Drug Firm's Monopoly Threatened by Rival Legislature: DuPont Merck is
backing a bill that would hamper a competitor's efforts to market a
generic substitute of bloodthinning medication.
By CARL INGRAM, Times Staff Writer

SACRAMENTOTwo large drug companies are waging a legislative war at the
Capitol over whether one gets to keep a 40yearold brand name monopoly
or must share the lucrative California market with the rival maker of a
new generic substitute.
At stake are millions of dollars in sales a year and the health of
thousands of patients suffering from heart, respiratory, neurological
and other serious diseases.
Each side has lined up powerful supporters, ranging from
doctors and patient advocates to HMOs and chain drug stores, and
has hired some of the most expensive lobbyists in town.
At issue is a commonly prescribed bloodthinning medication for
heart patients known as Coumadin. It has been manufactured
exclusively for 40 years by DuPont Merck Pharmaceutical Inc. of
Wilmington, Del.
But now Barr Laboratories Inc. of New York, maker of a
cheaper generic substitute medication newly approved by the
federal Food and Drug Administration, wants to break into the
Coumadin market.
Barr is among the top 10 independent manufacturers of generic
medicines, reporting $232 million in net sales last year. DuPont
Merck is larger but is privately held and does not report its sales.
Generic equivalents sell anywhere from 20% to 70% less than
brand name medications, depending on market conditions. Some
estimates have put national sales of Coumadin at $400 million to
$500 million a year, of which California's share is estimated at $40
million to $50 million.
Last year, MediCal, the taxpayerfinanced health care program
for the poor, spent $6.1 million for Coumadin, officials said. In
March, for example, MediCal paid for 15,000 prescriptions of
Coumadin.
DuPont Merck, which claims that patients' health and welfare
would be put at risk if Barr gains entry without additional
safeguards, is sponsoring a bill by Sen. Hilda Solis (DEl Monte)
that would impose what Barr calls steep barriers to its substitute
medication, called warfarin sodium.
Amid conflicting testimony, the Solis bill was heard last month by
the Senate Health and Human Services Committee, but was not put
to a vote.
A second hearing is scheduled for Wednesday. Solis and
DuPont Merck's chief lobbyist in Sacramento, John R. Valencia,
said amendments will be offered in an attempt to reach a
compromise.
For state lawmakers the choice is difficult: Vote for DuPont
Merck's bill and virtually assure its continued monopoly or vote
against it and face criticism that they have potentially jeopardized
the health of thousands of Californians with serious heart problems.
The bill (SB 1181) would prohibit a pharmacist from dispensing
any generic or substitute drug for Coumadin and certain other
medications unless the prescribing physician and the patient consent
to the switch. Druggists now can routinely substitute generic
medications unless the physician instructs otherwise.
The bill also would create a screening system for about 24
"narrow therapeutic index" drugs, including Coumadin, and their
FDAapproved generic substitutes. The standards would be stricter
than, and in addition to, the national standards already applied by
the FDA.
The FDA so far has approved generic substitutes for 16 "narrow
therapeutic index" medications.
Narrow therapeutic index medicines are used for treating severe
problems such as heart attack, depression, epilepsy, stroke and
asthma.
Margins of tolerance to them are so narrow, there can be wide
differences even when nearly the same dosage is prescribed. A
dose that is too small can be useless and one too big can be
dangerous, or in extreme cases, fatal.
"It's all about money," Barr chief executive officer Bruce
Downey said of DuPont Merck's opposition to his company's
generic substitute. "Their arguments are just manufactured to save
the monopoly position of DuPont Merck."
Not so, contend Solis and other supporters, including the
California affiliates of the American Heart Assn., American Lung
Assn., American College of Cardiologists and the United Cerebral
Palsy Assns.
Solis concedes that her legislation "could be misconstrued that I
was carrying some kind of special interest bill." But she said her
chief concern is safeguarding patient safety in the era of costcutting
by insurance and managed health organizations.
Solis said she fears that patients will be jeopardized by cutrate
generic substitutes dispensed without physician and patient
approval.
"If, in fact, you do that, you could be risking the lives of children
and the elderly," Solis said. "Did the patient ultimately have some
protection and safety? That is my primary goal here."
But Charles Mayr, a Barr spokesman, said challenges to generic
products are without scientific foundation. "There may be anecdotal
evidence, but where's the clinical evidence that shows these
[generic] drugs are not working?" he asked.
Solis counters that various medical studies support her concern
for patient safety.
The Wilson administration opposes the bill on several grounds,
including the belief that it is unnecessary.
"Current law allows for physicians and pharmacists to make a
decision that a generic drug should not be substituted if they believe
that another drug is more appropriate and medically necessary,"
said Ken August, spokesman for the state Department of Health
Services.
Downey, of Barr Laboratories, said the California bill is part of a
multistate legislative campaign by DuPont Merck to deny the
generic version a chance to compete with Coumadin.
Downey said the big push is occurring in Sacramento.
"California is the key state because of the size of its market," he
said.
Barr is supported by the powerful HMO industry, including
Kaiser in California, and chain drugstores.
Economic turf wars are relatively common in the Legislature, but
this one involves some extraordinary firepower.
Both sides armed themselves with sophisticated public relations
companies and some of the capital's bestconnected lobbyists:
Dennis Carpenter, Kathleen Snodgrass and Marjorie Schwartz for
Barr; and Valencia, Don Brown and Mark Watts for DuPont
Merck.
As part of its multistate campaign, DuPont Merck in January
gave $75,000 as a "seed" grant to finance the newly created "Health
Alliance for Narrow Therapeutic Index Patient Safety." The group
describes itself as a national coalition of "medical, consumer and
patient advocacy organizations."
"We philosophically and financially support them," said Scott
Nelson, a DuPont Merck vice president, of the alliance. He said the
company also financially backs other nonprofit health interest
groups that support legislation such as Solis' measure.
Nelson insisted that his company's support of such organizations
had no connection to the Solis bill in California or legislative efforts
in other states.
"The legislation that we are supporting [is] in the best interests of
patient safety," Nelson said. "With a high degree of certainty, I can
say if we made financial contributions in the past [to alliance
members], it is unrelated to this issue."
DuPont Merck has been a modestabout $4,000contributor
to legislative candidates of both parties in California in the past
couple of years. Barr officials said they have made no donations to
state legislators in California, but have given approximately $5,000
to candidates in other states.
A Capitol staffer involved in the issue said some lawmakers are
"uncomfortable" with the conflicting interests in Solis' bill.
"One of the confusing aspects is that it is presented as a bill
which is intended to protect people," the staffer said. "But the
alternative explanation is that what we have here is two
pharmaceuticals fighting for market share. The members just are not
sure."

Copyright Los Angeles Times