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Daily News

June 20, 2003

Citing a memo by a former George Bush Sr. official, Sen. Orrin Hatch and the brand-name drug industry are questioning the constitutionality of a provision in the Senate generic reform bill that would let a generic drug maker seek a declaratory judgment if the brand-name drug maker does not sue within a certain timeframe. The generic drug industry has fired back in support of the provision, relying on the expertise of a former Senate Judiciary Committee staff member.

The provision has made it into the version of the bill the Senate passed June 19.

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The Senate today (June 20) amended Medicare legislation to ease re-importation of cheaper pharmaceuticals from Canada, but made implementation subject to a decision by the HHS secretary, likely preventing the amendment from taking effect.

A second degree amendment offered by Majority Leader Bill Frist (R-TN) prevents the re-importation amendment from taking effect until the HHS secretary certifies that it poses no new risk to public health and safety and will significantly reduce drug prices.

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House Republicans have decided not to attach medical malpractice legislation to the House Medicare bill because they were afraid they would lose too many votes, and it would have forced the Medicare bill into the Judiciary Committee, according to a congressional source. The medical malpractice bill contains two provisions that would protect drug and medical device companies from product liability.

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Contrasting language on average wholesale price (AWP) reform is among the key items to be reconciled by the House Rules Committee when it takes up Medicare reform legislation next week.

The rules committee is expected to take up the Medicare bills June 25, with floor consideration tipped for the following day. Both the House Energy and Commerce and Ways and Means committees passed Medicare reform legislation this week, reporting out largely similar bills, but with some key differences.

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June 19, 2003

Medicare reform legislation pending in the House would give a subsidy for retiree plans that provide adequate drug coverage, slightly reducing the number of retirees projected to lose coverage with the introduction of a new Medicare prescription drug benefit. A different employer subsidy plan is included in the Senate bill.

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A House Republican said this week he "may have to" vote against his party's Medicare reform bill when it comes to a vote on the floor because of his deep concerns over the average wholesale price (AWP) reform provision in the legislation. Norwood has been pushing an alternative proposal to revamp the AWP drug reimbursement formula in a way that would not cut into oncologists' revenues.

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Physicians would have a choice of two reimbursement methodologies for outpatient drugs in a revised fix to the Average Wholesale Price (AWP) system included in the House Medicare bills being marked up this week.

Physicians can opt out of a new procurement system that uses competitive bidding from drug suppliers and instead be reimbursed according to the average manufacturers' sales price, a methodology that, unlike AWP, accounts for the rebates and discounts physicians receive when they purchase drugs.

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House GOP lawmakers made last-minute changes to their Medicare bill to phase in the start of head-to-head competition between traditional Medicare and private plans, as the Bush Administration is taking a hands off approach to the measure it views as potentially disruptive to the bipartisan consensus needed to pass a prescription drug benefit. The Senate bill does not include the controversial competition provision.

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The Senate today (June 19) voted 94-1 to attach legislation designed to speed generic drugs to market to a Medicare prescription drug bill. But in a separate vote, the Senate gave Democrats their second defeat in two days in their efforts to change the shape of the Medicare drug benefit.

The Senate also incorporated new protections for pharmacists already found in the House Medicare legislation.

The generic drug amendment, offered by Sen. Judd Gregg (R-NH) is based on S. 1225. The lone vote against the bill came from Sen. Orrin Hatch (R-UT).

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June 18, 2003

In a boost for rural providers, lawmakers last night secured a roughly $11 billion increase to the rural reimbursement portion of the House GOP Medicare reform bill reported out of the House Ways and Means Committee after a nearly eight-hour markup. The rural increase significantly strengthens the chances of support from rural Republicans, some of which recently said they would vote against the overall House reform bill if it failed to include adequate rural relief.

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Key groups involved in patient safety efforts say Congress should develop a voluntary, confidential system for reporting medical errors that ensures error reports are not used to punish. Such a system would help publicize the "near misses" and other errors that go unreported for fear of reprisal, representatives of the groups say.

Dennis O'Leary, president of the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), said Congress should pass legislation mandating a medical error reporting system that would help leverage sharing of information.

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SAN ANTONIO, TX -- The advertising and promotion division of FDA's drug center will be regulating the therapeutic biologics shifted to the drug center as part of FDA's reorganization, according to the division's director. The decision means that biotechnology companies' advertising and promotions -- especially premarket communication -- eventually will be more strictly regulated than they had been under the biologics center, according to an industry source.

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As CMS reverses its plan for an administrative remedy, the Senate is taking steps to crack down on the practice of physicians referring patients to specialty hospitals in which they have a financial stake.

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The rump group of five GOP Energy and Commerce lawmakers is preparing to offer its Medicare reform proposal on the House floor next week even though elements of the plan were added to the GOP bill during committee markup yesterday (June 18), according to a source close to the group and statements made by one of its members.

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Senate Democrats are planning to once again float a proposal to sunset the Medicare drug benefit in a bid to come up with funding to eliminate the gap in prescription drug coverage under the Senate Medicare reform bill. The proposal is one of several amendments Democrats say they intend to offer during the ongoing Senate Medicare floor debate in an attempt to improve the compromise legislation.

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June 17, 2003

As Republican lawmakers push hard for tort reform and product liability protection, FDA Commissioner Mark McClellan has entered the debate by complaining that trial lawyers make it difficult for FDA to get adverse event information on product labels and have contributed to increased health care costs. McClellan has complained about trial lawyers at least twice in recent speeches, but he has stopped short of proposing administrative or legislation solutions.

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The American Heart Association (AHA) says FDA should perform consumer research before it implements a new initiative that would for the first time allow food manufacturers to make qualified health claims about their products. The group says a mechanism of different levels of health claims based on different levels of scientific evidence could help consumers better understand health claims.

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The "rump group" of five Energy and Commerce Committee Republicans has reached a deal with committee chair Billy Tauzin (R-LA) and will support committee passage of a revised version of the GOP Medicare drug benefit bill, members of the group said. Under the deal, Tauzin will include the group's prescription drug plan -- which includes low-income protections, a drug discount and debit card approach to paying for prescription drugs -- as a transitional element and then a fallback option in the GOP bill, Rep. Steve Buyer (R-IN) told Inside CMS.

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A key food industry group is telling the Office of Management and Budget (OMB) that FDA underestimated the burden to industry of its proposed recordkeeping rule, which would implement a provision in the recently enacted bioterrorism law. The National Food Processors Association (NFPA) says FDA's proposal is not practical or manageable and would impose unnecessarily high costs. Specifically, the group takes issue with provisions that would require facilities to perform "detailed lot-level tracking."

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A key Senator in the generic drug access debate says Congress should change provisions of the Senate's compromise bill that would continue the current practice of lumping patent invalidity and patent non-infringement challenges. Sen. Orrin Hatch (R-UT), an author of the 1984 drug patent law and chair of the Senate Judiciary Committee, also is upset that the compromise drug patent reform bill would retain a provision that grants the first company to file a generic drug application 180 days of market exclusivity.

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