Medical Devices and Prescription Drug Policy

The top House Democrats dealing with trade issues wrote to the government's lead trade negotiator on Wednesday urging him to embrace quick access to generic drugs for countries participating in the pending Asia-Pacific regional trade agreement.

The letter to United States Trade Representative Ron Kirk comes as the U.S. embarks on the ninth round of negotiations regarding the nine-nation Trans Pacific Partnership. It urges Kirk to adopt generic-friendly policies that would limit a brand-name manufacturer's exclusive marketing rights based on clinical trial data to five years, running concurrently with such protections in the U.S. 

"A core objective" of that policy, the letter says, is to ensure that free-trade agreements "do not put patients in poor countries in a position in which they could have to wait longer than patients in the United States to obtain affordable life saving generic medicines."

Some 50 lawmakers from both parties have written to President Obama urging him to keep in place the current rules for approving generic versions of biologic drugs.

The letter, spearheaded by Rep. Anna Eshoo (D-Calif.), says the 12-year exclusivity period approved under the healthcare reform law balances "the need for patient access with incentives for innovation."

Reducing the exclusivity period to seven years, as the president urged in his deficit-reduction proposal last month, could lead drugmakers to set up shop in countries with friendlier regulations, the letter says.

Exclusivity is the length of time that a brand-name product can stay on the market without competition from a generic version. Cutting that  period down to seven years could save the federal government $3.5 billion over 10 years, according to the Congressional Budget Office, because cheaper generic drugs would make it to market quicker. 

Eshoo's letter, made public Tuesday, was also sent to the members of the new deficit-cutting supercommittee, who are seeking ways to slash the federal deficit by $1.5 trillion or more by Nov. 23.

Tuesday's interim report from the president's jobs council repeats venture capitalists' demands for reform of the approval process for pharmaceuticals and medical devices.

The report starts with an oft-repeated rundown of the U.S.'s declining leadership in medical innovation as Europe, China and India boost their investments in biotechnology. The report goes on to blame the "uncertain [Food and Drug Administration] regulatory environment" for the decline.

Investors want to change the drug and device approval process to make it faster and easier. Under the current system, complex clinical trials require new products to demonstrate that they're not only safe, but effective as well. 

Drugmakers should not fear investing in new medicines for rare diseases because federal regulators have shown considerable flexibility when approving them, says a new report from the National Organization for Rare Disorders.

The report was released Tuesday in conjunction with the start of a three-day U.S. conference on rare diseases and orphan drugs. Federal law offers financial incentives for drug companies to develop so-called "orphan" drugs for diseases that affect 200,000 or fewer U.S. patients, but the standard for federal approval is the same as for more mainstream medicines — even though the pool of test patients is much smaller.

"This review of [Food and Drug Administration] actions concludes that two of every three orphan drugs approved show FDA's historic flexibility in its review of effectiveness data on orphan drug therapies," study author Frank Sasinowski said in a statement. "Therefore, FDA has demonstrated in its actions on orphan products that it recognizes the importance of therapies for persons with rare disorders. It would be helpful for such flexibility and importance to be recognized in a formal FDA policy, and for FDA officials to incorporate and recognize that flexibility in a systematic way in their evaluations of each new therapy in development and under FDA review for Americans with any rare disease."

The big news for the healthcare sector next week is Wednesday’s markup of free-trade legislation in the Senate, which could mean big profits for the pharmaceutical and medical device industries.

Both groups have been lobbying hard to get the deals with South Korea, Colombia and Panama approved; South Korea in particular is a huge and growing market, importing more than $875 million in U.S. medical technology products in 2010. Under the Free Trade Agreement, South Korea would eliminate its tariff on U.S. medicines (currently as high as 8 percent) over three years and on medical devices (as high as 50 percent) over 10 years.

Wednesday’s Senate vote will be preceded by a mark-up Tuesday in the Senate Finance Committee.

Doctors are rationing drugs because of shortages, NPR reports.

PolitiFact rates the contentions by EMILY's List that former Wisconsin Gov. Tommy Thompson (R) signed partial-birth abortion legislation exposing abortion providers to life in prison and forcing women to get care across state lines as "half true." Thompson is now running for Sen. Herb Kohl's (D) seat.

The hits against Mitt Romney's (R) Massachusetts healthcare reform plan keep on coming as his competition with Rick Perry (R) gets increasingly ugly, the Boston Globe reports.

Blue Shield of California is the first insurer to pull coverage of Avastin for the treatment of breast cancer after an FDA advisory panel recommended in June that the agency revoke the Roche drug's approval for that condition, The Wall Street Journal reports.

New research links oral contraceptives to increased HIV risk, MedPage Today reports, a preliminary finding that could have huge implications for public health policy, especially in sub-Saharan Africa.

Nobel Prize in medicine laureate Ralph Steinman died just days before the announcement, Bloomberg reports.

The Government Accountability Office said Friday that federal health officials should more closely monitor a discount program for prescription drugs.

Under the program known as 340B, participating drugmakers offer discounts to hospitals and other healthcare providers on certain drugs for use in outpatient settings. Some congressional Democrats have previously proposed expanding the program to inpatient settings, which the pharmaceutical industry strongly opposes.

The GAO said in its report that 340B discounts have not led to drug shortages. Manufacturers and healthcare providers told the investigative office that they haven’t had a harder time obtaining drugs as a result of the discounted prices.

But GAO said the Health Resources and Services Administration should toughen its oversight of the program. HRSA has never conducted an audit to determine whether the terms of the discount program have been violated, GAO said.

“Today’s GAO report shows that the 340B drug discount program — which was improved and expanded in the landmark 2010 healthcare reform law — is serving its intended purpose of helping reduce costs and improve services at safety-net hospitals and clinics,” said Rep. Henry Waxman (D-Calif.), a 340B supporter. “However, I am concerned by GAO’s findings that HRSA’s program oversight is inadequate. The agency needs to do a better job of making sure that drug manufacturers and program participants are providing appropriate discounts and meeting the laws’ requirements.”

Five consumer groups are urging federal regulators to reject a proposed merger between two of the nation's largest administrators of prescription drug programs.

The proposed merger between two giant Pharmacy Benefit Managers (PBMs), MedCo Health Solutions and Express Scripts, is under review by the Federal Trade Commission. The groups wrote in a letter to Commissioner Jon Leibowitz that the merger would:

• Reduce competition and increase costs for consumers; 

• Enable the PBMs to create restrictive pharmacy networks that limit patient choice;

• Give the PBMs "tremendous dominance" - more than 50 percent of the market - with regards to costly specialty drugs such as those that fight cancer; and 

• Limit access to new and innovative drugs by increasing the PBMs' ability to create restrictive formularies.

Specialty drugs have drawn much of the scrutiny. Some 57 million Americans depend on them, and prices rose 19.6 percent in 2010 versus 1.4 percent for traditional retail drugs, a trend that's expected to worsen.

Drug benefit managers will save consumers and taxpayers $2 trillion over the next decade, says a new report requested by the Pharmaceutical Care Management Association.

The report comes just as the House Judiciary Committee prepares to scrutinize a pending merger between two of the biggest pharmacy benefit managers (PBMs), Express Scripts and Medco Health Solutions. The merger has drawn concerns in Congress over consolidation in the healthcare industry, but the new report may counterbalance that by playing up benefit managers' savings to the cash-strapped government.

The report by Visante concludes that average PBM savings between 2012 and 2021 should amount to 35 percent of drug spending without such management tools; commercial plan sponsors and their members can be expected to save $1.3 trillion, while Medicare and its beneficiaries should save $700 billion. PBM critics say those savings come at the cost of limited patient choices and out-of-business pharmacies. Read more...

Rep. Bill Cassidy (R-La.), one of the few doctors in Congress, said Watson has "tremendous potential" to improve healthcare.