United States: Capitol Hill Healthcare Update - December 1, 2016

House Passes Cures Legislation

After months of debate and partisan wrangling, the House on Wednesday voted 392-26 to pass the "21st Century Cures" bill designed to accelerate the development of new drugs and medical devices as well as increase federal funding for biomedical research. The Senate is expected to give the bill final congressional approval next week before lawmakers recess for the year. The legislation would authorize $4.8 billion over 10 years to the National Institutes of Health (NIH), including $1.8 billion for Vice President Biden's "Cancer Moonshot" project, $1.5 billion for NIH's BRAIN initiative to study diseases like Alzheimer's, and $1.5 billion for NIH's Precision Medicine Initiative. The Food and Drug Administration (FDA) would be eligible for an additional $500 million over 10 years, and states could apply for $1 billion in federal grants over two years to address opioid abuse. None of that money is guaranteed, a key concession by Democrats after November's Republican election sweep. Funding will be subject to annual congressional approval.

Earlier versions of the bill required stakeholders to provide offsets for the new spending, including one that would have forced companies with drugs subject to the FDA's Risk Evaluation and Mitigation Strategies to make the products available to generic manufacturers. But all industry payfors were ultimately dropped, and the bill's new spending instead will be paid for by sales from drawing down the U.S. strategic petroleum reserve and cutting $3.5 billion from the Affordable Care Act's prevention fund.

The Cures effort began in 2015 with sweeping goals of accelerating the discovery and approval of revolutionary new treatments, backed up by new exclusivities for drug manufacturers and guaranteed reimbursements for device makers. But most of those provisions were dropped as the partisan debate over drug prices hampered efforts in Congress to win approval for regulatory and reimbursement policies favorable to industry.

The final Cures bill would establish a review pathway at the FDA for biomarkers, increase patient participation in the drug-approval process, and require the FDA to evaluate real-world evidence to support new uses for previously-approved drugs. It also would streamline the review process for combination products that include both a drug and device, and allow the FDA to accelerate approval of regenerative therapies to heal damaged human cells, a measure pushed by Senate Majority Leader Mitch McConnell (R-KY).

For medical technology manufacturers, the bill would establish a breakthrough device pathway by building on the current priority review pathway. It also would expand the FDA's ability to apply the humanitarian device exemption to devices that treat diseases and conditions that impact up to 8,000 individuals, double the current 4,000 patient limit.

The legislation also would require the FDA's ombudsman to audit and assess the measurements used to track implementation of the so-called "least burdensome" requirements for device makers.

Trump's Picks for HHS, CMS

President-elect Trump announced he is nominating Congressman Tom Price (R-GA) to be secretary of the U.S. Department of Health and Human Services (HHS) and Seema Verma to be Centers for Medicare and Medicaid Services (CMS) administrator.

Rep. Price, an orthopedic surgeon, is chairman of the House Budget Committee and a member of the Ways and Means Committee, which has jurisdiction over CMS. He's been a vocal opponent of the Affordable Care Act and authored "repeal and replace" legislation for the House GOP. Price also was a leading voice in Congress on replacing the Sustainable Growth Rate with the new physician-reimbursement system that will come online next year, and he has been an opponent of competitive bidding for durable medical equipment.

Verma served in Vice President-elect Mike Pence's administration in Indiana in a variety of healthcare roles, and for Pence's predecessor, Gov. Mitch Daniels. She led Pence's effort to expand Medicaid coverage with federal funding as well as assisting with Medicaid redesigns in other states.

Both Price and Verma will require Senate confirmation.

Top Dems Call on CMS to Kill Part B Demo

The top Democrats in Congress are asking CMS not to finalize the agency's sweeping and controversial proposal to test changes to Medicare reimbursements for drugs administered in physician offices. The move by House Democratic Leader Nancy Pelosi (D-CA) and incoming Senate Democratic Leader Chuck Schumer (D-NY) could effectively kill the Part B demo, which was the Obama administration's election-year effort to control drug prices. CMS's innovation center announced the demonstration program in March, but it immediately faced bipartisan criticism on Capitol Hill as well as from the drug industry and some physician and patient groups. Still, CMS hasn't publicly responded to the Democrats' call to scrap the pilot program or told Republican committee staff on Capitol Hill what the agency's next steps may be. Even if the pilot program were finalized before Obama leaves office, the incoming Trump administration could roll it back. Congress could take action early next year to block it, too.

Mylan Won't Testify at Senate Hearing

After Mylan, the U.S. Department of Justice (DOJ) and CMS declined to participate in a Senate Judiciary Committee hearing scheduled for this week. Panel Chairman Chuck Grassley (R-IA) accused the Obama administration of "dodging accountability" and Mylan of "gaming the system." Sen. Grassley is probing Mylan's $465 million settlement with the DOJ for allegedly overcharging Medicaid for its life-saving EpiPen allergy treatment. Mylan declined to send a company witness to the hearing because it is "a pending matter." Grassley said he is considering issuing subpoenas to compel Mylan's testimony. Separately, Grassley also is calling on the U.S. Securities and Exchange Commission to investigate whether Mylan misled investors about the settlement.

Hospitals Call for Changes to Chronic Care Framework

The American Hospital Association last week called for expanding the Senate Finance Committee's draft plan to create Medicare programs to improve coordination and reduce cost for treating chronic conditions. The trade association, which represents nearly 5,000 hospitals nationwide, urged senators to expand access to telehealth by removing restrictions on covered services and technologies. The committee proposed expanding the Medicare telehealth benefit, including coverage of consults for patients experiencing acute stroke symptoms and monthly clinical visits for patients undergoing home dialysis treatment. Hospitals also called for increased regulatory flexibility for doctors' groups that participate in accountable care organizations and for an adjustment to the CMS "hierarchical conditions" risk model to include socio-economic and socio-demographic factors on the cost of care. Led by committee Chairman Orrin Hatch (R-UT), the chronic care proposal is expected to be considered next year in the Senate.

Diabetes Group Wants Probe of Insulin Prices

The American Diabetes Association is calling on Congress to hold hearings on recent insulin price increases. Insulin was discovered in 1921, and its first patent expired 75 years ago. Since then, multiple companies have produced variants with faster-acting or longer-lasting formulations. Insulin prices tripled between 2002 and 2013, the group said, forcing some of the six million Americans with diabetes to ration their medicine. Separately, Sen. Bernie Sanders (I-VT) and Rep. Elijah Cummings (D-MD) have asked the DOJ and the Federal Trade Commission to investigate what they said was collusion among drug companies over insulin prices.

Pelosi, Schumer Vow to Block GOP Medicare Changes

The top Democrats in Congress are warning that Republicans could "privatize" Medicare, signaling they will fight GOP changes to the healthcare system for the elderly and disabled. Republicans have made no secret of their goal next year to advance Medicare changes as part of repealing the ACA. House Speaker Paul Ryan (R-WI) has called for expanding Medicare Advantage plans, allowing beneficiaries to shop for plans other than the traditional fee-for-service Medicare, and for consolidating Medicare Part A and Part B. House Democratic Leader Nancy Pelosi (D-CA) and incoming Senate Democratic Leader Chuck Schumer (D-NY) warned Republicans against over-reaching on Medicare, saying changes could backfire on Republicans and cost them politically in the 2018 mid-term elections.

House Hearing on Preventive Services

The House Energy and Commerce Health Subcommittee on Wednesday held a hearing on bipartisan legislation reauthorizing the U.S. Preventive Services Task Force. The legislation, introduced by Reps. Marsha Blackburn (R-TN) and Bobby Rush (D-IL), would require the task force to ensure balanced and relevant representation of medical personnel on its committees and require members to disclose conflicts of interest. The bill would require specialists to review the preventive services that the task force examines. It also would require the Government Accountability Office to submit a report comparing the task force's recommendations with other federal government health guidelines. It's not likely Blackburn's legislation would be considered by the House before it adjourns this month, requiring the bill to be reintroduced in the 115th Congress in 2017.

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