Advocacy for Fair Drug Pricing | AAM
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Millions of Americans rely on the Association for Accessible Medicines (AAM) to ensure they have access to the medicines they need. AAM in turn has identified the issues that stand in the way of access to these medicines and, by working with state and federal lawmakers, the FDA, and other stakeholders, we advocate for finding solutions to these issues.

By increasing our share of voice in today’s healthcare narrative, and advocating for issues that can create incentives for market-driven behaviors, millions of Americans will not only experience savings at the pharmacy counter, but live healthier and more productive lives. The key priority issues are:

  • Expediting the availability of safe, high quality, and low cost generic drugs and biosimilars
  • Increasing competition in the drug market place to lower drug prices
  • Preventing abuse of prescription medicines
  • Protecting low-income subsidies for Medicare patients
  • Ensuring safe disposal of unused medicines

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Priority Issues


REMS/Sample Acquisition Remedies

Patient safety is a top priority of the AAM and its Biosimilars Council. For this reason, our members strongly support current FDA-mandated Risk Evaluation and Mitigation Strategies (REMS). These patient safety programs are designed to serve a clear public health purpose – that of ensuring that the benefits of a drug outweigh its safety risks.

Congress, FDA and others have repeatedly raised concerns that these programs are not being used as intended. Certain brand drug companies continue to exploit regulatory loopholes in REMS programs, blocking patient access and delaying market entry of generics and biosimilars to preserve their market share for as long as possible.

Key Points

  • REMS components can include specific safety instructions for healthcare professionals and distributors prior to prescribing, shipping, or dispensing a drug.
  • Certain brand drug companies have been denying manufacturers of generic drugs or biosimilars access to the product samples they need to conduct bioequivalence studies necessary to gain FDA approval and pursue market entry. Even in cases where FDA certifies that a generic company can safely handle a drug for clinical use, brand companies are refusing to sell them their drug.
  • Some brand drug companies are using tactics that grew out of REMS Elements to Assure Safe Use (ETASU) requirements to delay generic competition for REMS and non-REMS products.
  • The abuses are growing. FDA requires REMS programs for up to 40 percent of new drug approvals. And, as the biosimilar market begins to develop, the inability of biosimilar manufacturers to obtain samples of brand biologics for early development testing purposes will also delay access.
  • Misuse of REMS costs patients, payors, government programs and the entire health care system more than $6 billion dollars annually.
AAM Efforts:

AAM and the Biosimilars Council are working to strengthen REMS programs to ensure that they are properly used to protect patients and cannot be used to promote anti-competitive business practices that drive up costs and impede patient access to affordable medicines.

Stop REMS Abuse 


Price and Practice Transparency

AAM and its member organizations work hand-in-hand with Congress and the FDA to ensure that there is transparency for both consumers and regulators regarding pricing in the pharmaceutical industry. There is no reason that hidden costs should drive up costs for consumers and the AAM routinely educates policymakers and regulators on the benefits of increased industry transparency.

In addition to increased transparency lending itself to decreased consumer costs, producers are also able to benefit from the increased stability and regulatory predictability of a more transparent production environment.  However, the generic marketplace with a constantly fluctuating marketplace demands a different approach from brand-name drugs.

Key Points:

  • Generics are different – with different economics, market dynamics and regulatory environments. One-size-all approaches do no work for both brand and generic drugs.   
  • CPI based rebate penalty threaten generic market and patient access.
  • By failing to put sensational reports about high percentage price changes in the context of overall small dollar changes in the price of some generic drugs, many media stories misleadingly suggest to the public that percentage increase in generic drugs is a major concern in health care spending, when the generic marketplace is overall deflationary generic market. 
  • New regulatory and disclosure proposals around transparency cannot undermines generic competition or create a barrier to patient access by driving prices up.

For example, a 10% price increase on a $1,000 drug may sound reasonable, but the $100 increased cost is enormous on its own relative to the cost of most generics.  Conversely, a 10% price increase on any generic would usually be insignificant.  Thus, the importance of making an “apples to apples” comparison is critical to any legislation that considers a percentage threshold.



IP Issues and Patent Reform

AAM supports true innovation and competition, that leads to healthier patients and lower drug costs for patients. Many brand-name drug companies have manipulated our patent system in an effort to stifle competition and maintain their monopoly power. Patent abuse and extension of regulatory monopolies not only keeps drug prices high, they also slow innovation and prevent timely access to better, affordable medicines that save and enhance patients’ lives. AAM opposes these activities and consistently advocates for patent reform that lends itself to the timely patient access to safe, more-affordable and innovative new medicines. Preventing patent abuse is a market-based, pro-competitive strategy for solving the problem of stifling prescription drug prices.

One of the key tools to combat these abuses of the patent system is through the Inter Partes Review (IPR) process within the U.S. Patent and Trade Office (PTO), which allows the PTO to take a “second look” at its earlier decision to grant a patent. The IPR process is an efficient system that ensures poor-quality patents are weeded out through administrative review rather than costly litigation. AAM supports efforts to preserve this highly effective tool.

Given the widespread abuse of the patent system by some brand-name pharmaceutical companies, generic and biosimilar companies must sometimes settle patent litigation with brand- name companies in order to avoid protracted and costly litigation and to obtain a date certain for the start of price competition. Thus, AAM opposes restrictions on out of court settlements in drug patent litigation.

Key Points:

  • IPR is an important tool that Congress enacted as a bi-partisan solution to allow the PTO to eliminate bad patents efficiently. There are many advantages to allowing the PTO to police its own patent-granting decisions: PTO reexamination of granted patents is cheaper, faster and benefits from the greater technical expertise PTO holds to review patents than generalist judges. When IPR eliminates a bad patent, it cancels a government-granted monopoly and allows competition to lower prices. IPR is a thorn in the side of patent-system abusers, because IPR makes it easier to get rid of the bad patents they rely on to drive up drug prices.
  • Brand-name drug companies often attempt to bury competition from generic and biosimilar drugs indefinitely by finding ways to re-package existing inventions in later patents. These later patents are often not innovative, meaning they are likely invalid. Sometimes, as the original patent on a lucrative drug is close to expiring, the brand-name drug company will seek a new patent for something as meaningless as changing from a pill to a gelcap and call this a new innovation worthy of a new, multi-year monopoly from the government.
  • Restricting drug patent settlements is not the answer to assuring that consumers are guaranteed the earliest possible access to safe and affordable generic medicines. Changes to current law would unfairly prevent drug companies from settling legitimate patent disputes and would be harming consumers and patients.
  • Restricting the right of parties to settle litigation would have the unintended consequence of reducing the number of patent challenges brought by generic companies. This would work contrary to federal law that incentivizes generic companies to contest weak or potentially unenforceable patents and provide consumers access to lower-cost generic drugs as soon as possible.
AAM Efforts:

AAM has worked to eliminate barriers to generic and biosimilar drug competition caused by abuse of the patent system by branded drug and biologics manufacturers, while simultaneously ensuring that no harm to innovation occurs. To achieve these goals, AAM:

  • Supports inter partes review (IPR) within the U.S. Patent and Trademark Office (PTO); AAM filed amicus briefs in support of IPR constitutionality (for example, in the Oil States case);
  • Opposes loopholes that would allow brand companies to evade IPR review (for example, through rental of sovereign immunity) by supporting legislation to allow IPR review even if patent transferred to tribe or other sovereigns, see Restasis amicus brief
  • Supports efforts to ensure the patent system is used only to protect true innovation.

Stop Patent Abuse




The Generic Drug User Fee Act (GDUFA) is a historic FDA program that aims to promote safety, access, and transparency in the generic pharmaceutical industry.

More specifically, the program holds all foreign and domestic companies to consistently high-quality standards, speeds the availability of low cost, high quality generic drugs through more predictable review processes for ANDAs, and increases transparency between manufacturers and the FDA by requiring the identification and registration of all facilities involved in the manufacturing of generics and their active ingredients.

AAM and its members share and fully support GDUFA objectives with 100 percent industry generated funds and will continue to work with the FDA and the generics industry to provide timely access to safe, more affordable generic medicines.



Low Income Subsidies (LIS in Part D)

AAM member companies play a significant role in providing prescription medicines to the nearly 60 million Americans receiving Medicaid benefits and, at the current time, approximately 65% of all drugs dispensed through the Medicaid program are generic. On average, this ends up costing taxpayers 60% less per prescription than the corresponding brand and saving the Medicaid program and taxpayers tens of billions of dollars each year.

Key Points:

  • States can save hundreds of millions of dollars each year through the use of generic medicines in their Medicaid programs. For example, Texas saved more than $223 million simply by changing its prescription pads, making it easier for doctors to prescribe generics
  • Even with federal support, states report they are struggling to meet their share of expanding Medicaid costs. On average, Medicaid consumes about 20% of a state's budget. However, some states are spending as much as 31% percent of their annual budgets on Medicaid.
  • Nationally, Medicaid covers 74 million low-income Americans, including families, people with severe disabilities, and low-income Medicare beneficiaries, known as "dual eligibles." Total Medicaid spending on health care services and prescription drugs totaled approximately $545.1 billion in 2015.
AAM Efforts:

The Association works with federal and state level governments to promote best practices aimed at increasing the use of generic medicines and saving taxpayer money. These efforts include rapid responses to anti-substitution stories, advocating for specific generic substitution laws, and general education.

Repeal Medicaid Generics Penalty



Pharmaceutical Waste Take Back

Prescription medications are critical to the health and quality of life for millions of Americans. Unfortunately, not all unused prescription drugs are properly disposed of. AAM recognizes this and supports the safe disposal of unused drugs, taking steps to mitigate this societal and environmental challenge.

Reports of the presence of pharmaceutical compounds in the environment understandably have sparked public concern and have prompted some authorities to consider various “pharmaceutical waste” initiatives.

In support, the AAM urges legislators and policymakers to join industry in promoting robust public education campaigns to teach consumers the importance of properly discarding unused medicines.

Key Points:

  • Protecting water supplies against contamination from household chemicals and other dangerous wastes is not a new issue. The history of legislation dealing with naturally-occurring and man-made contaminants in drinking water in the U.S. begins with the 1899 Rivers and Harbors Act and continues through the 1974 Safe Drinking Water Act.
  • Recently developed hi-tech equipment has made it possible to detect trace amounts of consumer household chemicals, including pharmaceutical molecules, in surface waters at trace levels of nanograms per liter (ng/l), i.e., parts-per-trillion (ppt). One part-per-trillion is comparable to one penny out of 10 billion dollars, or one second in 32,000 years. It is only because of this advanced technology that any amount of pharmaceutical material can even be detected in water supplies
  • To date, there is no scientific evidence, analytical data or published peer reviewed reports showing that the extremely low concentrations of pharmaceutical materials in water poses any risks to humans. A study of human health risks for 26 pharmaceuticals found in U.S. waters, which was conducted using U.S. EPA standard worst-case exposure methods, concluded that those detectable pharmaceutical residues under worst-case scenarios presented no demonstrable risk to human health.
AAM Efforts:

AAM participates in a coalition of industry, scientific experts and academia – as well as U.S. Fish and Wildlife Service, the American Pharmacists Association, and others – all committed to working with policymakers to openly address concerns and help provide factual answers to questions around the proper disposal of pharmaceuticals.

Additionally, AAM and its members support efforts to raise awareness through consumer education programs and public awareness campaigns, conduct scientific research into potential long-term risks of trace concentrations of pharmaceuticals, and support the U.S. Drug Enforcement Agency’s (DEA) annual National Prescription Drug Take-Back Day.

Association for Accessible Medicines


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