Health

Health Policy Snapshot: June 2024

Greg Chesmore
June 04, 2024

It’s crunch time for Congressional reauthorization of the pediatric rare disease priority review voucher (PRV) program

If there’s something that usually unites Democrats and Republicans in Congress, it’s finding solutions for Americans living with rare diseases. How it’s best accomplished, however, remains contentious. In a clear example, members of Congress have yet to come to an agreement on reauthorization of the U.S. Food & Drug Administration’s pediatric rare disease priority review voucher (PRV) program, which is set to expire at the end of September. Reauthorization legislation passed the House Energy & Commerce health subcommittee in May, but almost all Democrats on the subcommittee opposed reauthorization, with some demanding more balance in the program, and others labeling it as a “give-away” to biopharmaceutical companies. The disagreement means changes to the legislation will be necessary in order to win bipartisan support from the full Energy & Commerce committee, the U.S. House and eventually the U.S. Senate. The pediatric rare disease PRV program provides incentives for research and development by providing innovative biotech and biopharma companies with transferable vouchers. Under the program, a sponsor who receives an approval for a drug or biologic product for a rare pediatric disease may qualify for a voucher than can be redeemed to receive priority review for a different product. The sponsor who receives the initial voucher may also transfer or sell the voucher to another sponsor. The bill creating the program passed in 2011, since that time 47 pediatric rare disease PRVs have been awarded for 35 different rare pediatric diseases. The full House Energy & Commerce committee hopes to come to an agreement and vote on the Creating Hope Reauthorization Act of 2024 by June 12. If approved by Congress and signed by the president, the FDA program would be reauthorized for another four years. At the end of May, the Rare Disease Company Coalition (RDCC) weighed in with a new report outlining the positive impact of the pediatric rare disease PRV program. Specifically, the RDCC report spotlighted the fact that 90% of the PRVs awarded since 2011 have been for disease areas for which is there is no FDA-approved treatment option.

Lead House sponsor of BIOSECURE Act announces plan for House consideration; Critics sound alarm over potential impacts

After the U.S. House Committee on Oversight and Accountability overwhelmingly passed an amended version of the BIOSECURE Act on May 15, U.S. Rep. Brad Wenstrup (R-OH) announced this week that he plans to add language from the BIOSECURE Act to the upcoming National Defense Authorization Act (NDAA) which Congress will soon consider. As a refresher, the BIOSECURE Act prohibits drug manufacturers from purchasing equipment or contracting with certain Chinese companies in hopes of keeping Americans’ health care information, including genetic information, out of the hands of companies identified as connected to the Chinese government. Wenstrup is leading the bipartisan effort with Rep. Raja Krishnamoorthi (D-IL). Similar legislation on the subject has cleared committees in the Senate, but it’s likely the bill will continue to evolve on its legislative journey. While bipartisan interest in the issue continues, some industry observers are sounding the alarm about potential unintended consequences of the legislation.  The revised language approved by the House committee partially assuages concerns raised after the Biotechnology Innovation Organization (BIO) released a survey that stated that 79% of their members report at least one contract with a Chinese CDMO, and 85% said that changing vendors would take between six months and six years. The new language adds a grandfathering clause and a safe harbor provision and clarifying the types of contracts to which the act would apply. Nonetheless, some industry observers, including Peter Kolchinsky, continue to press Congress for additional changes, arguing that the revised language continues to include language that could impact long-term access to innovative medicines. 

New Avalere study highlights payers’ increasing use of step therapy increasing in cancer care

While health plans have long used step therapy (or “fail first” protocols) as a main component in their utilization management programs to reduce prescription drug costs, it’s traditionally been less prevalent in oncology treatment. That is changing rapidly, according to a new American Cancer Society – Cancer Action Network-funded study released in May. The study, conducted by Avalere, focused on step therapy prevalence in Medicare Part D plans, including those offered through Medicare Advantage and stand-alone Part D prescription drug plans. The Inflation Reduction Act (IRA) sparked major changes in Medicare Part D benefit design, which requires payers and manufacturers to absorb more of the costs once Medicare beneficiaries reach certain out of pocket thresholds. This change is prompting some cancer patient advocacy organizations, including ACS-CAN, to express concerns that plans will be incentivized to be more aggressive with utilization management (UM) tools, including step therapy. “The likelihood that IRA changes will increase plans’ use of UM and other formulary restrictions underscores the importance of a thorough and robust formulary review process from CMS,” ACS-CAN said in its report summary. The full ACS-CAN/Avalere report can be accessed here.

2024 Elections: What’s on tap on how will impact access to innovative medicines? Schedule your presentation now

While many Americans can’t wait for the November elections to be behind us, this election’s ramifications for health care policy, especially for the patient access and the biotech and biopharma communities, will be enormous. With slim majorities in both the House and Senate, and a race for the White House that takes fascinating turns every hour of the day, Gridiron’s crystal ball is somewhat murky as we enter the summer months. Republicans will meet in Milwaukee for their national convention in mid-July (with a running mate for anticipated nominee Donald Trump to be announced at some point before the convention) and Democrats meet in Chicago August 19-22. It’s important for companies and organizations to prepare for the various scenarios and the issues that will likely be front-and-center if those scenarios become reality. It’ll also be important to absorb and analyze the results after November 6. Book your time for a Gridiron Public Affairs presentation (either before, after or both) on Election 2024 today, before the calendar fills up. Email Greg at greg@gridironpublicaffairs.com for more information.

Health Policy Snippets:

  • Health Policy 101. The Kaiser Family Foundation released its Health Policy 101 resource at the end of May. Outlining the history, background and trends within the U.S. health care system, it’s filled with fascinating (up to date!) facts on Medicare, Medicaid, the Affordable Care Act, the private health insurance market and global comparisons. It’s a great resource for interns, new hires or colleagues who want to know more about the intricacies of the U.S. health care system. Here’s a sampling of some of the facts:
    • Medicare currently consumes 12% of the U.S. federal budget and 21% of national health care spending;
    • 55% of Medicare beneficiaries are women/45% men and 76% are white (followed by 10% black and 9% Hispanic);
    • 13% of Medicare beneficiaries are under 65;
    • The percentage of people covered by Medicaid ranges from the lowest of 11% (Utah) to the highest of 34% (New Mexico)
    • …and plenty of other interesting facts to satisfy the health care policy nerd inside all of us!
  • Affordable Care Act (ACA) Popularity. Republican opposition to the ACA remains a centerpiece of most party health care talking points, but Americans continue to have an overwhelmingly positive view of the program (59%-39%) based on the latest KFF Health opinion polls. While former President Donald Trump continues to tout his desire to “repeal and replace” the ACA, President Joe Biden is touting record enrollment in ACA marketplace plans as a sign that the ACA is here to stay. While full repeal of the ACA remains highly unlikely, some aspects will need ongoing Congressional support (such as continuation of premium subsidies), making health care an top tier issue for the fall federal elections.