Tuesday, May 06, 2008
Drug Import, Medicare Bills Take Center Stage
• Straight Talk From FDA On Money
• Energy & Commerce Gets Industry’s Input On Import Bill
• Kennedy Floats Options For His Own Import Bill
• Lawmakers Queasy About Industry Access To Prescriber Data
• Senate Finance Members Begin Talks On Medicare Bill
• Tug-Of-War Underway Over E-Prescribing
STRAIGHT TALK FROM FDA ON MONEY
House Energy and Commerce Chair John Dingell (D-MI) took the lead on drafting import safety legislation circulating in the House and has passed up few opportunities to build momentum for major FDA reform. A hearing early last week about contaminated heparin dovetailed conveniently into a separate hearing two days later about drug-related provisions in the draft import bill. And over the course of the two hearings, Dingell finally got a concise answer from an FDA official to a budget-related question.
Drug center chief Janet Woodcock said inspecting every foreign facility that sends drugs or drug ingredients to the U.S. would cost about $225 million per two-year inspection cycle. Woodcock also said FDA would need an extra $100 million to meet its domestic inspection goals for drug-making facilities. And she said those figures don’t account for new information technology systems, which would cost tens of millions of dollars over several years.
Dingell praised Woodcock’s “courage” and “candor,” even as she reiterated that FDA doesn’t actually want to do all of those inspections. Dingell likes to dismiss FDA’s talk of a risk-based inspection regime as “hooey,” and he did so again last week—but without his trademark attacks on the purveyor of said hooey.
Woodcock has also been on a bit of tear when it comes to new authorities for FDA, reports FDA Week’s Sam Baker. Over the past two weeks she has endorsed a foreign inspectorate and a better facility registration system. She has said FDA would like to be able to block products from facilities that impede FDA inspections, extract more civil penalties from drug makers, and issue subpoenas.
ENERGY AND COMMERCE GETS INDUSTRY’S INPUT ON IMPORT BILL
The drug industry got its turn last week to weigh in on the titanic FDA Globalization Act, and the initial response was receptive but qualified. Representatives from the Pharmaceutical Research and Manufacturers of America, the Generic Pharmaceutical Association and the Biotechnology Industry Organization all signaled some measure of openness to new user fees and more foreign inspections. The House Energy and Commerce Committee also released vaguely supportive letters from Teva Pharmaceuticals and Ranbaxy, Inc.
Republicans have dug in against many of the proposed user fees (the Energy and Commerce draft has at least six, applied to every FDA-regulated industry). Sen. Mike Enzi (R-WY) is opposed to including new fees when the Senate health committee takes up its FDA legislation, his office tells FDA Week.
The Energy and Commerce health subcommittee split its time last week between the FDA import bill and an anti-counterfeiting proposal from Reps. Steve Buyer (R-IN) and Jim Matheson (D-UT). The pair wants an electronic pedigree for drugs, which the National Association of Chain Drug Stores adamantly opposes. Buyer and Matheson have been in talks with leading committee Democrats, but it’s not clear whether any track-and-trace provisions are likely to work their way into the larger import bill. They introduced their e-pedigree bill after being urged repeatedly by Dingell to hold off. Senate health committee Chair Edward Kennedy (D-MA), though, is receptive to the idea.
KENNEDY EYES ELECTRONIC PEDIGREE FOR SENATE IMPORT BILL
Dingell has sidestepped the idea of mandating trace and track technology in his import bill, but his Senate counterpart appears keenly interested. An electronic pedigree requirement is one of the options floated by Kennedy in an internal committee document obtained by FDA Week. FDA has tried in vain for years to get drug makers, distributors, repackagers and pharmacies to agree on a electronic pedigree. Chain drug stores don’t like the idea, but generic drug makers are cautiously supportive.
Senate health committee Democrats, in the options paper floated with committee Republicans, also suggest the idea of creating a foreign FDA inspectorate, charging industry registration fees for drug and device facility inspections, requiring drug labels to disclose where ingredients and finished product are made, and letting FDA fine violators of drug safety requirements – in these instances ideas that closely mirror those proposed by Dingell. Kennedy is also considering requiring foreign importers to show their products comply with FDA standards, and letting FDA destroy dangerous drug imports.
There are no details accompanying the options, such as user fee amounts or how importers would show they comply with FDA standards, reports FDA Week’s John Wilkerson. Drug and biotech companies gave mixed reviews to similar ideas included in Dingell’s draft import framework.
Some of Kennedy’s ideas closely track FDA’s wishes. Deputy Commissioner Janet Woodcock said in late April that FDA needs congressional help to create a unique identification number for all domestic and foreign drug establishments, including all facilities along the drug distribution chain. She likened the UDI with the “D-U-N-S number” that Dun and Bradstreet uses to uniquely identify companies and their various locations. It so happens that Kennedy is considering requiring “submission of the Dun and Bradstreet D-U-N-S number for a registered establishment, an e-mail address, payment of a registration fee.”
Kennedy is also considering requiring registration of drug importers and allowing FDA to impose licensing requirements. FDA proposed revamping the national drug code last August after the HHS Inspector General reported that FDA’s Drug Registration and Listing System is in poor condition.
Kennedy also wants to improve testing of drug purity and identity. Enhancing the process for developing the tests for drugs found in the U.S. Pharmacopeia and other compendia is an option, as is making FDA improve compendial tests. Another is requiring companies to keep records on the source and quality of drug ingredients.
With momentum growing, it appears 2008 will be a year for another FDA reform bill.
LAWMAKERS QUEASY ABOUT INDUSTRY ACCESS TO PRESCRIBER DATA
Key senators have begun to scrutinize the American Medical Association’s (AMA) policy of selling physician prescriber numbers to drug manufacturers, who then compare data with pharmacy claims to determine individual prescription patterns. AMA does have a program that lets doctors opt out of such sales, but Sens. Herb Kohl (D-WI) and Richard Durbin (D-IL) are skeptical. The lawmakers have asked AMA to describe exactly how the opt-out program works.
Consumer advocates and state sources are cheering lawmakers’ attention to the issue, reports Inside CMS’ Amy Lotven. Durbin and Kohl said they learned about AMA’s opt-out program while drafting legislation that would provide doctors with access to independent, academically-researched information about pharmaceutical products. Physicians’ current reliance on drug industry reps to keep up to date on new medicines and other information was the subject of a recent hearing by Kohl’s Senate aging committee.
AMA touts its opt-out program. The program gives doctors an option to protect their prescribing data from pharmaceutical representatives, while allowing vital information on prescribing patterns to continue to be available for beneficial public health purposes, AMA says in an e-mail. Physicians can use the program to designate their prescription data as off-limits to drug salespeople or to register complaints against drug companies or sales representatives who use the data inappropriately.
But AMA also defends data-mining. “Pharmaceutical companies use physician data to publicize drug recalls, develop clinical trials, alert physicians to continuing medical education opportunities, and deliver drug samples and educational materials to physicians.”
But, consumer advocates argue that AMA’s opt-out program is not enough, at best, and, at worst, a small effort to appease officials and advocates who had concerns about the AMA data-mining policy.
Marcia Hams of the Prescription Project, an organization—funded by the Pew Charitable Trusts and led by Community Catalyst – says AMA is making $44 million a year selling the list to the companies who match it up with the pharmacies to produce profiles of physicians that are used by industry marketing reps.
Hams says the Kohl/Durbin letter to AMA could be a catalyst for more change, and Sharon Treat of the National Legislative Association for Prescription Drugs agrees.
Some states are also stepping in. New Hampshire, Vermont and Maine have all passed laws regulating data-mining, but all are in litigation.
SENATE FINANCE MEMBERS GET DOWN TO BUSINESS ON MEDICARE BILL
As Senate Finance lawmakers begin serious talks this week on their upcoming Medicare bill, beneficiary advocates are stepping up pressure on the committee to include Part D beneficiary reforms in the package. Finance members on Tuesday (May 6) started discussing non-controversial “extenders” provisions that include rural boosts in payment to doctors and other providers, and will then move on to “other Medicare Part A and Part B changes” and finally to beneficiary issues, according to a congressional e-mail obtained by Inside CMS.
Floor action on the upcoming bill has slipped until after the May congressional recess, the e-mail states, “due to competing priorities in the Senate as well as a number of outstanding requests for input and technical support from the administration.”
The delay will give beneficiary advocates more time to convince lawmakers to include Part D reforms in the Medicare package. Advocates have been urging lawmakers in recent meetings to align the asset tests for the Part D low-income subsidy (LIS) and the Part B Medicare Savings Program (MSP), as well as eliminate co-payments for preventative services in a bid to encourage the use of these screenings, Inside CMS’ Brett Coughlin reports.
But Sen. Finance Chair Max Baucus (D-MT) is running into opposition from Bush administration officials on these issues, beneficiary advocates tell Inside CMS. But expect Sen. Jeff Bingaman (D-NM) to bring the issues up on the floor in an amendment if they aren’t included in the committee’s package, a beneficiary source said.
Beneficiary groups have also asked Baucus to eliminate two questions Part D beneficiaries are asked when they enroll in Part D. The first question asks potential Part D enrollees what the value of their life insurance is and the second relates to “cash value assistance” they receive from friend and family. The second question, a beneficiary advocate said, is a “disincentive” for friends and family to help their elderly relatives and should be removed.
Officials from the Social Security Administration have signed off on the proposal, but the administration continues to balk, sources told Coughlin.
TUG-OF-WAR UNDERWAY OVER E-PRESCRIBING
Medicare stakeholders and lawmakers are in the midst of their annual “food fight” over what to include in a Medicare provider give-back bill, and e-prescribing is caught in the fray. The potential multi-billion dollar savings linked to electronic prescribing makes it an attractive bill payer for some, but not others.
Chain drug stores are urging lawmakers to offset the cost of a fix to CMS’ average manufacturers price rule by congruently requiring physicians to adopt e-prescribing, but community pharmacists are nervous about entangling e-prescribing, which doctors are skittish about, with the Medicare bill. Pharmaceutical benefit managers are strong advocates of e-prescribing, as is a coalition of consumer and labor groups—including AARP, Consumers Union, AFL-CIO and SEIU – who recently wrote to lawmakers supporting pending e-prescribing legislation.
A chain drug store trade group on April 22 wrote a letter to all members of Congress urging them to include both the Fair Medicaid Drug Payment Act (S. 1951), which redefines AMP, and the E-Meds Act in the upcoming Medicare physician fix package.
But community pharmacists are nervous about the strategy, and have opted instead to focus their lobbying on bills to fix AMP and require prompt payment of drug claims, reports Lotven. Physician groups, who may benefit most from the upcoming Medicare package, are privately worried about the costs associated with an e-prescribing mandate.
The chain drug story industry came up with the idea of marrying AMP and e-prescribing bills after Sen. John Kerry (D-MA), sponsor of the Medicare Electronic Medication and Safety Protection (E-Meds-Act), announced his legislation would save $3 billion. Don Moran, the former head of the Office of Management and Budget, has estimated the AMP fix legislation would cost about $ 1.4 billion over five years, the source said.
But Washington insiders say the e-prescribing bill is expected to save less than a billion over the first five years, with most savings in the out years.
An e-prescribing provision was in an early draft of last year’s Medicare fix, yet did not make the final cut. Mark Merritt, president and CEO of the Pharmaceutical Care Management Association (PCMA), predicts the bill is likely to be included in the Finance Committee’s upcoming Medicare package.
The e-prescribing bill, introduced by Sens. John Kerry (D-MA) and John Ensign (R-NV) and in the House by Rep. Allyson Schwartz (D-PA), encourages physicians to integrate e-prescribing into their practices by offering a 1 percent per-claim bonus. However, physicians who do not adopt the mechanism by January 2011 would face a 10 percent per-claim fee schedule cut.--Sam Baker and Donna Haseley