CalPERS Calls on Congress to End Biotech Drug Monopoly.

Cites Committee-Passed Amendment as Missed Opportunity to Deliver Billions in Health Care Savings

SACRAMENTO, Calif. -- The California Public Employees' Retirement System (CalPERS) today expressed strong opposition to an amendment passed by the House Energy and Commerce Committee, calling the legislation a "failed opportunity" to deliver on billions of dollars in savings by ensuring innovation and competition in the biotech market.

"Today's vote to approve the Rep. Eshoo amendment is a failed opportunity to provide real savings to consumers," said CalPERS Board President Rob Feckner. "We are extremely disappointed that the Committee chose to side with brand drug companies rather than tens of millions of patients and purchasers in California."

"When state budgets are bursting and health care costs are skyrocketing, it is regrettable that the Committee would pass legislation that effectively extends the current brand biotech monopoly," said Anne Stausboll, CalPERS Chief Executive Officer. "We believe bipartisan legislation authored by Chairman Waxman to establish an approval pathway for biogenerics finds the appropriate balance between innovation and competition in the biotech market."

CalPERS supports legislation authored by Rep. Henry Waxman (D-Ca) and Rep. Nathan Deal (R-GA), known as the "Promoting Innovation and Access to Life-Saving Medicines Act," that establishes a clear pathway for the FDA to bring safe, affordable biogeneric medications to market in a timely manner. This approach is embraced by the Obama Administration, AARP, and the business and labor community. At a time when Congress is rightly focused on constraining health care costs, competition in the biotech market will reap billions of dollars in public and private savings.

CalPERS, the nation's second largest public purchaser of health care, spends more than $5.7 billion to purchase health benefits for nearly 1.3 million active and retired state and local government public employees and their family members. Biotech "specialty" drugs comprise as much as 10 percent of CalPERS spending despite representing less than 1 percent of all its health program's prescriptions. The Rep. Eshoo legislation effectively extends the current biotech monopoly by granting a 12-year exclusivity period that blocks competition; this period is longer than any other country in the world, even in countries that limit drug costs through price controls.

CalPERS has more than $185 billion in assets and is the largest U.S. public pension fund in the U.S. It administers retirement benefits for more than 1.6 million active and retired State, public school, and local public agency employees and their families on behalf of 2,600 California public employers.