June 22 (Bloomberg) -- Makers of generic drugs would gain the right to sell copies of medicines developed by biotech companies such as Amgen Inc. and Genentech Inc. under legislation to be introduced in the U.S. Senate.

The measure would create a pathway for the Food and Drug Administration to approve copies of treatments made through biotechnology, the senators said today in an e-mailed statement. The sponsors are Democratic Senators Hillary Clinton and Edward Kennedy and Republican Senators Orrin Hatch and Michael Enzi.

Americans spent $40.3 billion on biotech drugs last year, and analysts say competition from lower-cost generics may cut prices by a third. Companies such as Barr Pharmaceuticals Inc. and Teva Pharmaceutical Industries Ltd. have invested billions of dollars in acquisitions and facilities outside the U.S. for the technology to make generic versions of drugs whose patents have expired or been ruled invalid.

``Just as generic drugs have helped bring down the costs of medicines for millions of Americans, new `follow-on' versions of breakthrough biologics will make these innovative treatments more affordable for the patients who need them,'' said Kennedy of Massachusetts, chairman of the Senate health committee, in the statement.

The FDA approves copies of conventional drugs, made through chemical synthesis, under a 1984 law.

Biotech companies say their products, made from human proteins, can't be duplicated, and full-scale human trials would be needed to ensure that generic versions are safe and equally effective. Generic companies say the FDA should be allowed to decide on a case-by-case basis whether to waive the costly studies.

Leeway for the FDA

The senators' proposal would require generic companies to conduct animal studies and at least one clinical trial in humans unless the FDA determines that the steps aren't necessary. The FDA also would have leeway to decide if a generic product could be substituted by a pharmacist for a prescribed brand-name drug.

``If we thought that over a prolonged period of time and over a large number of cases that the FDA was making the wrong decision and being overly conservative, then we'd have to go back to Congress,'' said Bruce Downey, chief executive officer of Woodcliff Lake, New Jersey-based Barr, in an interview this month. ``The bigger risk now is not having a pathway.''

European regulators allow approval of generic versions they call ``biosimilars.'' The products aren't recognized as identical to the original drugs. Swiss drugmaker Novartis AG won backing from a European panel today to sell copies of Johnson & Johnson's Eprex, an anemia medicine sold in the U.S. as Procrit and as Amgen's Epogen.

`Future of Medicine'

``It's crucial that Congress get this right because biologics are the future of medicine,'' Hatch, of Utah, said in the senators' statement. ``It's taken a lot of effort, but we've achieved a good balance in this bill,'' Hatch said. Co-sponsor Clinton is from New York, and Enzi is from Wyoming.

The Senate health committee is expected to mark up the legislation June 27. Any bill would have to be passed by the full Senate and the House before being sent to President George W. Bush. Competing measures have been introduced in the House.

Generic companies betting on the U.S. market are targeting drugs whose patents have already run out or are set to expire in coming years. Most development projects are kept secret, although analysts say Epogen and Genentech's breast cancer drug Herceptin are among the products that may be vulnerable to competition once they lose patent production.

Kelley Davenport, a spokeswoman for Amgen of Thousand Oaks, California, and Stephanie Fischer, a spokeswoman for the Washington-based Biotechnology Industry Organization trade group, declined to comment on the legislation until they had time to review it.

Patient Safety Cited

``Generally, we support a pathway for follow-on biologics,'' said Megan Pace, a spokeswoman for South San Francisco, California-based Genentech, in a phone interview. While she hadn't seen the proposal, she said the company urges ``that any legislation that is passed ensures patient safety and appropriate data protection for innovators.''

Andrea Hofelich, a spokeswoman for the Generic Pharmaceutical Association in Arlington, Virginia, said her group was also still reviewing the proposal.

To contact the reporter on this story: Catherine Larkin in Washington at clarkin4@bloomberg.net.

Last Updated: June 22, 2007 19:41 EDT