On The Hill

Congress returned from its August recess this week right where it left off in July, as drug pricing took center stage. Speaker Pelosi’s long-anticipated drug-pricing plan had a publicly-released draft, while conversations continue surrounding the Grassley-Wyden bill that was passed by the Senate Finance Committee in late July. Elsewhere, the House Energy & Commerce Committee held a hearing on maternal health and the markup of the Labor-HHS-Education spending bill was postponed.

Maternal Health Hearing

The House Energy & Commerce Committee’s Subcommittee on Health held a hearing on Tuesday (Sep. 10) entitled “Improving Maternal Health: Legislation to Advance Prevention Efforts and Access to Care.” The hearing held a somber tone throughout as numerous stories of tragic maternal care-related deaths occurred during the witness statements and throughout the hearing. The statistics were presented, with the U.S. as one of the worst countries globally for maternal care, and committee members stated they wanted to address this issue, as it impacts so many. Rep. Greg Walden (R-OR), the Ranking Member of the full committee, gave a fiery statement during his opening remarks, slamming the Democratic members of the committee for not moving forward on legislation that he believed to be bipartisan, along with being given less than 24 hours to review testimony. However, the hearing was conducted in a truly non-contentious manner throughout, with no additional fireworks between members or parties. Chairwoman Anna Eshoo (D-CA) closed the hearing by mentioning that the committee would not be at ease until legislation is passed addressing these issues. To read an executive summary of this hearing, click here.

Drug Pricing

Speaker Pelosi’s Drug Pricing Plan

According to news reports, a document outlining Speaker Pelosi’s supposed drug pricing plan borrows from President Trump’s plan to tie the cost of drugs to the lower prices paid overseas while also trying to appease progressives. The government would be directed to negotiate prices on the 250 drugs that account for the highest costs to Medicare and the entire U.S. health system and that lack sufficient competition. That would cover drugs representing half of all spending in Medicare Part D, including insulin. The summary drops a controversial proposal to use a third-party arbiter to determine the price of medicines if negotiations fail. It would instead rely on parameters established by the use of international reference pricing and stiff penalties for companies that don’t cooperate. Savings from the lower-priced drugs would be directed to NIH to develop new medicines. The maximum price negotiated for the drugs would be tied to the cost of paid in other developed countries, where medicines often sell for less. The Trump administration is also embracing the concept, which is known as the international price index. Under the Pelosi plan, the upper limit for the drug must be no more than 1.2 times of the average price in six countries: Australia, Canada, France, Germany, Japan and the United Kingdom. Once price is negotiated, a drug company cannot raise it above the rate of inflation until sufficient competition develops in the market. Companies would be subject to financial penalties if they refuse to participate in negotiations or do not reach an agreement with the government. An excise tax would be equal to 75 percent of the gross sales of the drug in question from the previous year. The House Energy and Commerce and Ways and Means committees are expected to mark up the bill later this month. It is not clear when an official discussion draft will be released. ^[1] 

Ranking Member Wyden on Drug Pricing

Senator Ron Wyden (D-OR), the Ranking Member of the Senate Finance Committee, delivered an impassioned speech on the Senate Floor on Thursday (Sep. 12), calling on Senate Majority Leader Mitch McConnell (R-KY) to bring the drug pricing bill passed by the Finance Committee to the floor. Wyden said he believes “big pharma” has the “longest winning streak in Washington” and legislation should not be picked apart by these companies, especially on price gouging.

Labor-HHS-Education Spending Bill Markup Postponed

Earlier this week, Senate appropriators postponed a subcommittee markup of the FY 2020 Labor-HHS-Education spending bill. The bill would have offered a first look at the Senate’s top-line numbers for education, health and labor funding after Trump signed a two-year budget deal in August, H.R. 3877 (116). Lawmakers have until Sep. 30 to pass spending bills to avoid a government shutdown. Congressional leaders have said they plan to take up stopgap legislation to keep the government open. A reason for the postponement was not given by the Senate Appropriations Committee. A Senate GOP aide said the bill is being delayed until lawmakers and staff can reach an agreement on what constitutes a “poison pill.” The budget deal included a handshake agreement to avoid “poison pills.” ^[2] 

Upcoming Hearings

On Thursday, September 19, 2019, the House Energy & Commerce Committee’s Subcommittee on Consumer Protection & Commerce will hold a hearing entitled “Profits Over Consumers: Exposing how Pharmaceutical Companies Game the System.”

References

^[1] Karlin-Smith, Sarah. “Draft Pelosi plan calls for government negotiations on 250 drugs.” Politico Pro. 9 Sept. 2019. https://subscriber.politicopro.com/article/2019/09/pelosi-rolls-out-drug-pricing-plan-1713461

^[2] Gaudiano, Nicole. “Senate appropriators postpone markup of Labor-HHS-Education spending bill.” Politico Pro. 10 Sept. 2019.https://subscriber.politicopro.com/article/2019/09/senate-appropriators-postpone-markup-of-labor-hhs-education-spending-bill-3809646