September 14, 2023

Warren, Jayapal Urge FTC to Rein in Big Pharma Abuses of Patent System

FTC To Hold Open Meeting To Consider Key Policy Statement on Improper Patent Listings

Big Pharma Exploits FDA’s “Orange Book” to Prevent the Entry of Lower-Cost Generics and Block Competition 

Text of Letter (PDF)

Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.) and U.S. Representative Pramila Jayapal (D-Wash.) sent a letter to Federal Trade Commission (FTC) Chair Lina Khan, ahead of the Commission’s open meeting later today, urging the FTC to issue a policy statement about the improper listing of drug-related patents in the Food and Drug Administration’s (FDA’s) Orange Book. Big Pharma’s exploitation of the Orange Book blocks competition and prevents lower-cost drugs from entering the market, keeping drug prices high and padding Big Pharma’s profits. 

“Brand-name pharmaceutical companies have routinely abused the U.S. patent system, violated antitrust law, and hiked the prices of prescription drugs to widen their own profit margins. We urge the FTC to take steps to end Big Pharma’s routine exploitation of the Orange Book and hold drug companies accountable for their anti-competitive business practices that are ‘imposing costs on individuals and society alike,”’ wrote the lawmakers. 

The FDA’s Orange Book contains a list of FDA-approved drugs and their related patent and exclusivity information, considered some of the “most valuable patents in the world.” Brand-name drug companies are required to list patent information in the Orange Book that covers drug substances, drug products, and method of use. However, Big Pharma regularly lists patents outside these categories, even when courts have ruled they are outside the scope of the Orange Book. 

“Improper ‘sham’ patents serve the primary purpose of blocking competitors from introducing lower-costs generic drugs. That’s because FDA is automatically barred from approving a generic drug for 30 months if a brand-name drug company sues a generic competitor for infringing on an Orange Book-listed patent. Pharmaceutical companies are therefore incentivized to list more patents in the Orange Book, whether they’re valid or not, to hold off generic competition for multiple years and extend their own monopolies regardless of the outcome of any litigation,” continued the lawmakers. 

The lawmakers note that the FTC has previously raised concerns about these activities, highlighting an amicus brief outlining the harms to consumers from pharmaceutical companies that improperly list patents in the Orange Book and block generics or follow-on competition. An FDA study found that the introduction of even a single generic drug can lower a drug’s price by almost 40%, and with two generic options available, prices drop by over half. 

“Unjustified delays in generic competition are costing patients and taxpayers billions of dollars, just to pad Big Pharma’s profits… The FTC now has the chance to hold Big Pharma accountable for these anti-competitive business tactics. We support your decision to discuss this critical issue at tomorrow’s open meeting and encourage you to release a strong policy statement declaring that the listing of sham patents in the Orange Book is an unfair method of competition that is reducing access to essential drugs and hurting patients,” concluded the lawmakers. 

Senator Warren has led efforts to use every tool available to the government to lower drug prices and fight Big Pharma’s anti-competitive business practices: 

  • In August 2023, Senator Warren and Representative Jayapal sent a letter to FDA Commissioner Dr. Robert M. Califf, urging him to close loopholes that pharmaceutical companies have exploited to block generics from entering the market, keeping drug prices high and maximizing profits. 
  • In June 2023, Senators Warren and Angus King (I-Maine) and Representative Lloyd Doggett (D-Texas) sent a letter to Department of Commerce (DOC) Secretary Gina Raimondo and Department of Health and Human Services (HHS) Secretary Xavier Becerra asking for information on the membership, process, timeline, and scope of work of the recently announced Interagency Working Group for Bayh-Dole.
  • In April 2023, Senator Warren and Representative Jayapal sent a letter to Kathi Vidal, Director of the USPTO, calling on USPTO to take immediate action and use its existing administrative authorities to help lower drug prices and hold pharmaceutical companies accountable for anti-competitive business practices. The lawmakers outlined six specific actions that the USPTO should take. 
  • In February 2023, Senators Warren and Bernie Sanders (I-Vt.) and Representatives Jayapal and Katie Porter (D-Calif.) sent a letter to the USPTO, calling on the agency to give close scrutiny to any of Merck’s requests for new patents for Keytruda, a biological treatment used to treat cancer, citing new reports about Merck’s ongoing abuse of the patent system to protect its monopoly on the drug. 
  • In January 2023, Senators Warren and King and Representative Doggett led their colleagues in sending a follow-up letter to HHS Secretary Xavier Becerra that urged the Secretary to exercise his authority to lower the price of cancer treatment Xtandi. 
  • In December 2022, Senator Warren and Rep. Jayapal sent a letter to Director Kathi Vidal following up on their June 2021 letter about USPTO’s efforts to hold pharmaceutical companies accountable for anti-competitive business practices and tackle high drug prices.
  • In June 2022, Senators Warren and King and Representatives Doggett, Joaquin Castro (D-Texas), Sara Jacobs (D-Calif.), and Porter led a group of 100 members from across the ideological spectrum to urge HHS Secretary Xavier Becerra to swiftly act and use his existing authorities to lower prices on critical prescription drugs.
  • In April 2022, Senator Warren sent a letter to HHS Secretary Becerra, sharing the findings from a letter that over 25 legal and public health experts sent to her outlining three powerful legal tools the Biden administration could use to lower drug prices. 
  • In March 2022, Senator Warren and her colleagues called out drug manufacturers for squeezing American families with rapid and widespread price hikes on prescription drugs.
  • In February 2022, Senators Warren and King and Representative Doggett urged HHS to exercise its march-in rights for the life-saving cancer drug Xtandi to dramatically lower its price for millions of Americans.
  • In June 2021, Senator Warren led a letter questioning PhRMA's lobbying efforts to block policies that would lower drug costs for millions of Americans.
  • Senator Warren has also introduced legislation that would radically reduce drug prices through public manufacturing of prescription drugs, including the Affordable Drug Manufacturing Act with Representative Jan Schakowsky (D-Ill.).