FFC insists on greater progress from AbbVie on Drug Affordability

June 20, 2024

For the second proxy season in a row, Friends Fiduciary has filed a shareholder resolution at AbbVie asking the Board of Directors to establish and report on a process by which the impact of extended patent exclusivities on product access will be considered in deciding whether to apply for secondary and tertiary patents. Secondary and tertiary patents are the patents applied for following the main, active ingredient patent, and typically cover properties such as methods of administration, manufacturing processes, dosing regimens, and additional indications. These patents can significantly extend the exclusivity period on branded drugs, delaying competition from generic drug makers and resulting in higher drug/medicine prices for patients, along with increased costs for the U.S. healthcare system. FFC’s proposal does not seek to prohibit AbbVie from applying for secondary and tertiary patents on its medicines; we only ask that the Company disclose the process through which the impact on patient access would be considered when the Company applies for these additional patents.

FFC’s proposal received a 25% vote in support, representing strong support from fellow investors and indicating significant investor concern around this issue.

Our letter to shareholders in support of the proposal can be found here.

In addition, the institutional proxy service, ISS, standard policy recommended support for the proposal. Here is their analysis.