Walmart and Rite Aid Corp. have joined with nearly two dozen organizations in the health care supply chain to urge the Food and Drug Administration to re-examine its proposed rule on pharmaceutical labeling.

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Walmart, Rite Aid join effort questioning FDA's proposed rule on drug labeling

March 13th, 2014

WASHINGTON – Walmart and Rite Aid Corp. have joined with nearly two dozen organizations in the health care supply chain to urge the Food and Drug Administration to re-examine its proposed rule on pharmaceutical labeling.

The Generic Pharmaceutical Association (GPhA) said Walmart and Rite Aid added their names to a letter signed by 22 health industry organizations that was sent on Wednesday to the FDA.

The signatories — which also include drug chains Walgreen Co. and CVS Caremark Corp., as well as the National Association of Chain Drug Stores — call on the FDA to "fully explore the potential unintended consequences that the rule may have on patient access and national health care costs. Permitting labeling changes for generic drugs without FDA approval counters 30 years of law requiring generic and brand medicines to have the same labels."

Released in November, the FDA's proposed rule, titled "Supplemental Applications Proposing Labeling Changes for Approved Drugs and Biological Products," would allow generic drug manufacturers to make changes to their products' labels, which they currently aren't permitted to do unless the manufacturer of the reference listed drug (RLD) first changes its label.

Critics of the proposed rule, including lawmakers and policy experts, have questioned its legality, cost and impact on patient safety. They claim the rule would boost the exposure of generic drug makers to product liability lawsuits, which in turn would hike national health care spending because the increased liability would hoist generics prices. That also could impact patient access to generics, which account for 84% of all prescriptions.

GPhA noted that Walmart and Rite Aid are the latest stakeholders to question the proposed rule.

"Walmart was a pioneer in promoting safe, affordable generic medicines for consumers and their families through its ground-breaking $4 generics program and continues to be a leader in ensuring access to life-saving medicines," GPhA president and chief executive officer Ralph Neas said in a statement. "Today they lend their voice to a chorus of health care companies concerned that the proposed rule creates a regulatory framework whereby multiple, different labeling, including different warnings, can simultaneously exist in the marketplace for multiple generic versions of a drug. This would cause dangerous confusion, increase costs and reduce availability of generic medicines for patients who need them most.”

Addressed to FDA commissioner Margaret Hamburg, the letter cited a study by Matrix Global Advisors showing that generic drug spending would climb by $4 billion a year, or 5.4% of generic retail prescription drug spending in 2012, if the proposed labeling rule is implemented. And of that total, government health programs would pay $1.5 billion, and private health insurance would pay $2.5 billion, according to the study.

"As drafted, this rule would burden consumers, taxpayers, large and small businesses, and state and federal governments with billions of dollars in increased costs for generic medicines," the March 12 letter to Hamburg stated. "The proposed rule also may expose pharmacists, physicians, generic drug manufacturers and others in the health care system to substantial new tort liability costs. These, in turn, would require generic manufacturers to adjust prices to stay in business, withdraw products or decline to launch new, affordable versions of brand medicines. This would have a chilling effect on the ability of generic manufacturers and others in the pharmaceutical supply chain to provide affordable medicines to millions of Americans and people across the globe. This is the opposite effect that was intended with the advent of generic medications."

Others signing the letter include McKesson, Cardinal Health, AmerisourceBergen, H.D. Smith, the American Pharmacists Association, the Healthcare Distribution Management Association, the Healthcare Supply Chain Association, Express Scripts, the Pharmaceutical Care Management Association, the Academy of Managed Care Pharmacy, the American Association of Colleges of Pharmacy, the American Society of Health-System Pharmacists, Amerinet, the Cardiovascular Research Foundation, Innovatix, MedAssets, the National Coalition on Health Care, Novation and the Premier Healthcare Alliance.

"We believe that simple changes to the proposed rule can achieve all of FDA's objectives related to efficient communication of important safety information. At this critical juncture, we look forward to working with you, and all stakeholders to identify a course of action that does not put patient safety or patient savings at risk," the letter concluded.