Sector News

'Landmark' Senate bill would overhaul pharma

March 30, 2017
Life sciences

In the wake of the Republicans’ failure to repeal and replace the Affordable Care Act last week, Democrats are stepping in with some proposals of their own. A lot of proposals, in fact, in a “landmark” drug pricing bill that would dramatically reshape the industry.

Led by Sen. Al Franken, a coalition of Democrats and independent Sen. Bernie Sanders are backing a full menu of proposals aimed at reining in drug prices and making meds more affordable for patients. The legislation, in fact, includes many, if not most, of the cost-saving ideas that have been floating around Capitol Hill in recent months—and years. But the bill is so big and transformative that it will run into industry pushback, and in the environment on the Hill today, Democrats will have a tough time gaining support from across the aisle.

Sen. Franken’s bill would require drug companies to publicly report development, manufacturing and marketing costs; allow Medicare to negotiate drug prices; tax drugmakers who implement big price hikes; and mandate more reporting by patient assistance groups who receive pharma funds.

These aren’t popular ideas in the pharma business and that list only scratches the surface of the bill. It also would clear the way for importing cheaper (and safe) meds from Canadian sellers, end the direct-to-consumer advertising tax deduction, outlaw pay-for-delay arrangements that keep generic drugs off the market, and create incentives to bolster generic drug competition.

Plus, it would set aside $10 billion over 10 years for the NIH to establish a Center for Clinical Research that would take federally funded research into the clinic. The center would conduct all phases of testing—even into phase 3. If one of those programs won an FDA approval, the center would license or partner with drugmakers to get the medicine to patients.

The legislation additionally calls for for a cap to patients’ out-of-pocket costs, a measure pharma might like because it would require payers to cover more drug spending. But it also would put an end to the Medicare Part D coverage gap—with the extra spending funded partly by pharma—and would renew drug rebates on “dual-eligible” patients who qualify or both Medicare and Medicaid. Finally, it would order a GAO investigation into orphan drug laws.

On that last point, the GAO recently agreed to strike up an investigation at the request of three Senate Republicans.

Voicing his support for the proposals, Public Citizen’s Access to Medicines director Peter Maybarduk called Franken’s bill “one of the most comprehensive reforms of the pharmaceutical industry ever proposed.” But with Democrats holding a minority in both the House and the Senate, getting the bill to the president’s desk in anything close to its current form would be a monumental task.

Even in past years, bills calling for Medicare price negotiations and drug importation have failed to garner the support needed to become law. And those bills were relatively simple. With this massive bill, a variety of competing special interests are sure to weigh in. Garnering a consensus, particularly with Republicans smarting from their healthcare failure, could be difficult.

This time, however, the lawmakers hope things may be different. In a statement, multiple senators cited President Donald Trump’s desire to bring down drug costs as a boost to their efforts.

“President Trump said he wanted to lower drug costs and we’re offering concrete proposals to make that happen,” Sen. Sherrod Brown, D-Ohio, said in the release.

Sens. Sanders and Amy Klobuchar, who is also part of the new effort, have reached out to Trump in the past to work together to tackle drug costs.

Reps. Elijah Cummings and Peter Welch, who were among a group of four Democratic representatives to submit a companion bill in the House, recently met with the president to talk drug prices. The pair used their meeting to trot out a Medicare price negotiation proposal, and Cummings said afterward Trump was “enthusiastic” about the idea.

By Eric Sagonowsky

Source: Fierce Pharma

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