Obama seeks path for cheaper generic biotech drugs

By Lisa Richwine

WASHINGTON (Reuters) - President Barack Obama called for access to cheaper generic versions of biotechnology drugs in a budget plan released on Thursday that seeks savings to pay for a healthcare overhaul.

Copycats of some of the world's most expensive drugs could save an estimated $9.2 billion over 10 years and help pay for expanded insurance coverage and improved care, according to budget documents.

Winning a legal pathway for cheaper forms of biotech drugs, or biologics, could open a huge new market for generic drugmakers such as Teva Pharmaceutical Industries Ltd and Mylan Inc.

Brand-name companies say they back the idea but want an adequate period of market exclusivity for the original products and safety protections for patients.

Obama's support in his fiscal 2010 spending plan could help move the issue through Congress, which would need to pass legislation to allow U.S. Food and Drug Administration approval of the medicines. Key Democrats support generic biologics but details remain to be worked out.

Obama's push "basically signals the time is now," said Kathleen Jaeger, president of the Generic Pharmaceutical Association, a trade group. "This is really an opportunity to achieve real cost savings."

Biologic drugs are man-made forms of human proteins and are more difficult to reproduce than traditional pharmaceuticals. Some biologics costs tens of thousands of dollars a year.

The medicines are typically injected and treat conditions ranging from anemia and rheumatoid arthritis to cancer. Examples include Genentech Inc's Herceptin and Avastin and Amgen Inc's Epogen and Aranesp.