New House E&C Chairman to Consider Value-Based Drug Price Negotiations

Posted 02 February 2017 By Zachary Brennan

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The newly minted chairman of the influential House Energy & Commerce Committee is looking to tackle pharmaceutical price gouging with a new bill and comments on how there need to be more negotiations to bring down prices.

In an interview with The Oregonian this week, Rep. Greg Walden (R-OR), who attended Tuesday’s meeting with President Donald Trump and pharmaceutical CEOs, said: “Right now they're prevented from having those negotiations by law. We would fix that.”

Walden’s comments to pass legislation to allow the government and private insurers to negotiate "value-based payments" for high-cost drugs seems to run counter to what his Republican colleagues have argued for, and it rekindles a conversation that Vox and other media outlets cast as a President Trump flip-flop because Trump seemed to backtrack on comments made previously to further negotiate drug prices at the government level.

But a House Energy & Commerce committee spokesperson clarified to Focus: "The chairman’s comment [in the Oregonian interview] was not in regards to Medicare Part D negotiations. In the White House meeting, President Trump discussed ways to lower drug prices that fit market-based solutions. One policy that was discussed in that meeting was encouraging a more value-based system that could incentivize data sharing between manufacturers and payers to evaluate the long-term benefits of therapies that are created. We are looking at multiple ways to act on this issue impacting families across the country."

Merck CEO Ken Frazier also said Thursday in the company’s quarterly earnings call that he did not think the preferred solution for Congress would be direct government negotiation.

Generic Drug PRV Program

On Thursday, Walden noted that his committee next week will take up a bill from Reps. Kurt Schrader (D-OR) and Gus Bilirakis (R-FL) to further speed generic drugs to market and create a new priority review voucher (PRV) program for generics to incentivize development.

FDA last March began prioritizing the review of abbreviated new drug applications (ANDAs) for sole-source generic drugs, which are those that have seen steep price increases in recent years, and which Reps. Schrader and Bilirakis say they want to target.

FDA Law Blog also notes that the PRV program included in the bill does not really offer that much of an incentive for generic companies, particularly given the proposed GDUFA II goals, which are due to take effect next year. 

Other provisions in the bill would amend the tropical disease PRV program and add the requirement that those seeking such a voucher would have to provide “reports of new clinical investigations (other than bioavailability studies) essential to the approval of the application and conducted or sponsored by the applicant.”  

The bill also would require the comptroller general to conduct a study on Risk Evaluation and Mitigation Strategies (REMS).

HR 749

Editor's note: Updated with comment from the House E&C Committee.

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Categories: Drugs, Reimbursement, News, US

Tags: Walden, House E&C, Schrader, Merck, CMS drug negotiations

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