President Trump is expected to deliver his first major speech on U.S. drug prices in early May, even as the pharmaceutical industry pours more money than ever into lobbying efforts.
The White House has targeted May 8 as the date for the address, according to sources with close ties to the drug industry and the Department of Health and Human Services. The administration didn't confirm or deny the date. The speech was scheduled for last week, but postponed after HHS Secretary Alex Azar was hospitalized for an intestinal illness.
It will be the first time Trump speaks extensively about the country’s rapidly accelerating drug costs, an issue he brought up repeatedly on the campaign trail but hasn’t mentioned much since assuming office 15 months ago. You can bet that all corners of the pharmaceutical industry will be hanging on the president's every word, trying to get a sense of how aggressively — or not — the president plans to go after the issue.
Perhaps in anticipation that Trump would take some action this year, the industry has boosted lobbying spending to unprecedented levels. Its main trade group, the Pharmaceutical Research and Manufacturers of America, spent $9.96 million in the first quarter of this year — nearly $2 million more than during the same period in 2017, according to the database Open Secrets.
Top drugmakers — including AbbVie, Celgene, Bayer, Novo Nordisk and Sanofi — also beat lobbying spending records in the first quarter of 2018. Pharmaceutical and medical product makers are the top spenders on lobbying by a long shot; last year, they outspent the oil and gas industry by $153 million.
Granted, it’s unlikely Trump will ask Congress to carry out one of the industry’s greatest fears — passing legislation allowing the federal government to directly negotiate prices with drugmakers as part of Medicare Part D instead of continuing to let private insurers do so.
The president has previously touted that idea, echoing arguments by liberals that such a practice would nudge down drug spending overall. But there’s little chance it would ever be accepted by Republicans running Congress, who point to the Congressional Budget Office’s conclusion that allowing government Part D negotiations would have a “negligible effect on federal spending.”
Instead, the president may riff on smaller ideas laid out in his February budget proposal, which tried to get at drug prices in a more roundabout way by tweaking the way Medicare and Medicaid pay for drugs and how the FDA approves and regulates them.
An accompanying paper from the White House Council of Economic Advisers laid out two goals for lowering drug costs — reducing the prices Americans now pay for biopharmaceutical products and expanding incentives for drug companies’ innovation, as I reported at the time. It soundly rejected the idea of the government negotiating prices.
“Reducing drug prices that Americans pay means recognizing that many artificially high prices result from government policies that prevent, rather than foster, healthy price competition,” says the report, titled “Reforming Pharmaceutical Pricing at Home and Abroad.”
“Drug prices, for example, are sometimes artificially high due to government regulations that raise prices,” it continues.
Among the ideas laid out by the administration is a proposal to move some of the drugs paid for under Medicare’s Part B doctors' program into its Part D prescription drug effort, thereby allowing insurers and pharmacy benefit managers (PBMs) to negotiate which drugs are covered.
The paper also suggests passing on the rebates and discounts negotiated by PBMs to seniors who purchase drugs through Part D and creating a pilot program in which a limited number of state Medicaid programs could experiment with negotiating prices with manufacturers and crafting their own list of covered drugs.
At the time, PhRMA had a mixed reaction to such proposals. The group said it supports ideas such as passing drug rebates on to seniors but warned other elements of the plan could “limit access to innovative medicines.”
The industry has also had some success on Capitol Hill this year. Lobbyists for PhRMA and drug companies convinced lawmakers not to include in their February spending bill the CREATES Act, which tries to even the playing field for generic drug developers who often run up against blockades from branded pharmaceutical companies seeking to keep their competition at bay (I wrote about it in this Health 202).
But members of Congress did include a thorn for the industry by making it pay for more of seniors’ prescription drug costs. Under the revised Medicare rule, drug companies must discount drugs 70 percent for Medicare enrollees who fall into the “doughnut hole” coverage gap instead of the current 50 percent.
PhRMA President Stephen Ubl called the change a “bailout” for the private insurers who sell Medicare Part D plans. “This proposal provides a massive bailout for insurance companies and undermines their incentive to reduce Part D costs, an incentive that has worked well for more than a decade,” he said in a statement.
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AHH: Autism rates in children increased 15 percent from 2014 to 2016, and have spiked 150 percent since 2000, according to a new report from the CDC. Experts are not entirely sure of the cause, Karen Weintraub reports for USA Today. One in about 59 8-year-old children in 2014 had autism, a developmental disorder that is marked by communication and social challenges.
“The rise is partly driven by increasing diagnoses among African-American and Hispanic children, who are narrowing the diagnostic gap with their white classmates,” Karen writes. "In the 2012 report, white children were diagnosed 50% more often than Hispanic children and 20% more than African-American children. In the latest report, that gap shrunk to 20% among Hispanics and 10% among blacks."
Craig Newschaffer, director of the AJ Drexel Autism Institute at Drexel University, explained to Karen there are “no obvious environmental causes for the rising rates, and without data on adults, it remains unclear whether more people have autism, or the condition has always been this common, just unrecognized or called by other names.”
OOF: Sen. Robert Menendez, the New Jersey Democrat who avoided conviction in a federal corruption trial last year, violated federal law and Senate rules in accepting unreported gifts from a friend and political ally, the Senate Ethics Committee said yesterday, per The Post's Mike DeBonis. In a four-page 'letter of admonition,' the panel’s three Republicans and three Democrats ordered Menendez to pay back the gifts he received from Salomon Melgen, a Florida eye doctor and top Medicare biller, and said he is “hereby severely admonished.”
“Your assistance to Dr. Melgen under these circumstances demonstrated poor judgment, and it risked undermining the public’s confidence in the Senate,” the letter reads. “As such, your actions reflected discredit upon the Senate.”
"The Ethics Committee findings complete a winding, six-year saga in which the New Jersey senator was accused of corrupt dealings to benefit a political donor, Melgen, only to see his prosecution end in a mistrial in November after 10 weeks in court," Mike writes. "As long as Menendez repays the gifts, he is unlikely to face further official sanctions. But the stern reprimand stands to cloud his pending campaign for a third Senate term, though he retains an advantage as a Democratic incumbent in a liberal-leaning state."
OUCH: White House doctor Ronny L. Jackson hasn't just lost his shot at becoming Veterans Affairs secretary. Allegations against him are also threatening to derail his military career and promotion to two-star admiral, The Post's Lisa Rein, Dan Lamothe and David Nakamura report.
Jackson has been accused of dispensing prescription medication too freely, including a store of the opioid Percocet that put the White House military officials “into a panic” when it went missing, according to a list of allegations released Wednesday by top Senate Veterans' Affairs Committee Democrat Jon Tester (Mont.). Tester also relayed allegations of “multiple incidents of drunkenness on duty,” including one in which Jackson could not be reached in his hotel room when needed and at a Secret Service going-away party in which Jackson “got drunk and wrecked a government vehicle.”
A spokesman for Jack Reed (R.I.), the top Democrat on the Senate Armed Services Committee, said the allegations “must be reviewed and addressed by the Department of Defense” before the committee can consider his promotion nomination. Trump nominated Jackson in March for advancement to two-star admiral, before unexpectedly also nominating him a few weeks later to replace David Shulkin, who was ousted as VA secretary, Dan notes.
Sen. Richard Blumenthal (Conn.), another Democrat on the panel, said yesterday the committee will want answers, and House Speaker Paul Ryan (R-Wis.) suggested to reporters that it would be “smart” to have an inspector general review the case.
“We should find out if there’s merit to these allegations, and, if there are, then … the proper oversight should be done,” Ryan said.
— Trump lambasted Tester yesterday for his central role in ending Jackson’s prospects. But Tester’s GOP counterpart — Senate VA Committee Chairman Johnny Isakson (Ga.) — defended the Montana Democrat’s decision to release the information.
“That’s his right,” Isakson said.
"Those divergent responses to Tester’s stunning move underscored how controversial and consequential that decision could be in the coming weeks for the two-term senator, who has worked to burnish a bipartisan reputation yet has opposed some of Trump’s biggest priorities," The Post's Seung Min Kim and Sean Sullivan write. "The decision to detail the specific allegations — which Jackson has denied — was highly unusual, considering all the accusations had yet to be proved, and it only obscured the prime reason Jackson’s nomination was struggling to gain traction in the Senate: Even Republicans plainly believed he wasn’t fit for the job."
— Top Senate Democrat Chuck Schumer (D-N.Y.) said yesterday the new head of the CDC assured him there is no prohibition on the agency researching gun violence -- a question around which there's been much confusion due to a decades-old regulation. Schumer said he met with CDC Director Robert Redfield, who told him that “there is no longer a prohibition on the CDC conducting research on the gun violence epidemic.”
“That is a good first step, but we have a lot of work to do to ensure the CDC initiates this extremely important research in the near future,” Schumer said in a statement. “I hope that the CDC will use some of their newly increased resources from the omnibus spending package to get this done.”
Schumer’s meeting with Redfield comes after Democrats secured language in this year's sweeping spending bill that clarifies the CDC can conduct research into gun violence. (The Health 202 wrote in February about the 22-year-old Dickey Amendment, which says the CDC can’t use money to “advocate or promote gun control.”)
— A renowned child psychiatrist at the University of Illinois at Chicago put vulnerable kids at great risk during one of her clinical trials, a mistake that forced the university to repay the $3.1 million it received from the National Institute of Mental Health for the study. Mani Pavuluri violated research rules by testing lithium, a powerful drug, on children younger than 13, failing to notify parents of the study’s risks and falsifying data to cover up the misconduct, ProPublica’s Jodi S. Cohen details in an investigation published yesterday.
Pavuluri’s research was meant to assess how the brains of adolescents with bipolar disorder function during a manic state and after a lithium-based treatment. “In issuing the rare rebuke, federal officials concluded that Pavuluri’s ‘serious and continuing noncompliance’ with rules to protect human subjects violated the terms of the grant,” Jodi writes. “NIMH said she had 'increased risk to the study subjects' and made any outcomes scientifically meaningless.”
Pavuluri had a host of other violations included enrolling children younger than 10 for the study that was meant to include those ages 13 to 16, including children who had previously used psychotropic medication, failing to give some of the girls in the trial pregnancy tests before taking lithium even though the consent form stated they would be tested, and failing to keep her clinical and research roles separate.
But NIMH didn't solely blame Pavuluri. "The agency determined that the university’s institutional review board … conducted an ‘insufficient’ initial assessment of Pavuluri’s research plans,” Jodi writes. “The board didn’t even have a copy of her research protocol at its initial review.”
— A few more good reads from The Post and beyond:
- 2018 Health Datapalooza continues
President Trump says Ronny Jackson was treated "really unfairly:"
Missed "Fox &Friends" yesterday? Here's what Trump said about Ronny Jackson, Michael Cohen and more: