News & Views: 7/13 - 7/19

July 20, 2021

The Senate Judiciary Committee held a hearing on anticompetitive behavior in the pharmaceutical industry.

The Democrat Senators discussed possible legislation that would prevent patent gaming and the allocation of additional resources to the FTC to enforce antitrust regulations. The Republican Senators argued that additional regulations will inhibit innovation and that more transparency, particularly among PBMs, will lower prices. The majority of the witnesses highlighted the need for increased resources and improved approval mechanisms for the US Patent and Trademark Office to increase competition and lower prices. To read the testimonies or watch the hearing, click here.

A group of Representatives wrote to Speaker Pelosi, Leader Schumer, Chairman Yarmuth, and Chairman Sanders to include Medicare negotiation in the upcoming reconciliation bill.

The letter was spearheaded by Rep. Susan Wild (D-PA) and signed on to by 13 other vulnerable Representatives. They wrote that the overwhelming public support of the policy should be reason enough to include Medicare negotiation in the bill. The letter also argues that the pharmaceutical industry’s January price hike was just the most recent annual price hike and if Congress does not act now, the industry will continue to take advantage of patients. To read the full letter, click here.

PBMs and insulin manufacturers, Eli Lilly, Sanofi, and Novo Nordisk, face claims of racketeering.

The lawsuit, filed by wholesalers, alleged that the companies were engaging in antitrust practices, such as shadow pricing, and paying illegal kickbacks to PBMs for favorable formulary placement. A federal judge dropped the charges of antitrust practices, but the companies will still face charges for illegal kickbacks that kept insulin prices high. To read the entire article, click here.

Researchers at Duke Margolis Center for Health Policy published a report on the challenges of and solutions to creating a resilient drug supply chain.

The report highlights current issues with the pharmaceutical supply chain, before discussing policy solutions. While the Biden administration has put forward an executive order and “100-Day Review” on supply chains, the authors claim that there is a significant lack of market incentives, an underinvestment in manufacturing quality, and lack of transparency that have made the US pharmaceutical supply chain vulnerable to gaming. To read the full report, click here.

Researchers at KFF estimated the potential impact that Aduhelm will have on the Medicaid program.

While Medicaid enrollees only account for a small portion of people with Alzheimer’s disease, the high costs per enrollee could have a significant impact on Medicaid budgets. The authors estimated the yearly net price of Aduhelm to be $43,000 for Medicaid based on the 23.1% base rebate. If 25% of Medicaid beneficiaries currently taking medication for Alzheimer’s disease switch to Aduhelm it will cost states $230 million and the federal government $490 million each year. To read the full article, click here.  

CIDSA Experts in the News

Ge Bai coauthored a Health Affairs blog post on reforming pharmacy direct and indirect remuneration (DIR) in Part D. The authors offer multiple policy solutions, as the current DIR system does not reduce out-of-pocket costs for patients and reduces competition among small and independent pharmacies. In addition to increasing transparency and using evidence-based quality measures, pharmacies should be required to report claim level adjustments after point of sale and allow pharmacies to opt-out of DIR by providing the lowest possible price to patients at point of sale. To read the full article, click here.

Sean Dickson and Richard Frank spoke to reporters at Bloomberg Law on the expected implications that the high costs associated with Aduhelm will have on Medicare. Dickson opined that Medicare will not issue a non-coverage decision in this case, but by limiting the covered population HHS reduces the risk of a legal challenge, which would be likely if they opted not to cover the drug at all. Frank discussed the lack of precedent for these reviews for new drugs, as they are typically withheld for new medical devices and new procedures. To read the full article, click here.

Stacie Dusetzina spoke with reporters at Cure Today on how brand name drug manufacturers prevent generics from entering the market. Dusetzina explained that large manufacturers often prevent generic competition by withholding samples of their drugs or through engaging in product hopping. Even still, when generics are available, Medicare beneficiaries often times have higher out-of-pocket costs for the generic due to Part D loophole. To read the full article, click here.

Rachel Sachs spoke with Kaiser Health News reporters on President Biden’s executive order on competition. While the executive order highlights older policy ideas, such as importation, Sachs opined that this should not be concerning, as the administration has just chosen to advocate for existing policies rather than starting from scratch. She also pointed out that it will be easier to judge the policies that the administration is really pushing for after the report outlining HHS’ plan is released in 45 days. To read the full article, click here.

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