With help from Allie Bice, Dan Goldberg, Rachel Roubein and Adam Cancryn
‚ÄĒ Seven drug industry executives will testify at the Senate Finance Committee’s hearing on pricing Tuesday. Expect harsh questioning and some attempts to deflect blame.
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‚ÄĒ The Supreme Court declined to hear Maryland‚Äôs bid to revive its drug pricing law. But the move may not discourage other states seeking to address the same issue.
‚ÄĒ FDA rebuts media reports on safety of generic drugs. “We welcome the accountability inspired by a free press,” Commissioner Scott Gottlieb said, adding some interpretations of the data are ‚Äúseriously flawed.‚ÄĚ
** A message from EMD Serono: Multiple sclerosis (MS) is up to three times more common in women. At EMD Serono, we‚Äôre committed to helping these women. See how we‚Äôre working to help women with MS. **
Happy Monday and welcome back to Prescription PULSE, where we want to know which pharmaceutical executive will get the most heat at Tuesday‚Äôs grilling. Send your prediction, news and tips to Sarah Karlin-Smith ([email protected] or @SarahKarlin) and Sarah Owermohle ([email protected] or @owermohle).
DRUG COMPANY CEOS FACE CAPITOL HILL RECKONING ‚ÄĒ Seven industry executives will face a grilling from the Senate Finance Committee on drug pricing Tuesday, a signal that major legislation addressing costs is on the horizon. It is likely to be reminiscent of past hearings with bank, health insurance and tobacco executives that led to major changes for those industries.
‚ÄúThis is not a good sign for the pharmaceutical industry that they are the next industry that is begin called before Congress to explain their abusive practices,‚ÄĚ said Ben Wakana, executive director of Patients for Affordable Drugs.
The hearing comes with drugmakers facing an increasingly hostile political environment and no longer able to count on longtime Republican allies to protect them from emboldened Democrats.
How pharma will handle it: The executives will aim to strike just the right note of contrition while also shifting the blame for high prices to other parts of the health care industry. They’ll additionally tout their investments in research and development and the role they play in saving lives.
How lawmakers will react: Committee aides say members will have little patience for drug executives who don‚Äôt give straight answers or who point fingers ‚ÄúThe CEOs would be wise to be attending the hearing from a very earnest perspective,‚ÄĚ one Republican aide said. ‚ÄúIt will go south for them really quickly if they‚Äôre not trying to be helpful and forthright in their answers.‚ÄĚ And lawmakers say they‚Äôll be ready to refute arguments that other industry players bear the blame.
The bottom line: Tuesday will be a rough day for pharma. ‚ÄúEven on the best day, if the CEOS perform well, it doesn‚Äôt take away the sting of the issue being out there,‚ÄĚ said one federal policy expert in the industry whose company is not represented on the witness stand. Read Sarah Karlin-Smith‚Äôs full preview here.
‚Ä¶ And in case you thought attention on drugmakers would die down after Tuesday: Sens. Chuck Grassley and Ron Wyden, the Finance Committee chairman and ranking member, launched an investigation late last week of three insulin-makers ‚ÄĒ Eli Lilly, Sanofi and Novo Nordisk ‚ÄĒ over surging prices for the life-saving diabetes medicine. House members also are looking at the issue. More for Pros here.
SCOTUS DECISION IN MARYLAND CASE SHOULDN‚ÄôT BE HUGE BLOW TO STATES’ DRUG PRICING EFFORTS ‚ÄĒ The Supreme Court last week declined to take up Maryland‚Äôs appeal of a lower court decision that invalidated a state law aimed at preventing price gouging of generic and off-patent medicines. The move comes as dozens of states are working on legislation to control drug costs, but legal experts weren‚Äôt overly concerned that the court’s refusal would squelch those efforts.
‚ÄúI don‚Äôt think that the case is damning whatsoever for other drug pricing laws,‚ÄĚ said Jaime King of UC Hastings College of the Law.
That‚Äôs largely because many states have moved away from the approach Maryland took and are deliberately crafting bills that shouldn‚Äôt affect drug sales in other states, said Erin Fuse Brown of Georgia State University’s law school. The Maryland statute was struck down by the 4th U.S. Circuit Court of Appeals, which found that it violates the Constitution’s commerce clause by regulating the prices of transactions that occur outside Maryland. The law would have allowed the state to investigate ‚Äúunconscionable‚ÄĚ drug price increases, and to request violators pay back consumers, require them to lower drug prices for a year and pay fines up to $10,000 for each transgression. It targeted the prices drug companies charge to wholesalers ‚ÄĒ sales which often would occur out of state.
However, ‚Äúthe dormant commerce clause wouldn‚Äôt block transactions that are within the state, and so efforts by the state to regulate the prices that insurers pay or payers pay for drugs and that consumers pay within the state wouldn’t raise the same problem,‚ÄĚ Brown said.
One lingering concern: The threat of costly litigation could still stop states from acting on drug prices. The industry is apt to find different legal challenges for other types of bills. ‚ÄúThe real power is to scare legislators,‚ÄĚ said Harvard‚Äôs Ameet Sarpatwari. Industry can say ‚Äú‚Äėwe won against Maryland, do you really want to spend you your limited capital on this when we will definitely take you to court and may win,‚Äô‚ÄĚ he said. But while Sarpatwari thinks the case ‚Äúhas a slight possible chilling effect on the whole,‚ÄĚ he believes there is now enough momentum on the issue that most states will go forward with their plans.
FDA PUSHES BACK ON GENERIC DRUG SAFETY ‚ÄĒThe agency issued a rare public rebuttal to media reports about generic drug safety, saying that while it welcomes ‚Äúthe accountability inspired by a free press‚ÄĚ it found some recent stories ‚Äúseriously flawed.‚ÄĚ The statement came weeks after Commissioner Scott Gottlieb promised a response to a series of Bloomberg reports that there had been a decline in FDA facility inspections both in the United States and abroad, as well as softer penalties for violations over the years. One of the stories said Mylan‚Äôs generic version of the heart medicine Lipitor was associated with more side effects than the branded product.
On oversight, FDA pointed to increased inspections in India even as they declined in China (which Bloomberg also noted, along with a boom in approved manufacturers in both countries). The agency also highlighted a rise in warning letters over the years, saying they were not necessarily tied to drug quality problems but rather its the agency‚Äôs practice of targeting higher-risk facilities for inspections ‚ÄĒ which it said was a factor in the shifting country inspection trends, too.
On product safety, the agency said that in analyzing its own data from 2012 to 2018, it found no evidence that generic Lipitor ‚ÄĒ or any generic product ‚ÄĒ was more likely to be associated with adverse events than its brand-name counterpart. Neither the FDA or Bloomberg released methodology for adverse event trends, but Gottlieb tweeted three weeks ago, shortly after the last published story, that he thought Bloomberg‚Äôs was incorrect.
‚Ä¶ FDA did acknowledge just how vast and complex generic drug regulation has grown. The products account for 90 percent of retail prescriptions, and at least 80 percent of U.S. drugs‚Äô active ingredients are made outside the country. But consumers need to have confidence in the products, the agency said: ‚ÄúGeneric drugs provide affordable access to critical treatments.‚ÄĚ
THE DILEMMA OF CITING SIDE EFFECT IN DRUG ADS ‚ÄĒ A pair of researchers are noting an ‚Äúethical and practical dilemma‚ÄĚ with including possible major and minor side effects in direct-to-consumer ads. In a Scientific American article last week, they drew on conclusions from their own previously published research about how viewers respond to ads that mention both major side effects (such as stroke or heart attack) and minor ones (like dry mouth and headache).
The issue: When drug companies advertise their medicines, they‚Äôre required to include a lengthy list of the risks. Across six experiments in their 2017 paper, the researchers determined that when drug companies list both major and minor side effects, consumers view the overall danger as less severe than when they only hear the major risks. Essentially, listing minor side effects dilutes the importance of the major ones ‚ÄĒ and makes consumers willing to pay more for the drug.
A possible solution: Listing the major effects in bold red type and putting the minor ones in regular type helped. Study participants rated the drug’s risk as similar in that case to when they only saw the major side effects.
The results ‚Äúadd to the chorus‚ÄĚ of voices calling for redrafting policies around communicating drug risks to consumers, the researchers wrote last week. Indeed, FDA asked for input last year about risks presented in direct-to-consumer ads on TV.
PFIZER EXEC TO HOST GILLIBRAND FUNDRAISER ‚ÄĒ Top Pfizer executive Sally Susman is throwing a March fundraiser for Sen. Kirsten Gillibrand‚Äôs presidential campaign, according to a CNBC report, with tickets ranging from $1,000 to $2,700. Susman is the executive vice president and corporate affairs officer for the New York-based drug company, and had previously supported the New York Democrat‚Äôs Senate campaigns.
The fundraiser comes as most 2020 Democrats have sought to distance themselves from industry money, relying instead on small-dollar donors. Gillibrand said she will reject corporate PAC support, and tweeted in January that her run will be ‚Äúfor and by people, not corporate PACs.‚ÄĚ Pfizer ranked as one of the largest donors to her last Senate run, contributing with employees and the company’s PAC donating more than $80,000.
Gillibrand has co-sponsored a few of the drug pricing bills circulating in Congress, including fellow 2020 candidate Sen. Bernie Sanders‚Äô Prescription Drug Price Relief Act, S. 102 (116), which would revoke a manufacturer‚Äôs patent and marketing exclusivities if the U.S. price for its drug exceeds the median of prices paid in Canada, the United Kingdom, Germany, France and Japan.
Tuesday: The Senate Finance Committee holds a hearing on drug pricing in the United States with executives from seven large manufacturers scheduled to testify.
FDA‚Äôs Oncologic Drugs Advisory Committee meets to review Karyopharm Therapeutics’ new drug application for selinexor tablets to treat relapsed refractory multiple myeloma.
Wednesday: The House Energy and Commerce Oversight Subcommittee holds a hearing on the measles outbreak in the United States.
Friends of NIDA hosts a briefing with the Congressional Addiction, Treatment and Recovery Caucus on benefits and challenges of cannabinoid research.
FDA Commissioner Scott Gottlieb updates the House Appropriations Agriculture-FDA subcommittee on agency operations.
Thursday: The Alliance for Health Policy hosts a congressional briefing on the basics of biosimilars.
Kentucky, Ohio are latest to go after PBMs ‚ÄĒ Pharmacy benefit managers took in $123 million more from Kentucky Medicaid plans than they paid to pharmacies that dispensed the drugs, according to a report from the state‚Äôs health department. The report examined spread pricing ‚ÄĒ the difference between what a PBM reimburses drugstores and what it charges health plan clients. Critics argue that PBMs are unfairly profiting from the gap, and several states are looking into the issue. Meanwhile, Ohio Attorney General Dave Yost said last week that he wants OptumRX to repay $16 million he believes it owes the state Bureau of Workers Compensation because the PBM did not return savings from drug price cuts over nearly three years.
Cuomo tries an opioid tax, again ‚ÄĒ New York Gov. Andrew Cuomo is taking another stab at taxing the sale of opioids, hoping this one passes judicial muster. His budget amendment calls for a two-tiered excise tax ‚ÄĒ 0.25 cent per morphine milligram equivalent on opioids with a wholesale acquisition cost under 50 cents per unit and a 1.5 cent tax for those costing more ‚ÄĒ on manufacturers and distributors, and expressly allows them to pass on the additional costs to pharmacists or consumers. Prohibiting that kind of pass-through is what doomed Cuomo‚Äôs 2018 tax, which a federal judge ruled in December placed an unconstitutional burden on interstate commerce by forcing companies to raise prices elsewhere to defray the cost of a New York tax. But the new proposal faces opposition. It would be a ‚Äútax on pharmacies that pharmacies cannot absorb,‚ÄĚ said Debbi Barber, president of the Pharmacists Society of the State of New York.
Utah governor wants to reclassify and study marijuana ‚ÄĒ Utah Gov. Gary Herbert said Friday that federal officials should remove marijuana from the list of Schedule I drugs so it can be studied for medicinal use ‚ÄĒ and, if proven effective, prescribed to patients for various ailments. “There ought to be science, not just anecdotal stories but research, clinical studies like we do any other drug so that doctors can actually prescribe it and know for whatever ailments are out there this will help you,” Herbert said during an interview at POLITICO’s State Solutions Conference. Of course, 33 states (including his own) and the District of Columbia aren‚Äôt waiting. More for Pros here.
Sorry, Florida, the White House isn‚Äôt ready to OK ‚ÄĒ Last Wednesday Gov. Ron DeSantis said President Trump had endorsed Florida‚Äôs proposal to import prescription drugs from Canada. But on Friday White House deputy press secretary Judd Deere stopped short of endorsing the plan, The Hill reports. Deere said Trump ‚Äúhas instructed his staff to meet with the governor to learn more details about what he is considering.‚ÄĚ
Goldwater can‚Äôt force FDA disclosure of reasons for providing experimental drugs ‚ÄĒ A federal judge in Arizona rejected efforts by the libertarian Goldwater Institute to force FDA to publicly explain how it decided to allow two people infected with Ebola to try the experimental drug ZMapp in 2014, even though it had not yet been cleared for human testing, Capitol Media Services reports. Goldwater, which spearheaded the right-to-try legislation that lets patients skirt the FDA when requesting access to experimental drugs, argued the public has a right to know how the government makes unapproved drugs available, particularly in emergency situations. The judge disagreed, reasoning that the information sought was part of an investigational drug application that is designed to be kept confidential to protect the trade secrets and commercial information of the drug developer.
Keytruda fails late-stage liver cancer trial ‚ÄĒ Merck reported its drug Keytruda failed a Phase 3 trial as second-line treatment for patients with advanced liver cancer, less than four months after it received accelerated approval for a similar indication. Accelerated approvals require additional studies to verify the benefit, and it was unclear how FDA would respond. It could issue a warning or caution against use of the drug for advanced hepatocellular carcinoma. But the agency has not immediately done so after confirmatory studies of cancer immunotherapies failed in the past, Biopharma reported.
Federal judge allows consumer-fraud lawsuit against major insulin-makers ‚ÄĒ A district judge in New Jersey is allowing a class-action lawsuit against Novo Nordisk, Eli Lilly and Sanofi to move forward, Bloomberg reported. The suit, filed by 67 diabetics, accused the companies of hiking prices for the life-saving drug nearly 150 percent over five years, forcing some patients to pay close to $900 a month to stay on the insulin they needed. In his Feb. 15 ruling, the judge dismissed racketeering claims against the companies. But he said patients could press on with their key argument that company practices violated consumer-protection laws in states including New Jersey, New York, Wisconsin, Tennessee and New Hampshire.
Cigna has retained five of the six lobbying firms ‚ÄĒ Banner Public Affairs, Bose Public Affairs Group, Levine & Company, Nathanson+Hauck and the Wynne Health Group ‚ÄĒ that previously were with Express Scripts in Washington, POLITICO Influence reported. The PBM, which recently merged with the insurer, spent more than $3.2 million on lobbying in the capital last year.
The Reservoir Communications Group added Gretta Stone, PhRMA‚Äôs former deputy vice president of policy and research, to its group of health care policy experts.
HHS OIG released a summary of its comparison of average sales prices and average manufacturer prices for the third quarter of 2018, which found that nine drug codes met CMS‚Äôs price substitution criteria.
The Institute for Clinical and Economic Review published a report on the effectiveness and value of Spinraza and Zolgensma for treatment of spinal muscular atrophy.
FDA issued draft guidance for industry on nicotine replacement therapy.
Sen. Amy Klobuchar (D-Minn.) sent a letter to FDA Commissioner Scott Gottlieb asking what steps the agency has taken to prevent pharmaceutical companies from misrepresenting the risk of addiction to medical professionals and consumers. The letter followed a Stat/ProPublica report detailing how Richard Sackler, a physician and member of the family that founded and made billions from Purdue Pharma, knew for years that the company was downplaying OxyContin‚Äôs potential for addiction to increase sales.
Non-Israeli patients to pay over $300,000 for experimental ALS treatment ‚ÄĒ The cost to Israelis: nothing. That‚Äôs because the Israeli Health Ministry is planning to let five patients from abroad be charged tens of thousands of dollars to subsidize the cost of providing the stem cell therapy free to eight Israelis with ALS, Ido Efrati reports for Haaretz. The move could anger ALS patients in the United States who were hoping to access the treatment, NurOwn, through the new Right to Try law. BrainStorm Cell Therapeutics, the U.S.-Israeli biotechnology company that is developing it, had considered providing its therapies to patients under the law but backed off, citing funding concerns.
** A message from EMD Serono: More than two million people suffer from multiple sclerosis (MS) worldwide. But this disease strikes women unequally, affecting them up to three times more often than men.
At EMD Serono, we are driven by a commitment to develop innovations that help all those impacted by MS. EMD Serono’s experience and scientific discoveries in MS date back more than 20 years. People living with MS, their caregivers and healthcare teams are our catalyst and inspiration to continue innovating, advocating and collaborating.
Multiple sclerosis not only impacts women‚Äôs health but also their families and their work, limiting their ability to join, thrive and rise in their communities and workplaces. That‚Äôs why EMD Serono is championing a global initiative called Healthy Women, Healthy Economies. We are partnering with MS researchers, medical societies and patient advocacy organizations to help women living with MS. Learn more here. **