DOSE OF REALITY: FORBES: HOW BIG PHARMA EXPLOITS LOOPHOLES IN THE PATENT SYSTEM

Avik Roy Highlights How Increased USPTO-FDA Collaboration and Greater Scrutiny of Patent Applications Can Help Improve Prescription Drug Competition

Avik Roy, president of The Foundation for Research on Equal Opportunity (FREOPP), is out with a new column in Forbes which explores how Big Pharma games the patent system to extend exclusivity and monopoly pricing in the U.S.

The Humira Example

To bring these issues into focus, Roy highlights the example of AbbVie’s blockbuster rheumatoid arthritis drug Humira, which is a case study in Big Pharma’s egregious anti-competitive practices. AbbVie built a fortress of patents around Humira, preventing competition from entering the market for years beyond a typical period of exclusivity. All the while, the company increased the price of the blockbuster drug. While the main composition patents on Humira were set to expire in 2016, AbbVie’s patent strategy blocked competition for at least another six years, costing patients and taxpayers $114 billion in the process.

Underlying AbbVie’s strategy around Humira was an effort to pursue weaker, secondary patents on aspects such as the drug’s dosage and method of manufacturing. AbbVie also aggressively sued potential competitors to Humira and settled with them to delay their entry into the market.

Recent Push to Increase USPTO-FDA Collaboration

In order to prevent drug makers from exploiting the patent system in this manner, Roy points to an effort started by U.S. Senators Bill Cassidy (R-LA) and Maggie Hassan (D-NH) to scrutinize the lack of oversight on pharmaceutical patents from both the U.S. Patent and Trademark Office (USPTO) and U.S. Food and Drug Administration (FDA). In particular, Roy notes that the USPTO “isn’t supposed to issue patents for manufacturing processes that have been used for more than a year prior to a patent submission, [yet] they are doing so.” In addition to the scrutiny from lawmakers, in 2021 the Biden Administration issued an executive order “require[ing] improved coordination between the FDA and the USPTO.” These combined efforts between the legislative and executive branches have, in fact, led to increased collaboration and coordination between the two agencies, as Roy notes.

The Solution: Scrutinize Frivolous, Incremental Patents

Roy argues there should be greater scrutiny on Big Pharma’s patent applications. And in particular, on patent applications that are designed to extend a drug’s patent protection beyond its initial period of protection. He argues that despite arguments defending intellectual property rights and free markets, brand name pharmaceutical companies are clearly abusing the market through a concerted effort to build patent thickets around their blockbuster products. Roy finishes his piece by writing “[i]f we truly want to reward innovation, it’s equally important to not reward patent trolls who seek to gain monopoly power over obvious or incremental improvements.”

Read the full column from Forbes HERE.

Read more from Avik Roy in Forbes on how a recent piece of legislation, The PREVAIL Act, would make it more difficult to hold brand name drug manufacturers accountable HERE.

Read Avik Roy’s earlier column in Forbes on how Big Pharma’s product hopping stifles innovation HERE.

Read more on how Big Pharma’s patent abuse tactics drive increased costs for consumers and the U.S. health care system HERE.

Learn more about market-based solutions to hold Big Pharma accountable and lower drug prices HERE.