The U.S. Senate Finance Committee’s new Democratic chair is considering bringing back a bipartisan bill from the last session of Congress that would require drug manufacturers to pay the federal government rebates on Medicare Part B and Part D drugs for which prices rise faster than the rate of inflation, Political Pro health care reporter Sarah Owermohle told 340B stakeholders on Tuesday during a talk about drug pricing reform.
Owermohle, who covers drug pricing and the COVID-19 pandemic for Politico Pro, was a featured speaker during the 340B Coalition winter conference. Senate Finance Chair Ron Wyden (D-Ore.) wrote the inflation-indexed Medicare rebate bill that Owermohle spoke of with ex-chair Charles Grassley (R-Iowa). Wyden withdrew his support for the bill last July when Grassley reintroduced it, minus the rebates for Part D drugs. Several Senate Republicans opposed including Part D drugs, Owermohle pointed out.
Mitch McConnell (Ky.), the Republican former Senate majority leader, refused to bring the bill up for a vote before the full Senate. “There’s a good chance it could be back and eligible for passage because it did have bipartisan support,” Owermohle said. Although McConnell didn’t want to bring it up for a vote, if his Democratic successor as majority leader, Chuck Schumer (N.Y.) wanted to, “it could pass,” she said.
“It was the one major bipartisan [drug pricing] reform that made it out of a congressional committee,” Owermohle said. Former President Trump backed it, but Senate Republicans splintered over it, in particular over requiring inflation-indexed rebates on Part D drugs. “Remember this bill,” she advised her audience.
Owermohle predicted that “you could see a drug pricing agenda” from the Biden administration after it attends to two higher priorities first: (1) making sure all Americans who want a vaccination against COVID-19 can get one by July, and (2) bolstering the Affordable Care Act and covering more of the uninsured population. “After he gets those things done, I think he will be turning next to drug prices,” she said.
During his election campaign, Owermohle said, Biden expressed support for creating an independent drug price advisory board that would assess the value of potentially expensive new drugs that lack competition in tandem with the prices charged for the drugs in other countries. The board would recommend what federal government programs should pay. “While this would be a big step, it’s still a step shy of direct government negotiation with manufacturers, which is what many Democrats want,” she said.
With Congress on track to pass a $2 trillion COVID-19 relief bill and other relief bills probably on the way, “any drug pricing measure that can alleviate some of that spending could be a good candidate” for inclusion in relief legislation, Owermohle said. One such measure, which the U.S. House Energy and Commerce Committee added to the pandemic relief bill still taking shape, would eliminate the limit on rebates that drug manufacturers pay to Medicaid, now capped at 100 percent of a drug’s average manufacturer price (AMP).
“That’s an appealing one,” Owermohle said.
Inside Health Policy reported Monday that Senate Finance chair Wyden says the Senate plans to keep the measure in the relief bill. Last session’s drug pricing bill that he wrote with Grassley would have lifted the cap on Medicaid drug rebates to 125 percent of AMP. Owermohle also said she does not see any major 340B reforms making it through Congress but narrow provisions like a recently-introduced bipartisan bill to enable rural hospitals to access 340B pricing on orphan drugs that are used for common purposes has a chance. She said she expects significant action on 340B policy by the new administration.
