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Generics stifling pioneer drug development?

No way, say industry watchers and big pharma.

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Has the explosion in generic utilization curbed pioneer-drug research and development? That's one concern floated by some pharmaceutical industry watchers, who claim that the stunning market share gains made by generic drug makers could reduce incentives for branded drug companies to spend to develop new molecular entities, conduct lengthy clinical trials, gain FDA approval and bring those new drugs to market.

Not so, says IMS Health. "Some claim that Hatch-Waxman [the 1984 Drug Price Competition and Patent Term Restoration Act] has worked too well for the generic side, at the cost of harming the innovation of new or improved medicines," IMS noted in a 2012 report. "But the facts do not support that claim."

Citing a cautionary article in the journalHealth Affairsthat urged Congress to take another look at Hatch-Waxman and consider amending the law to "delay generic competition by increasing the market monopoly for branded drugs," IMS countered that pioneer-drug R&D has surged in the face of generic competition.

"Although generic utilization has reached new levels, more new medicines were launched in 2011 than in any other year of the past decade," IMS reported. "New medicines launched last year brought improved efficacy, safety and convenience for diseases affecting millions of patients battling chronic conditions; important breakthroughs for rare diseases transformed treatment options through personalized medicines based on genetic markers for subtypes of cancer and individually cultured immunotherapies."

"Each of these new treatments represents vast improvements in therapy that were spawned by competition to the older medicines," the report added. "By creating a fair balance between innovation of new medicines and accessibility to lower cost generic medicines, federal law has established a win-win for providers and American consumers."

The brand-name drug industry concurs. According to the trade group Pharmaceutical Research and Manufacturers of America, more than 5,000 medicines are under development, 70% of which are potentially the first of their class.

In a report released Jan. 17, PhRMA called the drug pipeline "innovative and robust," with 158 drugs under development for ovarian cancer, 19 for sickle cell disease and 41 for small-cell lung cancer.

"Biopharmaceutical companies, working with other partners in the American research ecosystem, have made incredible progress in helping confront some of the most challenging and costly diseases facing patients around the world," said PhRMA president and CEO John Castellani.

The report also noted that personalized medicines accounted for an increasing proportion of the pipeline, with the number of potential new medicines for rare diseases averaging 140 per year in the last 10 years.

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