Preserve Access to Generics and Biosimilars

Summary#

This bill, the Preserve Access to Affordable Generics and Biosimilars Act, would make it illegal for brand drug or biological product companies to give value to generic or biosimilar applicants in exchange for delaying the competitor’s market entry. It adds a new Section 27 to the Federal Trade Commission Act that treats such agreements as unfair methods of competition. The bill creates a legal presumption that an agreement is anticompetitive if a generic (ANDA) filer or a biosimilar application filer receives anything of value and agrees to limit or forgo research, manufacturing, marketing, or sales. Parties can rebut the presumption by showing the payment was for other services or that procompetitive benefits outweigh harms.

The bill lets the FTC bring civil actions in federal court, seek injunctions, and recover civil penalties. Penalties may be up to three times the value reasonably attributable to the violation, with courts considering factors like culpability and profits. The bill lists specific exclusions where consideration is allowed, including the right to market before patent or exclusivity expiration, reasonable litigation expenses (capped at $7,500,000 in 2025 and adjusted thereafter), and covenants not to sue. It also amends related statutes to require companies to file certifications about settlements, to include Patent Trial and Appeal Board proceedings in required notices, and ties violations to forfeiture of certain 180-day exclusivity rights. The FTC must report within one year on whether to add an exclusion for consideration that is a release or waiver of damages. The FTC must start enforcement within 6 years after required certification filings. The new rule applies to agreements entered on or after the date of enactment.

What it means for you#

• For brand-name drug and biological product companies: the bill makes certain payments or transfers of value to potential generic or biosimilar competitors unlawful when tied to an agreement to delay market entry. It also adds reporting and certification requirements for settlement agreements.
• For generic and biosimilar applicants: receiving value tied to an agreement to limit or delay commercialization could trigger enforcement and civil penalties; certain kinds of consideration (earlier marketing rights, limited litigation cost payments, covenants not to sue) are carved out.
• For patients and payers: the stated purpose is to protect timely competition from generics and biosimilars, but the bill text does not itself estimate effects on prices, access, or federal spending.
• For regulators and courts: the FTC gains explicit authority under the new section to treat these agreements as unfair methods of competition and to bring civil actions seeking penalties and injunctions.

Expenses#

No publicly available information on the bill’s overall budgetary costs or savings is provided in the bill text. The bill does specify civil penalties payable to the United States of up to three times the value reasonably attributable to a violation, and it sets a cap on permitted litigation expense payments (e.g., $7,500,000 for calendar year 2025, adjusted thereafter).

Proponents' View#

The bill’s findings and stated purposes say it would restore the original intent of statutes that encourage early competition from generics and biosimilars, stop "reverse payment" settlements that share monopoly profits to delay competition, protect consumers and health care payers, and support antitrust principles by prohibiting anticompetitive practices in the pharmaceutical industry.

Opponents' View#

No publicly available information on opponents’ views or objections is included in the bill text or provided metadata.