A version of this story first appeared in D.C. Diagnosis, STAT’s weekly newsletter about the politics and policy of health and medicine. Sign up here to receive it in your inbox.
The 27 senators who sit on the Senate Finance Committee are set to grill seven drug company executives Tuesday morning about high prescription drug prices. STAT spoke with lawmakers in both parties about what they plan to ask, what they hope to hear, and what answers they won’t accept. Below are five major takeaways.
Both Republicans and Democrats want to know why the U.S. pays more for drugs than other nations — and that question is likely to loom large. Members across the ideological spectrum — everyone from Democratic Sens. Sheldon Whitehouse and Ben Cardin to conservatives like Sens. James Lankford and Bill Cassidy brought up the issue in conversations Monday. Exactly how Congress can tackle this issue is still unclear, but something tells me many Democrats aren’t eager to support the Trump administration’s plan of tying what Medicare pays for drugs to what other countries pay.
Chairman Chuck Grassley wants an answer to a simple but contentious question. I caught up with Grassley Monday to ask him what he plans to ask drug makers. His response was to the point: “How do you set prices?” While the teams of attorneys preparing the CEOs undoubtedly have crafted an answer to the question, drug makers have long fought any and all measures to require more explanation of how they set their prices. They’ve even gone to court to fight state laws requiring such disclosures. Grassley’s long been a fan of price transparency, and if he decides to pick a fight (like by using his subpoena power to get more intel), it could set off a huge political battle. (Remember, staff for Grassley and Wyden spent 18 months poring over documents from Gilead over how the company set its price for the hepatitis C drug Sovaldi.)
There’s an increased interest from Republicans in particular on patent and exclusivity issues. Cassidy is expected to ask questions about so-called evergreening and how rebates are used to thwart competition for lower cost drugs — commonly known in wonky circles as the “rebate trap.” But Cassidy isn’t likely to be the only one to bring up the issue, one lobbyist following patent issues told STAT Monday.
Democrats want to know why drug makers haven’t used savings from the Republican tax bill to lower prices. Sen. Bob Menendez (D-N.J.), mentioned this hot topic to me Monday. It’s a well-worn refrain from Democrats that drug makers should have used their tax savings to lower prices, but it’ll be interesting to see how drug makers actually respond when pressed on the issue.
Lawmakers are not going to stand for drug makers trying to shift blame to others in the supply chain. Grassley sent a shot across the bow Monday afternoon, tweeting that drug makers shouldn’t “try to blame everyone but themselves/take no responsibility for their role in fixing the problem.” Ranking member Ron Wyden (R-Ore.) towed a similar line in a brief interview with STAT. “The main thing I’m interested in getting tomorrow is whether they’re gonna step up and get beyond the blame game,” Wyden told STAT on Monday.
If that didn’t convince you to tune in later this morning, maybe Sen. Tom Carper of Delaware will.
“You could sell tickets for this one,” Sen. Tom Carper (D-Del.) told STAT. “I’d pay.”
STAT Scooplet: Consumer groups are spending big on ads
Several anti-pharma coalitions are using the publicity around today’s hearing to drive home their push for action to lower drug prices. Chief among them: the patent reform group CAPA, which is paying to wrap today’s Washington Post in a two-page ad.
The group’s message: “Patent Abuse is Standard Practice for Big Pharma.” The ad targets six drugs in particular: AbbVie’s Humira, Bristol-Myers Squibb’s Eliquis, J&J’s Remicade and its blood thinner Xarelto, Pfizer’s Lyrica, and Sanofi’s Lantus. (As a reminder, CAPA, which launched last month and boasts members including the Association for Accessible Medicines, America’s Health Insurance Plans, and Kaiser Permanente, is pushing to make patent reform a larger part of the discussion on high drug prices.)
CAPA isn’t the only one spending big today. The Coalition for Sustainable Rx Pricing is spending in the high five figures to run an ad on CNN and Fox News today. The ad, a mock advertisement for the drug “PriceGougi$ol,” whacks drug makers for spending more on advertising than research and development.
A look at FDA user fees’ lackluster impact on drug prices
New research from the Pew Charitable Trusts asks and answers an important, albeit wonky, drug pricing question: What impact has the FDA’s generic user fee program had on drug prices? The answer is a bit sobering …
As a refresher, Congress created the generic drug user fee program in 2012 to help FDA get generic drugs onto the market more quickly, with the ultimate goal of eventually driving down the price of those drugs. Pew found that during the first five years of the user fee program, FDA approved nearly 17 percent more generics (which is good!) but here’s the catch: The majority of the drugs approved were the fourth, fifth, and sixth copies of a brand drug to hit the market, which have minimal impact on the price of the drug they copy. (The most impact is from the second and third generics that hit the market.)
Despite the creation of the generic user fee program, the FDA has had a much harder time getting the first few generics for a drug into market — more than 500 drugs still lack any generic competition, according to FDA data.