FiercePharmaPolitics—Pelosi plan a 'non-starter' for Senate GOP, but Trump tweets differently

U.S. Capitol at dusk
A drug pricing proposal from House Speaker Nancy Pelosi dominated headlines this week. (Pixabay)

Welcome to the FiercePharma political roundup, where each Monday we’ll highlight notable developments that could affect how drugmakers operate.

As expected, House Democrats released their drug pricing plan last week, and the proposal varied slightly from a draft that had leaked the previous week. Under the official proposal, the Department of Health and Human Services would negotiate prices on at least 25 drugs annually and as many as 250.

Drugs where Medicare spends big would be first up for negotiation, but government programs wouldn't be the only ones to save. Pharma would be forced to offer the same cut-rate prices to private payers.

The plan calls for extreme financial penalties to get drugmakers to the negotiating table and an international pricing index to limit negotiated prices to within 120% of average prices in six other countries. Drugmakers would have to pony up a bigger share of Medicare Part D coverage to help pay for an out-of-pocket cap for patients. Another measure would roll back price hikes since 2016.

Cowen analysts Eric Assaraf and Rick Weissenstein wrote that certain pieces of the bill—such as price negotiations and the international price index—are "non-starters" for Republicans, but that others could gain traction. As the House works on its bill, the Senate will be putting together a "much different looking package." 

"The biggest unknown remains what Speaker (Nancy) Pelosi wants to do," they added. "If she wants to enact legislation, it would almost certainly have to look like the Senate version rather than her measure.

"Including the drug pricing provisions in a larger bill will make it harder for House Democrats to vote against the package; however, Pelosi may decide that giving President Trump a 'win' on drug pricing is too steep a price to pay."

As market watchers digest the House plan, a bill from Sens. Chuck Grassley and Ron Wyden has gained attention in the Senate. The bill, which cleared the Senate Finance Committee, proposes an out-of-pocket cap in Medicare Part D plus changes to simplify Medicare and Medicaid and shine light on the drug supply chain.

RELATED: Price rollbacks, Medicare negotiations, fines and more: Pharma's likely to hate House pricing plan

After Pelosi unveiled her bill, her counterpart in the Senate, Majority Leader Mitch McConnell, told Politico his chamber wouldn't consider "socialist price controls." The pharma industry took a similar tone, with PhRMA President Stephen Ubl in a statement calling the plan "radical." 

"It would fundamentally restructure how patients access medicines by giving the federal government unprecedented, sweeping authority to set medicine prices in public and private markets while importing price controls from other countries that restrict access to innovative medicines," he said. The bill would "upend" Medicare Part D, he added.

Congress should instead focus on boosting transparency, value-based contracts and ensuring patients can access negotiated savings, Ubl said.

And in what was a surprise to some market watchers, President Donald Trump took a bipartisan approach to the proposed legislation. 

As the debate evolves in Congress, Stat reports AARP is conducting an "all-out attack" on pharma and its pricing. That offensive includes TV commercials, airplanes flying banners and more, according to the report

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