Timothy P. Carney: Will Congress cover for a drug-maker's billion-dollar mistake?
By: Timothy P. Carney
Examiner Columnist
October 23, 2009
Amid President Obama's push to trim government and private-sector spending on health care, one drug maker is lobbying hard to extend the patent protection of a costly drug - an extension that could cost taxpayers and patients $1 billion.
The Medicines Company makes Angiomax, an anti-coagulant drug that helps prevent a second heart attack. In early 2001, after the Food and Drug Administration approved Angiomax, MDCO applied for a standard extension to its patent -- an extension that would have been approved, except the company's lawyers filed the application 61 days after the FDA's approval, missing the statutory deadline by one day.
As a result, Angiomax's patent protection is set to expire next year instead of in 2014, as the routine extension would have allowed. Teva Pharmaceuticals, the largest generic drug company in the world, has applied for FDA approval of a generic version of Angiomax, as have other drug makers. If these generics hit the shelf next year, there goes a huge profit stream for MDCO, as prices would go through the floor.
MDCO has said the early expiration of the patent could cost the company $1 billion. So, they're scrambling to fix it. Since 2002 the company has spent more than $13 million on lobbying - almost solely in the effort to get their 2001 tardiness forgiven and their Angiomax patent extended to 2014.
The most recent quarterly lobbying reports for MDCO show the company is ramping up its full-court press for a legislative save from its billion-dollar error. MDCO retains 16 different lobbying firms for this issue, and shelled out $1.3 million in the past three months, or $30,000 every day Congress was in session.
New MDCO lobbyists this year include former House Minority Leader Dick Gephardt, whose firm has hauled in $410,000 in nine months on this issue. MDCO has also hired as a lobbyist long-time liberal activist and Nikki Heidepriem, who contributed nearly $30,000 to Democrats and Democratic groups last election.
MDCO's impressive Republican lobbying platoon was trimmed a bit when former Majority Leader Dick Armey was driven from his lobbying post at K Street firm DLA Piper because of Armey's anti-health-care "reform" activism.
MDCO has drafted legislative language that is circulating Capitol Hill in search of a vehicle it can ride to the president's desk. The provision states the director of the Patent and Trademark Office "shall accept an application under this section that is filed not later than three business days after" the deadline for patent extensions - and the bill is explicitly retroactive.
Speaking on a similar bill in 2006, Jon Dudas, then director of the PTO, said that such a measure would apply to exactly one case: Angiomax.
In case there was any doubt what this bill was about, the current legislative language specifies that this deadline-forgiveness applies to "a drug that is intended for use in humans that is in the anticoagulant class of drugs."
On fairness grounds, MDCO has a point: The company would have been entitled to the 56-week extension of the patent to make up for time lost while the FDA was still approving the drug. For being one day late, should the company really lose a billion dollars?
But at the core of his push for health care reform, Obama has called on all corners of the health industry to find tens of billions of dollars in savings - both for the private sector and the government. Americans spend too much on the health care they get, the White House says, and everyone must chip in to bring those costs down.
Changing the law so as to keep generics off the market for a life-saving product is the opposite of seeking savings. So, while this is, at its heart, a lobbying knife fight between generics and MDCO, it would seem the generics' profit interests coincide here with Obama's broader agenda. MDCO's argument -- that this law is needed to encourage innovation -- is absurd: a retroactive extension of a patent does nothing to encourage innovation.
But the Angiomax tale is not typically a headline grabber -- it's been ignored in the current health care debate. How much do Democrats care about trimming health care costs? Are they willing to let a company suffer so much for filing a paper a day late? More to the point: Are they prepared to say no to a $13 million lobbying effort?
Timothy P. Carney is The Washington Examiner's Lobbying Editor, His K Street column appears on Wednesdays.
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