Association for Accessible Medicines launches lawsuit

Following the introduction of a law targeting generic drug makers in Maryland, the Association for Accessible Medicines has taken subsequent action. As a trade group for producers of generic pharma products, the Association for Accessible Medicines represents generic drug producers and aims to prevent the law from being imposed.

Intended to allow the Attorney General to take legal action against drug companies who charge ‘unconscionable prices’ for their products, the new law has faced criticism from a number of circles. While supporters of the law claim that consumers will now be able to afford access to life-saving drugs, many critics have declared the law unconstitutional and unnecessarily complex. Due to take effect in October, the law is only intended to apply to generic pharma companies who manufacture a product which at least three other companies make. Branded medications protected by patent laws will not, therefore, be affected by the incoming law.

Is the law targeting the wrong firms?
Although many people are keen for medications in the US to be cheaper and more accessible, targeting companies which are already facing competition from at least three other firms seem counter-effective. It is arguable that the firms targeted by the new law already adjust their prices of generic drugs in light of competitors in the market. Critics may argue that the companies unaffected by the law, such as patent holders, will continue to charge excessively high prices, without pressure from competitors to reduce retail prices.

What are unconscionable prices?
While the nature and aims of the law have been subjected to harsh criticism, so too has the wording of the legislation. Preventing generic drug producers from charging ‘unconscionable’ prices, without defining what ‘unconscionable’ means, puts companies in a precarious position. The uncertainty surrounding the term renders generic pharma law unclear and companies could face fines, despite not receiving guidance regarding acceptable pricing terms.

Although the new law is not due to be enforced until October, it is likely to face on-going challenges from generic pharma attorneys and general pharma law firms. For many, the alleged unconstitutional nature of the proposed law requires it to be abolished completely. For others, however, amending the law and removing the existing uncertainty will suffice.

While the drug industry as a whole must be tightly regulated, it appears that this latest attempt to restrict generic drug manufacturers will be ineffective in terms of increasing drug accessibility to consumers. With harsh criticism already leveled at lawmakers, it remains to be seen whether the legal challenge from the Association for Accessible Medicines will be successful.

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