United States: Capitol Hill Healthcare Update - February 25, 2019

Below is this week's "Capitol Hill Healthcare Update," which is posted on Mondays when Congress is in session. Highlights this week: Pharma industry CEOs testify before a Senate committee; House and Senate panels probe insulin prices; medical device tax suspension bills to be introduced; Gottlieb to testify before House panel; and more.


Democrats on the Senate committee questioning top executives from seven leading pharmaceutical manufacturers are expected to argue that the industry's business model is unacceptable and to accuse the companies of colluding with the Trump administration to increase prescription drug prices.

The top executives from AbbVie, Johnson & Johnson, Sanofi and other drug companies will appear before the Senate Finance Committee on Tuesday for a hearing on how drug prices are established and why they increase.

According to a Democratic committee aide, Democratic senators will seek to make a moral case for why drug prices should be lowered and how the industry's business model needs to change - warning this is pharma's "final opportunity" to concede the industry bears significant responsibility for drug prices.

Witnesses also are expected to be questioned about executive compensation and how they leveraged the 2017 tax reform law to buy shares of outstanding company stock instead of lowering drug prices.

But industry criticism won't be leveled only by Democrats. Republican senators are expected to question executives on so-called evergreening to extend patent protections and delay competition, companies' revenue compared with their investments in research and development, and sales in countries where governments set prices.

The legislative and political risks for the drug industry haven't been this high since 2009, when Democrats in charge of Congress and the White House pushed what became the Affordable Care Act. The executives' performance will likely determine how much fuel is added to existing legislative efforts to lower drug prices and to what degree those efforts become bipartisan.


Bipartisan legislation to repeal the 2.3 percent excise tax on the sale of medical technology is expected to be introduced in the House this week.

Reps. Ron Kind, D-Wis., and Jackie Walorski, R-Ind., are the lead sponsors on the bill, which in recent years has generated near-unanimous Republican support and also backing from dozens of Democrats. Introduction could be pushed into March to allow time for additional lawmakers to join the legislation as original co-sponsors.

House advocates hope to pair their effort with Senate legislation expected to be introduced by Sens. Pat Toomey, R-Penn., and Amy Klobuchar, D-Minn.

The House voted last summer 283-132 to repeal the device tax, but the bill was not considered in the Senate. Congress last year suspended the device tax until 2020. But industry advocates want it permanently killed, saying the tax siphons funds from growing medical technology companies, and burdens innovation and job creation.

Meanwhile, a group of bipartisan senators is seeking to suspend the tax on health insurers, which, like the device tax, was included in the Affordable Care Act. Led by Sens. Cory Gardner, R-Colo., and Jeanne Shaheen, D-N.H., the lawmakers are seeking co-sponsors for legislation that would prevent the $16 billion tax on insurers from taking effect in 2020.


FDA Commissioner Scott Gottlieb will testify Wednesday before the House panel that approves his agency's congressional appropriations.

Gottlieb had been scheduled to appear before the panel earlier this month, but his appearance was postponed to allow lawmakers to attend the funeral of former Rep. John Dingell, D-Mich.

The only witness to testify before the House Appropriations Agriculture Subcommittee, Gottlieb is expected to outline how the recent government shutdown affected operations for drug and medical device approvals as well as inspections of foreign manufacturing facilities.


The Senate Finance Committee last week joined two House committees looking into the high cost of insulin.

Chairman Chuck Grassley, R-Iowa, and Sen. Ron Wyden, D-Ore., sent letters to the CEOs of Eli Lilly, Novo Nordisk and Sanofi asking about prices of their insulin products, which the senators said have increased by more than 500 percent in the past two decades.

In the House, Rep. Diana DeGette, D-Colo., also has questioned manufacturers about insulin prices. DeGette is the chairwoman of the Energy and Commerce Oversight and Investigations Subcommittee, and she's also co-leader of the Congressional Diabetes Caucus.

The House Oversight and Reform Committee heard testimony in January from a mother whose daughter died after rationing her insulin because she couldn't afford it.

Meanwhile, Rep. Peter Welch, D-Vt., introduced legislation that would allow patients, pharmacists and wholesalers to import insulin from Canada and other countries.


Saying the healthcare industry is vulnerable to attack, Sen. Mark Warner, D-Va., wants to hear from groups representing hospitals, physicians, health IT and medical device manufacturers on policies to improve cybersecurity.

Warner said sharing of patients' health data and tech solutions such as telemedicine represent a boon to patients, particularly in rural and underserved areas. But the technology also creates risk, he said.

The senator posed a series of questions about current cyber practices to several stakeholders, including AdvaMed, America's Health Insurance Plans, the American Medical Association, the Federation of American Hospitals and the Healthcare Leadership Council.

Warner is a member of the Finance Committee, which has jurisdiction over Medicare and Medicaid. He's also the top Democrat on the Intelligence Committee.


Two of the federal government's leading experts on infectious disease and immunization will testify this week before a House subcommittee examining the government's efforts to contain the spread of measles.

Dr. Anthony Facui, the director of NIH's Institute for Allergy and Infection Diseases, and Dr. Nancy Messonnier, director of CDC's National Center for Immunization and Respiratory Diseases, will testify before the House Energy and Commerce Oversight and Investigations Subcommittee.

Chairwoman Diana DeGette, D-Colo., said 127 measles cases have been reported in 10 states this year, with nearly half that total in one Washington state county that's a suburb of Portland, Oregon.

More than 20 million lives have been saved around the world since 2000 because of the measles vaccine, according to the CDC.

Amid concern that vaccination rates have slipped, Senate HELP Committee Chairman Lamar Alexander, R-Tenn., and Sen. Patty Murray, D-Wash., announced the committee will hold a hearing March 5 on the re-emergence of vaccine-preventable diseases in the United States.


Sen. Sherrod Brown, D-Ohio, last week introduced legislation that would allow Americans over 50 years old the option to participate in Medicare 15 years before the current retirement age.

Brown's "Medicare buy-in" bill was co-sponsored by several Senate Democrats, including presidential candidates Sens. Kamala Harris, D-Calif.; Cory Booker, D-N.J.; and Amy Klobuchar, D-Minn.

Identical House legislation was introduced by Rep. Brian Higgins, D-N.Y.

But momentum among Democrats is to go further than Brown's bill. Sen. Bernie Sanders, I-Vt., said he will soon reintroduce his "Medicare for All" legislation, which would expand Medicare into a universal health insurance program. Sanders also is seeking the Democratic presidential nomination.

Harris and Booker supported Sanders' bill last year, as did presidential candidates Sens. Elizabeth Warren, D-Mass., and Kirsten Gillibrand, D-N.Y.

But Brown - himself a potential presidential contender - said Sanders' bill is politically unrealistic and that expanding Medicare is a more achievable option.

Meanwhile, Rep. Pramila Jayapal, D-Wash., is expected to introduce a revised single-payer healthcare overhaul bill in the House this week. Her office said at least 100 Democrats have signed on as co-sponsors.


Two more House lawmakers are seeking signatures on a letter to HHS Secretary Alex Azar calling on CMS to withdraw a proposed regulation that aims to lower prescription drug costs by allowing Medicare Part D and Medicare Advantage plans to exclude from formularies coverage of certain medicines - including cancer drugs.

CMS says its proposal would give Part D plans flexibility not to cover drugs in the so-called six protected classes: antidepressants, antipsychotics, anticonvulsants, immunosuppressants, antiretrovirals and cancer drugs.

But Reps. Barbara Lee, D-Calif., and Will Hurd, R-Texas, are circulating a draft letter to Azar that says CMS' plan could have "reverberating effects for patients suffering from multiple conditions and exacerbate health disparities in low-income and minority communities."

CMS' proposal has sparked concern among patient groups, which fear that newly approved treatments could lack Medicare coverage.

Earlier this month, Rep. Grace Napolitano, D-Calif., organized a separate letter to Azar, calling on him to maintain the six protected classes within the Part D program.

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