Getting the drugs we need  pg. 3

I think we should give limited (patent) exclusivity on the basis of that, and give an extended exclusivity when people demonstrate a hard endpoint… We need to develop regulatory approaches that… encourage the taking of risk. And of course that’s going to have to make some fundamental changes in attitude at the FDA itself.

PAUL—I absolutely agree. The (intellectual property) challenges right now are formidable. The effective patent life for a new drug today is probably averaging only 10 years or so in the U.S.. If it takes 15 years to both discover and develop a drug, five or even 10 years may be too little time to recoup the investments required.

We must be assured that once a drug reaches the market we have a sufficient period of time of patent exclusivity to recoup our investments. Right now with the current patent laws there are also huge incentives for generic companies… to come in and challenge patents in a way that is like winning the lottery…

By the way, I believe that generic drugs are one important way to reduce prescription drug prices in this country. Prescription drug costs in the U.S. could be reduced by 10 to 15 percent overnight if physicians would prescribe generic drugs when they should. But there will be no more generic drugs if there are not patent protected drugs in the first place.

WOOD—I actually think we should also offer extensions of exclusivity on the basis of certain agreed performance goals. For example, if you were developing (the first) statin today… and you demonstrate that it lowers cholesterol, that’s a demonstrable indication for which you would get exclusivity.

But if you come back a few years from now and demonstrate… that you’ve also reduced cardiovascular mortality or morbidity in a significant way, I think that’s not an unreasonable reason to get an extended exclusivity… I’m trying to incentivize the performance of the right studies.

Wouldn’t that also encourage pharmaceutical companies to do more post-marketing surveillance?

WOOD—It could be done in the same way… I think there’s a need for a liability protection for companies where they’re either conducting a mandated phase IV (post-marketing surveillance) study, which most of the time they don’t conduct, of course. But if they’re conducting a safety study, they should get liability protection for that…

There are going to be companies which might even disappear as household names because of just astronomic liability… The numbers are being thrown around of more than $100 billion in terms of the liability risk to Merck (over Vioxx), for example. That’s a lot of money.

PAUL—Let’s not forget that somebody’s got to pay for such product liability litigation—justified or not. Because of the tremendous incentives trial lawyers have in litigating such cases, I think the legal system is in need of tort reform. This is not to say that people don’t have the right to recover damages when they’ve been injured, but in this country right now, I believe this system is out of whack.

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