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ICYMI: Sen. Chuck Grassley takes your questions on drug prices, insulin, and innovation

February 20,2020

ICYMI: Sen. Chuck
Grassley takes your questions on drug prices, insulin, and innovation

Thursday, February 20,

Chuck Grassley has a clear position on this Congress’s priority list.

can bet your boots, families care a lot more about what they’re paying each
month for their child’s insulin than impeaching the president,” the Iowa
Republican said.

issue has become something of a focus for Grassley, who is working to bring
more Republicans behind the bipartisan package of reforms intended to lower
drug prices that he co-sponsors and that President Trump highlighted during his
State of the Union address this year.

who chairs the powerful Senate Finance Committee that has jurisdiction over
Medicare and Medicaid, has also launched investigations into insulin pricing
and the pharmaceutical supply chain. And in a career that spans nearly 40 years
in office, Grassley also helped write the law that designed Medicare’s drug
benefit, helped shepherd the bipartisan addiction recovery bill known as CARA,
and has led a series of oversight probes into hospitals, federally funded
medical research, and many other health care players and issues.

recently asked subscribers to submit questions for Grassley. Here are his
responses, lightly edited for length and clarity.

Lash, chief strategy officer of West Health: In a recent Gallup-West Health
poll, 73% of Americans said lowering drug costs was an issue for them in the
2020 elections, with 35% saying it was among their most important issues. If
the Senate does not take a floor vote on legislation to lower drug costs, what
do you expect to happen to senators in close races in the November election?

hit the nail on the head. Soaring out-of-pocket health care costs are driving
voter angst and arguably will drive voter behavior at the polls in November.
I’ve shared these sentiments with my Republican colleagues, the White House,
and, frankly, anyone who’ll listen to what I have to say.

year I started my 40th consecutive year holding meetings in each of Iowa’s 99
counties. Dialogue is the essence of representative government. As chairman of
the Senate Finance Committee, I also get an earful from those who have a stake
in our efforts to legislate drug pricing reforms. That includes patient
advocacy groups, Big Pharma, hospitals, and insurers. Based on constituent
feedback and stakeholder pushback, I’ve got my finger squarely on the pulse of
what matters to people. And you can bet your boots, families care a lot more
about what they’re paying each month for their child’s insulin than impeaching
the president

Johnson: If insurance companies were eliminated, wouldn’t pharma companies HAVE
TO make medicines affordable?

long said consumers must have skin in the game to appreciate the cost of
delivering health care. Consumer-driven care fosters innovative cures and
treatments; it can also help drive down prices. The $100 million question is
how to make health care and pharmaceutical drugs more affordable for Americans.
Reforming our health care delivery system presents trade-offs and consequences,
for the workforce delivering health care and employed within the health care
sector and for American consumers and taxpayers. A one-size-fits-all,
single-payer system, such as “Medicare for all,” would kick tens of millions of
Americans off of their private health insurance, restrict choices and services,
and lead to longer wait times for patient access.

chairman of the Senate Finance Committee, lowering prescription drug costs is a
top priority on my agenda in the 116th Congress. I’ve led a series of committee
hearings and heard from the largest pharmaceutical companies and pharmacy
benefit manager companies (PBMs) to unravel the bureaucracy and secrecy that
undermines accountability and drives up costs. My constituents in Iowa agree
with the rest of America: The U.S. health care system is too complex, too
secretive, too confusing, and too expensive. In addition to my bipartisan
Grassley/Wyden bill to reduce drug prices, I support efforts by Chairman Lamar
Alexander and others to end surprise medical billing.

there’s no silver bullet or single boogeyman to blame in this debate — such as
your suggestion to eliminate insurance companies. We can’t wave a magic wand to
make prescription medicine more affordable. Whether taxpayers or investors are
footing the bill, the road from research and development to product approval
and commercialization for blockbuster miracle drugs is long, risky, and
expensive. However, a $2 million per patient price tag for new gene therapy or
inexplicable increases for century-old insulin need a high-dose reality check.
Banning insurance companies would be like throwing the baby out with the
bathwater. And without private insurance companies competing to negotiate
prices with pharmaceutical companies, it may make matters worse.

Kutler, director of advocacy for the Endocrine Society: The rapid price
increases for insulin have made it difficult for many people to afford this
medication and effectively manage their diabetes. This has put patient safety
in jeopardy as rationing insulin is not an option. We appreciate that the
Senate bill caps out-of-pocket costs, as this will help many people with
diabetes. What other provisions in the legislation do you believe will make
insulin more affordable for all patients? Are there other provisions specific to
insulin that you are considering adding to the legislation?

year, I launched a congressional investigation to unravel the drug pricing
supply chain and get to the bottom of the unreasonable price trajectory for
insulin, a century-old medicine. The exorbitant pricing surge for insulin puts
the public health, patient safety, and taxpayer dollars at risk.

investigation has identified an Achilles’ heel riddling the drug supply chain:
too much secrecy. Price transparency will help restore competition and drive
down prices. Big Pharma cloaks drug pricing behind a complex web of rebates and
discounts, and I want to find out to what extent, if any, they find their way
into the consumer’s pockets.

Prescription Drug Pricing Reduction Act [puts a] cap on out-of-pocket
spending in Medicare Part D that will bring relief to people with diabetes [and
includes] other provisions to help beneficiaries afford their insulin.
Beneficiary responsibility for insulin and other drugs up until the threshold
at which their costs are capped drops from 25% to 20%. Drug companies would be
penalized for runaway price increases by having to pay a rebate for price hikes
above inflation. Stopping pharmacy benefit managers (PBMs) from playing games
by taking back a portion of payments to pharmacies after the fact decreases
what beneficiaries pay at the pharmacy counter.

included a provision requiring the Department of Health and Human Services to
post online drug company justifications for price increases and the discounts negotiated
between the PBMs, insurers, and pharmacies. It also tackles spread pricing, a
situation by which PBMs charge an insurer more than they charge the pharmacy,
and then they pocket the difference. Iowans call that gaming the system. I’m
working to stop these shenanigans and provide savings to taxpayers and the
millions of Americans with diabetes who are struggling to afford lifesaving

Poto, founder of Stock Market Portfolio Advisor: The president’s advisers have
stated that the drug pricing bill could create an environment where runaway
profits by biotechs reaching the approval stage could get effectively capped,
killing the “animal spirits” of biotech R&D and their willingness to pursue
rare diseases with limited markets and go for marginal improvements in
competitive markets. Do you think the large pharma companies and the president
are just BS’ing about pulling R&D funding?

no question Big Pharma is driven by profit motives. The so-called “animal
spirit” of American ingenuity has launched new frontiers of scientific
discovery and 21st century miracle cures and treatments for countless chronic
illnesses and rare diseases. The risks and rewards of entrepreneurism generate
productivity and prosperity across all sectors of the economy, including

runaway profits won’t amount to a hill of beans for Big Pharma if Americans —
including the taxpaying public — can no longer afford the growing price tag and
soaring sticker shock at the pharmacy counter. My bipartisan drug pricing
reform bill provides a reasonable path forward to curb runaway prescription
drug costs without sacrificing innovation and restricting access to
prescription medicines that Americans need. The real bluff I’m working to snuff
out in Washington is the misguided resistance to the bipartisan Grassley-Wyden
drug pricing bill.

Canary, director of the National Viral Hepatitis Roundtable: Medicare is the
biggest purchaser of prescription medications in the U.S. Given our free market
economy, shouldn’t Medicare be able to negotiate prices?

I’ve listened, studied, and legislated on this issue throughout decades of
service in the United States Senate. In fact, about 17 years ago, I wrote the
Medicare Part D program. For the first time ever, Congress added an outpatient
prescription drug benefit to the Medicare program. Now today, some 14 years
since the voluntary Part D benefit has been operating, 43 million older
citizens are benefiting from the market-based prescription drug benefit. It
encourages innovation, produces healthier outcomes, and curbs costs for seniors
and taxpayers. That’s because Part D does not allow the federal government to
dictate prices or restrict drug coverage. Our bipartisan bill, signed by
President George W. Bush, includes a non-interference clause that expressly
prohibits Medicare from negotiating drug prices, setting drug prices and
establishing a one-size-fits-all list of prescription drugs covered by Part D.

the federal government to dictate drug prices for Medicare Part D would insert
Uncle Sam between the physician and the patient. If there’s one thing elected
officeholders should have learned by now about meddling with U.S. health care
policy, it’s this: Americans want to choose their doctor, choose coverage that
fits their needs, and delivers the best value for their money. Last May the
Congressional Budget Office confirmed this point of view. The nonpartisan
agency wrote that if Congress allowed Medicare to negotiate drug prices (by
repealing the non-interference clause), seniors would be restricted to a scaled
down list of drugs (known as the formulary) that would limit the drugs
available for providers to prescribe to seniors. As elected representatives and
policymakers, we must first do no harm. Preserving the foundation of private
enterprise in the U.S. drug supply chain is important to preserve competition,
innovation and public health.

Horvath, principal at Horvath Health Policy: As more states seek to create
price competition in the prescription drug market through importation of lower
cost, but identical drugs, would Senator Grassley support: amending federal law
to allow importation of drugs made in FDA-registered facilities from EU and
Japan, in addition to Canada? Or amending federal law to allow importation of
biologics, such as insulin?

at least two decades, I’ve supported legislation that would allow U.S.
consumers to lawfully purchase and import prescription drugs from Canada. In
2004, I proposed the REMEDIES Act that would open the door for Americans
to benefit from the same free trade principles that help lower prices and
expand choices for consumer goods and services from around the world.

my support for importing prescription drugs required the FDA to certify the
products and that manufacturing facilities were in compliance with U.S. safety
standards and other FDA criteria, including on-site inspections. Importing
drugs to help lower costs for American consumers can’t come at the expense of
patient safety. In addition, my bipartisan REMEDIES Act in 2004 included
provisions that would have expanded the importation of drugs to other
countries, including the EU, Japan, Australia, and New Zealand.

too long, Americans have shouldered the costly burden of research and
development that brings miracle drugs to market. And then, we pay through the
nose at the pharmacy counter while consumers in other nations pay a fraction of
the costs for very same medicine to treat their arthritis, ulcers, and
heartburn, for example. For the better part of a year, I’ve been investigating
the insulin supply chain to unravel why prices keep climbing for this
century-old medicine.

it comes to importing biologics, we must also take into consideration patent
protections and the safety and efficacy of importing biologics into the
medicine cabinets of American patients. Like any proposal, I’m open to
negotiating and discussing policy that’s best for U.S. consumers and the
American taxpayer. In addition, I also introduced the Safe and Affordable
Drugs from Canada Act of 2019 with Sen. Amy Klobuchar to permit the
importation of prescription drugs from approved pharmacies in Canada.

Stanford, executive director of Incubate, a coalition of life science venture
capital organizations: As a group that provides the funding necessary to fuel
early-stage companies, how do you feel your proposal strikes a balance between
pro-patient reforms while continuing to support innovative companies? As
early-stage investors, we see better than most just how precarious the
innovation ecosystem actually is simply not a given that investors will
continue to risk the capital necessary to bring new breakthroughs to market.
Are you concerned that inflation caps could be a slippery slope to outright
price controls that would fundamentally damage this ecosystem?

am a primary author of Medicare Part D. During those negotiations 17 years ago,
I insisted on a non-interference clause because I recognize the reality of our
pharmaceutical ecosystem. America’s system of free enterprise is that magic
balance between risk and reward premised on big dreams and big wins. But it
also requires a heavy dose of competition to make it work correctly for
consumers and taxpayers.

we wrote Medicare Part D, [former] Sen. Max Baucus (D-Mont.) and I agreed on
this fundamental framework. The new prescription drug benefit must preserve our
system of free enterprise.

Prescription Drug Pricing Reduction Act includes inflation caps not only
as a reasonable mechanism to deliver patient and taxpayer savings, but also as
necessary leverage to secure the bipartisan coalition necessary to get drug
pricing reform across the finish line.

will not swallow the poison pill of socialized medicine and centralized
government price controls. That would be the death knell to the genius of
America’s system of free enterprise that continues to cure diseases and save
lives that just a generation ago delivered a death sentence to patients. Our
bill allows pharmaceutical companies to set the launch price, which should
ensure reasonable profits.

Thadus: Would you have any suggestions as to how the government will address
gene therapy pricing now or in the future? Will there be a comprehensive
strategy or a case-by-case strategy per indication? Some insight would help us
as biotech investors. 

Prescription Drug Pricing Reduction Act passed out of the Senate Finance
Committee by an overwhelming two-thirds bipartisan vote. The White House
supports our bill. It includes provisions that allow Medicaid to pay for gene
therapies for rare diseases through risk-sharing value-based agreements. We’re
also taking a look at proposals that would allow state Medicaid programs to
spread out new gene therapies over time and link those payments to patient
outcomes. It’s a balancing act to foster innovation and tackle astronomical
pharmaceutical prices that would be unsustainable for taxpayers, insurers,
hospitals, and consumers.

Panichelli: Are you addressing opioids for chronic pain denied by Medicaid? My
sister, who I take care of, is now bedridden because she was denied opioids
that she’s been taking for 20 years. She has physical and mental issues and is
an abuse victim. I can’t find any help.

Trump administration declared a public health emergency in 2017 to address the
nation’s opioid crisis. The misuse of opioid pain relievers has contributed to
widespread addiction, disorders, and overdose deaths in the United States. Federal
guidelines have been developed to achieve a system of care in the United States
to ensure Americans receive appropriate, high quality, evidence-based care for

that said, the federal government should not dictate decisions between a patient
and her health care provider. Your sister is entitled to appeal coverage
decisions by Medicaid. Each state agency is required to send a written notice
explaining reasons for the denial. Deadlines vary by state and it’s important
to act promptly. Contact your sister’s Medicaid case manager to request
assistance with the appeals process.

Lee, senior adviser for Voices for Non-Opioid Choices: What steps could
Congress take to ensure that acute pain patients — the patients suffering from
pain that arises from a temporary condition, such as an injury or surgical
procedure — have choices in their pain management options, including non-opioid
therapies? What actions can Congress take to help educate members of the public
on the availability of non-addictive, non-opioid therapies for acute pain? How
could Congress support patients and providers to reduce the unnecessary opioids
used in the hospital setting?

you know, the opioid crisis has shifted the treatment landscape for pain
management in the United States as sweeping legislative, regulatory and
litigation activity is impacting the delivery of care in hospitals, doctor’s
offices, skilled nursing facilities, and pharmacies across the country.
Congress passed the Comprehensive Addiction and Recovery Act (CARA) of 2016
and the SUPPORT Act of 2018 to help address the systemic problems that
have contributed to the public health crisis, including mishandled distribution
and prescribing practices of addictive opioids.

reforms implemented by CARA include beefed up case management requirements to
limit at-risk patients from abuse and misuse of opioids, such as when a
beneficiary is found to have been filling prescriptions from multiple
prescribers at multiple pharmacies. The SUPPORT Act provides resources
to help hospitals develop best practices and protocols for non-opioid pain
management and requires updated federal guidelines from HHS to help hospitals
navigate the reforms that may include changes to financial incentives and
hospital reimbursement for pain treatment practices. New federal reporting
requirements will help track patient risk and electronic health record
documentation will help trace “waste” and diversion of controlled substances in
hospital and pharmacy settings.

also worked to improve public participation in the National Take-Back Day
organized each spring and fall by local law enforcement and the Drug
Enforcement Administration. The safe disposal of unneeded, unwanted, and unused
prescription medicine keeps prescription medicines out of the wrong hands and
helps prevent accidental poisonings, drug addiction, and overdose deaths.

Carr, physician: Have you considered shortening the patent protection period
for brand-name drugs that cost the Americans a significantly higher amount than
the Europeans pay for the same drug? Seems like this would incentivize the drug
companies to lower prices for Americans.

former chairman of the Senate Judiciary Committee, I’ve developed a package of
bipartisan solutions to fix loopholes in our intellectual property and patent
laws. As with drug pricing reform, policymakers must first do no harm. The
framers enshrined constitutional patent protections in our founding document
because they had the vision to know how crucial entrepreneurism would be for
American prosperity. Instead of shortening the patent protection period, I’ve
worked to prevent the industry from abusing competitive guardrails and gaming
the system at taxpayer expense.

jig is up. Big Pharma is taking advantage of patent laws to pad their profits.
For example, in some cases branded and generic drug manufacturers are in
cahoots to keep drug prices artificially high. They broker sweetheart financial
arrangements that keep a generic, or a biosimilar, off the market. My
bipartisan bill with Sen. Amy Klobuchar would stop this anti-competitive,
pay-for-delay, tactic that pushes up the price for consumers at the pharmacy

companies try to twist patent laws to operate with legal monopolies for
perpetuity. Through a patchwork of legal protections, drug companies may
cultivate an impenetrable thicket of patents that result in keeping a generic
off the market for years beyond the original patent. I’ve also introduced the Stop
STALLING Act with Sen. Klobuchar to stop “sham” citizen petitions to the
FDA that are designed to slow approval of new generic medicines. I’m the lead
author of another bipartisan effort that calls upon the Federal Trade
Commission to investigate mergers of pharmacy benefit managers and health

I teamed up with Sen. Pat Leahy to push through the newly enacted CREATES bill
that will fix an anti-competitive practice in which branded companies refused
to sell samples of their drugs to generic companies that were necessary for
them to secure FDA approval to gain entry to the market. The CREATES law also
fixes another stalling tactic that branded manufacturers used to filibuster and
delay a generics approval process from the FDA. I’ll continue working to curb
excessive drug prices with legislative reforms that leverage competition to
serve as a check on costs without compromising innovation.

Bernstein: If companies can raise prices to the point that the drug might as
well not exist, because the people that need them can’t afford them, shouldn’t
we eliminate their right to exclusivity?

protections entice investors and startups with the carrot of prosperity to plow
forward with years of investment and risk to get a drug to market. Eliminating
intellectual property protection would stunt innovative cures and treatments.
Blockbuster gene therapies and treatments for common and rare diseases, from
cystic fibrosis to diabetes and cancer, give hope to tens of millions of
Americans and their loved ones. On the other hand, I’m a legislative and
oversight watchdog when it comes to rooting out anti-competitive behavior that
games the system at taxpayer expense. Check out my legislative efforts in my
answer to Matthew Carr. I’m open to any policy discussion that will help drive
down prices without sacrificing innovation and cures that save lives.

Kinn, infectious disease specialist at the University of Iowa: Given their
broad public health benefit, antibiotics require a very different solution in
the larger drug pricing debate. Antibiotic manufacturers are unable to earn a
return on investment, despite bringing important new antibiotics to market, as
evidenced by the bankruptcies of 2 small antibiotics firms in 2019. What new
strategies can Congress undertake to secure antibiotic innovation?

system of free enterprise rewards entrepreneurship and innovation. Protections
for intellectual property also help underwrite the financial capital required
for risk-taking and ingenuity to push the envelope on new frontiers of
medicine. This ecosystem has fostered miracle cures and treatments to reach the
market, from biologics to gene therapy and next generation antibiotics.

the pipeline for antifungal and antimicrobial manufacturing is not flourishing.
It operates on a low-volume, low-revenue model. In fact, only 12 new
antibiotics have been approved since 2000. As of May 2017, 51 antibiotics and
11 biologics were in the clinical pipeline. Only five are expected to reach the

and development of antibiotics are crucial to public health and deserve
favorable tax and regulatory regimes to stay productive and competitive in the
market. The economics of new antibiotic development are challenging because
they are created with the sole intent to be used sparingly. Reforming the
Medicare reimbursement process in ways that encourage research on, and the
development of, advanced antibiotics available to treat the most serious and
life-threatening resistant bacterial infections is one idea to boost the
R&D pipeline and bottom line for antibiotic innovators and manufacturers.

Ronda Akins, infectious diseases clinical specialist at Methodist Health
System: Antibiotic resistance is commonly driven by overuse and misuse of
antibiotics. In 2019, requirements from CMS now require antimicrobial
stewardship in hospitals. However, these requirements for antimicrobial
stewardship are not clearly delineated nor mandated to the extent needed to
actually provide significant impact (and does not even apply to the community
setting). What more can Congress do to promote appropriate antibiotic use and
address resistance?

concerns are spot on. At least 2 million people are infected with antibiotic
resistant bacteria each year, resulting in 23,000 fatalities, according to the
CDC. Antimicrobial resistance is a pressing public health challenge that
requires an all hands on deck approach with public-private collaboration from
the government, pharmaceutical, medical, and scientific communities to address
effectively. Although the federal government has issued stewardship processes
for hospitals to slow resistance to the therapies, the risk for overuse and
misuse requires sustained commitment to stewardship and clinical best

2012, Congress passed the Generating Antibiotic Incentives Now (GAIN) Act
as a good first step. It provided manufacturers new tools, expedited FDA
approval processes, and prioritized qualified infectious disease products
(QIDP) with the possibility of extending patent exclusivity.

manufacturing companies operate on a low-revenue, low-volume production model.
The profit incentives aren’t driving dollars into research and development for
next generation antibiotic therapies. This presents a clear and present danger
to public health and to the U.S. economy. Here’s why. Antibiotic resistant
infections extend time spent in the hospital between roughly six to 12 days.
That adds up to an additional 8 million hospital days for U.S. patients.
Antibiotic-resistant infections contribute to lost productivity to the tune of
$35 billion a year and an additional $20 billion in health care costs. With
these social and economic costs in mind, Congress continues working to find
cost-effective, patient-centered policies to address the problem.

the fiscal year 2020 Inpatient Prospective Payment System (IPPS) final rule,
the Trump administration streamlined and improved payment incentives for novel
antibiotics that received a QIDP designation. It’s another important step to
reduce barriers to product innovation and improve patient outcomes.

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