By Lisa Seachrist
WASHINGTON - Tucked into Senate legislation granting the Agriculture Department operating funds for fiscal year 2001 is a provision to open up the possibility for extensions to biotechnology process patents under the Hatch-Waxman Act.
The legislative language, which has passed the Senate Appropriations Committee and will come before the full Senate either next week or right after Memorial Day, is the work of Sen. Judd Gregg (R-N.H.), chair of the Senate's Appropriations Subcommittee on Commerce, Justice, State and Judiciary. The fundamental change in the Hatch-Waxman Act comes at the behest of Columbia University, holder of a critical biotechnology patent, in stark opposition to the desires of the pharmaceutical, biotechnology and generic industries.
"What we are talking about here is a major change in the Hatch-Waxman Act without hearings or discussions," said Jeff Trewhitt, spokesman for the Pharmaceutical Research and Manufacturers of America. "We are reviewing this matter and won't have anything more to say until we've completed that review."
The Biotechnology Industry Organization (BIO) drafted a letter to Senate Judiciary Chairman Orrin Hatch (R-Utah), author of the original act, highlighting its opposition to Gregg's proposal and the fact the issue really is a matter for the Judiciary Committee, not the Appropriations Committee. In the letter obtained by BioWorld Today, BIO said, "As you know, there is a long-held principle that prohibits including authorizing language on an appropriations bill. Moreover, this issue is a matter for the Judiciary Committee. As you know, patent issues are complex and deserve a full airing and discussion in that committee - something which did not happen in the matter at issue."
The matter at issue is a Columbia University patent for the cotransformation of mammalian cells - the process allowing foreign genes to be inserted into mammalian cells to produce proteins. The process is at the heart of at least 18 existing products, including Amgen Inc.'s Epogen, Genzyme Corp.'s Cerezyme and Genentech Inc.'s Pulmozyme.
Under the Drug Price Competition and Patent Term Restoration Act (Hatch-Waxman), the companies producing drugs can receive patent extensions for up to five years to compensate for regulatory delays these drugs and biologics experience at FDA. Columbia argues the same delays that prevent the companies from selling their products have lessened the value of the cotransformation patent by preventing Columbia from collecting royalties on the sales of products utilizing the cotransformation technology.
Columbia has held the patent since 1983, and it's set to expire on Aug. 16. The university wasn't able to collect royalties until there were product sales beginning in 1988. The proposal would extend the patent to allow Columbia to continue to pull in royalties from the sales of these products. A Columbia spokesman said the university is requesting only an 18-month extension, but still that represents a significant amount of cash.
Lisa Raines, senior vice president of government relations for Genzyme Corp., estimated Columbia receives $100 million a year in royalties, largely from biotechnology companies. In addition, she said the proposal as currently written doesn't stipulate the length of the patent extension.
"The legislative language is actually quite unworkable," Raines said. "It's impossible to figure out what the length of the patent term extension would be. Is it for the time lost on one product or is it for every product? What about future products?"
Under Hatch-Waxman, a company may apply for a patent extension within 60 days of getting a FDA approval for the product and the extension may grant only an "effective" patent term of 14 years. Some have interpreted the appropriations language to grant Columbia an additional five years.
"The amendment in the Senate bill is inconsistent with the restrictions that have been enacted under Hatch-Waxman," BIO said in its letter to Hatch. "It would apply to at least 18 existing products and others in the future, while Hatch-Waxman allows only one extension per drug. The 'effective patent term' of the Columbia patent will be more than 22 years."
A spokeswoman for the Judiciary Committee said the senator and the committee were aware of the matter, but had no comment on the issue. Raines said, "It breaks every rule for Hatch-Waxman."
Irrespective of the actual problems with the legislation, Diane Dorman, manager of communications for the Generic Pharmaceutical Industry Association, said her organization opposes the legislation because of the way it was introduced into Congress.
"We don't know how opening up Hatch-Waxman to process patents would affect our companies," Dorman said. "In philosophy, we're always opposed to granting patent extension in the dead of night. Gregg is trying to rewrite existing law with appropriations."
Gregg, who is a Columbia alumnus, has said this legislation is his highest priority, congressional sources told BioWorld Today. Most industry organizations were unaware the measure had been inserted until congressional staffers began alerting them to it earlier this week.
"It's possible, especially in the Senate, to do things very quietly," Raines said. "We have to try to catch these things before it is too late."
The provision isn't in the House appropriations legislation, so if the provision survives a likely floor amendment to remove it, the House and Senate would have to agree to include it during the conference committee.