Senators Pan Pfizer’s Plan to Block Generic Lipitor

Pfizer’s plan to persuade health insurance and benefits companies to favor Lipitor over its new generic competition has three senators crying foul.

The patent on Lipitor, the cholesterol-lowering statin that earned Pfizer more than $5.3 billion in annual U.S. sales, has now expired, opening the door for cheaper generic versions. But Pfizer is offering large discounts to pharmacy benefit managers — the middlemen between drug companies and health insurance providers — that block the competition.

“Consumers and taxpayers foot the bill when drug benefit companies and insurers manipulate the marketplace to prevent access to generic drugs for millions of Americans,” Sen. Herb Kohl (D-Wis.)  said in a statement. “We hope that scrutiny into these business practices will restore fairness and open the gates to affordable prescription drug choices and tremendous cost savings.”

Kohl joined Senators Max Baucus (D-Mont.) and Charles E. Grassley (R-Iowa) in asking Pfizer, three pharmacy benefit companies and two insurance companies for more information about the agreements, citing concerns about the impact on health care costs.

“By working with manufacturers to push brand-name drugs, drug benefit companies may be abusing Medicare to boost their profits and denying generic alternatives to patients – a practice that needs to end immediately,” Baucus said in a statement. “We need to take a close look to ensure we’re protecting both taxpayer dollars and access to the medicine patients need.”

Under Pfizer’s plan, which was first reported by the New York Times, the co-pay for a 30-day supply of Lipitor would drop to $10 — the same co-pay as generic versions. The Senators worry pharmacy benefit managers will continue charging employers and Medicare the full cost of the drug and pocket the difference. In letters to the companies, they’re asking for clarification.

“In what’s been reported, just about everyone wins except consumers and taxpayers,” Grassley said in a statement. “That’s cause for scrutiny, and these letters reflect a commitment to looking at how to prevent the system from being manipulated so that access to generic drugs is restricted and taxpayers are forced to unnecessarily pay brand-name drug prices.”

Using data from 2005 to 2008, the U.S. Centers for Disease Control and Prevention estimated that 25 percent of adults over age 45 used statins — up from 2 percent in the mid-1990s. And between 1999 and 2007, deaths associated with heart disease declined by 28 percent.

“Generics will facilitate access to statins,” Stephen Nicholls, clinical director of the Cleveland Clinic Center for Cardiovascular Diagnostics and Prevention, told ABC News in November. “And in light of the overwhelming body of evidence that statins are good medications, increased access is a positive outcome.”

On Wednesday, the U.S. Food and Drug Administration approved the first generic version of Lipitor, made by Ranbaxy Laboratories Ltd. Ranbaxy has exclusive rights to sell the generic for 180 days, during which time it will be Lipitor’s sole competitor.

In an email to ABC News, Pfizer spokesman MacKay Jimeson said the senators’ letter is based on “incomplete and incorrect information.”

“Our intent is to offer Lipitor to payers and patients at or below the cost of a generic during the 180-day period.  As a result, patients receive Lipitor at co-pays comparable to generics,” he wrote. “Participation in Pfizer’s programs by a health plan is entirely voluntary. It is not imposed on any plan either by Pfizer or their [pharmacy benefit manager].”

The senators asked the companies to respond to their letters no later than Dec. 21.