Drugmakers have declared their profound disappointment with President Barack Obama's budget proposals for healthcare, saying they threaten jobs and innovation.

The US president has announced his proposals for fiscal year 2013 that aim to reduce the country's deficit by $4 trillion over the next decade, and to cut spending in Medicaid, Medicare and other healthcare programmes over that period by $364 billion. They are moves that have not gone down well with the country's research-based drugmakers.

John Castellani, chief executive of the Pharmaceutical Research and Manufacturers of America, said that despite President Obama’s "many pronouncements to support innovation, advance biomedical research, promote job creation and control health care costs for seniors, his 2013 budget proposal flies in the face of these important goals". Specifically, he claimed that proposed mandatory rebates to Medicare's prescription drug benefit, known as Part D, "are a short-sighted proposition that could destabilise the programme and threaten hundreds of thousands of American jobs".

Mr Castellani said “Medicare Part D is working well for seniors" and "due to competition, costs continue to be far below initial projections. We should not disrupt this successful programme". He added that "we are also troubled by the president’s proposal to reduce data protection for innovative biologic medicines, which is critically important to the development of cutting-edge medicines".

He concluded by saying the proposed budget "would weaken our ability to innovate and create jobs. This is not an investment in America’s future and these proposals should not be considered".

Concern over NIH funding freeze

A proposal to keep the National Institutes of Health's budget at the current level of $30.86 billion has also attracted criticism. John Edward Porter, chair of Research!America, which says it is the nation's largest not-for-profit public education and advocacy alliance, said the budget "is a mixed bag for science and innovation", but with regards to the NIH, insisted that "we simply cannot freeze investments in biomedical research. The consequences would be disastrous as global competition intensifies".

Research!America president Mary Woolley added that while the group appreciates increased funding for "priorities like the National Center for the Translational Sciences and combating Alzheimer's disease, we strongly believe a frozen budget for the NIH will flatline medical breakthroughs in the coming years and stifle the business and job creation that begins with R&D". She concluded that "researchers will leave the field, potential breakthroughs will be shelved and new business opportunities grounded in medical discovery will evaporate as research institutions struggle with leaner budgets".

Increased user fees for generics, biosimilars

Meantime, the proposals would see the US Food and Drug Administration receive a budget of $4.49 billion for the year beginning October 1, up 17% on the year-before driven by increased industry user fees.

A new user fee to support generics would provide $299 million and another for biosimilars ($20 million). Some $10 million in new resources will be used "to enhance collaboration with our Chinese counterparts and increase the agency’s presence in and expertise on China", the FDA said.

Commissioner Margaret Hamburg said "these are austere budget times, and the FDA budget request reflects this reality". She noted that "with FDA-regulated products accounting for about a quarter of each dollar that Americans spend, these budget priorities will benefit patients and consumers and strengthen our economy.”