United States: Sitting Here On Capitol Hill: Congressional Developments On Life Science And Consumer Product Issues

In This Issue

  1. Drug Manufacturing: Sen. Grassley Pressures Company Over Data Manipulation
  2. Medical Product Innovation: Update to 21st Century Cures Act in the Works
  3. Drug Pricing: Senate Finance Committee Releases Text of Committee-Passed Bill
  4. Cosmetics Reform: House Progressives Introduces Legislation
  5. Bill Introductions
  6. State Activity

Letters and Statements

Drug Manufacturing: Sen. Grassley Pressures Novartis Over Data Manipulation

Senator Charles Grassley (R-IA), chairman of the Senate Finance Committee, sent a letter in August to Novartis International AG CEO Vasant Narasimhan requesting documents relating to AveXis, a subsidiary of Novartis, manipulating data about a treatment for infants suffering from spinal muscular atrophy. The treatment, Zolgensma, is the most expensive drug in the world.

“...AveXis became aware of the data manipulation before the FDA approved Zolgensma but intentionally withheld that information from the FDA until after the product was approved,” Sen. Grassley wrote. “Such conduct is reprehensible and could have an adverse effect on patients. Accordingly, the conduct ought to be investigated and, as appropriate, punished to the fullest extent of the law.”

Sen. Grassley sent a letter to the FDA on August 7 urging the agency to reinstate unannounced inspections of prescription drug manufacturing facilities in foreign countries. He explained that the reinstatement should occur in light of the administration’s new “Safe Importation Action Plan” as well as the fact that these facilities provide most of the ingredients for production inside the U.S.

In the letter, Sen. Grassley argued, “Unbeknownst to many consumers...80 percent of Active Pharmaceutical Ingredients are produced abroad, the majority in China and India; however, the FDA only inspected one in five registered human drug manufacturing facilities abroad last year.”

“I strongly encourage the administration’s demonstration projects to include unannounced inspections in foreign manufacturing facilities to determine whether they meet the required Active Pharmaceutical Ingredients and drug quality and safety standards to include sufficient record-keeping, testing and protections against counterfeiting,” the letter concluded.

Legislation

Medical Product Innovation: Update to 21st Century Cures Act in the Works

Rep. Fred Upton (R-MI) recently revealed that he and Rep. Diana DeGette (D-CO)

Upton are working on legislation that would update the 21st Century Cures Act. Reps. Upton and DeGette were co-authors of the bill that was signed into law in late 2016 that is designed to accelerate medical product development and facilitate patient access to new innovations.

In a statement during a House Energy and Commerce Health Subcommittee hearing, Rep. Upton divulged that they currently are in the listening stage of a “Cures 2.0” version, seeking input from various groups on how to improve the law. He noted that he hoped that the proposed draft bill could be completed by early next year.

Drug Pricing: Senate Finance Committee Releases Text of Committee-Passed Bill

The leaders of the Senate Finance Committee recently released the text of bipartisan drug pricing legislation the committee passed in late July. Chairman Chuck Grassley (R-IA) and Ranking Member Ron Wyden (D-OR) formally introduce the bill, S. 2543, entitled the Prescription Drug Pricing Reduction Act (PDPRA) that would make reforms in Medicare and Medicaid, increase transparency, and curb abuses.

As reported previously when the bill passed the committee, the bill specifically would require the Department of Health and Human Services (DHHS) to make public on its website, beginning on July 1, 2022, data reported to it by insurers and pharmacy benefit managers (PBMs) under Medicare Part D requirements on an aggregate basis. In addition, DHHS would be required to report discrepancies related to direct and indirect remuneration information submitted by Part D plans and results of independent financial audits. The bill would also require Part D insurers to conduct audits of PBMs and report certain financial information to pharmacies and DHHS.

With respect to manufacturers, the bill would require a mandatory rebate if a pharmaceutical manufacturer increases its list price for certain covered Part D drugs above inflation. Further, it would require a manufacturer to submit justifications to DHHS for price increases for prescription drugs and biologics where DHHS determines that the manufacturer’s price increase met or exceeded certain thresholds. DHHS would be required to publicly post the price justifications.

For Medicaid, the bill would require enhanced auditing and reporting of the price and drug product information reported by manufacturers of covered outpatient drugs. It would also limit payment to PBMs under Medicaid to prevent abusive spread pricing and require DHHS to conduct surveys regarding payments for and prices of drugs covered under Medicaid programs.

In addition to the text of the bill, a committee report and a section-by-section analysis was released to the accompany the bill.

Cosmetics Reform: House Progressives Introduce Legislation

Rep. Jan Schakowsky (D-IL) and a group of House progressives recently introduced their version of cosmetics reform legislation—H.R. 4296, the Safe Cosmetics and Personal Care Products Act. Long active on cosmetics reform, Rep. Schakowsky first introduced this bill in 2010 and has expressed a commitment to passing a strong regulatory framework for cosmetics and personal care products.

This bill will not be the main vehicle that will be considered by the House if it moves forward on cosmetic reforms legislation. That bill—the Personal Care Products Safety Actâ€"is being drafted by Rep. Frank Pallone (D-NJ), Chairman of the House Energy and Commerce Committee, and Rep. John Shimkus (R-IL) and they hope to introduce it this fall.

The type of legislation introduced by Rep. Schakowsky is often described as a “marker bill,” in that it outlines the priorities of a certain group of lawmakers on a key policy issue being considered. The goal of introducing these marker bills is to influence the debate on key legislation ideally to the point where key provisions of the marker bill are inserted into the final version of the legislation that ultimately gets enacted.

In remarks introducing the bill, Rep. Schakowsky described it as the “progressive standard bearer” in establishing a robust regulatory framework to ensure the safety of cosmetics and personal care products. She added that it would “close major loopholes in federal law that allow companies to use nearly any ingredient in these products—even chemicals that are known to harm human health and the environment like coal tar dyes, formaldehyde, lead acetate, parabens, and phthalates.”

Under the bill, manufacturers would be required to register with the FDA and disclose all the ingredients in their products, including secret fragrance ingredients. The FDA would be granted new authority to recall unsafe products and remove them from the market while providing public notice of recalls. The legislation also would completely ban toxic ingredients in cosmetics and ban animal testing where a validated, non-animal testing alternative exists. This bill has been updated and the new version includes provisions that would protect highly exposed and vulnerable populations, including salon workers.

Bill Introductions

Senate

  • S. 2543 – Introduced on September 25 by Sen. Charles Grassley (R-IA). The bill, entitled the Prescription Drug Pricing Reduction Act, would aim to lower prescription drug prices in the Medicare and Medicaid programs, to improve transparency related to pharmaceutical prices and transactions, to lower patients’ out-of-pocket costs, and to ensure accountability (more details above).

House

  • H.R. 4296 – Introduced on September 12 by Rep. Jan Schakowsky (D-IL); co-sponsored by Reps. Sean Patrick Maloney (D-NY), Barbara Lee (D-CA), Ted Lieu (D-CA), Raul Grijalva (D-AZ), Rosa DeLauro (D-CT), Jared Huffman (D-CA), Ayanna Pressley (D-MA), Alcee Hastings (D-FL), Alan Lowenthal (D-CA), Judy Chu (D-CA), Jackie Speier (D-CA), Pramila Jayapal (D-WA), Diana DeGette (D-CO), Chellie Pingree (D-ME), Doris Matsui (D-CA), and Debbie Wasserman Schultz (D-FL). A bill to ensure the safe use of cosmetics (more details above).
  • H.R. 4322 – Introduced on September 12 by Rep. Donna Shalala (D-FL); co-sponsored by Reps. Matt Gaetz (D-FL), Barbara Lee (D-CA), and Joe Courtney (D-CT). A bill to promote cannabis research. The bill was referred to the House Energy and Commerce, and Judiciary Committees.
  • H.R. 4455 – Introduced on September 20 by Rep. Kurt Schrader (D-OR); co-sponsored by Rep. Greg Gianforte (R-MT). A bill to provide for a temporary payment increase under the Medicare program for certain biosimilar biological products to encourage the development and use of such products. The bill was referred to the House Energy and Commerce, and Ways and Means Committees.
  • H.R. 4538 – Introduced on September 26 by Rep. Peter Welch (D-VT); co-sponsored by Rep. McKinley (R-WV). A bill to limit the orphan drug exclusion under the drug discount program under section 340B of the Public Health Service Act. The bill was referred to the House Energy and Commerce Committee.
  • H.R. 4587 – Introduced on October 1 by Rep. Scott Peters (D-CA); co-sponsored by Reps. Anthony Brindisi (D-NY) and Peter King (R-NY). A bill to eliminate cost sharing for biosimilar biological products furnished under Medicare part B. The bill was referred to the House Energy and Commerce, and the House Ways and Means Committees.
  • H.R. 4619 – Introduced on October 8 by Rep. Jan Schakowsky (D-IL); co-sponsored by Reps. Brian Higgins (D-NY) and Susan Wild (D-PA). A bill to require drug manufacturers to pay a Medicare part D rebate for certain drugs if the price of such drugs increases faster than inflation. The bill was referred to the House Energy and Commerce, and Ways and Means Committees.

State Activity

CALIFORNIA: California recently enacted a law targeting so-called “pay-for-delay” agreements between pharmaceutical companies. While there is a body of caselaw addressing this issue, especially following the Supreme Court’s seminal Actavis decision, this is the first law on this topic, federal or state. On October 7, Governor Gavin Newsom (D) signed the law that aims to combat illegal agreements in which the brand drug company pays a generic or biosimilar applicant to delay the generic/biosimilar applicant’s research, production, or sale of a competing version of its drug. The new law, which goes into effect on January 1, 2020, would presume these agreements are anti-competitive. The law also provides certain limited exceptions to the prohibition. If found liable, the defendant may be liable for up to $20 million in civil penalties.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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