A split between House Democratic
leaders and rank-and-file members over how to lower drug prices is threatening
the party's efforts tries to make good on one of its biggest campaign promises
just weeks into the new congressional session.
Some progressive lawmakers and outside
groups are concerned that aides to Speaker Nancy Pelosi are proposing to have a
third party help decide the price of a drug through binding arbitration — a
solution that falls short of the Democrats' 2018 campaign platform that
promised direct government negotiations for medicines in Medicare Part D.
The dispute is focused on Pelosi’s
senior health policy adviser Wendell Primus. He is deeply involved in crafting
the policy's details and is searching for an approach that could both
significantly lower drug prices and potentially win support from the
Trump administration, according to lawmakers, the drug industry and health
policy groups.
Two major concerns are emerging with
his push for arbitration. Sources say Primus is limiting it to a select group
of high-cost drugs, instead of developing a broader proposal for all medicines.
Additionally, the arbitration process would be voluntary and nonbinding,
meaning companies could opt out without consequence.
“I am concerned that arbitration is a
little too narrow to get the job done,” said Rep. Lloyd Doggett (D-Texas), the
chairman of the Ways and Means health subcommittee and sponsor of a newly
introduced drug pricing bill that has more than 110 co-sponsors. “I’m concerned
about passing the buck or shifting of the responsibility to the arbitrator. Who
would arbitrate? And would this be such a narrow group of drugs that would be
involved that we won’t see any significant impact?”
Doggett said he's concerned the drug
industry would be able to game the arbitration process.
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One arbitration model in a 2008 Health Affairs paper
by Harvard health policy experts Joseph Newhouse and Richard Frank, a senior
official in ex-President Barack Obama’s health department, would either have
the third-party arbitrator pick from price proposals offered by the government
and drug manufacturer or propose a third price based on independent research.
Binding arbitration “puts patient
access at risk to get lower prices. Drug corporations’ monopolies should be at
risk never patient access,” said Alex Lawson, executive director of Social
Security Works, one of the outside groups concerned about the proposal.
Rep. Mark Pocan (D-Wis.), a leader of
the Congressional Progressive Caucus, which was to meet with Pelosi Thursday,
downplayed Primus’ influence over the issue, signaling that the party’s
increasingly powerful left wing will push hard for a sweeping drug price
policy.
“I’m not worried what Wendell thinks,”
he said. “When he gets elected to Congress, it’ll matter.”
Pocan pointed to the broad public
support for giving the government power to limit price increases, arguing that
Democrats’ vow to lower drug costs was a key driver in the party’s midterm
election success and will be again in 2020.
“There will probably be some folks in
the caucus who want to be more narrow, and I think the rest of us will advocate
on behalf of our constituents,” he said in an interview. “This shouldn’t be a
hard sell to people. If necessary, we can crank up people in districts to call
their members.
Pelosi’s office declined to comment on
binding arbitration. “House Democrats are looking at a variety of aggressive
drug price negotiating mechanisms as we develop our flagship prescription drug
price legislation,” spokesperson Henry Connelly said.
Critics are instead pushing a price
negotiation bill from Doggett and Sen. Sherrod Brown (D-Ohio) that was
introduced Thursday.
The measure tracks with Democrats’
campaign promise to allow government drug price negotiation in Medicare Part D.
But it departs from past Democratic drug negotiation proposals that were
predicted to generate little in the way of savings unless Medicare also
restricted the medicines patients could access.
If drug companies refuse to negotiate
in good faith, the bill allows Medicare to authorize generic drug companies to
produce the medicine in question, even if the product has patent protection or
government-granted marketing exclusivity. The brand-name drug company would be
given a royalty if this occurred. Until the maker of generic drugs starts
production, Medicare would be guaranteed a price that is the average of
the cost paid for the medicine in other wealthy, developed European countries
during any interim period while generic companies gear up manufacturing. Most
other countries have government negotiations and get lower prices than the
United States.
“It would be a total capitulation to
pharma from what we can tell, to prefer a narrow and conservative binding
arbitration model over [Dogett’s] bill,” said Peter Maybarduk, director of
Public Citizen’s Access to Medicines Program. “We believe the public is
clamoring for more muscular action,” he added, saying that Doggett’s drug
pricing bill is clearly leading and where the Democratic caucus wants to go.
“Poll after poll shows that lowering
drug prices is a top concern for the American people," Social Security
Works' Lawson added. "They also show that maintaining access to needed
drugs is equally important. ... Negotiating with licenses is the best and most
popular way forward. It accomplishes both goals by directly negotiating lower
prices without putting patients’ access in pharma’s greedy crosshairs.”
The disagreements are already stoking
concerns the party is fumbling its chance to tackle drug costs, with some
involved perceiving a lack of urgency from party leaders on the issue.
Several members have spent years formulating a series of policy proposals, yet
House Democrats have yet to articulate a clear plan of attack beyond assurances
that it’s a top priority for leadership and for top Democrats on the Energy and
Commerce Committee.
“It’s a work in progress at this
point,” said Rep. Peter Welch (D-Vt.), who has introduced multiple drug pricing
bills, including one giving Medicare broad leeway to negotiate prices. “There’s
always concern about how long it’ll take. … We’re moving. My concern is that we
get a specific outcome that lowers drug prices, and I don’t know how much time
that’s going to take.”
Any drawn-out process could give
Republicans an opening to introduce their own drug price reforms and begin to
dictate terms of the debate.
“Energy and Commerce needs to, frankly,
pick up the pace because we’re concerned they’re going to get preempted by
Senate Republicans,” said one individual familiar with Democrats’
deliberations. “It is concerning we’re seeing such a slow-walking.”
But some lawmakers are signaling the
Democrats will be deliberative and avoid rushing. “It will take a while,”
Doggett said. He remained committed to exploring the range of ideas to see what
generates the most support. “And hopefully out of the hearings we are doing and
the various committees, we will be able to identify shortcomings as well as
strengths.”
Energy and Commerce health subcommittee
Chairwoman Anna Eshoo (D-Calif.) characterized her committee’s work as still in
its early stages. But she defended taking a meticulous approach.
“You really need to know at some point
what the traffic will bear,” she told POLITICO. “You can have a brilliant idea,
thought out step by step, detail by detail, and if you don’t have enough votes,
it doesn’t matter. It just doesn’t matter.”
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