RIO GRANDE, P.R. -- Generic pharmaceutical manufacturers got a promising dose of news about their industry's prospects and a chance to hear from a slate of health care experts and high-profile federal officials at the generic industry's annual powwow late last month.

The occasion was the Generic Pharmaceutical Association's 2003 Annual Meeting which kicked off Jan. 27. The conference, held within sight of the Atlantic surf at the e West in Rio Mar Beach resort, drew more than 400 generic industry leaders and guests.

The event was rich in content, with speakers representing corporate health plan payers, federal and state government, seniors' groups, big insurance companies, academia and market research. They included NACDS president and chief executive Craig Fuller, Democratic Congressman Henry Waxman (see story, page 35), Food and Drug Administration Commissioner Mark McClellan, U.S. Trade Representative Claude Burcky and Doug Long, vice president of industry relations for IMS Health.

Fuller, who spoke as part of a panel titled "2003 Health Care Challenges and Partnering Opportunities," said pharmacy retailers and generic suppliers had much to gain by working together to shape the future of managed care and prescription drug benefits for seniors. "I'm very optimistic about our ability to work together," Fuller said. However, he added, pressure on payers will continue to mount as drug costs go up--making lower-cost generics that much more essential to both public and private prescription benefit plans.

"Prescription costs now account for 10 percent of a $1.6 trillion health care spend in this country," Fuller noted. "The problem for policy-makers is they used to be 8 percent. And they'll probably be 12 percent before too long."

The NACDS chief expressed doubts about the prospects for passage of a meaningful Medicare drug benefit this year, despite intense political pressure from senior advocates and other groups. "I've very dubious about where we're heading with Medicare right now," he told generic representatives, noting how far apart Democrats, Republicans and the White House remain in their proposals for Medicare reform.

Also addressing the group was IMS Health drug industry expert and vice president Doug Long, who painted a rosy short-term view for the generics industry as recent patent expirations on big-selling brand-name drugs yield big gains for new, bio-equivalent substitutes.

Another panel at the four-day meeting addressed the challenge of curbing prescription drug costs while maintaining meaningful cover age. The panel included major health insurers and corporate plan sponsors.

"We love generics at the Blues," said John Cerisano, who spoke on behalf of the Blue Cross Blue Shield Association. He said the big insurer supported legislation to remove barriers to generic competition, and had worked among its own members to battle "the misperception that generics are somehow inferior."

Another member of that panel was Bruce Bradley, director of health plan strategy and public policy health care initiatives for General Motors, the nation's biggest corporate health plan sponsor. Bradley said generics have become a crucial component of GM's efforts to get control of its massive health care bills.

"Health care costs are the only major component of our cost structure that is going up dramatically, and it has management very concerned," he told GPhA members. GM, Bradley said, "has been extremely active in promoting your industry "among its employees and health providers.

Bradley urged generic drug makers to "keep the high road" in their marketing efforts by avoiding deals with branded drug manufacturers that effectively keep some generics off the mar et. He also expressed concern about recent steep price increases for some me-too drugs.

One of the most highly anticipated events at the conference was an appearance by new FDA Commissioner Mark McClellan. In his first major speech since taking over as head of the agency Nov. 14, McClellan laid out a highly detailed set of goals for the FDA and expressed strong support for generics.

McClellan's speech was greeted warmly by generic industry representatives. "We were pleased to hear the commissioner's goals of streamlining the approval process and promptly bringing generic products to market, said Frank Della Fera, vice president of sales and marketing for Eon Labs. "As Mr. McClellan said himself, it was no accident that his first public appearance was at a generic pharmaceutical industry event. The recent support we have received from Washington is unprecedented and bodes well for the future growth of our industry."