Senate to Take on Pharmaceutical Prices Again: Real Reform or More of the Same?

Posted 12 June 2017 By Zachary Brennan

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The Senate Health, Education, Labor & Pensions (HELP) committee will hold a hearing Tuesday on prescription drug costs and look to address a problem many in America are grappling with: how the drug delivery system affects what patients pay.

The hearing will likely address how pharmacy benefit managers (PBMs), insurers and others in the prescription drug ecosystem impact prices and what can be done to bring them down, though some are questioning whether anything substantial from Congress or the Trump Administration will get done.

In a note to investors on Monday, Bernstein’s Ronny Gal wrote that HHS Secretary Tom Price is working on policy recommendations, which will likely surface before the year’s end. But he also said to expect a "relatively mild package, effectively diverted by the drug industry lobby to target generics and headline grabbers (Turing, etc.) rather than address the core problem of drug costs." 

And because the current HHS and FDA heads are pro-industry, he said, "truly sharp cost measures are unlikely."

Dr. Walid Gellad, director of the Center for Pharmaceutical Policy and Prescribing at the University of Pittsburgh, said he agreed with Gal’s sentiment.

"I think PBMs and insurers will feel the heat tomorrow, wholesalers less so, doctors not at all, but ultimately the heat wave will pass without any serious damage," he said.

Past as Prologue

The Senate has previously targeted particular companies in the pharmaceutical industry with little impact other than to name and shame them. Last year, the Senate Special Aging Committee targeted Turing Pharmaceuticals’ infamous 5,000% price hike of the toxoplasmosis drug Daraprim (pyrimethamine), but there is no indication that the price of the drug was ever reduced. Turing did not respond to a request for comment.

Similarly, the same Senate committee went after Valeant Pharmaceuticals and massive price increases for the drugs Cuprimine (penicillamine) and Syprine (trientine hydrochloride), among others. A Valeant spokeswoman told Focus that the prices of Cuprimine and Syprine have not been lowered since the hearing but also have not been increased.

The company’s most recent quarterly report says the company’s new pricing committee signed off on 2% to 9% increases to wholesale acquisition costs for neurology, GI and urology drugs, though no pricing increases were taken on dermatology and ophthalmology products.

Similarly, the outcry over the price of Mylan's EpiPen has not led to lower prices, according to the New York Times.

Hearing

Democrats at Tuesday’s hearing are expected to revive provisions floated in March and earlier, while Republicans are expected to continue to criticize PBMs, which previously were targeted as unnecessary middlemen.

The national association representing PBMs, the Pharmaceutical Care Management Association, sought to get ahead of expected criticism and issued a report saying that "drugmakers have attempted to shift focus away from the increasing prices they set towards the price concessions (rebates) that they negotiate" with PBMs.

And with a new Maryland law targeting generic drug price spikes, the Association of Accessible Medicines (AAM) also released a new report on Monday showing the significant savings from generic drugs.

Members on the House are also requesting a similar hearing as the one that will occur in the Senate tomorrow.

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Categories: Drugs, Crisis management, Government affairs, News, US, FDA

Tags: Senate HELP, Mylan, Valeant, Turing, drug prices

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