PBMs, drug prices, and innovation

Two hearings yesterday highlighted incredible biopharmaceutical advances and how policy can help or hinder access to them. Plus, BIO Impact registration is now open—here’s what you need to know. (741 words, 3 minutes, 42 seconds)

5 ways the government’s ‘getting in the way’ of innovation, per House hearing

The biopharmaceutical industry has developed incredible innovation—but policies like drug price controls in the Inflation Reduction Act (IRA) and the World Trade Organization’s waiver of COVID-19 IP will hinder access to innovation, said Members of Congress at the House Ways & Means Health Subcommittee yesterday.

Five ways the government’s “getting in the way” of innovation,per Chair Vern Buchanan (R-FL):

1. Centers for Medicare and Medicaid Services’ coverage decision on Alzheimer’s treatments.
2. Repeal of the Medicare Coverage of Innovative Technology (MCIT) rule without an alternative.
3. The CMS Innovation Center’s (CMMI) consideration of the “Accelerating Clinical Evidence Model.”
4. The WTO’s waiver of COVID IP protections.
5. The IRA’s drug price “negotiation” provisions.

Bipartisan concerns about CMMI: Full Chair Jason Smith (R-MO) expressed concerns about CMMI, while Rep. Terri Sewell (D-AL) noted the need for guardrails around CMMI.

Many asked about the impact of the COVID IP waiver—with Rep. Michelle Steele (R-CA) specifically asking about the damage to the life sciences industry in California. The waiver would have a “chilling” impact on investment, said witness Dr. Darius Lakdawalla of the USC Schaeffer Center.

Many asked about the impact of drug price controls—with Chair Smith noting that we could see as many as 135 fewer cures due to “negotiation” in the IRA.   

The key quote: “The IRA includes an exemption from the negotiation process for orphan drugs. However, the exemption is limited to orphan drugs that are only for one rare disease or condition. As many of you know, many rare disease drugs are often discovered as a second or third indication,” said Rep. Kevin Hern (R-OK). “I’m calling on my Democratic colleagues to work with me on a technical fix to the bill to make sure that more rare disease drugs and treatments are protected from the negotiation process.”

Senate committee explores role of PBMs in insulin prices

The Senate Health, Education, Labor, and Pensions (HELP) Committee held a hearing yesterday on insulin prices featuring CEOs of BIO member companies Eli Lilly, Novo Nordisk, and Sanofi and pharmacy benefit managers (PBMs)—here’s what to know. 

The key takeaway: While Chairman Bernie Sanders (I-VT) criticized drug manufacturers’ profits, he and several bipartisan Senators also called out PBMs for their huge profits, vertical integration, and lack of transparency.

The key quote: “I’ve seen that work that you’ve done, the technology that you—the drug companies—have put together that have made these medicines more convenient to take and have made it easier for the diabetic to manage her diabetes,” said Ranking Member Bill Cassidy (R-LA).

Speaking of PBMs, Senator Cassidy said, "But what I’m told is that in recent years, the net price of insulin has actually decreased even as the list price has increased...but it is clear the savings are not always reaching the patient," noting the vertical integration of PBMs “with the largest insurance companies in the world managing about 80% of the prescription drug claims.”  (Watch around 00:30:00.)

What’s next: The Senate HELP Committee will mark up four prescription drug bills today, including the Pharmacy Benefit Manager Reform Act delayed last week. We’ll have more tomorrow.

Watch highlights from both hearings:

BIO Impact returns

BIO Impact returns in September for the first time since 2019—here’s how you can register and impact the event.

What, when, where: The BIO Impact Ag & Environment Conference will take place September 19-20 in Raleigh, NC.

The program will cover topics including…

• Addressing climate change and food insecurity—with biotech products and processes like gene-edited crops, food animals that can withstand heat and disease, and sustainable aviation fuels with lower carbon emissions.
• Improving the regulatory approval process to promote innovation—read more.
• Increasing market access and acceptance.

Here’s how you can get ready:

1. Nominate a biotech hero. The George Washington Carver Award recognizes an individual in agricultural and environmental biotechnology, while the Rosalind Franklin Award recognizes a woman who has made significant contributions to the advancement of the bioeconomy and biotech innovation. 

Read more about the 2022 winners.

2. Apply to showcase your company at Start-Up Stadium. BIO is accepting applications from companies focused on food and farm innovation, sustainable fuels, and biobased manufacturing—apply by July 10.

3. Register now—we hope to see you there!

President Biden’s Thursday: Delivering remarks this afternoon about his administration’s historic conservation efforts.

What’s Happening on Capitol Hill: We’re watching the Senate Health, Education, Labor, and Pensions (HELP) Committee mark up four health-related bills, including the Pharmacy Benefit Manager Reform Act. The House Energy & Commerce Health Subcommittee will hear from several administration officials on responding to future public health security threats. Other hearings of note will cover agricultural trade, COVID immunity, and drug shortages.