Jonathan
Gardner Published Dec. 12,
2019
Dive Brief:
·
The House of Representatives on Thursday voted 230-192 to send
to the Senate legislation requiring pharma companies directly negotiate the
price of 50 drugs with the federal government.
·
The bill is unlikely to get a vote in the Senate, where an
alternative voted out of the Finance Committee mainly proposes mandated rebates
to Medicare for drugs that have price increases at greater than the rate of
inflation. President Donald Trump has backed that plan, but there are no signs
it will be debated soon.
·
The industry trade group PhRMA has fiercely opposed the
legislation, claiming it would trigger "nuclear winter" for biotech
innovation. A statement from the lobby called on the Senate to "stop H.R.
3 in its tracks."
Dive Insight:
Even if, as
appears likely, the bill backed by House Speaker Nancy Pelosi, D-Calif., will
never be signed into law, today's vote was still significant. Years of lobbying
and public pressure have forced lawmakers to act and has knocked the
pharmaceutical industry on its heels.
If anything,
the bill in its final form became more hostile to the sector. The original bill
would have only tagged 25 drugs for negotiation with the Department of Health
and Human Services, but in its final, approved form, the number of drugs
subject to negotiation would rise over time to 50.
This boosted
the amount of savings from drug spending the federal government would see from
$345 billion to $456 billion through 2029, Congressional
Budget Office forecasters said. The flip side of that reduction in revenue
would be a decline in pharma company R&D activity, which in turn would
reduce the number of new drugs to reach the market by eight in the decade
ending 2029 and 30 in the following decade, CBO said.
Senate Majority
Leader Mitch McConnell, R-Ky., has already said the bill will not be considered
in the Senate. In September, the Finance Committee passed its own version of
drug pricing legislation, which mandated rebates to Medicare for drug price
increases above the inflation rate. It did not include any provisions for price
negotiation by the Department of Health and Human Services.
Committee
Chairman Chuck Grassley, R-Iowa, last week announced some changes to his bill
that reduced Medicare beneficiary drug cost sharing and adjusted manufacturer
discounts for pharmacy-dispensed drugs.
However, it is
not clear whether that legislation will get a vote by the full Senate, either.
Some Republicans have opposed it — only six of the 15 Republican on the
committee voted for it — and McConnell hasn't indicated a timeline for a floor
vote.
Assuming the
Senate passes a bill, the Republican-opposed provisions from the House bill
could still be in play.
A joint
committee would need to resolve differences between the two bills, a process that
involves extensive horse-trading in order to come up with a document agreeable
to majorities in both chambers, which means the House Democrats might have a
chance to get HHS price negotiation into a bill intended to be sent to the
White House.
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