The Senate handed a defeat to supporters of lower-priced generic drugs, approving a measure that would require a long legal process before the new generic drugs can be put on the market.
The House has taken no action on similar legislation. Inaction by Congress means the drug developers can, for now, continue to sell their products without generic competition.The Senate's 53-45 vote Thursday spelled defeat for supporters of the generic companies, who wanted to give government regulators authority to immediately allow the lower-priced alternative drugs to be sold.
Instead, the Senate said a multi-billion-dollar dispute between brand-name manufacturers and their generic competitors should be resolved through the courts, a process that could take seven months or more, allowing the brand-name companies to avoid competition during that period.
The biggest beneficiary of the vote was Glaxo-Wellcome Inc., a British company with offices in Research Triangle Park, N.C., which makes the world's top-selling drug, the ulcer medication Zantac. Last year, $2 billion worth of Zantac was sold in the United States alone.
The measure approved Thursday by the Senate would require that before a generic drug could go on the market, courts must first decide that the manufacturer had made substantial investments in the product and would pay an adequate royalty to the original developer of the drug.
The provision was an amendment to a defense spending bill.
The dispute stems from the 1994 law that implemented the General Agreement on Tariffs and Trade, or GATT, a world-trade treaty. The law extended drug patents from 17 years to 20 years.
Sen. Orrin Hatch, R-Utah, who led the battle to protect the brand-name drug firms, said the judicial review process would protect the world trade treaty and said the brand-name companies were purposely protected.
"This was not an oversight," he said.