In a groundbreaking move, the Biden Administration has unveiled a new policy that could allow the US government to seize patents for medicines developed using public funding if it deems their prices unreasonably high. This policy, known as "march-in rights," would grant the government the authority to grant additional licenses to third parties to manufacture and distribute these drugs if the original patent holder fails to make them available at affordable prices.
Under the draft roadmap shared by Reuters, certain criteria will be considered when evaluating whether a drug's price is excessive. Factors such as limited patient accessibility and whether drug manufacturers are exploiting health or safety concerns to inflate prices will be taken into account. White House adviser Lael Brainard emphasized during a press call that the government's aim is to ensure lower-cost alternatives are available when drug companies fail to offer taxpayer-funded drugs at reasonable prices.
Although the government has previously been reluctant to seize patents for expensive drugs, this new policy marks a significant shift in approach. Earlier this year, the government decided against forcing Pfizer and Astellas Pharma to reduce the price of their prostate cancer drug Xtandi. However, the administration's announcement now signals a more assertive stance on regulating drug prices.
To facilitate public input, the government plans to seek feedback on the proposal for a period of 60 days. Once the feedback has been considered, they will work towards finalizing the policy. The introduction of march-in rights under the Bayh-Dole Act of 1980 was intended to safeguard the rights of inventors who develop products or inventions with the support of public funds. While the National Institutes of Health possesses the power to seize patents for federally-funded medicines, former NIH director Francis Collins clarified that they could not employ march-in rights to address exorbitant drug costs.
Critics argue that this new policy could discourage investment in the pharmaceutical industry due to the potential threat of patent seizure. However, they also acknowledge that having a credible deterrent may prove useful if the industry becomes unyielding in its pricing practices. Megan Van Etten, spokesperson for the leading pharmaceutical lobby group PhRMA, warns that allowing the government to exercise march-in rights based on price would impede innovation and harm patients. Van Etten argued that this policy risks returning to a time when government-funded research remained idle and failed to benefit anyone.
Amidst calls from progressive lawmakers within the Democratic Party, the Biden administration has faced mounting pressure to utilize its march-in authority to address high drug prices. Earlier this year, Moderna CEO Stephane Bancel attracted criticism when the company announced plans to increase the price of its COVID-19 vaccine up to $130 per dose. Democratic Senator Bernie Sanders expressed his concerns during a Congressional hearing, highlighting that Moderna's Spikevax vaccine was developed with governmental assistance.
The newly appointed Director of the National Institutes of Health, Monica Bertagnolli, shares the concerns surrounding inflated drug prices. As she settles into her role, Bertagnolli pledges to utilize all available tools to ensure patient access to essential medications. While clarifying her position on march-in rights, Bertagnolli stated that if she were to exercise these powers, it would be done with the intention of achieving fair access to drugs for patients.
While this new policy has the potential to reshape the pharmaceutical industry's pricing dynamics, it remains to be seen how it will navigate legal challenges. Joseph Allen, director of lobbying group The Bayh-Dole Coalition and a former staffer for Senator Birch Bayh, suggests that Congress may contest the compatibility of the policy with existing law. As the public engages in the feedback process, stakeholders eagerly await the outcome of these discussions and the subsequent impact on drug pricing and access in the United States.