Congress passed the Food and Drug Administration Amendments Act of 2007 (“FDAAA”) to give the U.S. Food and Drug Administration (“FDA”) new authority to regulate the safety of marketed drugs. As part of this authority, FDA may require drug companies to propose and implement Risk Evaluation and Mitigation Strategy (“REMS”) for certain drugs whose risk- benefit profiles warrant safety measures beyond professional labeling. FDA may require REMS as part of the approval of a new drug or biologic (brand or generic), or for an approved product when new safety information arises. If FDA determines that a drug has been shown to be effective but is associated with an adverse drug experience, the FDA will require that the REMS have elements to assure safe use (“ETASU”). An example of an ETASU is that health care providers who prescribe the drug have particular training or experience or are specially certified.
The FDA, Federal Trade Commission, and generic drug manufacturers have raised concerns that branded drug manufacturers could be using REMS to impede generic competition. One concern is that branded companies may use REMS distribution restrictions to deny generic companies the drug samples they need to conduct necessary testing and otherwise meet the requirements for generic drug approval. Another concern is that branded drug firm may abuse situations where FDA approval of a generic drug is conditioned on the utilization of a single, shared ETASU by both the generic and branded companies. Essentially, the concern is that branded firms are impeding negotiations of a single, shared ETASU in order to delay generic entry.
To address these concerns, the Senate Judiciary Committee introduced Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act of 2016 on June 14, 2016. The bill—co- sponsored by Senators Grassley (R-IA), Klobuchar (D-MN), Leahy (D-VT), and Lee (R-UT)— permits a generic manufacturer to sue the branded manufacturer if: (1) the branded manufacturer fails to “provide sufficient quantities of [a drug sample] on commercially reasonable, market- based terms”; or (2) branded and generic manufacturers are unable to develop single, shared ETASU after 120 days of initiating a request to develop a shared ETASU. The relief contemplated in the bill is (1) a court order that the brand company provide the drug sample or the brand and generic develop single, shared ETASU or generic firm join a pre-existing ETASU; and (2) monetary award.