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Why Billy Dunn’s support of Aduhelm is so shocking

Billy Dunn, the director of the FDA’s Office of Neuroscience, has long held a reputation among colleagues, industry executives, and patient advocates as a conservative and demanding regulator. Then came Aduhelm, Biogen’s controversial Alzheimer’s drug.

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Now Dunn has emerged as perhaps the most pivotal FDA player inside the Aduhelm saga, after a STAT investigation revealed Dunn met with the company in an off-the-books meeting to discuss getting the drug approved. Dunn, for his part, has been one of Aduhelm’s biggest backers, even imploring a skeptical advisory committee panel last November to approve the drug based on what he called “home run” data. That role, former colleagues told STAT, is at odds with the regulator they have come to know.

My colleagues Adam Feuerstein, Damian Garde, and I spoke to more than 20 sources with connections to Dunn for a deep new profile for STAT. It provides the first in-depth look at the otherwise low-profile regulator, and attempts to answer the question: What about Biogen made Billy Dunn act so differently? More here.

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Caution: Senators desperate for pay-fors ahead

A bipartisan group of senators is approaching do-or-die time on a package to fund roads, bridges, and other infrastructure priorities, and they have turned their attention to the hospital and pharmaceutical industries to finance the bill, my colleague Rachel Cohrs reports.

The deal is still in flux, but a list of health care policies that could be included has been circulating on K Street since late last week. Hospitals and drugmakers have both activated their lobbying armies to defend their territory (and their money). Here’s the rundown:

  • Delaying a Trump-era policy that would eliminate the drug rebates that pharmacy middlemen and insurers use to negotiate down the price of certain drugs. Lawmakers could still further delay or repeal the policy in a separate, $3.5 trillion partisan package
  • Banning spread pricing practices by drug middlemen (more on those two below)
  • Extending Medicare sequestration pay cuts for health care providers
  • Letting HHS force drug makers to pay back the government for wasted drugs that were sold in large packages

And a somewhat surprising piggybank: The Provider Relief Fund, which was set up to help hospitals and docs with Covid-related losses. It’s especially appealing because the Biden administration has lowballed the amount of money left for months. HHS has maintained that there is $24 billion left over, but a government watchdog reported last week that there’s actually $43.7 billion left.

The Health Resources and Services Administration said the difference was due to a semantic discrepancy about whether funds were “unallocated” or “unobligated,” and that the larger number includes money providers returned to the government and unclaimed money from some prior tranches of relief funds.

HHS is also slow-walking the money. The agency told stakeholders in May that the release of the remaining funds was imminent, but it never came. Now, staff has gone quiet, ignoring several hospital industry groups and lobbyists in recent weeks as the pot of money surfaced as a potential infrastructure cash cow. Providers haven’t been able to apply to recoup their losses anytime after June 2020, which includes much of last summer’s surge, a surge last winter, and recent hospitalizations related to Delta.

The middlemen’s take on those big-ticket drug pricing policies 

There’s some good and some bad for middlemen on the policy list above: they love the idea of repealing the Trump-era policy that eliminated rebates (though they don’t think Congress is going far enough, since it’s only talking about delaying the policy from taking effect.) And while you’d think that they would hate the idea of banning spread pricing, it’s more nuanced than that.

Here’s what PCMA CEO J.C. Scott told me on Monday:

Independent analyses suggest that banning so-called spread pricing in the Medicaid program —  the practice where middlemen pocket the difference between what they charge their customers for a drug and what they buy it for — could take a serious chunk out of PBM’s pocket.

But Scott emphasized that the group doesn’t take issue with banning the practice in Medicaid, because, he explained, the government is technically the middlemen’s client, and clients get to choose the terms of their PBM contracts.

“If the client is making the choice not to use that particular tool, we would not make a policy-based objection to that,” Scott said “That is the government’s call.”

PCMA is opposed, however, to banning spread pricing in the commercial market. But Scott was skeptical that budget wonks would rule that such a law saves the government money.While the wonks ruled last year that a spread pricing ban saved $1.7 billion, those savings didn’t come from the ban itself, but rather from related transparency provisions. Those transparency provisions are already being implemented, he said, so they presumably couldn’t be used as an offset this time around.

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Drug makers are still falling short of the law when it comes to disclosing clinical trial results.

This was the web edition of 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.