I found this letter to the editor in the Washington Times this morning. The entire letter is so important that I have copied it to the blog.

A chill pill for drug industry advocates

Nonsense. That is the best description of the opinions expressed by Peter Ferrara in "Poor prescription for health prospects" (Commentary, Thursday).

He states that members of Business for Affordable Medicines (BAM), working to close loopholes in the federal law that governs pharmaceutical competition, are "charlatans" seeking to "posture themselves on a high moral pedestal as champions of the poor, the sick, and the needy ."

The 1984 Hatch-Waxman Act was passed to protect patented drugs from competition by lower cost generic alternatives and to ensure robust generic competition as soon as possible after the patents expire. The result was a careful balance that ensured brand drug companies would invest in new drug research and that consumers could eventually get access to new cures at lower prices. Today, the brand drug industry has perfected a scheme to prevent generic competition well after the patents on their drugs expire.

Mr. Ferrara states that our advocacy of legislation to restore the balance intended by the Hatch-Waxman Act constitutes an "assault" on intellectual property and the patent system. He also claims drug companies will simply stop investing in research if their ability to market drugs without competition is affected in any way.

In fact, the Senate-passed bill does not change patent protections at all. Drug patents will still remain in effect for 20 years under the bill, an element demanded by our coalition members such as Kodak and Motorola, who are among the nation's largest patent holders. No BAM member will support any effort to undermine strong patent protections.

In addition, it is competition — not the lack of it — that drives pharmaceutical innovation. Drug industry spending for research has increased dramatically since 1984 as a result of, not despite, increasing generic competition.

Mr. Ferrara freely uses drug industry propaganda to conclude that "cures will dry up" if our efforts to bring free-market principles back into the equation are successful. He claims the average new drug costs $800 million to produce, without pointing out that only the drug industry uses this figure with a straight face. The data to support it is based entirely on internal surveys that have never been shared with outside auditors. He also fails to point out that, despite this, the brand pharmaceutical industry is more profitable than any other industry in the world, according to Forbes magazine.

The Federal Trade Commission reported last month that the industry has perfected schemes to "game" the system, and encouraged Congress to act now. The Congressional Budget Office has determined that bills to close loopholes in the Hatch-Waxman Act will save purchasers — including taxpayers — $6 billion annually.

Mr. Ferrara also implies that increased use of generic drugs "are a threat to the public health." He fails to assure the public that the FDA requires all generics to be bioequivalent to the brands they replace and to provide the same levels of safety and efficacy.

By passing Hatch-Waxman reform legislation, Congress has an opportunity to provide significant prescription drug cost relief to voters this year — and without costing taxpayers a dime. Despite drug industry claims, restoring competition to the pharmaceutical industry is the best prescription for the health of Americans and the industry.

WILLIAM JANKLOW
Governor
South Dakota
Pierre, S.D.

This well written letter defines the battle. With some researching, I found BAM's home page - Business for Affordable Medicine includes the nation's leading employers, organized labor, and governors. BAM was established to improve employee access to affordable health care through reform of the federal Hatch-Waxman Act.