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US health care reform limits further pain for pharmaceutical industry

Date March 19, 2010

US health reform in what may be its final form is a mixed bag for pharmaceutical manufacturers and will have differing effects on various sectors of the industry. Gone is the ban on "pay-for-delay" deals between generic and branded manufacturers, gone is any chance of speedy entry by generic biologicals, and added is $19.8bn in new assistance over a decade for the elderly to purchase drugs (Obama healthcare reform puts new focus on 'pay for delay' deals, February 26, 2010).

But whilst an immediate threat to drugmakers’ bottom line was eliminated – the now-disposed ban on legal settlements delaying the entry of generic drugs – it has not been eliminated as a future legislative risk. Congressional budget forecasters have attached five-year government savings of $800m from standalone legislation that would ban the settlements, which lawmakers could turn to in the future if more savings are needed.

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