Dear Majority Leader Frist:
We, the undersigned biotechnology executives, strongly oppose further
efforts to legalize prescription drug importation. Importation will put patients
at risk, chill investment in biotechnology and other pharmaceutical research
and development, and threaten intellectual property protections.
First, legalizing importation will place patients at risk of obtaining
products that do not meet the FDA standards that patients have relied upon for
decades. Since biotechnology products are unique, many are particularly
susceptible to adulteration, degradation and virtually undetectable
counterfeiting. Many cannot be administered safely by the patient, but require
intervention and/or supervision of a health care provider. BIO believes that the
importation of non-biotechnology products could increase the availability of
unsafe or ineffective biotechnology products.
Second, efforts to legalize importation (and to import foreign price controls)
will have a negative impact on biotechnology investment. The cost and time to
develop a new pharmaceutical product is generally agreed to be more than $800
million and 12-15 years; the costs and time to develop a new biotechnology
product can be substantially greater. Since many biotechnology companies do
not have the financial underpinning provided by multiple profitable products
already on the market, they rely on maintaining a high rate of capital
investment for long periods of time – investment that is made based on an
expectation of a healthy return. National or local policy changes that affect the
potential viability of the biotechnology market (via price controls or any other
means) will affect the willingness of investors to take this risk.
Third, prescription drug importation legislation will erode intellectual
property rights. One bill would prevent U.S. manufacturers from enforcing
their patents against foreign products that, if marketed in the U.S. under current
law, would violate the patent on the U.S. product. Even though the foreign
product is imported into the U.S. market in direct competition with the U.S.
FDA-approved drug, the manufacturer would be denied recourse under U.S.
patent laws. The impact on the biotechnology industry of such a change to
patent rights would be enormous.
Finally, although efforts to legalize importation are intended as a
mechanism to lower the price of prescription drugs, the Congressional Budget
Office and numerous economists have challenged the assumptions of
substantial cost savings, noting both the unique features of the world
pharmaceutical marketplace and the substantial costs incurred by intermediaries
in the proposed import/export scheme that certainly would be passed along to
patients. Moreover, recently introduced bills would impose numerous
requirements that were not even envisioned by the economists who looked at
earlier legislation, so transaction costs under these proposals would be
significantly higher. Additionally, examination by economists of European
parallel imports shows that the expected significant savings for consumers have
not materialized, although the traders have realized tidy profits. None of the
bills recently introduced guarantee that the cost differential for the
importer/exporter actually would be passed along to the consumer.
We urge you to oppose further importation legislation. Importation
measures will harm the biotechnology industry and will, more importantly,
harm the patients we are dedicated to help. Legalizing importation is not the
answer to improving access to prescription drugs. Its promise is false and its
dangers are real.
Richard F. Pops
Carl B. Feldbaum
Charles E. Bugg, Ph.D.
Royce L. Watkins
Dante J. Marciani
Lawrence W. Greer
David E.I. Pyott
Duane J. Roth
Dennis M. Fenton
Ginger L. Graham
Kleanthis G. Xanthopoulos, Ph.D.
Gerald J. Yakatan, Ph.D.
John P. Walker
Joseph D. Panetta
Frederic D. Price
David F. Hale
Stephen A. Sherwin, M.D.
Richard W. Hamilton
Lawrence C. Fritz
A. Stephen Dahms
Louis G. Lange
Jay M. Short, Ph.D.
Evan B. Siegel, Ph.D.
Steven J. Mento, Ph.D.
Gregory T. Lucier
Martin D. Cleary
Lewis J. Shuster
David E. Robinson
Larry G. Stambaugh
Walter H. Moos
Ted W. Love, M.D.
Hollings C. Renton
Jennie P. Mather
Timothy J.R. Harris, Ph.D.
Jeffrey N. Peterson
Rick E. Winningham
David V. Goeddel
Benjamin F. McGraw
John L. Castello
Timothy C. Rodell, M.D.
Paul R. Pescatello
David R. Brennan
Charles A. Rice
John Spencer, Jr.
William D. Johnston, Ph.D.
James Hussey, MBA
Kenneth C. Carter, Ph.D.
Rachel K. King
William A. Haseltine, Ph.D.
Douglas A. Doerfler
C. Robert Eaton
David P. Wright
Carol A. Nacy, Ph.D.
Una S. Ryan Ph.D.
James C. Mullen
Henri A. Termeer
Geoffrey F. Cox
Steven M. Rauscher
Diedre Gillespie, M.D., M.B.A.
Joshua Boger Ph.D.
James V. Adam
Saint Paul, Minnesota
James B. Palmer, M.D.
Bruce A. Williams
Joseph C. Scodari
John H. Johnson
Nutley, New Jersey
George A. Oram
Göran Ando, M.D
Gary K. Zammit, Ph.D.
Karin A. Duncker
Lynne H. Parker
Michael P. McDermott
Peter F. Young
Clint G. Dederick, Jr.
J. Donald deBethizy, Ph.D.
J. Bruce Kaylos
Gil Van Bokkelen
Anthony J. Dennis
Bruce A. Peacock
Raymond K. Houck
Frank Baldino, Jr.
David W. Anstice
C. Boyd Clarke
William B. Wiederseim
Robert R. Ruffolo, Jr.
West Greenwich, Rhode Island
Patrick. B. Flanagan
Michael T. Redman
Peter D. Meldrum
Brian H. Moss
Albert A. Luderer, Ph.D.
Steven C. Quay, M.D., Ph.D.
Ruth M. Scott
Bruce L.A. Carter