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Columbia University Patent Extension Would Cost Consumers, Open Floodgates for More Special Deals

May 26, 2000

Columbia University Patent Extension Would Cost Consumers, Open Floodgates for More Special Deals

Groups Urge Senators to Remove Rider Added Secretly
to Appropriations Bill

WASHINGTON, D.C. — Granting Columbia University a patent extension for a drug-manufacturing process would lead to higher drug prices for consumers and open the floodgates for pharmaceutical companies to demand similar special deals, a coalition of 16 groups says.

In a letter sent this week to Sens. John McCain (R-Ariz.) and Richard Durbin (D-Ill.), Public Citizen and an array of groups ranging from Consumers Union and Families USA to the National Council of Senior Citizens and the U.S. Public Interest Research Group (U.S. PIRG) urged the senators to eliminate the patent extension from the Agricultural Appropriations bill (S. 2536).

The provision was slipped into the bill by Sen. Judd Gregg (R-N.H), a Columbia University alumnus, and has not been debated in any committee hearing.

“This secretly added provision would be a windfall to Columbia University at the expense of consumers, who are already paying too much for important drugs they need to treat heart attacks, strokes, AIDS, cancer and other diseases,” said Frank Clemente, director of Public Citizen’s Congress Watch. “This is a classic example of backroom dealing, and it should be pulled from the bill immediately.”

The provision would grant an extension on a patent for “contransformation,” a process in which animal cells are used to manufacture proteins for drugs. The patent, which the university has held since 1983, has brought it nearly $300 million. Taxpayers funded the research that led to the discovery of the process.

In the letter, the groups point out that granting the extension would:

* Constitute a major rewrite of the Hatch-Waxman Act, 1984 legislation that lays out guidelines for patent extensions for drugs — not manufacturing processes.

* Cost consumers. A five-year patent extension could give Columbia an additional $500 million. Not only would drugs currently manufactured with the process cost more, but so would new drugs using the process. “Americans are clamoring for Congress to enact policies that would substantially reduce the cost of drugs — not maintain their high levels or increase them,” the letter says.

* Open the floodgates for drug companies whose patents are about to expire to ask Congress for special extensions. In the next few years, patents of 20 blockbuster drugs with sales of $20 billion a year are set to expire. “Now is not the time to give the manufacturers of those drugs any hope of favorable treatment,” the letter states.

The letter also notes that if Columbia has a legitimate argument, it should be made in committee hearings, so the provision can be debated publicly rather than being tacked quietly to the bill.

“This is a sweetheart provision that is good for one entity but bad for everyone else, and it should be eliminated,” Clemente said.