WASHINGTON, D.C. – U.S. Senators Tammy Baldwin (D-WI), Bill Cassidy, M.D. (R-LA) and Jeanne Shaheen (D-NH) introduced bipartisan legislation today to close the orphan drug loophole that drug companies use to keep competition off the market and rake in profits.
A drug company can get seven years of market exclusivity if it proves to the Food and Drug Administration (FDA) a new drug would not be economically viable without that exclusivity. If granted, that exclusivity persists for seven years even if the drug becomes economically viable on its own. By maintaining exclusivity, drug companies can make billions in profit without market competition, including on treatments for things like substance use disorder.
The senators’ bill closes the loophole and allows the FDA to remove market exclusivity if the drug company cannot continue to prove that the drug needs exclusivity to be economically viable. This will encourage market competition and allow more innovative treatments to come to market, helping to drive down the cost of drugs.
“Washington needs to step up and be a stronger partner to communities fighting the substance abuse epidemic, and we need to make sure that all safe and affordable treatment options are available to patients. We can do this by taking on unfair practices and leveling the playing field so we can use every tool at our disposal to combat this public health crisis,” said Senator Baldwin. “This legislation will close a loophole to help expand access to innovative medications. I’m proud to support this bipartisan effort to help fight this epidemic and save lives.”
“Health care monopolies lead to expensive – and often unaffordable – drugs. Eliminating the orphan drug loophole lowers prices by fostering market competition. Drug companies should have the ability to innovate, but that innovation cannot be the result of exploiting the market,” said Dr. Cassidy.
“Health care costs were going through the roof before the pandemic, which is why as this crisis continues, Congress needs to do everything in its power to ensure Americans don’t sacrifice their personal health because they can’t afford it. Lawmakers should start by curbing skyrocketing prescription drug prices,” said Senator Shaheen. “Our bipartisan legislation would do just that by cracking down on drug manufacturers who abuse the system to prevent more affordable competitors from coming to market. Unfortunately, we have seen drug companies game this system to charge sky-high prices for medications used to treat those who struggle with substance use disorder. As our communities suffer from the effects of how one public health crisis is exacerbating another, we need to be doing everything we can to ensure patients and treatment providers have access to affordable, effective medication. I’ll continue to work across the aisle to reduce prescription drug costs and increase market competition among manufacturers so Granite Staters and Americans across the country don’t have to pick between affording their medication and paying the bills.”