How Healthcare Legislation Can Ensure Patient Safety and Spur Innovation

7/9/09

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continued biomedical innovation by providing 12 years of data exclusivity to the developer of the innovator biologic. This period of exclusivity protects the developer’s intellectual property and investment, which allows companies to reinvest in R&D to develop new treatments and breakthrough therapies.

According to a recent study, more than 100 new medicines are currently in development by companies with a presence in Washington state. If they make it to market, many of these drugs will combat the leading causes of death in Washington and the United States, including heart disease, cancer, stroke, lower respiratory diseases, Alzheimer’s, diabetes, influenza, pneumonia, nephritis, septicemia, and liver disease. Others will fight diseases that Seattle’s vibrant global health community is tackling head on, such as HIV/AIDS, tuberculosis, and pneumonia.

Lawmakers also must make sure that the biotech industry continues to receive the financial incentives necessary to support the research and development of new biologics, which require billions of dollars in investment, research, and production. Recent data suggests that it costs nearly $1 billion for a new therapy to make it to market, and only one new drug approved out of the three will recover the cost of research and development. In addition, it can take as many as 16 years for a drug to recoup the investment made to bring it to market. Only one out of three approved drugs eventually make a profit. Unless biotech firms are able to recoup the investments made in adequate sales and receive a return on their investment, financing for biologic research will dry up, biotech firms will fail, jobs will be cut, and future innovation will be stifled. Additional potential casualties are patients that otherwise would have benefited from the promise of a new drug that never makes it to market due to a lack of investment dollars as a result of legislation that does not preserve continued incentive to innovate and develop new therapies.

Such a downturn would hit Washington particularly hard. There are 140 biotech companies currently in Washington; this is a $10.5 billion-a-year business directly employing more than 20,000 residents, while more than 67,000 Washington residents’ livelihood is dependent on the biotechnology industry.

It is vital that we keep biotech innovation alive in Washington State because we are one of the top recipients of National Institute of Health (NIH) funding as well as venture capital investment. These funding sources go largely to investments in human biotechnology, medical therapeutics, and the pharmaceuticals sectors. These sectors would be the hardest hit if irresponsible biosimilars legislation became law.

Another potential “side effect” of biosimilar legislation that does not preserve continued incentive to invest in innovation may be that the federal government may have to become the new “investors” in biologic drug development. In the advent the private sector no longer has incentive to invest in new drugs or biotech companies, and if we hope to advance new biologics into the clinic, and eventually to patients, taxpayers may ultimately have to pay for innovation.

It is my sincere hope that Senators Patty Murray and Maria Cantwell follow Rep. Inslee’s lead and champion his legislation’s principles in the Senate to set appropriate standards for the approval of biosimilars. These standards must protect patient safety while also encouraging research that helps bring new, more advanced treatments—and even cures—to patients in Washington State and around the world.

Chris Rivera is the President of the Washington Biotechnology & Biomedical Association. Follow @

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  • Dan Eramian

    Mr. Rivera should make it clear that his position on the follow-on biologics issue does not represent all the views of the biotech community in the state of Washington.