Health

The latest news and legislative activity affecting healthcare and bioscience

July 11, 2019
Legislative updates

The health committees were busy right before the July recess. On June 26, the Senate Health, Education, Labor and Pensions Committee marked up three bills: S. 1199, the Poison Center Network Enhancement Act; S. 1173, the Emergency Medical Services for Children Program Reauthorization Act; and S.1895, a measure from HELP Chairman Lamar Alexander (R-Tenn.) and ranking member Patty Murray (D-Wash.) to lower health care costs. Meanwhile in the House also on June 26, the Ways and Means Committee marked up five bills: H.R. 3417, The Beneficiary Education Tools, Telehealth, and Extenders Reauthorization Act; H.R. 3429, The HEARTS and Rural Relief Act; the Improving Chronic Care Management Act; H.R. 3414, The Opioid Workforce Act; and the Protecting Access to Information for Effective and Necessary Treatment (PATIENTS) Act.

Even the Judiciary Committee has been working on health issues. On June 27, the Senate Judiciary Committee marked up four bills: S. 1227 to require the Federal Trade Commission to study the role of intermediaries in the pharmaceutical supply chain and provide Congress with appropriate policy recommendations; S. 440 to prevent a patent owner from asserting sovereign immunity as a defense in certain actions before the U.S. Patent and Trademark Office; S. 1224 to enable the FTC to deter the filing of “sham” citizen petitions as an attempt to interfere with approval of a competing generic drug or biosimilar and facilitate the review of petitions filed to raise legitimate public health concerns; and S. 1416 to prohibit anticompetitive behaviors by drug product manufacturers.

Drug Pricing
Senate HELP Chairman Lamar Alexander (R-TN) led passage of the Lower Health Care Costs Act right before the July recess. It included Senator Tammy Baldwin’s (D-WI) bipartisan FAIR Drug Pricing Act that would require drugmakers to notify HHS of price hikes above 10 percent and justify the increases while disclosing R&D costs. A similar bipartisan bill is in the House, the SPIKE Act or H.R. 2069, which has raised Republican concerns. SPIKE isn’t quite the same as FAIR – it would require manufacturers to justify price increases that are 10 percent or $10,000 over one year, 25 percent or $25,000 over three years, or products launched at a price of $26,000 or more. While it breezed through the House Ways & Means Committee in April, SPIKE later hit a snag with Energy and Commerce Republicans who argued that the launch price benchmark in particular could deal a blow to small biotechs and medicines for rare diseases (which often are pricier than others).

Also, the Senate Finance Committee is considering several changes to Medicare, including ending the financial incentives doctors receive for administering pricier drugs under Medicare Part B and capping the out-of-pocket costs for people covered under Medicare Part D, the public health insurance program’s prescription drug benefit. Chairman Chuck Grassley (R-IA) and Senators Bill Cassidy (R-LA) and Tim Scott (R-SC) want to help states finance expensive gene therapies by permitting them to pay for them over years and creating certain quality metrics for the medicines. Capping costs for the elderly in Medicare Part D is also proving tricky as lawmakers debate who should foot the bill for billions of dollars in annual drug costs: whether to split it evenly between the government, insurers and drugmakers, or have one of those parties take on the lion’s share. If drugmakers were asked to cover half the costs of a cap—putting more than $13 billion of new costs onto the pharmaceutical industry in the first year alone and more than $200 billion in costs over 10 years—then the government and Medicare beneficiaries could save more than $200 billion over 10 years, according to a recent study.

FDA Policing the Drug Supply
Lawmakers from both parties are seeking more information about regulators’ capacity to protect the U.S. drug supply, as foreign-made generic blood-pressure pills tainted with probable carcinogens continue to be recalled. House Energy and Commerce Committee Chairman Frank Pallone (D-NJ) and Rep. Greg Walden (R-OR) want details on the FDA’s ability to adequately inspect foreign and domestic pharmaceutical manufacturing facilities. The lawmakers are seeking specific information regarding a recall of the drug valsartan that was manufactured by Chinese firm Zhejiang Huahai Pharmaceutical Co. Ltd. They also want more details about a dispute between senior FDA staff and an inspector who visited one of the company’s plants where medication contaminated with the probable human carcinogen NDMA was first detected. The FDA began a recall of valsartan made by Zhejiang Huahai in July 2018. The company’s contaminated valsartan was sold to major drugmakers and used as an ingredient in a number of popular cardiovascular therapies. Since then, the FDA has found that other pharmaceutical companies, including Mylan NV and India’s Hetero Labs Ltd., made and sold contaminated blood-pressure drugs. The recalls have sparked a wave of lawsuits.

Medicaid Block Grants
Placing spending limits on Medicaid is illegal, a top committee Democrat said in a letter to HHS Secretary Alex Azar demanding clarity on the Trump administration’s plans. The June 27 letter from House Energy and Commerce Committee Chairman Frank Pallone (D-NJ) comes after reports the administration might approve waivers letting some states receive their federal Medicaid money in block grants. That would place a limit on the federal money states can deploy for the low-income health-care program and give states more autonomy to determine eligibility. Medicaid has traditionally operated with an open-ended funding system, where the federal government matches different percentages of what states pay. These percentages are based off state income levels, and there is no limit on how much the federal government will match.

Opioid Crisis Fuels Medicaid Pilots
Two more states received permission from the Trump administration to use Medicaid money to fight mental and physical health problems associated with the opioid crisis. Almost half of the states have been approved for special waivers that provide federal Medicaid matching funds for new or experimental substance abuse programs, including outreach of treatment in different types of facilities. Minnesota and Nebraska are the 23rd and 24th states to be given the go-ahead from the Centers for Medicare and Medicaid Services. 

Health Funding
The House Appropriations Committee passed the Labor-HHS bill that totals $189.9 billion on May 8, which contrasts the 12% cut proposed in President Trump’s FY2020 budget. The bill provides $99 billion for the Department of Health and Human Services (HHS) and includes significant funding increases since FY2019, i.e. NCI’s funding is increased from $5.7 billion to $6.2 billion and NCATS’ funding is increased from $806 million to $845 million. It also launches a new multi-year public health surveillance initiative and funds cybersecurity efforts. However, it cuts CMS by $3 billion from $276 billion to $273 billion in FY2020. Chairwoman DeLauro (D-CT) said she was able to accommodate 90% of the requests made by members in crafting the bill and accompanying report. G2G wrote up a summary and distributed it a few weeks, which is available here. The bill will go to the floor in June and the Senate is finalizing their version now and is expected to introduce it in June and conference negotiations should occur August-September. Details include:

Discretionary funding:
• $99.4 billion for the HHS, $8.88 billion more than fiscal 2019 and $21.3 billion more than requested.
• $75.9 billion for the Education Department, $4.48 billion more than fiscal 2019 and $11.9 billion more than requested.
• $13.3 billion for the Labor Department, $1.2 billion more than fiscal 2019 and $2.4 billion more than requested.

HHS funding would include the following for various programs:
• $11.6 billion for Head Start, a $1.5 billion increase from fiscal 2019. 
• $7.68 billion for the Child Care and Development Block Grant, a $2.4 billion increase. 
• $5.68 billion for community health centers, which would include a $50 million increase in discretionary funding.
• $3.84 billion for substance abuse treatment, including $1.5 billion for State Opioid Response grants, at SAMHSA; at least $500 million for the NIH’s Helping to End Addiction Long-Term Initiative; and $475.6 million for CDC Opioid Overdose Prevention and Surveillance. 
• $3.01 billion for the Public Health and Social Services Emergency Fund, a $377 million increase.
• $2.44 billion for the Ryan White HIV/AIDS program, a $116.4 million increase.
• $2.39 billion for Alzheimer’s disease research, $500 million for a precision medicine initiative, $411 million for the BRAIN Initiative, and $195 million for the Cancer Moonshot Initiative at the NIH.

Drug Samples for Generic Development
Recently, two House committees approved H.R. 965, the CREATES Act, which would allow generic-drug developers to sue brand-name drug makers for not selling them samples needed for testing during the FDA approval process. It also would give the FDA more flexibility to allow generic companies to use separate safety protocols than those in place for the branded drug. The generic drug maker would have to prove that the branded drug maker hasn’t delivered sufficient quantities generally within 31 days of a request. Generic drug makers could request FDA authorization to obtain a sample of a branded drug that’s subject to an FDA safety protocol, called a risk evaluation and mitigation strategy (REMS) with “elements to assure safe use” (ETASU). Some drug companies have withheld samples from generic drug makers due to being subject to such protocols. The measure would also create an affirmative defense if the branded drug company offered to sell sufficient quantities of the product on reasonable terms and the generic developer didn’t accept the offer in a specified time frame. Products not subject to a safety protocol would have to be offered within 14 days of receiving a request and accepted within 7 days. Those subject to safety protocols would have to be offered within 20 days and accepted within 10 days. The Congressional Budget Office estimated the bill would reduce the federal deficit by $3.9 billion from fiscal 2019 through 2029 by allowing earlier entry of lower-priced generic drugs, which would reduce federal spending on prescription drugs and subsidies for health insurance.

House Panel Releases Surprise Medical Bill Plan
Following the Senate HELP Committee, the House Energy and Commerce Committee recently released a bipartisan plan to protect patients from receiving pricey and unexpected medical bills, offering the first fleshed-out blueprint in the chamber to address the high-profile issue. The bill would bar providers from billing patients for the unpaid balance of bills for emergency services. Patients would pay as if the hospital used was in their health plan's network. It would also require patients be notified and give their consent before scheduled care is delivered by an out-of-network provider. Patients not told in advance would be protected from hefty bills. States would still be able to set their own payment standards for health plans they regulate. The draft bill also would provide $50 million in grants for states to create all-payer claims databases.

Interchangeable Biosimilars
Pharmacists are a step closer to seamlessly switching between a biologic drug and a cheaper alternative called a biosimilar thanks to the final industry advice for drug makers the FDA released recently. Biologic drugs are some of the most expensive products on the market due to manufacturing complexity, as they’re made from living cells, and treat serious conditions like cancer. So far, there are no biosimilars available in the U.S. that are considered interchangeable. But this FDA advice could help change that and consequently could increase biosimilar utilization.

Diabetes Funding
Reps. Diana DeGette (D-CO) and Tom Reed (R-NY) introduced H.R. 2668, Special Diabetes Program Reauthorization Act to continue funding a key federal diabetes research program for an additional five years and increase its annual funding from $150 million to $200 million a year. The Special Diabetes Program for Type 1 Diabetes is a decades-old federal program that’s currently providing researchers at the NIH $150 million a year to study Type 1 diabetes. Significant debate has ensued on the cost of insulin within health committees of jurisdiction over the past couple of months and furthering research on diabetes remains a bipartisan priority.

Patent Legislation
The Second Look at Drug Patents Act, which was just introduced by John Cornyn (R-TX) and Patty Murray (D-WA), would require the U.S. Patent and Trademark Office to initiate a process to reexamine the validity of patents over 30 days before they are listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (the “Orange Book”) because some manufacturers use “patent evergreening” by applying for follow-on patents for disingenuous “improvements” to their original drugs to extend their period of market exclusivity. Once listed in the Orange Book it has the legal effect of blocking generic entry. The Act would require all new patents be submitted to the Official Gazette of the Patent and Trademark Office (“Gazette”) within 30 days of approval, which enables soliciting additional information about the strength of those patents and invite patent challenges. Then any patent included in the Gazette would be listed in the Orange Book on a provisional basis unless the Patent Trial Appeal Board confirms the patent to be patentable or if the patent is not challenged within a specific timeframe. The Second Look at Drug Patents Act would provide a way to prevent disingenuous “improvements” that are insubstantial, e.g. mere dosage changes to help bring generic drugs to market in a timelier fashion.

May 31, 2019
Legislative updates

Health Funding

The House Appropriations Committee passed the Labor-HHS bill that totals $189.9 billion on May 8, which contrasts the 12% cut proposed in President Trump’s FY2020 budget. The bill provides $99 billion for the Department of Health and Human Services (HHS) and includes significant funding increases since FY2019, i.e. NCI’s funding is increased from $5.7 billion to $6.2 billion and NCATS’ funding is increased from $806 million to $845 million. It also launches a new multi-year public health surveillance initiative and funds cybersecurity efforts. However, it cuts CMS by $3 billion from $276 billion to $273 billion in FY2020. Chairwoman DeLauro (D-CT) said she was able to accommodate 90% of the requests made by members in crafting the bill and accompanying report. G2G wrote up a summary and distributed it a few weeks, which is available here. The bill will go to the floor in June and the Senate is finalizing their version now and is expected to introduce it in June and conference negotiations should occur August-September. Details include:

Discretionary funding:

  • $99.4 billion for the HHS, $8.88 billion more than fiscal 2019 and $21.3 billion more than requested.
  • $75.9 billion for the Education Department, $4.48 billion more than fiscal 2019 and $11.9 billion more than requested.
  • $13.3 billion for the Labor Department, $1.2 billion more than fiscal 2019 and $2.4 billion more than requested.

HHS funding would include the following for various programs:

  • $11.6 billion for Head Start, a $1.5 billion increase from fiscal 2019.
  • $7.68 billion for the Child Care and Development Block Grant, a $2.4 billion increase.
  • $5.68 billion for community health centers, which would include a $50 million increase in discretionary funding.
  • $3.84 billion for substance abuse treatment, including $1.5 billion for State Opioid Response grants, at SAMHSA; at least $500 million for the NIH’s Helping to End Addiction Long-Term Initiative; and $475.6 million for CDC Opioid Overdose Prevention and Surveillance.
  • $3.01 billion for the Public Health and Social Services Emergency Fund, a $377 million increase.
  • $2.44 billion for the Ryan White HIV/AIDS program, a $116.4 million increase.
  • $2.39 billion for Alzheimer’s disease research, $500 million for a precision medicine initiative, $411 million for the BRAIN Initiative, and $195 million for the Cancer Moonshot Initiative at the NIH.

Medical Innovation

On May 23, HHS announced an invitation for comment on how to accelerate bringing medicines and treatments into patients’ hands faster under ReImagine HHS: Accelerate Clinical Innovation Initiative. HHS is seeking participation for meetings on June 20 and 21 and welcomes written comments due June 12 at http://src.bna.com/IsA from all interested parties, including, but not limited to, patients, physicians, researchers, medical product developers, commercial health insurance plan sponsors and carriers, private investors, and the community at large. In 2011, NIH created a center to get new treatments on the market faster as it takes an average of 17 years to translate medical discoveries into patient care, according to a 2011 study.

Drug-Pricing Transparency Bills

Republicans are warning House Democratic leaders they’ll sink legislation that would address rising drug prices if they pair it with measures to bolster Obamacare. However, House leaders plan a vote on H.R. 987 to do just that. It would combine seven bills, that together, are designed to bring more low-cost generic drugs to the market, ban short-term insurance policies Democrats deride as “junk” plans, and restore funds for Obamacare programs cut by the Trump administration. The drug-pricing bills bundled into the package have support from members of both parties, but the ones bolstering the Affordable Care Act are generally backed only by Democrats. The White House has issued a veto threat.

Medicare Part D plays a central role in the drug pricing debate. On May 23, the House Energy & Commerce and Ways & Means committees released a draft, bipartisan bill to cap seniors’ drug costs in Medicare Part D and shift most of the program’s catastrophic drug costs from the government to insurers. It aligns with the approach being considered by Senate Finance Committee, but contrasts the Medicare-negotiation approach that Speaker Pelosi was trying to sell to the White House. These House committees are requesting feedback on the draft bill now. Specifically, it would increase insurers’ share of their enrollees’ Part D catastrophic drug spending from 15% to 80% over four years. (Currently, once seniors’ out-of-pocket costs hit $5,100, they enter the catastrophic coverage stage. At that point, they pay 5% of their drug costs, insurers pay 15% of the cost and Medicare pays 80%.) The bill would also gradually change the percentages: seniors 0%, Medicare 20% and insurers 80%. Lawmakers on both sides of the aisle have expressed interest in capping out-of-pocket costs and the White House has also backed the idea, most recently in Trump's fiscal 2020 budget proposal. The Trump proposal to cap expenses would also move 80% of liability to plans but do it over a 10-year period, which would cost an estimated $14 billion over a decade. Policy experts predict that shifting the burden to insurers would pressure them to choose lower-priced drugs in formularies and negotiate better deals with drug companies. The bill does not appear to shift drug makers' burden for covering drug costs though.

Drug Samples for Generic Development

Recently, two House committees approved (H.R. 965, the CREATES Act), which would allow generic-drug developers to sue brand-name drug makers for not selling them samples needed for testing during the FDA approval process. It also would give the FDA more flexibility to allow generic companies to use separate safety protocols than those in place for the branded drug. The generic drug maker would have to prove that the branded drug maker hasn’t delivered sufficient quantities generally within 31 days of a request. Generic drug makers could request FDA authorization to obtain a sample of a branded drug that’s subject to an FDA safety protocol, called a risk evaluation and mitigation strategy (REMS) with “elements to assure safe use” (ETASU). Some drug companies have withheld samples from generic drug makers due to being subject to such protocols. The measure would also create an affirmative defense if the branded drug company offered to sell sufficient quantities of the product on reasonable terms and the generic developer didn’t accept the offer in a specified time frame. Products not subject to a safety protocol would have to be offered within 14 days of receiving a request and accepted within 7 days. Those subject to safety protocols would have to be offered within 20 days and accepted within 10 days. The Congressional Budget Office estimated the bill would reduce the federal deficit by $3.9 billion from fiscal 2019 through 2029 by allowing earlier entry of lower-priced generic drugs, which would reduce federal spending on prescription drugs and subsidies for health insurance.

House Panel Releases Surprise Medical Bill Plan

House Energy & Commerce Committee recently released a bipartisan plan to protect patients from receiving pricey and unexpected medical bills, offering the first fleshed-out blueprint in the chamber to address the high-profile issue. The draft would bar providers from billing patients for the unpaid balance of bills for emergency services. Patients would pay as if the hospital used was in their health plan's network. It would also require patients be notified and give their consent before scheduled care is delivered by an out-of-network provider. Patients not told in advance would be protected from hefty bills. States would still be able to set their own payment standards for health plans they regulate. The draft bill also would provide $50 million in grants for states to create all-payer claims databases.

Interchangeable Biosimilars

Pharmacists are a step closer to seamlessly switching between a biologic drug and a cheaper alternative called a biosimilar thanks to the final industry advice for drug makers the FDA released recently. Biologic drugs are some of the most expensive products on the market due to manufacturing complexity, as they’re made from living cells, and treat serious conditions like cancer. So far, there are no biosimilars available in the U.S. that are considered interchangeable. But this FDA advice could help change that and consequently could increase biosimilar utilization.

Diabetes Funding

Reps. Diana DeGette (D-CO) and Tom Reed (R-NY) introduced bipartisan legislation (H.R. 2668, Special Diabetes Program Reauthorization Act) recently to continue funding a key federal diabetes research program for an additional five years and increase its annual funding from $150 million to $200 million a year. The Special Diabetes Program for Type 1 Diabetes is a decades-old federal program that’s currently providing researchers at the National Institutes of Health $150 million a year to study Type 1 diabetes. Significant debate has ensued on the cost of insulin within health committees of jurisdiction over the past couple of months and furthering research on diabetes remains a bipartisan priority.

Patent Legislation

The Second Look at Drug Patents Act, which was just introduced by John Cornyn (R-TX) and Patty Murray (D-WA), would require the U.S. Patent and Trademark Office to initiate a process to reexamine the validity of patents over 30 days before they are listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (the “Orange Book”) because some manufacturers use “patent evergreening” by applying for follow-on patents for disingenuous “improvements” to their original drugs to extend their period of market exclusivity. Once listed in the Orange Book it has the legal effect of blocking generic entry. The Act would require all new patents be submitted to the Official Gazette of the Patent and Trademark Office (“Gazette”) within 30 days of approval, which enables soliciting additional information about the strength of those patents and invite patent challenges. Then any patent included in the Gazette would be listed in the Orange Book on a provisional basis unless the Patent Trial Appeal Board confirms the patent to be patentable or if the patent is not challenged within a specific timeframe. The Second Look at Drug Patents Act would provide a way to prevent disingenuous “improvements” that are insubstantial, e.g. mere dosage changes to help bring generic drugs to market in a timelier fashion.

April 30, 2019
Legislative updates

NIH Appropriations

Although thePresident’s FY2020 budget proposal would cut $4.5 billion from NIH to go from$38 billion to $33.5 billion, in both the House and Senate LHHS Appropriations hearings the Members of Congress clearly stated that NIH would not be cut. The House just introduced the LHHS Appropriations bill on April 29 – the first of 12bills. It increases the Department of Health and Human Services by $8.5 billion to $99 billion, including $2 billion increase to NIH, an increase from $5.7 billion to $6.2 billion for NCI and an increase from $806 million to $845 million for NCATS (National Center forAdvancing Translational Sciences). It also includes increase to $921 million for the CDC, increase to $115 million for SAMHSA, increase to $475 million for HRSA and first-time ever $50 million for gun violence research. It would also provide $189.8billion in discretionary funds, $11.7 billion more than FY19 levels. TheDepartment of Labor would receive $13.3 billion, a $1.2 billion increase, and the Department of Education would receive $75.9 billion, a $4.4 billion increase.

Drug Pricing

Both theHouse and Senate committees of jurisdiction held hearings calling on key pharmaceutical companies to explain their drug pricing practices and to tackle ways to bring them down. Witnesses included Cigna Vice President and ChiefClinical Officer Steve Miller; CVS Health Executive Vice President Derica Rice;Humana Health Care Services President William Fleming; OptumRx CEO John Prince; and Prime Therapeutics Interim President & CEO Mike Kolar. A common themeis the PBMs are collecting rebates and not passing on the savings, effectively requiring the drug companies to raise their prices. Senator Leahy (D-VT) andRep. Cicilline (D-RI) took the lead in introducing the CREATES Act to promote competition in the market for drugs and biological products by facilitating the timely entry of lower-cost generic and biosimilar versions of those drugs and biological products. The House Energy and Commerce Committee passed the CREATESAct unanimously. Also, House Ways and Means Chairman Neal (D-MA) introduced thePrescription Drug Sunshine, Transparency, Accountability and Reporting Act(STAR Act) and passed it unanimously before the recess to call manufacturers to account for dramatic increases in drug prices. Meanwhile the House Energy andCommerce Committee marked up even more bills, including:

  • BLOCKING Act: to stop generic drug companies from sitting on the 180-day exclusivity period awarded to the first generic manufacturer that challenges a brand-name company's patent and keeping other competitors off the market. Has bipartisan support.
  • Protecting Consumer Access to Generic Drugs Act: to prohibit "pay-for-delay" patent     settlements, in which a brand name company pays the generic manufacturer     to stay off the market for a certain period of time. This is led by Democrats with limited Republican support. Has bipartisan support.
  • Purple Book Continuity Act: to provide generic and biosimilar makers more information about the patents on branded products. Does not have bipartisan support and is led by Democrats.
  • Orange Book Transparency Act: to require FDA to disclose additional patent information when listing but not any patent claims on a device that is used for the delivery of the drug and to require patent holders to notify HHS if the Patent Trial and Appeals Board issues a decision that a listed drug patent is invalid. Does not have bipartisan support and is led by Democrats.
  • Payment Commission Data Act: to provide MedPAC and MACPAC with access to drug pricing and rebate data, to help Congress better understand the cost of prescription drugs. Has bipartisan support.

Drug Advertising

The self-imposed deadline for drug companies to voluntarily put cost information in their television ads has arrived, as the White House reviews a rule to make prices a mandatory element in TV drug ads. Back in October major drug companies including Eli Lilly, Novartis, Allergan, and Johnson & Johnson’s Janssen promised to provide some type of information about drug costs in their direct-to-consumer ads by April 15. The voluntary move was an effort to satisfy the desire of President Trump and Congress for more transparency about pharmaceutical prices and to head off regulations making list price disclosures in ads mandatory.

Affordable Care Act

Since Trump has entered the White House, the uninsured rate has increased by 1.4 million people – uninsured Americans under age 65 rose from 27.5 million in 2016 to28.9 million in 2018, according to the Congressional Budget Office. During this time, Republicans in Congress and the White House enacted changes to ACA that included allowing groups of small businesses to form health insurance plans for their employees, expanding short-term limited-duration insurance plans, and reducing to zero the penalty for individuals who lack health coverage. TheTrump administration also allowed states to implement laws requiring Medicaid enrollees to work in exchange for benefits, leading to over 18,000 people being dropped from the Medicaid rolls in Arkansas in 2018, for example. Since 2013when ACA began, more than 20 million people have gained insurance coverage, nearly 13 million of whom became covered as a result of the ACA’s Medicaid expansion, not exchanges.

 

PresidentTrump is continuing to argue against ACA and is now pursuing its complete elimination. However, if repealed it would remove a key component regarding rising drug prices. The Biologics Price Competition and Innovation Act, which was included in the 900+ page ACA allows pharmaceutical companies to submit drug applications for products that mimic biologics without having to jump through all the costly hoops, i.e. clinical trials, associated with getting a novel medicine approved by the FDA. If ACA ends so does this program.

 

In Congress,ACA reform efforts are also underway. The House Energy and Commerce Committee considered six bills before the recess aiming to tackle ACA and health care costs. They mirror many of the House Democratic leadership plan to expandObamacare's benefits while reversing Trump administration policies, which means none are bipartisan:

  • State Allowance for a Variety of Exchanges Act (SAVE Act): to give states $200 million annually in federal funding to establish state-based marketplaces.
  • State Health Care Premium Reduction Act: to give states $10 billion each year for a reinsurance program, or to reduce out-of-pocket costs of individuals in qualified health plans.
  • Short-Term, Limited Duration Insurance: to reverse the Trump administration's expansion of short-term health plans.
  • Protecting Americans with Preexisting Conditions Act: to reverse Trump administration policies that weaken protections for patients with pre-existing conditions.
  • Marketing and Outreach Restoration to Empower Health Education Act (MORE Health Education Act: to restore ACA outreach and enrollment funding that was cut by the White House.
  • Expand Navigators’ Resources for Outreach, Learning, and Longevity Act (ENROLL Act): to provide $100 million to the Federal-Facilitated Marketplace Navigator program and make other changes to navigator requirements.

Health IT

The Senate Health, Education, Labor and Pensions Committee (HELP) plans a hearing in May to follow up on implementing electronic health information sharing provisions in the 21st Century Cures Act. The hearing will include witnesses from the Trump administration and will be the committee’s second of the 116th Congress discussing ways to bolster digital health records and improve information sharing.

 

American Cures Act and American Innovation Act

Senator Durbin (D-IL) and Reps. Foster (D-IL) and Underwood (D-IL) teamed up to announce the introduction of the American Cures Act and the American Innovation Act, which would create a mandatory fund to provide steady, predictable funding for breakthrough research at America’s top research agencies. This steady, long-term investment would allow the agencies to plan and manage strategic growth while maximizing efficiencies.

 

The AmericanCures Act would provide annual budget increases of five percent plus inflation at America’s top four biomedical research agencies: The National Institutes ofHealth, the Centers for Disease Control and Prevention, the Department ofDefense Health Program, and the Veterans Medical and Prosthetics ResearchProgram. The American Innovation Act would provide annual budget increases of five percent for cutting edge research at five important federal research agencies: The National Science Foundation, the Department of Energy Office ofScience, the Department of Defense Science and Technology Programs, theNational Institute of Standards and Technology Scientific and TechnicalResearch, and the National Aeronautics and Space Administration ScienceDirectorate.

 

Medicare Drug Spending

The cost for22 drugs shot up more than 500 percent per dose from 2013 through 2017, according to a Bloomberg Law analysis of Medicare Part D data. The median increase among drugs offered through Medicare’s primary prescription plan was28 percent from 2013 to 2017, but some medications went up in price more than others. The median is the midpoint of the spending-change distribution, meaning that the same number of drugs changed in price more and less than 28 percent.Overall, Medicare spent about $154.8 billion on 42.7 million Americans withPart D coverage in 2017. In March, CMS reported an average annual spending increase of 10.6 percent from 2013 through 2017.

 

NIH Funding Cliff

A funding cliff written into the 21st Century Cures Act that was enacted at the end of the Obama administration could hamper two major NIH projects:personalized medicine and new cancer therapies. The 2016 bipartisan law created a 10-year innovation fund to accelerate special projects in four areas, including precision medicine and President Barack Obama’s Cancer Moonshot initiative to double the rate of new cancer treatments and prevention therapies. Due to the challenge of paying for this new fund, which provided$4.8 billion to NIH and $500 million to FDA, through offsets and budget work-arounds, a funding cliff does loom ahead. One offset included a cap onMedicaid reimbursement for durable medical equipment at equivalent Medicare pay rates and a draw down from the Strategic Petroleum Reserve with funding staggered based on how the savings that offset the bill are implemented.

 

Rare Disease Drug Guidance

The FDA issued a new rare disease guidance on how to incorporate natural history studies, which follow how a disease progresses to understand how to treat it, into the development of rare disease drugs. This is welcomed by orphan drug companies aiming to treat rare conditions that affect just 200,000 or fewer people and can be extremely expensive to develop and market. The draft guidance describes the broad potential uses of a natural history study in all phases of drug development for rare diseases. It also examines the strengths and weaknesses of various types of natural history studies, data elements and research plans, and provides practical framework for the conduct of a natural history study.