry Waxman, who has introduced legislation which would provide just five years’ exclusivity.

President Barack Obama, who supports seven years’ market exclusivity for branded biologics, commented on Friday that while extending the data exclusivity period for biologics further would obviously be better for the drugmakers’ bottom lines, “it also means you’re keeping important drugs off the market and driving up those costs further.”

Rep Eshoo said her amendment “sets forth a straightforward, scientific process for approval" and will promote competition, lower prices and assure that patients receive safe and effective treatments. In March she introduced, with Democrat Jay Inslee and Republican Joe Barton, the Pathways for Biosimilars Act (HR 1548), which would offer 14 years’ data protection.

However, Rep Waxman - whose Promoting Innovation and Access to Life-Saving Medicine Act (HR 1427), also introduced in March, provides five years’ exclusivity - said that adoption of this amendment “is exactly the wrong way to increase competition and reduce prices.” With it, "we're guaranteeing higher drug costs in the future,” he said.

The vote by the House Committee, which added the amendment as it finished work on the health reform legislation - America’s Affordable Health Choices Act (HR 3200) - before the start of the August recess, follows a similar vote on July 13 by the Senate Health, Education, Labor and Pensions (HELP) Committee, which also rejected the Administration’s call for branded firms to have just seven years market freedom before biogenerics (or “biosimilars,” as the branded industry calls them), can come to market.

Billy Tauzin, chief executive of the Pharmaceutical Research and Manufacturers of American (PhRMA) welcomed the House panel vote as “a step in the right direction because it strikes an appropriate balance between the desire for enhanced competition and preserving incentives for innovation.”

And Jim Greenwood, chief executive of the Biotechnology Industry Organization (BIO) said the Committee vote represented “a decisive win for the patients of today and tomorrow.”

However, the Generic Pharmaceutical Association (GPhA) said it was “sincerely disappointed that some members of the House Energy and Commerce Committee have decided to put brand pharmaceutical profits before patient needs.”

"The amendment passed tosses patient needs out the window,” said GPhA chief executive Kathleen Jaeger, adding: “it is ironic that as Congress works to reduce health care costs and increase access to high-quality care that some members are choosing to go down a path that only benefits the brand pharmaceutical industry.”

Meantime, the Committee mark-up session also approved, in a voice vote, an amendment which would ban “pay-for-delay” settlements between branded and generic drugmakers aimed at keeping generic competitors out of the market.

The amendment, which was sponsored by Illinois Democrat Bobby Rush, was welcomed by Jon Leibowitz, chairman of the Federal Trade Commission (FTC), who had long called for such deals to be outlawed.

“If enacted into law, this measure will put an end to the sweetheart deals between brand and generic pharmaceutical companies that force consumers to wait - sometimes years - for more affordable generic drugs. We estimate that this critical provision will save consumers about $3.5 billion per year and advance the cause of affordable health care for all Americans,” said Commissioner Leibowitz.

However, the GPhA responded to the vote by claiming that an outright ban on settlements would have “the unintended effect of benefiting the brand industry and ultimately harming consumers by keeping more affordable generics from getting to the market in a timely manner.”

“What is often overlooked in this debate is that settlements that successfully conclude patent litigation typically result in the early and predictable introduction of generic competition, at tens of billions of savings to consumers. Without the settlement, there would be no certainty to the introduction of generic competition for the brand product being challenged. That’s why the current system of a case-by-case review by the federal government to ensure that pro-consumers settlements are not blocked benefits consumers over brand companies. Unfortunately, an outright ban has exactly the opposite effect by putting brand companies in the driver’s seat,” said Ms Jaeger.