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Welch, Gowdy, Cummings Investigate Drug Company’s Bypass of U.S. Patent Laws

October 3, 2017
Press Release

Washington, DC—Today, Rep. Peter Welch (D-VT) joined House Oversight Committee Chairman Trey Gowdy (R-SC) and Rep. Elijah E. Cummings (D-MD) in sending a letter to the chief executive officer of Allergan demanding detailed information on the company’s unconventional transfer of its patents for the eye drug Restasis to the Saint Regis Mohawk tribe in order to maintain the company’s monopoly pricing power over the drug.

“The implications of Allergan’s patent transfer raise questions for Congress, as the exchange may impair competition across the pharmaceutical industry and ultimately dissuade companies from pursing less-costly generic alternatives to brand drugs,” Welch and his colleagues wrote.

Many have raised concerns that Allergan’s patent transfer may impede generic competition because Native American tribes may be immune from legal claims generic drug makers use to challenge patents and bring cheaper drugs to the market quicker.

When Restasis was approved by the Food and Drug Administration in 2003, the patent on one of its active ingredients was set to expire in 2014.  That same year, Allergan filed additional patents extending its protections to 2024.  As Allergan’s second-best selling drug, Restasis reportedly generated nearly $1.5 billion in revenues for the company last year.

Welch and his colleagues demanded Allergan provide the Committee with the following by October 16, 2017:

  • Agreements and communications between officials at Allergan and the Saint Regis Mohawk tribe, relating to the Restasis patents;
  • Analyses conducted in connection with agreements regarding the Restasis patents, including projections for market share;
  • Documents and communications concerning sales of Restasis through federal health care programs;
  • Documents presented to the Board of Directors concerning agreements regarding the Restasis patents; and
  • Documents and communications regarding considerations for similar arrangements for other Allergan products.

Welch is one of the leading advocates in the House for cutting the skyrocketing price of prescription drugs.  He has introduced legislation to require the federal government to use its bulk purchasing power to negotiate lower Medicare drug prices for seniors as well as legislation to allow the safe importation of prescription drugs from FDA-approved facilities in Canada. 

Welch is a senior member of the House Energy and Commerce Committee and the Committee on Oversight and Government Reform.