A 'pill penalty' fix and bipartisan calls for PBM reform

A busy week in Washington, D.C., brought legislation to fix the Inflation Reduction Act “pill penalty,” bipartisan calls for PBM reform, and BIO CEO John F. Crowley explaining why Congress needs to act to support rare disease drug development. (1012 words, 5 minutes, 3 seconds)

Legislation to fix ‘pill penalty’ reintroduced in Congress

BIO applauded the reintroduction of bipartisan legislation that would eliminate the “pill penalty” in the Inflation Reduction Act (IRA).

The bill: The IRA arbitrarily gives small molecule drugs only nine years of total protection from price controls, while biologics can be exempt for 13 years. The Ensuring Pathways to Innovative Cures (EPIC) Act, H.R. 1492, introduced in the previous Congress and reintroduced on Feb. 21, alters the IRA provision.

Why it matters: “For decades small molecule medicines that come in a pill or tablet have been recognized for improving patient adherence,” said BIO President & CEO John F. Crowley. “Today, instead of building on years of biomedical progress, some innovator companies and investors are now being forced to pull away.”

BIO’s view: “On behalf of America’s patients and biotech innovators. I’d like to thank Reps. Gregory Murphy (R-NC), Don Davis (D-NC) and Richard Hudson (R-NC) for their leadership on this important issue,” Crowley said. “This bipartisan legislation will eliminate the pill penalty and help ensure science and researchers—not government bureaucrats—determine the possible treatments innovator companies pursue."

Related legislation: Rep. Davis on Thursday introduced the bipartisan Maintaining Investments in New Innovation (MINI) Act (H.R.1672). Like the EPIC Act, the MINI Act would increase price control exemptions of small molecule drugs from nine to 13 years, but it specifically provides this extension to small molecule drugs with genetically targeted technology.

Read more on Bio.News.

House members urge passage of PBM reforms

Congress must pass legislation to prevent pharmacy benefit managers (PBMs) from inflating drug costs, limiting patient access, and forcing pharmacy closures, lawmakers from both parties agreed last week.

What happened: At a Feb. 26 Energy & Commerce Subcommittee on Health hearing, Chair Earl “Buddy” Carter (R-GA), Ranking Member Diana DeGette (D-CO), Reps. Jake Auchincloss (D-MA). Mariannette Miller-Meeks (R-IW), Rep. Diana Harshbarger (R-TN), Rep. John Joyce (R-WV), and others criticized PBMs.

Why it matters: Three PBMs, acting as middlemen, control 80% of the U.S. prescription drug market and leverage their position to profit through anticompetitive tactics that harm patients.

Where things stand: Bipartisan PBM reforms and other important health legislation were included in a proposed funding bill in December but ultimately cut from that bill, noted Rep. DeGette.

What’s next: With Congress focused on spending legislation, Rep. DeGette suggested reintroducing the health bills in March by “suspension,” a procedure allowing for a quick vote on broadly supported measures. Rep. Carter agreed to consider it.

What they’re saying: “We have heard directly from our constituents that the harmful and anticompetitive tactics of some PBMs have only gotten worse, and that Congressional action is desperately needed,” Rep. Carter said. 

Read more on Bio.News.

What Else to Read This Week

With thoughtful FDA reforms, building a “nation of miracles” is within reach, writes John F. Crowley in STAT News.Crowley recalls his first meeting with President Trump in 2017: “We discussed how reforming, modernizing, and streamlining the Food and Drug Administration’s approval process for rare disease therapies could create a wave of new cures and therapies for the millions who suffer—most of them children,” says Crowley. Emphasizing that a properly staffed FDA is essential, Crowley said, “The president has a renewed chance to put this vision into action. … The administration should build on what works at agencies like the FDA while fixing what is broken.” He explains how.

We can’t afford to stall rare disease treatments, Crowley writes in Real Clear Health. The Pediatric Priority Review Voucher (PPRV) program “offers incentives for companies to develop treatments for rare diseases impacting children,” he explains. “Another area in need of urgent attention is the Inflation Reduction Act (IRA), which is creating additional barriers for orphan drug development.” Congress should reinstate the PPRV, which expired late last year, and pass the ORPHAN Cures Act, which mitigates IRA obstacles to orphan drug development, he concludes. Read the whole thing.

9 in 10 people who have kidney disease don’t know it—and there are often no early symptoms.These are just two facts we share for Kidney Action Week (March 3-7). The American Kidney Fund is offering free virtual sessions “packed with expert advice, life-changing strategies, and real stories that empower you to take control of your health.” 

Eli Lilly plans to more than double U.S. manufacturing investment since 2020, exceeding $50 billion. The BIO member announced three new manufacturing sites for active pharmaceutical ingredients (API) and one for future injectable therapies, which will create a total of 3,000 new jobs plus nearly 10,000 construction jobs. “The Tax Cuts and Jobs Act legislation passed in 2017 during President Trump's first term in office has been foundational to Lilly's domestic manufacturing investments, and it is essential that these policies are extended this year,” said Lilly Chair and CEO David A. Ricks.

BIO and its members participated in the Sustainable Aviation Fuel (SAF) Coalition’s Capitol Hill fly-in. BIO's John Torres and members LanzaJet and LanzaTech participated. Coalition members met key congressional leaders, including Sens. Jerry Moran (R-KS), Tammy Duckworth (D-IL), and Amy Klobuchar (D-MN), to advocate for policies that will drive large-scale production and adoption of SAF, a low-carbon jet fuel produced through biotech. BIO has been a SAF Coaliton member since shortly after its founding.

Saturday is the third National Biobased Products Day, an initiative of the U.S. Department of Agriculture (USDA) BioPreferred® Program. The U.S. environment and economy benefit from biobased products, which are cost-comparative while increasing renewable resource use. Read more here about how to mark the day.

ICYMI: Celebrating Rare Disease Day. The EveryLife Foundation for Rare Diseases brought hundreds of rare disease advocates to Capitol Hill—see more here. On Feb. 26, the National Organization for Rare Diseases (NORD) and Goodwin Law hosted a reception in D.C., bringing together members of the rare disease community ahead of the big day (photo above). And on Feb. 28, BIO participated in LightUpForRare, lighting up the top floors of the D.C. office.

Beltway Report

The Senate Health, Education, Labor and Pensions Committee has a hearing scheduled for Wednesday to consider Jayanta Bhattacharya’s nomination for Director of the National Institutes of Health (NIH), and another on Thursday to consider Dr. Martin Makary’s nomination for Food and Drug Administration (FDA) Commissioner. The Senate Committee on Small Business and Entrepreneurship will investigate reforming SBIR-STTR funding.