Illinois General Assembly - Full Text of SJR0048
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Full Text of SJR0048  95th General Assembly



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2     WHEREAS, With approximately $16 billion in biologic drug
3 patents set to expire next year, the average price of a
4 traditional drug is about $45, while the average cost of a
5 biologic can be about 4 times as much, and with Medicaid
6 accounting for about 19% of federal government drug
7 expenditures, the 110th United States Congress will be
8 considering legislation to authorize a regulatory pathway at
9 the federal Food and Drug Administration (FDA) for the approval
10 of therapeutically equivalent versions of biologic drugs; and
11     WHEREAS, Biologics are a major driver of increasing
12 prescription drug costs; for the first time, 5 of the 20
13 top-selling drugs in 2005 were made by biotech companies;
14 generic competition for biotech pharmaceuticals has the
15 potential to offer consumers dramatic and substantial savings,
16 while also lowering America's healthcare bill; and
17     WHEREAS, Illinois spends nearly $200 million for 61
18 biologics under its Medicaid pharmacy benefits and Part D wrap
19 around programs and an estimated 12% of its drug benefits on
20 biologics for State employees and retirees; and
21     WHEREAS, The science to create affordable generic biotech
22 drugs exists today; it is being done in other countries; raw



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1 materials are available today for many bio-generic products
2 including insulin, GCSF, epoetin, interferons, and others; in
3 many countries around the world, competitive biotech products
4 are already available to consumers; in these countries,
5 patients have access to safe biogenerics and receive
6 significant cost savings from competition provided by
7 biogenerics; and
8     WHEREAS, Significant investment is made by biotech drug
9 developers in intellectual property, and appropriate
10 intellectual property protection and the ability to recoup
11 their investment is needed; however, as has been proven under
12 the Drug Price Competition and Patent Restoration Act of 1984,
13 competition fuels innovation; timely generic competition will
14 ensure continued innovation in biotech drugs; it is critical to
15 preserve the incentives for innovation that drive the
16 development of new biologics, but it is now time to provide the
17 balance of competition to those drugs off-patent or so to lose
18 patent protection in order to keep this country's biotech
19 innovators strong and growing; and
20     WHEREAS, A Citizens Petition was submitted to the FDA in
21 August 2006 requesting that the FDA use its statutory and
22 regulatory authority to issue guidelines that will facilitate
23 the availability of more affordable, therapeutically
24 equivalent versions of insulin and human growth hormone (HGH);



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1 and
2     WHEREAS, American patients currently spend approximately
3 $1.5 billion on insulin products to treat diabetes and
4 approximately $433 million on HGH, which is used to treat a
5 variety of conditions, including growth deficiencies in
6 children and adults, chronic renal insufficiency, and AIDS
7 wasting syndrome; and
8     WHEREAS, The FDA has repeatedly and publicly indicated that
9 guidance on the approval process for insulin and HGH would be
10 forthcoming; this guidance would provide generic
11 pharmaceutical manufacturers with the criteria for
12 demonstrating equivalence of generic versions of insulin and
13 HGH; however, it appears that issuance of appropriate
14 regulatory requirements for these products has come to a
15 standstill resulting in our citizens and taxpayers to continue
16 to shoulder the burden for excessive costs because no generic
17 version of either of these products is available; insulin and
18 HGH have relatively simple biologic structures with a long
19 history of safe use and a wealth of data available about these
20 products; and
21     WHEREAS, While such guidance unnecessarily languishes in
22 the United States, the European Medicines Agency (EMEA) has
23 adopted final guidelines on quality, non-clinical and clinical



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1 issues regarding similar biological medicinal products in
2 December 2003 and a general regulatory guideline on such
3 products in September 2005; the EMEA also issued final
4 product-specific guidance documents on similar biologic
5 medicine products, including one for insulin, in February 2006;
6 and
7     WHEREAS, In 2004, national Medicaid expenditures for
8 insulin alone were approximately $500 million; insulin was
9 historically approved for sale in the United States under the
10 Federal Food Drug and Cosmetic Act; this fact should make it
11 eligible to generic competition under the Drug Price
12 Competition and Patent Restoration Act of 1984; diabetes is on
13 the rise, and, if current population and diagnosis rates
14 continue as projected, the number of people with diabetes could
15 reach 17.4 million by 2020 with attendant costs rising to an
16 estimated $192 billion; insulin is a relatively simple
17 biopharmaceutical product and many versions are no longer
18 patent protected; if the FDA were to issue guidance in a timely
19 manner, a lower cost generic form could rapidly begin
20 generating savings for patients; and
21     WHEREAS, On average, African-Americans are 2.4 times as
22 likely to have diabetes as Caucasians; the highest incidence of
23 diabetes in African-Americans occurs between 65 and 75 years of
24 age; African-American women are especially affected; when



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1 adjusted for age, African-American women are more likely to be
2 diagnosed with diabetes than non-Hispanic Caucasians,
3 African-American men, or Hispanics; African-Americans with
4 diabetes are more likely to experience complications of
5 diabetes; diabetic retinopathy, an eye disease, is 19% more
6 common in African-American men than Caucasian men; amputations
7 of lower extremities are also more common in African-Americans
8 with diabetes; and
9     WHEREAS, As of 2002, 2 million Hispanic adults age 20 years
10 and older and about 8.2% of the population have diabetes;
11 diabetes is more prevalent in older Hispanics with the highest
12 rates in Hispanics 65 and older; on average, Hispanics are 1.5
13 times as likely to have diabetes as Caucasians;
14 Mexican-Americans, the largest Hispanic subgroup, are more
15 than twice as likely to have diagnosed diabetes than
16 non-Hispanic Caucasians; in 2002, the death rate from diabetes
17 in Hispanics was 60% higher than the death rate of non-Hispanic
18 Caucasians; in 2001, Hispanics of all races experienced more
19 age-adjusted years of potential life lost before age 75 years
20 than non-Hispanic Caucasians for diabetes; and
21     WHEREAS, HGH is one of the most expensive prescription
22 regimes, costing a patient upwards of $30,000 a year; HGH has
23 annual sales in the United States that are estimated to be more
24 than $700 million; HGH costs are increasing as the number of



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1 growth deficiency-related cases continues to rise and as the
2 FDA approves new uses for HGH; as usage and the subsequent
3 expenses increase, Illinois is paying high prices for a drug
4 product that has not been patent protected since 2003; and
5     WHEREAS, The financial impact of the availability of
6 generic, substitutable versions of insulin, HGH, and other
7 biologics would be dramatic to the State and its citizens; for
8 example, if only one-third of patients using insulin were
9 converted to a generic and it was priced at a modest 10%
10 discount, payers would save $17 million annually; a discount of
11 30%, more typical of the generic market, with only one-third of
12 patients utilizing the generic, would result in savings of more
13 than $50 million annually; if all Medicaid patients were
14 converted to the generic, at a 30% discount to current brand
15 prices, the savings would exceed $150 million annually; and
16     WHEREAS, For more than 2 decades, generic pharmaceuticals
17 have offered our State with a mechanism to manage the high cost
18 of providing prescription drugs for State-funded and federally
19 mandated prescription drug programs; at the same time, generic
20 drugs have provided all of the citizens of Illinois with the
21 opportunity to lower their prescription drug costs; therefore,
22 be it



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2 CONCURRING HEREIN, that we urge the members of the 110th United
3 States Congress and the President of the United States to enact
4 legislation that establishes a regulatory pathway authorizing
5 the Secretary of Health and Human Services to approve
6 abbreviated applications for biological products that are
7 comparable to previously approved biological products; and be
8 it further
9     RESOLVED, That the FDA promptly issue guidance documents
10 outlining the specific approval requirements for forms of
11 insulin and HGH that are therapeutically equivalent to brand
12 products currently approved by the FDA; the issuance of these
13 guidance documents would open the door for significant savings
14 on these important therapies for consumers across our nation;
15 and be it further
16     RESOLVED, That the FDA also commit to working with drug
17 companies developing such products and to expediting the
18 application process so that these products may be approved and
19 made available to patients as quickly as possible; and be it
20 further
21     RESOLVED, That we strongly concur with those Governors who
22 filed the Citizens Petition or sent letters of support for the
23 Citizens Petition to the FDA on this issue; and be it further



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1     RESOLVED, That we and the Governor have a responsibility
2 for managing the costs that the State incurs for prescription
3 drugs in connection with our State Medicaid program, as well as
4 other State programs such as State employees and State retirees
5 that provide a drug benefit; we also are charged with ensuring
6 that high quality, affordable healthcare is available to all
7 citizens of our State; and be it further
8     RESOLVED, That suitable copies of this Resolution be
9 provided to the acting Commissioner of the FDA, the Speaker the
10 United States House of Representatives, the Minority Leader of
11 the United States House of Representatives, the Majority Leader
12 of the United States Senate, the Minority Leader of the United
13 States Senate, and each member of the Illinois congressional
14 delegation.