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Inside Health Policy FDA Week: Lawmakers to Trump: Push NIH on March-In Rights as Answer to Drug Pricing

April 7, 2017

Over 50 members of Congress are calling on President Donald Trump to direct the National Institutes of Health to issue guidance on when it will exercise so called “march-in rights,” effectively canceling exclusivity when patented drugs are not available on reasonable terms. The lawmakers and one consumer advocacy group held up the process as a solution to Trump’s promise to bring down drug prices.

Products that were developed at least in part by federal funding are subject to march-in rights, whereby NIH can require a company license its patent to another party when “action is necessary to alleviate health and safety needs which are not being reasonably satisfied,” or when the benefits of existing patents are not “available to the public on reasonable terms.” NIH was granted this power by the Bayh-Dole Act of 1980, but it has never exercised it.

The lawmakers argue such guidance would aide manufacturers in “[making] better-informed pricing decisions,” in addition to helping patients.

”Drug manufacturers and patients need clarity. We urge you to direct NIH to issue public guidelines on the circumstances that will likely require it to invoke taxpayer protection rights. Reasonable and transparent guidelines would discourage drug price gouging and create a more competitive market for drugs developed using tax dollars. American taxpayers should be able to access publicly-funded medications on reasonable terms, instead of being burdened with unreasonable prices,” the letter spearheaded by Rep. Lloyd Doggett (D-TX) states.

While the lawmakers don’t go as far as asking Trump to direct NIH to use the provision, they highlight NIH’s refusal to hold a hearing on the use of march-in rights for cancer drug Xtandi. A group of lawmakers in March 2016 urged the institutes to hold that hearing after NIH was petitioned by Knowledge Ecology International and the Union for Affordable Cancer Treatment to exercise march-in rights for that drug.

The lawmakers argue that directing NIH to provide clarity on this provision could at least partially deliver on Trump’s promise to rein in high drug prices.

”We write regarding your oft-stated commitment to bring down pharmaceutical prices. You have said that the pharmaceutical industry is ‘getting away with murder’ and called drug prices ‘astronomical.’ We urge you to use your existing statutory authority to respond to soaring drug costs harming so many American families...Your Administration already has legal authority to prevent pricing excesses by promoting competition, while protecting taxpayer investments and addressing the failures of government-approved monopolies,” the letter continues.

Public Citizen also held up march-in rights as an answer to drug pricing in an April 4 press release applauding the letter. “American taxpayers support the essential research for many new classes of medications and other medical technologies, through the National Institutes of Health (NIH), to the tune of $30 billion a year. Prescription medication corporations rip off American taxpayers when they turn around and charge outrageous monopoly prices for the same life-or-death medicines, forcing the rationing of the health care we need. We have the right, and the incoming administration has the power, to authorize competition when corporations price gouge people,” Peter Maybarduk, director of Public Citizen’s Access to Medicines Program, wrote.

Lawmakers increasingly appear to be eying termination of exclusivity as an answer to what they see as unscrupulous pharmaceutical industry behavior. Provisions in a new bill introduced by Sen. Al Franken (D-MN) would terminate a variety of exclusivities in the event a company is found to have violated certain laws.