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Evidence Base in Design
The Preserve Access to Affordable Generics and Biosimilars Act (S. 1096)
The Preserve Access to Affordable Generics and Biosimilars Act (S. 1096) is a critical
piece of legislation aimed at curbing anticompetitive practices in the pharmaceutical industry,
specifically targeting "pay-for-delay" agreements (GovTrack.us, 2025). These agreements occur
when brand-name drug manufacturers compensate generic or biosimilar competitors to delay the
market entry of lower-cost alternatives. Introduced by Senator Amy Klobuchar (D-MN) and co-
sponsored by bipartisan lawmakers, the bill seeks to eliminate these settlements, which
artificially inflate drug prices and limit patient access to affordable medications. The problem
stems from the exploitation of patent laws and litigation strategies by brand-name manufacturers
to extend monopolies, costing consumers and federal programs like Medicaid billions annually.
The high cost of prescription drugs remains a pressing public health concern, with
generic and biosimilar competition serving as a key mechanism to reduce prices. However, as
highlighted in the articles by Dave et al. (2020) and Gupta et al. (2020), brand-name
manufacturers employ tactics like pay-for-delay settlements, secondary patenting, and citizen
petitions to stifle competition. For instance, Dave et al. (2020) found that delayed generic entry
due to patent litigation cost Medicaid an estimated $761 million over seven years, with the top
five drugs alone responsible for nearly two-thirds of excess spending. Similarly, Gupta et al.
(2020) note that secondary patents extend monopolies by an average of 6.7 years, while
authorized generics and product-hopping further deter competition. These practices
disproportionately burden public payers and patients, particularly for life-saving medications like
biologics, which account for over half of U.S. prescription drug spending.
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S. 1096 addresses these issues by prohibiting compensation agreements that delay
generics/biosimilars and strengthening FTC oversight. The bill establishes a legal presumption
that such settlements are anticompetitive unless manufacturers prove otherwise, shifting the
burden of proof to industry actors. This aligns with findings that litigation—often settled
secretly—is the primary driver of delays (Dave et al., 2020). By curtailing these abuses, the
policy could save billions in healthcare spending and accelerate patient access to generics, which
typically cost 80–85% less than brand-name drugs. However, challenges remain, including
potential loopholes (e.g., "value" transfers disguised as licensing deals) and opposition from
pharmaceutical lobbyists.
Economic Stability as the Key Social Determinant
Among the five social determinants of health (SDOH) outlined by Healthy People 2030,
economic stability is the most significant factor influencing the Preserve Access to Affordable
Generics and Biosimilars Act (S. 1096). This policy directly addresses the financial barriers
created by anticompetitive pharmaceutical practices, which disproportionately affect low-income
populations reliant on affordable medications. As noted by the Office of Disease Prevention and
Health Promotion (2024), economic instability—marked by poverty, unemployment, and
unaffordable healthcare—exacerbates health disparities. Delayed generic drug entry, driven by
"pay-for-delay" settlements and patent litigation, forces Medicaid and vulnerable patients to
overpay for brand-name drugs, deepening financial strain.
The Dave et al. (2020) study highlights how delayed generic competition cost Medicaid
$761 million over seven years, with brand-name drugs dominating spending despite generics
typically costing 80–85% less. For economically disadvantaged individuals, these delays mean
choosing between medications and other essentials like food or housing. Gupta et al. (2020)
Evidence Base in Design
The Preserve Access to Affordable Generics and Biosimilars Act (S. 1096)
The Preserve Access to Affordable Generics and Biosimilars Act (S. 1096) is a critical
piece of legislation aimed at curbing anticompetitive practices in the pharmaceutical industry,
specifically targeting "pay-for-delay" agreements (GovTrack.us, 2025). These agreements occur
when brand-name drug manufacturers compensate generic or biosimilar competitors to delay the
market entry of lower-cost alternatives. Introduced by Senator Amy Klobuchar (D-MN) and co-
sponsored by bipartisan lawmakers, the bill seeks to eliminate these settlements, which
artificially inflate drug prices and limit patient access to affordable medications. The problem
stems from the exploitation of patent laws and litigation strategies by brand-name manufacturers
to extend monopolies, costing consumers and federal programs like Medicaid billions annually.
The high cost of prescription drugs remains a pressing public health concern, with
generic and biosimilar competition serving as a key mechanism to reduce prices. However, as
highlighted in the articles by Dave et al. (2020) and Gupta et al. (2020), brand-name
manufacturers employ tactics like pay-for-delay settlements, secondary patenting, and citizen
petitions to stifle competition. For instance, Dave et al. (2020) found that delayed generic entry
due to patent litigation cost Medicaid an estimated $761 million over seven years, with the top
five drugs alone responsible for nearly two-thirds of excess spending. Similarly, Gupta et al.
(2020) note that secondary patents extend monopolies by an average of 6.7 years, while
authorized generics and product-hopping further deter competition. These practices
disproportionately burden public payers and patients, particularly for life-saving medications like
biologics, which account for over half of U.S. prescription drug spending.
, 2
S. 1096 addresses these issues by prohibiting compensation agreements that delay
generics/biosimilars and strengthening FTC oversight. The bill establishes a legal presumption
that such settlements are anticompetitive unless manufacturers prove otherwise, shifting the
burden of proof to industry actors. This aligns with findings that litigation—often settled
secretly—is the primary driver of delays (Dave et al., 2020). By curtailing these abuses, the
policy could save billions in healthcare spending and accelerate patient access to generics, which
typically cost 80–85% less than brand-name drugs. However, challenges remain, including
potential loopholes (e.g., "value" transfers disguised as licensing deals) and opposition from
pharmaceutical lobbyists.
Economic Stability as the Key Social Determinant
Among the five social determinants of health (SDOH) outlined by Healthy People 2030,
economic stability is the most significant factor influencing the Preserve Access to Affordable
Generics and Biosimilars Act (S. 1096). This policy directly addresses the financial barriers
created by anticompetitive pharmaceutical practices, which disproportionately affect low-income
populations reliant on affordable medications. As noted by the Office of Disease Prevention and
Health Promotion (2024), economic instability—marked by poverty, unemployment, and
unaffordable healthcare—exacerbates health disparities. Delayed generic drug entry, driven by
"pay-for-delay" settlements and patent litigation, forces Medicaid and vulnerable patients to
overpay for brand-name drugs, deepening financial strain.
The Dave et al. (2020) study highlights how delayed generic competition cost Medicaid
$761 million over seven years, with brand-name drugs dominating spending despite generics
typically costing 80–85% less. For economically disadvantaged individuals, these delays mean
choosing between medications and other essentials like food or housing. Gupta et al. (2020)
