Rule change on generic drug labeling could cost billions

WASHINGTON (NNPA) – A proposed rule change for generic drug labels, crafted by the Food and Drug Administration, could cost patients, health care providers and drug manufacturers billions of dollars and limit access to affordable, prescription drugs for minorities and the poor, according to more than a dozen organizations that serve people of color.
Black groups and those representing other people of color expressed their concerns about the rule change in a March 14 letter to Margaret Hamburg, the commissioner of food and drugs for the United States Food and Drug Administration.
The letter said acknowledged that, “while great strides have been made around improving the health of racial and ethnic minority populations through the development of health policies and programs that will help eliminate health disparities, much remains to be done.”
Among the groups signing the letter were:  the National Medical Association, the National Dental Association, the National Black Nurses Foundation, the National Black Chamber of Commerce, the International Association of Black Professional Firefighters, the Association of Black Psychologists, the National Coalition on Black Civic Participation and the Southern Christian Leadership Conference.
The rule change is designed to allow generic drug makers the ability to update their drug labels as soon as they learn of new potential risks.
The letter stated, “[The proposed rule change] would not only jeopardize patient safety, but as a recent economic study has shown, would also create billions of dollars in annual increased costs for consumers, taxpayers, large and small businesses, and state and federal governments. The rule would decrease patient access, impede healthcare decisions and delivery, and make fewer generic drugs available for patients who need them most.”
Patients’ advocate groups and some health care providers worry that drugs that are scientifically identical will carry very different warning labels, adding to patient confusion and may cause some consumers to shun life-saving, generic drugs completely.
According to a report by Matrix Global Advisors, an economic policy consulting firm and sponsored by the Generic Pharmaceutical Association, a trade group for makers and distributors of generic prescription drugs, “the proposed Rule could be expected to increase spending on generic drugs by $4 billion per year (or 5.4 percent of generic retail prescription drug spending in 2012). Of this, government health programs would pay $1.5 billion, and private health insurance, $2.5 billion.”
In 2012, industry experts reported that generic drugs accounted for 84 percent of all prescriptions.
The report said that “generic manufacturers would face higher insurance premiums, self-insurance costs, and reserve spending on product liability, may exit or decline to enter the market for certain products for which they perceive greater liability risk or uninsurable liability risks.”
The report also warned that insurance companies that offered liability coverage to generic manufacturers in the past may also reverse course.
Even though the FDA said that the proposed rule is expected to generate little cost, the agency failed to take into account, “any impact from generic product liability and the accompanying price increases on physicians, pharmacists, hospitals, insurers, patients, or public payors as Medicare or Medicaid,” the report observed. This is a gross oversight on the FDA’s part, as the Proposed Rule would, by the agency’s own admission, provide patients using generic drugs ‘access to the courts’ to bring failure-to-warn suits against generic manufacturers.”
Derrick A. Humphries, a lawyer based in Washington, D.C. who represents many of the groups that signed the letter to Hamburg, said that the proposed rule change is not widely known among diverse populations.
Humphries said that the impact of any cost increase associated with generic drugs could cause an economic tsunami among minorities, especially African Americans who disproportionately go without health insurance and also suffer from chronic illnesses like diabetes and heart disease at higher rates than Whites.
“There must be an opportunity for diverse populations to have a seat at the table,” said Humphries. “It’s an issue we have to take seriously.”
Ralph Neas, the president and CEO of The Generic Pharmaceutical Association.
“We want the FDA to explore the unintended and harmful consequences that the rule may have on patient access, particularly on patients underserved by our nation’s health care system,” said Neas.
Neas called for a multi-stakeholder collaboration with the FDA.
The FDA should hear from providers that serve racial and ethnic populations and individuals who can offer expertise, experience and perspective, said Neas.
“We have a huge drug industry in this country,” said Melanie Campbell, president and CEO of the National Coalition on Black Civic Participation. “We have to pay attention to these changes. Sometimes it’s a fine detail that can have unintended consequences.
“The average person does not have time, but you have to tune in and understand the issue. It’s very important that we have our ear to the ground, not just when the FDA reaches out to [civil rights groups]. We need to reach out to the FDA.”
(Consumers can reach out to the FDA at:
Neas recommended that the FDA consider expedited industry review, e-labeling for brand name and generic drugs and additional congressional resources for the FDA.
“Assuring safety information will be provided to pharmacists, providers and patients in the most efficient and expeditious way, that’s the way to protect patient safety and protect the public health while at the same time preserving $1.2 trillion dollars in savings for the system and our patients that we saw over the past 10 years,” said Neas.
Campbell said that there’s an opportunity for a mutual partnership between the FDA and minority groups and that community stakeholders and consumers have to stay on top of the issues, especially when those issues have a systemic impact.
Campbell added: “We want to make sure that the rule change makes it less complicated, not more complicated for people to make decisions when you’re standing in front of your pharmacist.”

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