WASHINGTON —After nearly a decade at the helm, Generic Pharmaceutical Association president and CEO Kathleen Jaeger will leave the organization at the end of June, the industry group said May 4.
Jaeger joined the organization in 2002, shortly after its 2001 formation from three groups: the Generic Pharmaceutical Industry Association, the National Association of Pharmaceutical Manufacturers and the National Pharmaceutical Alliance.
“I think it was just a recognition from her perspective that it was time for a change,” GPhA chairman and Watson Pharmaceuticals president and CEO Paul Bisaro told Drug Store News. “Kathleen has taken us a very long way, and hopefully we can find someone who can take us further.”
Since 2002, she became a leading voice for the generic drug industry and a strong advocate on behalf of it on issues ranging from biosimilars to patent settlements. Meanwhile, the industry she represented has grown enormously, accounting for nearly three-quarters of all drugs dispensed in U.S. pharmacies, while accounting for 16% of the money spent on prescription drugs and, according to the organization, saving American consumers more than $734 billion over the last decade. Generics companies have gone from being small players to major forces in the drug industry as a whole, with many of them branching out into branded drugs as well.
“It has been a distinct honor to represent GPhA these past eight years and help build a strong, vibrant trade association,” Jaeger said. “I am extremely proud of the work that the GPhA has accomplished. Our industry has achieved many victories that have greatly contributed to improving the lives of countless Americans. And today, despite David and Goliath comparisons, the GPhA team has tremendously enhanced the visibility and influence of the trade association, and we’ve been successful at getting a seat at the table in critical industry debates.”
Lately, however, the generics industry has experienced several setbacks, suffering its biggest defeat with the passage of the healthcare-reform bill. The GPhA had long pushed for an abbreviated approval pathway for follow-on biologics, whereby biotech drugs would be subject to the same degree of competition as pharmaceutical drugs, with new drugs getting five years of data exclusivity before the Food and Drug Administration could approve a follow-on version, also known as a biosimilar or biogeneric. But members of Congress sided with the biotechnology industry and gave biotech drugs 12 years of exclusivity. That’s bad news for many generics companies. With fewer big blockbuster branded drugs coming off patent over the next 10 years, the market for them will become increasingly commoditized, leaving many generics companies accustomed to huge profits scrambling for a dwindling supply of top sellers. Just as many branded drug companies are trying to ward off the effects of the “patent cliff” by transitioning to high-cost specialty and biotech drugs, biosimilars also offer generics companies an alternative source of revenue, but the longer data-exclusivity period is certain to slow down the rate at which biosimilars get approved, especially considering that developing them is a lot more expensive than developing generic pharmaceuticals.
Legislative challenges to patent settlements are another looming issue for the industry. Brand and generic drug companies alike narrowly dodged a hit when an amendment banning the settlements was removed from the healthcare bill. When a generic drug company wants to launch a drug before the branded counterpart’s patent has expired, it can file an approval application with the Food and Drug Administration containing a Paragraph IV certification, a legal assertion that the patent is invalid, unenforceable or won’t be infringed. The branded drug company will file a patent litigation suit in response, but the two companies will often reach a settlement that allows the generics company to launch ahead of patent expiration—on the condition that it waits a while before launching—in exchange for the branded drug company paying the generic company or agreeing not to launch an “authorized generic,” which essentially is the branded drug marketed under its generic name at a slight discount. Critics deride the settlements as “pay-for-delay” deals, and Sen. Herb Kohl, DWis., has vowed to continue seeking a ban on them.
The third blow to the group came in April, when Teva Pharmaceutical Industries announced it would leave the organization, saying it was no longer capable of reflecting the company’s interests. Teva, based in Israel, has grown into the world’s largest generic drug company and is the only generics-focused company on IMS Health’s list of the top 15 drug makers worldwide, ranking above Boehringer Ingelheim, Amgen, Takeda and Bayer.
The organization would not disclose Jaeger’s future plans and has yet to hire a replacement for her, though Bisaro said it would begin looking for one soon.