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Daily News

January 16, 2003

The American Hospital Association (AHA) is protesting the Medicare Payment Advisory Commission's (MedPAC) call late yesterday (Jan. 15) for Congress to provide below-inflation payment updates for hospitals. MedPAC voted to give hospitals 2004 Medicare payment updates equal to the market-basket rate minus 0.4 percentage points for inpatient payments and the market-basket rate minus 0.9 percentage points for outpatient payments, according to AHA, which calls the recommendation "misguided."

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CMS Administrator Tom Scully quietly hired a long-time AARP official last month, sparking speculation that the move could help the Bush administration's effort to enact a prescription drug benefit this year.

Marty Corry, who worked for AARP as its director of federal legislation, is now a special assistant to Scully. He will work on long-term care policies as well as other issues, according to an agency official. Several CMS stakeholders who attended recent CMS meetings said they were surprised to learn that Corry joined the agency in December.

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A joint state cooperative developed to tackle soaring prescription drug prices is extending its reach from one side of the nation to the other. Informed sources say Hawaii is in the process of joining forces with the National Legislative Association on Prescription Drug Prices, which to date consists of all six New England states, New York, Pennsylvania and the District of Columbia.

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Congressional officials are refuting recent media articles reporting that Senate Republicans seriously considered naming Sen. Trent Lott (R-MS) chairman of the Senate Finance Committee.

Prior to the start of the new Congress, it was reported that Sen. Chuck Grassley (R-IA) balked at the idea of giving Lott the Finance Committee chairmanship following Lott's resignation as Senate majority leader. But congressional sources say that the news accounts are inaccurate and a spokesperson for Grassley said, "There's nothing to it."

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Rep. Henry Waxman (D-CA) plans to introduce legislation creating a special smallpox vaccine injury compensation program because it is unclear how, or if, someone injured by the vaccine would be compensated. Waxman's staff has spoken to the staff of Sens. Bill Frist (R-TN) and Edward Kennedy (D-MA), but the congressmen themselves have not yet spoken about the possible legislation, according to a congressional source.

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In a move that likely will be welcomed by the dietary supplement industry, the Office of Management and Budget (OMB) has cleared FDA's long-awaited dietary supplement good manufacturing practices (GMP) rule, according to an FDA official. The proposed rule needs to be typeset and will be published sometime in the coming weeks, the official adds.

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FDA has established an internal task force that will develop guidance documents over the next six months answering key questions about how the agency will implement a plan to allow conventional foods for the first time to carry qualified health claims. Within six months, the task force will report on how to apply the "weight of evidence" standard for qualified health claims on conventional foods, develop a framework of regulations, identify procedures and organizational staffing needs, and craft a consumer studies research agenda.

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A short-term remedy to prevent looming Medicare physician payment cuts was introduced in the Senate Jan. 15 as part of the fiscal year 2003 omnibus appropriations bill unveiled by Senate Republicans. The provision, which differs from a House plan, would hold Medicare physician rates at 2002 levels from March 1 until Sept. 30.

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January 15, 2003

California's attorney general has proposed controversial changes to the state's toxic labeling law in an effort to reduce the number of enforcement lawsuits filed by private citizens against industry. The changes would require plaintiffs under the labeling law, referred to as Proposition 65, to provide more documentation of alleged violations and establish reporting requirements on out-of-court settlements.

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A final rule clarifying when the president can waive informed consent for military personnel using an investigational drug or biologic in military operations has been sent to the Office of Management and Budget (OMB) for approval. An administration source says the final rule is largely unchanged from the earlier interim rule and has been in place for years. FDA is tying up loose ends by moving forward to finalize it, the source says.

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House Ways and Means Committee Chairman Bill Thomas (R-CA) is firing back at critics of his new bid to increase Medicare physician payments, claiming that the measure he introduced last week is the best available option to avert a new round of cuts for doctors.

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CMS' implementation of national average wholesale price (AWP) rates for pharmaceuticals will yield modest savings, the bulk of which should come from generic drugs, according to an agency official.

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The results of a new FDA survey of physicians' views on direct-to-consumer (DTC) advertising suggest consumers want to be informed about various drugs and that the agency's current DTC ad policy may be appropriate, an FDA source says. While the survey found doctors' viewpoints mixed, FDA was surprised at the percentage of doctors who viewed DTC ads as educational to patients, the source says.

[Click here for FDA's talk paper and the survey results.]

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In a landmark study, CMS concludes that quality of care for Medicare beneficiaries significantly improved from 1998-1999 to 2000-2001. While the study focused primarily on fee-for-service (FFS) patients, the level of care for Medicare+Choice (M+C) beneficiaries was as high -- if not higher -- than FFS, according to the lead researcher.

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January 14, 2003

In a move that has been years in the making, FDA has asked the Office of Management and Budget (OMB) to review a final rule that would hold animal drugs to the same recordkeeping and reporting requirements as human drugs. The rule is intended to define the kinds the information to be maintained and submitted by the animal drug applicant.

The final rule makes changes to an interim rule, "Records and Reports Concerning Experience with Approved New Animal Drugs," that was issued on Feb. 4, 2002 after having been proposed 10 years earlier (see FDA Week, Feb. 15, 2002, p8).

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Two medical device industry trade groups are at odds on whether an annual report from FDA's Office of Device Evaluation shows the recently enacted device user fee law is needed. The Advanced Medical Technology Association (AdvaMed) says the report backs the need for device user fees, while the Medical Device Manufacturers Association (MDMA) say it shows the user-fee law was poorly written.

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Marine Corps Commandant Gen. James Jones last week approved the start of a smallpox immunization program for all Marines headed to the U.S. Central Command region, which includes Iraq.

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Dodging a potential lawsuit, FDA is preparing a Federal Register notice that would further delay implementation of its requirement that certain wholesalers provide a drug sales history called a pedigree, according to sources. Secondary wholesalers plan to use the reprieve lobby for lawmakers to attach a legislative fix to the FDA spending bill for fiscal year 2003.

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HHS is reassuring hospitals that choose to send healthcare workers to other facilities to get vaccinated for smallpox that they will not be held liable if vaccinated workers in turn infect patients with smallpox vaccinia. Such hospitals were concerned they would not qualify for the liability protection the Homeland Security Act offers to those hospitals that administer the vaccine.

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FDA has slapped a "clinical hold" on one-third of U.S. gene therapy trials after a child in a French gene therapy trial developed a leukemia-like condition. While FDA says it has found no similar problems in U.S. trials, the agency decided as a precautionary measure to halt all active gene therapy trials using retroviral vectors to insert genes into blood stem cells.

The aggressive action puts a temporary hold on approximately 50 clinical studies (some of which are not active) out of some 150 clinical trials involving gene therapy.

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