HHS Pharmaceutical Pricing Forum: Lots of Questions, Few Definitive Answers

Posted 20 November 2015 By Zachary Brennan

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The Department of Health and Human Services’ (HHS) invite-only Pharmaceutical Forum on Friday turned out to be more of a listening session for a range of stakeholders to explain concerns and discuss a number of potential ways to lower drug prices, some of which involve US Food and Drug Administration (FDA) reforms.

HHS Secretary Sylvia Burwell kicked off the event by noting the steep cost increases for medicines, particularly for specialty drugs, which made up about $87 billion in 2012, or roughly 25% of total US drug spending, and could quadruple by 2020. 

But the complex problem of ensuring companies stay innovative while offering access to affordable drugs is what’s driving the discussion.

“As we work to strike the balance between fostering innovation and keeping drugs accessible and affordable, we must let the principle of putting the consumer at the center guide our thinking,” Burwell said.

FDA Action

Although Burwell didn’t note the progression of the Senate’s version of the 21st Century Cures Act, which could include some wholesale changes for FDA, she did note that FDA is looking to find ways to expedite accelerated drug development pathways and improve the review process.

And as Focusnoted earlier this week, much of the discussion on drug pricing and FDA continues to center on the faster approval of generic drugs and the beginning of a robust biosimilars market.

Both Steve Miller, MD, Senior Vice President and Chief Medical Officer of Express Scripts and Chip Davis, president and CEO of the Generic Pharmaceutical Association, criticized FDA for the slow approval rate of abbreviated new drug applications (ANDAs) and extensive backlog.

Similarly, Doug Long, vice president of IMS Health, noted that the ANDA backlog “is higher than it’s ever been” and FDA has “yet to take a big whack at it.”

Long also mentioned the prospect of biosimilars lowering the US drug bill, though he noted that pricing won’t really become competitive until multiple companies have biosimilars marketed for the same reference product, which probably won’t occur for a few years.

On the topic of the second round of negotiations for the Generic Drug User Fees (GDUFA), Davis also noted that so far it’s felt like a “work zone” though he said he remains optimistic.

Value

The question of drugs’ real-world value cropped up several times at the forum, and this is an issue that seems to be plaguing not only the US (as the New England Journal of Medicine indicated), but other countries as well, particularly with new cancer drugs.

Merck Chairman and CEO Ken Frazier noted that one of the challenges industry faces is that it’s restricted by the tools it can use to speak of certain real-world benefits or risks that aren’t included in a drug’s label.

“Sometimes in order to have a good sense of what the benefits/risks are, we have to look beyond the label, but we’re restricted by FDA regulations,” Frazier said.

Similarly, Mark McClellan of the Brookings Institution called for policy reforms that incentivize the development of valuable treatments and discourage high prices that don’t reflect value, and could result in excess utilization and unnecessary spending.

And although the forum has initiated a more robust, nationwide conversation around drug pricing and the potential for value-based or outcomes-based pricing and purchasing -- what is unclear is how HHS plans to take action and where it might start.

“This is a complex problem and there is no one solution,” Meena Seshamani, Director of the Office of Health Reform at HHS, said at the conclusion of the forum.

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Categories: Active pharmaceutical ingredients, Biologics and biotechnology, Drugs, Ethics, Government affairs, Research and development, Reimbursement, Regulatory strategy, Submission and registration, News, US, FDA

Tags: drug pricing, HHS pharmaceutical forum, Merck, Express Scripts, GPhA, IMS Health

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