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Mar 17, 2017 10:57 AM IST | Source: Moneycontrol.com

Why Scott Gottlieb, the new US FDA chief, could be good news for Indian drug makers

The US FDA appointment is closely watched by Indian pharmaceutical industry which supplies 40 percent of the generic medications consumed in the US. The generic or copycat drugs account for more than 8 in 10 prescriptions. India has 572 US FDA compliant plants -- the highest outside US.

ByViswanath Pilla
Why Scott Gottlieb, the new US FDA chief, could be good news for Indian drug makers

US President Donald Trump on Saturday hand-picked Scott Gottlieb to lead US Food and Drug Administration (US FDA) – the regulatory agency that approves every food and drug products marketed in America.

The appointment is still to be confirmed by the US Senate.

Gottlieb, 44, served in several senior positions at the US FDA during the George W Bush administration. He was trained as a physician and is known as a conservative health policy expert with deep ties to the pharmaceutical industry.

Gottlieb is also a partner at New Enterprise Associates, a large US-based venture capital firm. The firm’s investments include life-sciences companies. In addition to his service on several pharmaceutical companies’ boards, Gottlieb is a consultant for London-based pharmaceutical giant GlaxoSmithKline.

Gottlieb's proposed appointment as US FDA commissioner assumes significance given the Trump’s promise of reducing regulation at US FDA as one of his key priorities to make drugs affordable and accessible.

In a February 28 speech to Congress, Trump’s promised to "slash the restraints" on drug approval, complaining about the “slow and burdensome approval process” at the FDA.

The US FDA appointment is closely watched by Indian pharmaceutical industry which supplies 40 percent of the generic medications consumed in the US. The generic or copycat drugs account for more than 8 in 10 prescriptions. India has 572 US FDA compliant plants -- the highest outside US.

India exported drugs worth USD 11.6 billion in 2014-15. Of this, exports to the US alone were USD 3.8 billion, or a third of total exports.

Gottlieb statements on speeding up approvals for older generics should sound as music for India drug makers.

In an opinion piece titled ‘How Obama’s FDA Keeps Generic Drugs Off the Market’ on the Wall Street Journal in August last year Gottlieb opined that the biggest factors fueling the angst over drug prices in the US is that some older medicines that should sell cheaply as generics are still priced very high, often owing to a dwindling number of generic competitors and the rising costs of producing these drugs.

He further went on to say that a flurry of new regulations is raising production costs and reducing competition for branded drugs.

Gottlieb also contends that the complexity and costs of completing a generic-drug application has also grown enormously resulting in higher entry barriers for generic companies.

Gottlieb scorned US FDA proposal to require companies to have production lines dedicated to one or two drugs, citing potential safety hazards.
“The safety concerns could be addressed through better quality controls and improving its inspection capabilities,” he added.

Typically, generic-drug makers manufacture dozens of different drugs on each production line and hundreds of drugs in a single plant to save costs. While brand companies typically run only one or two products on each manufacturing line.

He was also critical on new FDA draft regulation that seeks generic makers to update their warning labels on safety of drugs.

In a March 6 speech at a conference in Orlando, Florida, Gottlieb talked about overhauling the rules for complex generic drugs with which brand-name companies have been able to create “monopolies in perpetuity.” He also discussed the need to inject competition in situations where decades-old drugs are provided by one generic supplier, allowing speculators to buy the drug and jack up the price.

In his past stint at FDA, Gottlieb served as Deputy Commissioner for medical and scientific affairs and helped coordinate with the White House and the Department of Health and Human Services. Part of his work included facilitating talks that led to a system in which generic drug manufacturers pay a fee to help accelerate the review of their products, similar to one in place for brand-name drugs.

The Indian Pharmaceutical Alliance (IPA) declined to comment on the new US FDA chief.

“His statements seem encouraging for generic drug makers,” said an executive of pharmaceutical on condition of anonymity.

“We need to see how his policies will pan-out in the coming days,” said the executive.
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