Hill talks PAHPA and PBMs

A busy Thursday on Capitol Hill brought progress on PAHPA and questions about PBMs—here’s what happened. (646 words, 3 minutes, 13 seconds)

House subcommittee approves PAHPA reauthorization

The House Energy & Commerce Health Subcommittee yesterday approved the reauthorization of important pandemic preparedness legislation, but Democrats complained the bills skimp on funding.

What happened: The subcommittee passed two bills from Rep. Richard Hudson (R-NC), “Preparedness and Response Reauthorization” and “Preparing for All Hazards and Pathogens Reauthorization,” which together help reauthorize the Pandemic All Hazards and Preparedness Act (PAHPA).

BIO calls for a robust PAHPA to fortify us against the next pandemic. (BIO’s Phyllis Arthur, last month, testified before this subcommittee about the need to reauthorize PAHPA.)

New provisions: Chair Brett Guthrie (R-KY) said the bills streamline response infrastructure within the Administration for Strategic Preparedness and Response (ASPR) and require the Biomedical Advanced Research and Development Authority (BARDA) to issue contracts for a minimum of five years.

Democrats’ funding frustrations: Ranking Member Anna Eshoo (D-CA) said she’s “frustrated” with a PAHPA plan “locking our nation’s health programs into five years of underfunding” and noted Americans want better preparedness (as a BIO-supported poll found). Rep. Frank Pallone (D-NJ) agreed, saying PAHPA has never been so partisan.

Addiction assistance: Also passed by the subcommittee yesterday, Chair Guthrie’s proposed reauthorization of the SUPPORT for Patients and Communities Act, which would guarantee Medicaid coverage for addiction treatment. The bill ensures Medicaid would give patients access to all FDA-approved overdose medications. BIO supports a strong version of this legislation.

What’s next: The bills will go to the full Energy & Commerce Committee for consideration; if passed, they’ll go to the full House. BIO will follow PAHPA’s progress and reconciliation with the Senate version, which is scheduled for a July 20 mark-up.

FTC Chair Khan tells House about PBM probes

Federal Trade Commission (FTC) Chair Lina Khan testified in the House yesterday, where the FTC’s pharmacy benefit manager (PBM) investigation and specific pharma mergers came up.

Why it matters: PBMs manage prescription drug benefits for insurance plans and payers. PBMs receive rebates from drug makers and should pass savings on to patients—but research shows they often profit while making drugs costlier.

PBM consolidation: Rep. Hank Johnson (D-GA) noted “three PBMs controlling 79% of the market” lead to higher drug costs. Rep. Deborah Ross (D-NC) said PBM market power means “patients don’t see a lot of the PBM discounts at the pharmacy counter.”

FTC going deeper: Khan said the FTC is deepening its inquiry into PBMs, which began last year.

“Conflicts of interest” apparently arise when insurers own PBMs and PBMs compete with the pharmacies they serve, Khan said. “We’ve also heard that these PBMs demand rebates in ways that may be denying patients access to more affordable drugs.”

On FTC’s approach to mergers: Rep. Darryl Issa (R-CA) asked about FTC’s challenge to Illumina’s reacquisition of its spinoff, Grail, and whether it would hinder the availability of cutting-edge cancer treatments. Rep. Lance Gooden (R-TX) asked about FTC’s opposition to Amgen’s proposed acquisition of Horizon Therapeutics and its impact on the domestic biotech industry; Khan committed to discussing it further.

What’s next: There is no release date for the FTC’s investigation of PBMs, but Khan testified it will “shine a light on the opaque operations of these large pharmacy middlemen who can dictate the pricing and access to life-saving drugs for so many Americans.”

More News: 

FDA: FDA approves first nonprescription daily oral contraceptive
“Today’s approval marks the first time a nonprescription daily oral contraceptive will be an available option for millions of people in the United States,” said Patrizia Cavazzoni, M.D., director of the FDA’s Center for Drug Evaluation and Research. “When used as directed, daily oral contraception is safe and is expected to be more effective than currently available nonprescription contraceptive methods in preventing unintended pregnancy.”

President Biden’s Friday: Visiting Camp David after a week of NATO business in Europe. Meanwhile, the White House has reportedly selected Ret. Maj. Gen. Paul Friedrichs to lead the White House Office of Pandemic Preparedness and Response Policy, per The Washington Post.

What’s Happening on Capitol Hill: The House continues work on the defense spending bill.