Proposed changes to Medicaid and mergers

We’re live in Washington, D.C., for BIO’s Patient & Health Advocacy Summit—watch here for highlights. Meanwhile, we look at proposed changes to Medicaid drug coverage and FTC’s merger guidelines, and what they mean for biotech innovation. (567 words, 2 minutes, 50 seconds)

Medicaid rule would harm patients, drug manufacturers, state biotech associations tell CMS

A proposed new rule on Medicaid drug coverage is detrimental to patients and the commercial sector,  the Council of State Bioscience Associations (CSBA) tells the Centers for Medicare and Medicaid Services (CMS).

Proposed new price calculation: Proposed rule [CMS-2434-P] would require manufacturers to aggregate, or “stack,” price concessions provided to separate entities across the supply chain when determining the Best Price through the Medicaid Drug Rebate Program.

Proposed new “covered outpatient drug” (COD) definition: The new rule would also expand the definition of a COD, with a particular impact on coverage for drugs administered in inpatient settings.

Why it matters: It’s not feasible to track discounts throughout the supply chain for price stacking, and it will harm drug development, says the letter from 48 CSBA members to CMS Administrator Chiquita Brooks-LaSure. The COD change could restrict patient access to innovative treatments, the letter adds.

The bottom line: “This sweeping proposal represents a statutory overreach and will result in upending more than thirty years of historical precedent,” says the letter. “CMS has greatly underestimated the negative downstream impacts this proposed rule would have on the drug manufacturing supply chain, critical government healthcare programs such as 340B, and ultimately the patients our members seek to treat.”

How to follow the BIO Patient & Health Advocacy Summit

Good Day BIO is covering the BIO Patient & Health Advocacy Summit (a.k.a. PHAS) in Washington, D.C., which brings together patient advocates, the biotechnology industry, and other stakeholders for two days of policy discussions, sharing best practices, and networking. Here’s how you can follow the highlights:

• Read Bio.News for panel recaps, exclusive Q&As, and much more.
• Join the conversation on social media on LinkedIn and X.
• Did someone forward this newsletter? Click here to subscribe and get news in your inbox daily!

What we’re watching at PHAS: BIO’s Chair and Vice Chair kick off the day with why the mission matters, followed by discussions on the Inflation Reduction Act’s unintended consequences and the federal perspective on the impact. In the afternoon, we’ll be covering a session on Medicaid and protecting patient access, and hear from leading patient advocates on how they leverage grassroots advocacy. (But it’s a jam-packed day—see the full schedule here.)  

FTC’s plans to slow mergers threaten biotech, BIO says

The Federal Trade Commission (FTC) is proposing new rules to enable aggressive opposition to mergers like the ones essential to biotech innovation, according to BIO.

What’s happening: The FTC proposes changing guidelines for determining when to challenge a merger—and changing the Hart-Scott- Rodino (HSR) Premerger Notification Form, which is required for mergers above a specific value.

FTC’s changes are designed to discourage mergers, with new HSR forms intended to quadruple reporting time, delaying mergers by months. FTC’s new Merger Guidelines, which ignore precedent, essentially mean “any proposed merger can be considered anticompetitive for any reason,” according to BIO’s comments.

Why it matters: “Two-thirds of drug development comes from larger pharmaceutical firms acquiring small innovators,” said BIO Deputy General Counsel John Delacourt. These startups need support to run clinical trials and gain approval.

Biotech is already suffering from FTC’s crackdown on mergers, which has dampened biotech merger activity this year. While FTC’s challenges may fail in court, their attitude chills investment, Delacourt told Bio.News.

What’s next: FTC will review comments and is expected to finalize new policies around the end of this year, though they may not hold up in court, Delacourt said.

BIO’s take: “In order to block a merger, the FTC will actually need to convince a court that its guidelines are well thought out,” Delacourt explained. “They may have a hard time doing that.”

Read more on Bio.News.

More News: 

Pfizer: FDA approves PENBRAYA™, the first and only vaccine for the prevention of the five most common serogroups causing meningococcal disease in adolescents
“Meningococcal disease is an uncommon but serious illness that can lead to death within 24 hours and, for survivors, can result in life-altering, significant long-term disabilities. PENBRAYA reduces the total number of doses needed for individuals to be fully vaccinated against the five most common serogroups, thereby streamlining the standard of care and potentially increasing the number of adolescents and young adults vaccinated.”

President Biden’s Monday: Holding an event in the White House to highlight the success of Bidenomics.

What’s Happening on Capitol Hill: The House and Senate have no official business scheduled. Discussions on choosing the next speaker are expected to continue today.