Drug pricing program 'legally flawed'

Here’s what BIO told CMS about their drug price “negotiation” program, plus what Members of Congress and witnesses said on Capitol Hill yesterday about FDA’s authority and mifepristone, R&D tax credits, and 340B. (603 words, 3 minutes, 0 seconds)

CMS Drug Price Negotiation Program ‘legally flawed,’ says BIO and CSBA

Before providing input on how to handle Medicare drug price “negotiations” (controls), BIO notes “legal flaws” in the structure and the limited room to impact the process. 

What’s happening: On April 14, BIO provided nearly 70 pages of recommendations for implementing “negotiations” in the Inflation Reduction Act (IRA) in response to a request for comments from the Centers for Medicare & Medicaid Services (CMS).

The process misses the target: Without tackling the market leverage of pharmacy benefit managers (PBMs), the IRA cannot achieve meaningfully lower patient out-of-pocket costs for drugs, says BIO.

The process is “legally flawed” because drug manufacturers have no negotiating power. Further, CMS’s plans for the process “have been issued as final,” precluding transparent rulemaking based on comments.

The process is one-sided. “The implementation…would materially benefit from two-sided engagement on all topics, including a full opportunity for stakeholders to submit comments on proposed policies and meaningful responses to such comments,” BIO notes.

BIO comments extensively on several key areas, including:

• defining eligible drugs;
• selecting drugs for negotiation and an opportunity for dispute;
• negotiating transparently and predictably;
• calculating and setting maximum fair price (MFP); and,
• using rebates to enforce MFP.

Read the comments from BIO and the Council of State Bioscience Associations (CSBA).

Read more on Bio.News.

BIO's Chief Policy Officer, John Murphy, writes in the Pittsburgh Post-Gazette about the negative impacts of the IRA for cancer patients.

More Health News:

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“The drug will remain widely available as the justices extended their deadline to Friday on whether to uphold the F.D.A.’s approval of the pill”—read our recap of the week in mifepristone on Bio.News.

Hill hearing recap: R&D tax credits, FDA’s authority, and more

Small biotechs face a heavy financial burden from regulatory requirements, says a BIO statement submitted in the House yesterday, as a flurry of hearings touched on issues like R&D tax credits and the need to protect FDA’s authority.

What we need: “carefully targeted reforms that promote greater access to capital while protecting investors, promoting transparency, and preserving market integrity,” said a statement by BIO Chief Advocacy Officer Nick Shipley submitted to the House Financial Services Subcommittee on Capital Markets.

“Regulatory burdens divert scarce funds from science to compliance,” argues BIO, calling for passage of the Helping Startups Continue to Grow Act and a proposal by Sen. Ted Budd (R-NC) to update the definition of emerging growth companies.

We need a tax code that supports science R&D with immediate tax credits, said Rep. Ron Estes (R-KS) during a House Ways & Means hearing. He reintroduced the American Innovation and R&D Competitiveness Act with bipartisan (and BIO’s) support.

On 340B: Reps. Larry Bucshon (R-IN) and Morgan Griffith (R-VA) mentioned abuses of the 340B program in the same hearing. “340B plays a critical role for some providers, but we need to make sure that there is accountability and transparency in the system,” said Administrator of the Health Resources and Services Administration Carole Johnson.

On mifepristone: We need a federal hearing to address recent court actions that are detrimental to the availability of mifepristone and FDA’s authority, Rep. Frank Pallone (D-NJ) told the House Energy & Commerce Health Subcommittee.

Watch: During yesterday's hearings, Sen. Martin Heinrich (D-NM) questioned FDA Commissioner Dr. Robert Califf on the impact of a federal court decision on the FDA’s approval of mifepristone, while Rep. Frank Pallone (D-NJ) requested the committee schedule a hearing to examine the federal drug approval process.

President Biden’s Thursday: During the fourth virtual leader-level meeting of the Major Economies Forum on Energy and Climate, he’s expected to announce support to help developing countries fight climate change, per Reuters.

What’s Happening on Capitol Hill: The Senate Agriculture Conservation Subcommittee hearing holds a hearing on conservation in the farm bill.